Currently, the U.S. Environmental Protection Agency is considering an application to establish eligibility of Argentine biodiesel for the U.S. Renewable Fuel Standard (RFS). The application was submitted by CARBIO, the trade association representing Argentine biodiesel producers. With 1.3 billion gallons of biodiesel production capacity and subsidies that promote exports, Argentine biodiesel could have a large impact on the U.S. biodiesel market. The American Soybean Association sent the letter below to EPA to register our concerns and make them aware of the broad impacts of this proposal.

As indicated in the letter, the ASA believes that the far reaching impacts of this issue require an exhaustive review by EPA that includes a public comment period and input from the various stakeholders as well as other government agencies, such as the U.S. Department of Agriculture, and the Office of the U.S. Trade Representative. EPA must be made aware of the fact that Argentine biodiesel is being heavily subsidized into world markets, and the European Union already has imposed anti-dumping duties on Argentine biodiesel imports due to the significant subsidies that Argentine biodiesel receives as the result of Argentina's differential export tax system (DET).

In addition, ASA believes that consideration of the CARBIO application should be done well in advance of the year in which any Argentine biodiesel would qualify for the RFS program, since the volumes of Argentine biodiesel would need to be factored into EPA’s calculation of the Required Volume Obligation (RVO) for Biomass-based diesel for that year. Clearly, with EPA’s proposed rule to limit the biomass-based diesel program to 1.28 billion gallons in 2014 and 2015, the potential for significant volumes of Argentine biodiesel to flood the U.S. market in 2014 and 2015 has not been contemplated by EPA.

A significant issue with the Argentine application is their plan to comply with the renewable biomass eligibility requirements. The renewable biomass requirements of the RFS statute and regulations require entities to demonstrate that their biofuel feedstock was derived from land that was in agricultural production prior to December 2007. In their proposal, CARBIO is asking EPA to approve an “Alternative Renewable Biomass Tracking Requirement” which would serve to replace the stringent feedstock recordkeeping requirements of the RFS and allow Argentine biodiesel to qualify for the RFS.

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