UPDATE 2-U.S. 'disappointed' with proposed EU duties on ethanol

Wed Jan 23, 2013 5:12pm EST

(Adds reaction from U.S. ethanol group)

WASHINGTON Jan 23 (Reuters) - The United States on Wednesday objected to proposed European Union import duties on U.S. ethanol that EU officials said are intended to offset subsidies given to American producers.

"We are disappointed in this outcome," said Nkenge Harmon, a spokeswoman for the U.S. Trade Representative's office. "I will add that we have serious concerns about certain procedural and methodological aspects of the investigation."

The European Commission has proposed a rare duty on all U.S. producers of ethanol after an investigation concluded that U.S. exporters sell the fuel to Europe at illegally low prices after receiving subsidies.

The European Union is seeking anti-dumping duties of 9.5 percent on all ethanol coming from the United States, according to a proposal seen by Reuters this week.

The document proposed that the regulation should be adopted by the member states no later than Feb. 22.

Shipments of ethanol from the United States to the EU are worth more than $930 million, or 700 million euros, a year.

EPure, a European ethanol industry group, supports the EU proposal. "We think it's effectively representing the fact that European industry has suffered from these cheap imports," a spokeswoman said.

U.S. ethanol industry groups the Renewable Fuels Association and Growth Energy said in a joint statement that ethanol producers and marketers were "outraged" by the proposal.

"Not only does it fly in the face of over 30 years of consistent practice by the European Commission, but it also violates numerous provisions of the World Trade Organization's agreement on anti dumping," it said. ($1 = 0.7526 euro) (Reporting by Doug Palmer and Timothy Gardner in Washington and Ethan Bilby in Brussels; editing by Ros Krasny, Mohammad Zargham, Nick Zieminski and Matthew Lewis)

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