Biodiesel import flood could drown European market
(Reuters) - A flood of potentially "dubious" biodiesel imports into Europe from China needs to be subject to closer EU vetting or it could trigger the collapse of the European Union's biofuels industry, top producer body EWABA said on Wednesday.
The European Waste-based Advanced Biofuels Association (EWABA) said 11 European biodiesel plants have already halted production and another 10 have reduced their capacity.
The EU has provided incentives for the production of biodiesel made with waste oils and fat as part of its efforts to increase renewable energy use.
At the same time, EU data and Chinese customs data have both shown a rise in imports to Europe from Chinese producers that see the opportunity provided by a strong market in Europe.
European vegetable oil industry group FEDIOL last week cited an abnormal rise in imports of biodiesel classified as waste based as a reason for plummeting rapeseed prices.
Offer prices in Europe for advanced biodiesel have nearly halved since August, traders say, reducing producers' earnings.
EWABA said the EU-backed inspection mechanism has not sufficiently checked imports and traders say spot audits in China are insufficient to ensure less sustainable materials, notably palm oil, are not used to make biofuel.
"The promotion to waste-based and advanced biodiesel has to be accompanied by effective policing and worldwide sound auditing and verification practices ... thus avoiding dubious or fraudulent activity," EWABA said, without naming specific Chinese companies.
If authorities do not crack down on the flows, it added: "We will soon be on a path which will irremediably spiral into the complete collapse of the EU industry. This would result in de-industrialization and damaging job losses".
It addressed its open letter to the European Commission, the German Federal Ministry for the Environment and the Dutch Emissions Authority.