EU Terminates Tariff Preferences on Pakistani Ethanol Imports

PARIS: The European Commission has revoked tariff exemptions for non-fuel ethanol arriving from Pakistan, heeding appeals from EU ethanol producers who claimed that a surge in inexpensive imports from the South Asian nation was creating price pressures and market instability.

According to the Commission’s statement released in the EU’s Official Journal on Friday, ethanol from Pakistan constituted over one-fourth of all non-fuel ethanol imports last year, positioning it as the leading import source for the EU.

The overall increase in ethanol imports has been a multi-year trend. EU customs figures reveal that non-fuel ethanol imports nearly doubled between 2021 and 2024, reaching 726,000 metric tons in 2024, up from approximately 376,000 tons in 2021.

Specifically, Pakistani ethanol imports experienced a surge of almost 300%, reaching 393,590 tons between 2021 and 2022, and remained 244% higher than 2021 levels in 2023.

Concurrently, EU production of non-fuel ethanol decreased, registering an 8% decline compared to 2021 figures last year.

The Commission stated that the data indicated a correlation between the increase in imports from Pakistan and significant disruptions in Union markets.

The Commission stated, “The Commission has determined that there is clear indication of considerable disruption in the Union market for non-fuel ethanol, evidenced by a substantial surge in imports at notably lower prices compared to Union manufacturers, coupled with a drop in Union output.”

EU ethanol manufacturers have welcomed the decision, which is slated to remain in effect for a duration of two years. However, they expressed their initial hope for a three-year period and voiced concerns regarding potential circumvention due to the exclusion of ethanol utilized in fuel production.