China launches investigation into U.S. distillers grains imports

Chinese ethanol industry claims U.S. producers are being unfairly subsidized.

China's Ministry of Commerce launched an antidumping and countervailing duty investigation Jan. 11 into U.S. dried distillers grains with solubles (DDGS) after the China Alcoholic Drinks Assn., an organization representing domestic ethanol producers, filed a petition claiming that U.S. ethanol producers unfairly benefit from subsidies and that DDGS was sold to China at lower prices that negatively affected the domestic market.

The ministry said the investigations should last no more than a year but added that they can be extended to one-and-a -half years.

“We are disappointed to see today the initiation of antidumping and countervailing duties investigations of U.S. DDGS exports to China. We believe the allegations by the Chinese petitioners are unwarranted and unhelpful,” U.S. Grains Council (USGC) president and chief executive officer Thomas N. Sleight said after learning of the announcement.

He said the investigations could have negative effects on U.S. ethanol and DDGS producers, as well as on Chinese consumers, potentially over a period of many years. China is currently the largest DDGS importer. From January to November 2015, the country imported more than 6 million metric tons of U.S. DDGS valued at $1.5 billion.

Sleight said USGC is confident that U.S. trading practices for DDGS, ethanol and all coarse grains and related products are fair throughout the world.

“We stand ready to cooperate fully with these investigations and will be working closely with our members to coordinate the U.S. industry response,” he added.

USGC has worked in China since 1981 to find solutions to the challenges of food security through development and trade.

“There have been measureable positive effects of this work for the Chinese feed and livestock industries and Chinese consumers. We and our members will work vigorously in the coming months to demonstrate that the allegations being investigated by (China's Ministry of Commerce) are false, even while we continue to stand ready to expand our cooperation with China on agricultural issues of mutual benefit,” Sleight said.

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