February 19, 2013 / 10:38 PM / 4 years ago

UPDATE 1-U.S. ethanol groups decry EU tariff as 'blatant protectionism'

WASHINGTON, Feb 19 (Reuters) - Two biofuels trade groups on Tuesday lambasted a European Union decision to impose an anti-dumping duty on U.S.-made ethanol as a protectionist move and said they would challenge the tariff "in every manner possible."

The 9.5 percent tariff on imports of U.S. ethanol was approved on Monday by the Council of the European Union. The imports were worth more than $930 million, or 700 million euros, a year.

"This is blatant protectionism at its worst," trade groups Renewable Fuels Association and Growth Energy said in a joint statement. They said the country-wide duty hitting all U.S. producers was not based on facts.

"We will challenge this policy in every manner possible," the U.S. groups said.

EU officials say the anti-dumping duty, which is expected to take effect by the end of the week, is needed because U.S. ethanol is sold in the EU at illegally low prices.

The case was brought by the EU ethanol industry association ePure, whose members produce 80 percent of Europe's bioethanol.

The European Commission, the EU's executive body, proposed the 9.5 percent duty last month.

A U.S. trade official on Tuesday echoed the U.S. industry groups' concerns.

"The U.S. is disappointed with this move by the EU, and we continue to have serious concerns about a number of procedural and methodological irregularities that took place during the final stages of the investigation," the official said.

U.S. ethanol production is down sharply due to record-high corn prices and weak domestic demand for gasoline. At recent rates of production, output could be 8 percent below the U.S. target for use.

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