HAMBURG (Reuters) - U.S. agribusiness group Archer Daniels Midland Co will suspend production at a major biodiesel plant in Germany because of increasing cheap imports of the renewable fuel into the European Union, it said on Friday.
The standstill is expected to last at least for the duration of the second quarter of 2018 and will be reviewed during the third quarter, a company spokeswoman said in an email.
The Mainz plant has capacity of about 275,000 tonnes a year, Reuters data shows.
Rising biodiesel imports from Argentina and an expected surge in shipments from Indonesia threaten to cripple biodiesel output in the European Union, the world’s top producer, industry experts said on March 7.
The EU has removed duties on biodiesel imports for 13 Argentine and Indonesian producers following the end of legal proceedings at the European Court of Justice (ECJ), an EU document this week showed.
The EU set anti-dumping duties on imports of the renewable fuel from the two countries in 2013, but faced a series of legal challenges at the European Court of Justice and the World Trade Organization. Both bodies ruled against the EU measures.
“Archer Daniels Midland Company plans to temporarily cease production of biodiesel at its facility in Mainz, Germany, as a result of increased biodiesel imports into the European Union,” the spokeswoman said in the email.
“Since September 2017, the European Union has seen an influx of imported biodiesel which has placed significant pressure on the local market, impacting profitability for European-based producers. With continued imports and increasingly poor margins, the company has taken the difficult decision to cut back production in the region.”
Reporting by Michael Hogan, editing by; Editing by David Goodman and David Evans