Biodiesel from Argentina and Indonesia Investigation Nos. 701-TA-571-572 and 731-TA-1347-1348 (Preliminary) Publication 4690 May 2017 U.S. International Trade Commission Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Rhonda K. Schmidtlein, Chairman David S. Johanson, Vice Chairman Irving A. Williamson Meredith M. Broadbent F. Scott Kieff Catherine DeFilippo Director of Operations Staff assigned Nathanael Comly, Investigator Calvin Chang, Investigator Brian Allen, Industry Analyst Tana von Kessler, Economist Charles Yost, Accountant Russel Duncan, Senior Statistician Carolyn Holmes, Statistical Assistant Michael Haldenstein, Attorney Elizabeth Haines, Supervisory Investigator Address all communications to Secretary to the Commission United States International Trade Commission Washington, DC 20436 U.S. International Trade Commission Washington, DC 20436 www.usitc.gov Biodiesel from Argentina and Indonesia Investigation Nos. 701-TA-571-572 and 731-TA-1347-1348 (Preliminary) Publication 4690 May 2017 CONTENTS Page Determinations ............................................................................................................................... 1 Views of the Commission ............................................................................................................... 3 Part I: Introduction .............................................................................................................. I-1 Background ................................................................................................................................ I-1 Statutory criteria and organization of the report ..................................................................... I-1 Statutory criteria ................................................................................................................... I-1 Organization of report ........................................................................................................... I-3 Market summary ....................................................................................................................... I-3 Summary data and data sources ............................................................................................... I-4 Previous and related investigations .......................................................................................... I-4 Nature and extent of alleged subsidies and sales at LTFV ........................................................ I-4 Alleged subsidies ................................................................................................................... I-4 Alleged sales at LTFV ............................................................................................................. I-5 The subject merchandise .......................................................................................................... I-6 Commerce’s scope ................................................................................................................ I-6 Tariff treatment ..................................................................................................................... I-6 The product ............................................................................................................................... I-7 Manufacturing processes ...................................................................................................... I-7 Description and applications ............................................................................................... I-13 Domestic like product issues ................................................................................................... I-20 Part II: Conditions of competition in the U.S. market........................................................... II-1 U.S. market characteristics....................................................................................................... II-1 Channels of distribution ........................................................................................................... II-2 Geographic distribution ........................................................................................................... II-2 Supply and demand considerations ......................................................................................... II-3 U.S. supply ............................................................................................................................ II-3 U.S. demand ......................................................................................................................... II-7 i CONTENTS Page Part II: Conditions of competition in the U.S. market--Continued ............................................. Substitutability issues ............................................................................................................. II-10 Lead times .......................................................................................................................... II-10 Factors affecting purchasing decisions............................................................................... II-10 Comparison of U.S.-produced and imported biodiesel ...................................................... II-11 Part III: U.S. producers’ production, shipments, and employment ...................................... III-1 U.S. producers ......................................................................................................................... III-1 U.S. production, capacity, and capacity utilization ................................................................. III-3 Alternative products ............................................................................................................ III-7 U.S. producers’ U.S. shipments and exports ........................................................................... III-7 U.S. producer’s commercial U.S. shipments by type .......................................................... III-9 U.S. producer’s monthly U.S. shipments ........................................................................... III-10 U.S. producers’ inventories ................................................................................................... III-11 U.S. producers’ imports and purchases ................................................................................ III-11 U.S. employment, wages, and productivity .......................................................................... III-11 Part IV: U.S. imports, apparent U.S. consumption, and market shares ............................... IV-1 U.S. importers.......................................................................................................................... IV-1 U.S. imports ............................................................................................................................. IV-2 Negligibility .............................................................................................................................. IV-6 Cumulation considerations ..................................................................................................... IV-6 Fungibility ............................................................................................................................ IV-6 Presence in the market ..................................................................................................... IV-10 Geographical markets ....................................................................................................... IV-14 Apparent U.S. consumption .................................................................................................. IV-16 ii CONTENTS Page Part V: Pricing data ............................................................................................................. V-1 Factors affecting prices ............................................................................................................ V-1 Raw material costs ............................................................................................................... V-1 Transportation costs to the U.S. market .............................................................................. V-2 U.S. inland transportation costs ........................................................................................... V-2 Pricing practices ....................................................................................................................... V-2 Pricing methods .................................................................................................................... V-2 Sales terms and discounts .................................................................................................... V-3 Price data .................................................................................................................................. V-3 Import purchase cost data ................................................................................................... V-9 Price trends ......................................................................................................................... V-11 Price comparisons .............................................................................................................. V-11 Lost sales and lost revenue .................................................................................................... V-12 Part VI: Financial experience of U.S.