THE decision to extend penalty tariffs on heavily subsidised American biodiesel has been welcomed by a leading producer on Teesside.

Richard Nickels, chief executive of The Biofuels Corporation at Seal Sands, said since Europe shrugged off allegations of protectionism in March to slap preliminary charges on US imports, he had seen the equivalent of a $200/t increase in the price for his product.

“They were holding the market back,” he said. “Margins have gone up, although we still aren’t getting enough feedstock.”

This month, Europe extended the anti-dumping duty, which will cost American producers up to $333/t, by another five years.

The Biofuels Corporation, which until spring this year was running substantially under capacity, had increased output, but Mr Nickels said it was impossible to forecast when it would hit maximum production.

The multi-feedstock plant now ran almost exclusively on UK and Irish waste oil, he said, with around 15% oil seed rape and tallow.

“We are now firmly going down the waste oil route,” said Mr Nickels, but there was insufficient feedstock to supply the 250,000/t a year plant.

Overcapacity in the European biodiesel industry now stands at around 13m tonnes, according to the European Biodiesel Board.

Mr Nickels acknowledged that, on the face of it, tariffs were indefensible.

“But not if they are driven by a (US) subsidy - that’s the issue,” he said. “My argument from the very start was that I would not have a problem with American imports - as I don’t with Argentinian - as long as there was no subsidy. America was carrying a $300/t cost and we could not compete.”

Source: www.nebusiness.co.uk