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Colombia to impose duties on U.S. ethanol exports

Colombia to impose duties on U.S. ethanol exports

Ethanol industry disappointed in new Colombian duties set a $0.1997/gal.

Colombia's Ministry of Commerce, Industry & Tourism (MINCIT) this weekend announced that it will impose duties of $0.1997/gal. on U.S. ethanol exports to Colombia.

In January 2019, Colombia’s MINCIT initiated a countervailing duty (CVD) investigation of U.S. ethanol at the behest of the National Biofuels Producers Assn. The preliminary decision of the CVD case imposed a preliminary four-month ad valorem duty of 9.36% on U.S. ethanol imports that began on May 9, 2019.

According to a joint statement from leadership of the U.S. Grains Council, Growth Energy and the Renewable Fuels Assn., the groups are disappointed in the latest decision.

“While we have cooperated fully with investigating authorities in Colombia to demonstrate these final duties are unjustified, the Colombian government sided with Colombia’s ethanol industry,” the groups said. “MINCIT’s decision was not supported by evidence and raises questions regarding the ministry’s compliance with standard CVD procedures.”

In the "Colombia Biofuels Annual" report released by the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) in August 2019, ethanol production was expected to reach 490 million liters in 2019, 4% higher than 2018, as a result of normal weather conditions, a higher blend mandate (E10) and larger fuel pool and more protection from U.S. ethanol imports.

“Imports from U.S. remain higher than past years but are expected to slow given the temporary duty, possible price regulation on imports and the likelihood that U.S. ethanol prices will remain higher in the near future due to higher U.S. corn prices resulting from rain delayed planting,” FAS stated.

Fuel ethanol imports are estimated to reach 220 million liters in 2019.

The U.S. groups added, “The U.S. ethanol industry remains committed to our partners in Colombia, continuing to help the country meet its blending targets and providing benefits to Colombian consumers so they may access a clean, renewable and affordable fuel.”

TAGS: Policy
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