The European Commission has decided not to impose provisional import tariffs on a flood of low-priced Argentine biodiesel until it gathers more information, although it considers the fuel to be subsidized and a potential threat to local producers.

The decision, detailed in a document seen by Reuters, comes as a major blow for European producers of fuels made from vegetable and recycled oil. They have been hit hard since the EU scrapped duties last year in response to a ruling by the World Trade Organisation.

The Commission had been expected to reinstate provisional duties this month or in October and Argentine sales to the EU had stalled in anticipation.

“The Commission’s preliminary conclusions are that the Argentinian imports of the product concerned into the unio are subsidized and that there appears to be a threat of material injury to the unio industry,” the Commission said in the document.

“However, the Commission finds it necessary to collect further information on developments after the investigation period which could further confirm the Commission’s preliminary findings in this investigation as well as shed more light on the unio interest,” it said.

“In view of its findings, the Commission will continue the investigation without the imposition of provisional measures.”

ARGENTINE PRODUCERS VERY CONFIDENT

The Commission said Argentina provided support to its industry through a set of measures, including export duties on soybeans, a biodiesel feedstock, that depressed prices to an artificially low level to the advantage of the downstream biodiesel industry.

The EU’s removal of duties on low-price biodiesel from Argentina and Indonesia last September and subsequent surge in imports has forced European producers to cut production.

“However, the Commission finds it necessary to collect further information on developments after the investigation period which could further confirm the Commission’s preliminary findings in this investigation as well as shed more light on the unio interest,” it said.

“In view of its findings, the Commission will continue the investigation without the imposition of provisional measures.”

ARGENTINE PRODUCERS VERY CONFIDENT

The Commission said Argentina provided support to its industry through a set of measures, including export duties on soybeans, a biodiesel feedstock, that depressed prices to an artificially low level to the advantage of the downstream biodiesel industry.

The EU’s removal of duties on low-price biodiesel from Argentina and Indonesia last September and subsequent surge in imports has forced European producers to cut production.

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