EU cancels glyphosate anti-dumping tariff
Dec. 15, 2010
The European Union will not renew its 30% glyphosate tariff on Chinese glyphosate that was suspended late last year and set to expire in January. The European Glyphosate Association withdrew its request to renew the glyphosate duty in September, and the EU is closing its anti-dumping investigation.
The biggest beneficiaries during the decade-long trade protection were the European divisions of Monsanto, the world’s largest producer of glyphosate, and Syngenta, the largest producer of pesticides. After extremely favorable glyphosate prices in 2008, oversupply of the active forced prices to historically low levels in 2009. The supply glut is still working its way through the distribution chain, keeping prices depressed and forcing multinational manufacturers to reduce its pricing structure to compete in global markets.
The decision is expected to be published in the EU’s Official Journal by the end of the year.
The EU duty on Chinese glyphosate began in 1998 with a 24% tax and was raised to almost 50% in 2000. It included other countries in 2002 when the officials claimed that Chinese companies were bypassing the law by using export companies in Taiwan and Malaysia. The tax was lowered to 29.9% in 2004 and suspended in May 2009.
Industry analysts widely considered the tax unnecessary as over-capacity has effectually commoditized glyphosate in global markets. Additionally, EU is considered a mature agricultural market, and the bloc’s pesticide value fell almost 8% this year after adjusting sales for inflation and currency exchange.
For many manufacturers, growth markets continue to reside in the Americas and Asia, where farmers are integrating other, often older actives into their glyphosate regimen to help stem glyphosate resistance, especially in the US.
The biggest beneficiaries during the decade-long trade protection were the European divisions of Monsanto, the world’s largest producer of glyphosate, and Syngenta, the largest producer of pesticides. After extremely favorable glyphosate prices in 2008, oversupply of the active forced prices to historically low levels in 2009. The supply glut is still working its way through the distribution chain, keeping prices depressed and forcing multinational manufacturers to reduce its pricing structure to compete in global markets.
The decision is expected to be published in the EU’s Official Journal by the end of the year.
The EU duty on Chinese glyphosate began in 1998 with a 24% tax and was raised to almost 50% in 2000. It included other countries in 2002 when the officials claimed that Chinese companies were bypassing the law by using export companies in Taiwan and Malaysia. The tax was lowered to 29.9% in 2004 and suspended in May 2009.
Industry analysts widely considered the tax unnecessary as over-capacity has effectually commoditized glyphosate in global markets. Additionally, EU is considered a mature agricultural market, and the bloc’s pesticide value fell almost 8% this year after adjusting sales for inflation and currency exchange.
For many manufacturers, growth markets continue to reside in the Americas and Asia, where farmers are integrating other, often older actives into their glyphosate regimen to help stem glyphosate resistance, especially in the US.
Source: FCI
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