US ethanol producers, Grains Council deny 'dumping' DDGS in China

By Daniel Enoch

© Copyright Agri-Pulse Communications, Inc.



WASHINGTON, Jan. 13, 2016 - Ethanol producers and the U.S. Grains Council (USGC) say they are disappointed that China has initiated anti-dumping and countervailing duty investigations involving U.S. exports of distiller's dried grains (DDGS) to the Asian nation.

Tom Buis, co-chair of Growth Energy denied the charges leveled by China's Ministry of Commerce and said the group, which represents U.S. ethanol producers, is working closely with its members and the Grains Council to coordinate an industry response. 

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“The false allegations by the Chinese petitioners have the potential to seriously threaten our largest overseas market for DDGS and could have a significant impact on the supply, demand and price for DDGS in the U.S. and other foreign markets.”

Some DDGS producers in China are asking for import duties, alleging that U.S. product was sold in China below the cost of production, hurting their business. The Ministry of Commerce also claims that U.S. DDGS are supported by as many as 42 subsidy programs, according to wire reports.

Thomas Sleight, CEO of the USGC, said China's action is “unwarranted and unhelpful.”

“They could have negative effects on U.S. ethanol and DDGS producers, as well as on Chinese consumers, potentially over a period of many years,” Sleight said in a statement. “We are also confident that our trading practices for DDGS, ethanol and all coarse grains and related products are fair throughout the world. We stand ready to cooperate fully with these investigations and will be working closely with our members to coordinate the U.S. industry response.”

Sleight said the Grains Council has worked in China since 1981 to find solutions to the challenges of food security through development and trade.

“There have been measureable positive effects of this work for the Chinese feed and livestock industries and Chinese consumers,” he continued. “We and our members will work vigorously in the coming months to demonstrate that the allegations … are false, even while we continue to stand ready to expand our cooperation with China on agricultural issues of mutual benefit.”

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Nutrient rich distiller's dried grains with solubles are a co-product of dry-milled ethanol production. On its website, USGC says more than 200 U.S. ethanol plants - mostly in the Corn Belt - can produce more than 14 billion gallons of ethanol and 30 million tons of DDGS a year. DDGS exports have exploded from 1 million tons in 2006 to more than 11 million tons to more than 45 countries in 2014. China received the bulk of DDGS exports that year, accounting for 52 percent of the export market, followed by Mexico (12 percent) and Korea, Vietnam and Japan each with 4 percent.

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