Planned anti-subsidy duties on palm oil methyl ester ineffective

In Germany, UFOP concludes that preliminary anti-subsidy duties announced by the EU Commision will not reduce imports of palm oil-based biodiesel after a comparison of 8% and 18% duty increases.

In the anti-subsidy proceedings against Indonesia, the responsible committee of the EU Commission agreed at the end of July 2019 to impose preliminary punitive tariffs. These tariffs will be between 8 per cent and 18 per cent and will presumably come into force on 5 September 2019.

UFOP has pointed out that the scheduled punitive tariffs will not raise the price for palm oil methyl ester (PME) to the price level of rapeseed oil methyl ester (RME). In other words, European rapeseed production, as a feedstock source for biodiesel production, will not benefit from the step taken. UFOP does not agree with the low level of the punitive tariffs. The association argues that just in the past weeks the EU Commission itself has taken a very critical stance on the issue of indirect changes in land use in connection with European biofuels policy.

The revision of the Renewable Energy Directive (RED II) provides that palm oil-based biofuels must be reduced as from 2024, until which year the levels consumed in 2019 will serve as the maximum value, to be scaled down to zero by 2030. UFOP contends that the EU Commission’s hesitation to impose efficient punitive tariffs prevents the tariffs from having a reducing effect on consumption in the European Union in 2019. Because of this, the association has called on the EU Commission to impose higher and more efficient punitive tariffs in order to make a perceptible contribution towards avoiding negative impacts on land use in Indonesia.