The European Union is set to impose provisional duties on Chinese biodiesel after finding it is being sold in EU markets at unfairly low prices, in the latest in a string of trade cases against China.

The European Commission, which oversees EU trade policy, has proposed setting provisional tariffs of between 12.8 and 36.4%, according to a document published on Friday. They are due to be imposed in mid-August.

The investigation is due to continue until February, when definitive duties for five years could be set.

The EU has already set provisional duties for electric vehicles made in China over what it sees as unfair subsidies in its most high-profile case.

For biodiesel, proposed duties are 12.8% for EcoCeres Group products, 36.4% for Jiaao Group, including Zhejiang Jiaao Enproenergy Co, and 25.4% for exports by Zhuoyue Group, including Longyan Zhuoyue New Energy Co

The European Biodiesel Board (EBB), which lodged the complaint, said earlier this month that a flood of biodiesel from China was having a devastating effect on EU production.

Chevron Renewable Energy Group had furloughed German workers, Shell had paused construction of a Dutch plant, BP was pausing a project in Germany and Argent Energy had closed a biorefinery, EBB said.

"While Chinese imports are not the only reason for these decisions, the biodiesel dumping has contributed to the difficulties producers face," it said.

It says Chinese companies exported 1.8 million tonnes of biodiesel to the European Union in 2023, 90% of all Chinese biodiesel exports.

The European Waste-based and Advanced Biofuels Association said it welcomed the measures, adding it believed they would prompt a normalisation of market conditions from an "extremely adverse" situation since late 2022.

(Reporting by Philip Blenkinsop and Tassilo Hummel; Editing by Susan Fenton)