Flood of China’s used cooking oil spurs call to hike US levies to protect growers of crops used for sustainable fuels
- Trade group says used cooking oil imports from China are weakening demand for US crops used to make sustainable fuels
- US imports of used cooking oil more than tripled in 2023, with more than half coming from China, according to the US International Trade Commission
Higher levies on Chinese used cooking oil could be on the table as President Joe Biden prepares a new wave of tariffs against China, as a US soybean trade group argues the imports are undercutting American crops used for biofuels.
The National Oilseed Processors Association (NOPA), which represents the biggest US soybean processors, including Cargill, Bunge Global and Archer-Daniels-Midland, wants the levies to be higher than the current 15.5 per cent rate, according to a notice sent to its members over the weekend that was seen by Bloomberg.
NOPA CEO Kailee Tkacz Buller said the memo was sent in response to rumours of possible additional tariffs being applied on used cooking oil. Association members support a boost on par with other clean energy sources, such as electric vehicles and solar, to level the playing field, Buller said in an email.
Soybean crushers worry a flood of used cooking oil imports from China is weakening demand for US crop-based ingredients that can be used to make renewable diesel and sustainable aviation fuel. There’s also widespread, unconfirmed speculation the used oil from Asia may not be authentic and instead is mixed with fresh vegetable oils, such as palm, potentially distorting commodity values and undermining US biofuel laws.
China’s exports to the US of processed animal and vegetable fats and oils – a category that includes used cooking oil – reached US$201 million in the first three months of this year, versus US$770 million in the whole of 2023, Chinese customs figures compiled by Bloomberg show. That compares to about US$47 million worth of shipments in 2022 from April onwards, when the data begins.
Soy oil values are down so far this year, though futures in Chicago’s commodities marekt have seen an uptick in the last couple of trading days as commodities traders await tariff news. Biden on Tuesday is expected to unveil an increase in some levies first imposed under former President Donald Trump. It’s not known if the announcement will include used cooking oil.