How the anti-dumping tariffs will affect Wilmar's biodiesel sales

Will things turn out badly?

DBS Vickers said that according to Bloomberg, the EU Commission has on 27 May13 (published on 28 May13) put provisional anti-dumping tariffs on Wilmar's biodiesel sales to the EU at 9.6%; whereas those sold by First Resources were given none.

These measures were applied because of complaints filed by the European Biodiesel Board, which pointed to prima facie evidence of the dumping of biodiesel.

Here's more from DBS Vickers:

This was considered sufficient to justify an investigation, the period of which lasted between 1 Jul11 and 30 Jun12.

We understand the affected parties have one-month to respond, before measures are implemented. Wilmar did not issue any statement; but we understand it had already diversified into other markets (we suspect the USA market now has a larger share), since the dumping investigation began.

This should leave its current biodiesel sales volumes to the EU market smaller than the 2011/12 period. Hence, the impact to Wilmar on a consolidated basis since 4Q12 has indicatively been insignificant.

Note that Wilmar does not disclose its biodiesel segment contribution to the Palm and Lauric Merchandising and Processing pretax.