Chinese tariff policies slide value of US DDGs by 30%

January 23, 2017 |

In Illinois, preliminary tariffs on U.S. DDG, totaling more than 40 percent, were imposed by China several months ago, causing the price of DDG to drop by about 30 percent, or about $60 per ton, affecting the 36 million tons of DDG produced annually in the U.S. The combined tariffs, now totaling more than 80 percent, will effectively close the Chinese animal feed market to U.S. DDG.

The U.S. DDG industry cooperated with the Chinese tariff investigation, even hosting Chinese Ministry of Commerce (MOFCOM) investigators at several U.S. production facilities, including the Marquis Energy facility in Illinois. Nevertheless, China ignored the factual data provided by the U.S. industry, disregarded WTO trade rules and used its own unknown calculations to impose these punitive tariffs.

“The Chinese tariffs are negatively impacting the U.S. ethanol industry’s exports, of not only ethanol, but our co-product of Dry Distillers Grain (DDG), a high-quality animal feed that is favored by Chinese livestock producers and is the largest export market for U.S. DDG,” says Mark Marquis, CEO of Marquis Energy.

U.S. farmers say these unfair tariffs will cost U.S. agriculture at least two billion dollars per year.

Category: Fuels

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