Sete to idle on Argentinian soybean oil imports

French biodiesel producer Saipol is to mothball its Sète facility in the south of the country citing an influx of biodiesel from Argentina following the EU's decision to change import duties levied on the volumes, local media has reported this week.

Europe and the US have chosen to treat Argentine biodiesel exports in diametrically opposing ways, meaning much of the volume is seeking a home in Europe. 

The move has prompted Saipol to reveal further details of the production cutback this week, as local media reported 90 staff from the Sète facility are to be placed on part-time contracts for six months as of February 2018.

The French biodiesel producer previously announced in October it would introduce part-time working hours at its five biodiesel production facilities in France because of increased Argentinian soybean oil-based biofuels.

The announcement comes weeks after the EU slashed its duties on imports of Argentinian soy methyl ester (SME) by four fifths and the US slapped a 72% import duty of the biofuel there.

The two moves have caused a surge in SME imports to Europe and left the landscape for SME in Europe somewhat mixed.

On one hand, the EU is trying to conclude a free trade deal with the South American Mercosur bloc, which could see Brazilian ethanol and Argentinian soybean oil granted lower-tariff access to the EU.

On the other, however, the European Parliament will vote on a proposal next month that could drastically increase the minimum greenhouse gas emission reduction requirement for biofuels in a move that could eliminate many crop-based fuels.

French Secretary of State Jean-Baptiste Lemoyne has previously attempted to dampen enthusiasm for the Mercosur deal. With French agricultural sector in line to lose out from such a deal, Lemoyne has headed a group of detractors from the Commission line and has urged negotiators to check their pace and seek a solution which suits all at the table.

Nonetheless, EU trade commissioner Cecilia Malmström believes a deal with Mercosur before the year end is “realistic,” with the European Commission keen to seal a deal ahead of next year’s general election in Brazil.

Malmström, however, has conceded there are “sensitivities on agricultural issues.”