• Bloomberg reported that the USA will be imposing new duties on biodiesel imports from Indonesia and Argentina. On 3 April, the International Trade Commission announced that biodiesel imports from Indonesia and Argentina will face new steep anti-dumping duties. The duties will hit Indonesian companies like Wilmar International and Musim Mas.

• The US Commerce Department calculated that imports from Argentina were sold in the USA at dumping margins of up to 86.41% while imports from Indonesia were sold at dumping margins of up to 276.65%. Due to the Trade Commission's findings that the imports are hurting the USA biodiesel industry, the USA will impose duties in line with those rates.

• We believe that this is negative for the Indonesian biodiesel producers. According to Oil World, Indonesia produced about 2.95mil tonnes of biodiesel in 2017. Out of these, roughly 74% were used domestically while the balance 26% were exported.

• The silver lining is that Indonesian companies can export their biodiesel products to the EU as the EU has abolished the anti-dumping duties on Indonesia and Argentina's biodiesel products. We reckon that Malaysian biodiesel producers would be beneficiaries of the antidumping duties imposed by the USA on Indonesia's biodiesel products. Malaysia exported 235,259 tonnes of biodiesel in 2017. Companies with biodiesel operations in Malaysia are Sime Darby Plantation, Felda Global Ventures and Genting Plantations.

• Reuters reported that Argentina will be applying export taxes on soybeans and soy products on the shipment date rather than the date the deal is closed. The revision will allow exporters to pay lower taxes, which are already coming down since the export tax rate is reduced by 0.5 percentage points per month until December 2019. The export tax rates are 28% for soybean and 26% for soybean oil and meal.

• Agricensus reported that China is calibrating its farmer subsidies to give soybean plantings an economic edge over corn in four of the country's northern provinces. The four provinces are Liaoning, Jilin, Heilongjiang and Inner Mongolia. The statement from the Ministry of Finance and Ministry of Agriculture did not disclose the size of the subsidies but said that the subsidy for soybean will be higher than corn.

• According to SGS, Malaysia's palm shipments rose by 19.4% MoM in March. Palm exports to India surged by 78.3% while China received 83.5% more shipments. On a negative note, exports to the EU fell by 14.5% MoM in March.

Source: AmInvest Research - 9 Apr 2018