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Argentina seeks EPA approval for biodiesel export

May 21 2013 Read 1812 Times

Ongoing trade disputes between Argentina and the European Union concerning the export of biodiesels have led to the country appealing for US environmental approval to ease export.

Argentina recently lodged a complaint with the World Trade Organization (WTO) against the EU. The complaint relates to the EU's rules regarding the importing and marketing of biodiesel. It also details problems with measures the EU uses to promote both renewable energy and a greenhouse gas control mechanism and the Union's support schemes for the biodiesel sector. The EU legislation and practices that Argentina are opposing, allegedly, limit the amount of biodiesel they are able to export to countries within the EU.

The Environmental Protection Agency (EPA) US last year received an application from Argentina to be awarded 'RIN' alternative fuel credits. These credits are intended for use by US importers and refiners as a way to prove they are meeting the biofuel standards and are following the rules for biodiesel blending.

Luis Zubizarreta, president of the Argentine Biofuels Chamber, said to Reuters Latin American Investment Summit: "We're going through the process of getting EPA approval, which takes some time. We're well positioned and we're very confident of achieving this. In the next few months, we should have that approval."

By allowing Argentine biodiesel producers the ability to earn credits the EPA would open up a new market. Companies would be able to help the US companies meet EPA mandates by selling their biodiesel within a large market.

Argentina is a large producer of biodiesels, however the ongoing dispute with the EU has seen its production fall from 2.4 million tonnes last year to 1.2 tonnes this year. Last year of the 1.6 million tonnes of biodiesel that Argentina exported, 90 per cent went to Europe. The loss of business has resulted in soybean crushers having to rely on soy oil export, which creates a lower rate of return for companies. Biodiesel exports to Europe fell in the first quarter of this year by 60 per cent to 163,500 tonnes.

Mr Zubizarreta said: "There was always strong pressure from the European industry to halt our exports. Besides hurting Argentine industry, this hurts European consumers, who are going to have to pay more for fuel."

In order to receive approval from the EPA, Argentina must comply with regulations in regards to blending proportions and soybean growth.   

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