In early April 2018 the United States confirmed steep anti-dumping duties and countervailing duties on Indonesian biodiesel imports. Published through the Federal Register the US imposed additional duties that range between 126.97 percent and 341.38 percent. For sure, this seriously harms the competitiveness of Indonesian biodiesel shipments to the world's top economy. If the policy is not altered, then it basically means the end of Indonesian biodiesel exports to the US market.
Pradnyawati, Director for Trade Security at Indonesia's Trade Ministry, said the US decision greatly damages exports of Indonesian biodiesel to the USA. She added that Indonesian biodiesel exporters have already filed for an appeal to the ruling at the US court.
If this appeal will not bear fruit, then the Indonesian government plans to take the issue to the World Trade Organization (WTO). But Pradnyawati emphasized that the government will first await the appeal. Considering biodiesel exports are an important asset - in terms of foreign exchange earnings - for Indonesia, the government is willing to use all measures to solve the matter and continue biodiesel shipments to the USA.
Last year, US biodiesel producers filed a complaint because their business was being damaged by cheap biodiesel imports from Indonesia (and Argentina). Later, the US Commerce Department concluded that Indonesian exporters had been selling their biodiesel products in the USA at 92.52 - 276.65 percent less than fair value, partly due to the Indonesian government's generous biodiesel subsidy program.
Togar Sitanggang, Secretary-General of the Indonesian Palm Oil Producers Association (Gapki), said exports of palm oil-related products to the USA was actually already on the decline prior to the setting of the anti-dumping duties. This trend is primarily attributed to the soybean supply glut. However, the recent anti-dumping duties do add negative sentiments, and therefore curtail exports further.
However, there is still a glimmer of hope for stakeholders in Indonesia's biodiesel industry. After the WTO had ruled, largely, in favor of Indonesia (in January 2018) in the battle between Indonesia and the European Union (EU) regarding the latter's anti-dumping duties on Indonesian biodiesel exports, Indonesia also won its appeal at the EU court. The European Court of Justice, the highest court in the EU, ruled last month that the bloc needs to scrap its anti-dumping duties on imports of Indonesian biodiesel products that ranged between 8.8 - 23.3 percent.