UK Launches Anti-Dumping Probe on Chinese Biodiesel Exports

The UK recently announced an anti-dumping investigation specifically focused on Chinese biodiesel exports. The move will likely cause some disruptions in Chinese trade in the short-term, with longer-term effects uncertain until the results are released.

The UK’s Trade Remedies Authority initiated the investigation on June 5 over the importing of Chinese biodiesel to the nation. The move comes following several months after a similar probe was undertaken by the broader European Union.

The investigation is estimated to conclude in the first quarter of 2025. In the interim, imports will continue to enter the UK market without any additional tariffs.

Chinese Biodiesel Inflow to UK Raises Concerns

The timeframe raises concerns among domestic producers about the potential inflow of Chinese biodiesel for several months. This could be especially significant if the EU market imposes duties on Chinese imports in response to its own anti-dumping measures.

The UK government's investigation was requested by the Road Transport Fuel Association. Although officially titled as a biodiesel case, it covers a wide range of HS codes that pertain to exportation of various products:

• Biodiesel
• HVO
• SAF
• Related Feedstocks
• Hydro Treated Paraffinic Gasoils
• Fatty Acid Mono Alkylesters.
• Provisional Duties Could be Imposed

Similar to the European Union, the UK can impose provisional duties before the official findings are released. This means importers will need to offer a guarantee that will cover any subsequent anti-dumping duties.

EU’s Anti-Dumping Measures Also Affecting UK Market

The impact of the EU's anti-dumping duties could also have major effects within the UCO-heavy UK market.

China exported over 1.5 million tons of biodiesel to the Netherlands last year, with total exports closer to 1.9 million tons. If these markets disappear, the UK will be one of the few mandated markets outside the EU tariff wall that will need to absorb Chinese barrels.

Alongside the uptick in offshore markets like marine bio-bunkering, the UK will likely see substantial changes beginning in July and enduring at least through the year.

The industry's initial response to the EU’s investigation has been mostly positive. It offers an end date for the inflow of cheap Chinese biodiesel despite it being anticipated after the closure of the EU market to China.

In the meantime, much of the Chinese biodiesel stock will likely find its way to the UK until the results of its anti-dumping investigation finish. The fact that the UK market will remain unprotected after the EU market closes due to the investigation will expedite this shift.

Anti-Dumping Investigation Comes "Better Late than Never"

Despite the delay, many experts welcomed the investigation. While it comes later than perhaps many people had hoped, the news has also been met with a “better late than never” reaction.

If the UK market remains open for at least six months during the investigation, the volume of imported biodiesel could be staggering. Assuming that the 1.5 million tons exported to the EU from China annually last year, the country could end up receiving 750,000 tons of double-counted Chinese biodiesel within that period.

Depending on the outcome, duties could be backdated when the investigation concludes. Registration and provisional duties are tools the UK can use to address a rise in biodiesel imports triggered by the launch of its investigation.

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This post comes from an analyst report available with a subscription to Prima CarbonZero, ResourceWise’s online biofuels and feedstocks platform.

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