The European Commission has repealed the antidumping duty of Eur62.30/mt on US ethanol imports, taking effect Wednesday.
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The duty was in place for five years from February 2013, followed by a 15-month expiry review.
The European ethanol association, ePURE, said in a statement that the decision is harmful for the domestic ethanol industry and the entire value chain that depends on it. ePURE said the risk is increased, as other destinations for US exports including Brazil, China, Peru and Colombia have in place, or are considering, measures against US imports.
Most market participants had expected the duty to be removed as there were no grounds for dumping, and this had already been weighing on the forward price curve. But many think the repeal will not necessarily result in a flurry of imports from the US.
Over the period the duty has been in place, arbitrage opportunities have been limited and have mostly opened in recent months. But even then, Europe's requirements for ISSC certification and a minimum of 50% greenhouse gas savings limits US product that is eligible.
In addition, the steep backwardation in the T2 market, combined with logistical constraints, are seen as major hurdles that are expected to dampen the effect of the duty removal.
-- Chrysa Glystra, email@example.com
-- Edited by James Burgess, firstname.lastname@example.org