Argentina will raise the biodiesel export tax to 15% from 8% as of July 1, 2018, according to the official Gazette published Monday.

This would make the export of soy-based biodiesel from the South American country into Europe more expensive, potentially cutting the arbitrage that has been open since the initial reduction in antidumping duties in September 2017.

The move comes after the European Commission announcement Thursday that all biodiesel imports into the EU from Argentina will be registered.

It follows a complaint by the European Biodiesel Board (EBB) on behalf of biodiesel producers in December 2017. The implications are that, should anti-subsidy tariffs be imposed by the EU, they can be applied retroactively.

With the price of soy-derived biodiesel (SME) in Argentina lower than biodiesel in Europe, much has been booked as a blendstock for FAME 0 (Fatty Acid Methyl Ester) into Europe, with almost 400,000 mt booked from Argentina since February, bringing the total amount booked since the initial reduction in antidumping duties in September to almost 1.2 million mt.

With European biodiesel consumption expected to be in the region of 13 million mt in 2018, this represents almost 10% of that demand that will come from Argentine product alone. But the boost in the export tax will most likely curtail some of these imports.

With most antidumping duties removed against Indonesian imports also, much biodiesel is expected from both Argentina and Indonesia in 2018.

The US currently has antidumping duties in place on biodiesel imports from Argentina, ranging from 60.44% to 276.65% and so this change in tax is anticipated to have little impact on this flow which has been curtailed since the adoption of these duties.