
Long, strange trip: How U.S. ethanol reaches China tariff-free - howard941
https://www.reuters.com/article/us-usa-trade-ethanol-insight/long-strange-trip-how-u-s-ethanol-reaches-china-tariff-free-idUSKCN1PW0BR
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magicalhippo
Reminds me of what they did to import Spanish cured hams (ala Serrano ham) to
Norway.

Norway has very high import duty on cured ham to protect traditional Norwegian
cured ham production, which we have a fair bit of. Now, duties you have to pay
when importing foreign goods into a country. However, at least in Norway,
there is an exception for processing goods abroad. In that case you only pay
duties on the actual work done abroad.

So, some clever folks started to transport the slaughtered, whole, pigs to
Norway from Spain and import them into Norway. They were just plain (dead)
pigs, and so the duty was rather low. Arriving at the destination just across
the border, the truck was then told to turn around and go back to Spain. The
pigs would then get cured in Spain, and then transported back to Norway.

Since the pigs used for the cured ham had already been imported into Norway
the hams had thus been processed abroad, invoking the exception. Thus they
only had to pay for the work done curing the ham, which was quite a lot
cheaper given labor costs in Spain, as well as avoiding the higher duties.

I was told there were quite a few surprised truck drivers, being told to go
right back with the same load after just having arrived in Norway. Not sure if
customs cracked down on this or if they're still doing it. Not exactly good
for the environment...

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archgoon
This appears to be "What Colour are your bits?": Ethanol Edition.

The original "What Colour are your bits?" essay.

[https://ansuz.sooke.bc.ca/entry/23](https://ansuz.sooke.bc.ca/entry/23)

~~~
whatshisface
The fact that bitcoin involves proof-of work is a testament that the origin of
bit sequences can actually be a coherent notion in computer science.

>"But when it comes to child pornography, I think maybe Colour should make a
difference - if we're going to ban it at all, it should matter where it came
from. Whether any children were actually involved, _who did or didn 't give
consent_"

It's a digression, but I have to say: what is it with how people with unique
ideas about copyright keep coming up with, uhh, "unique" ideas about CP?

~~~
gdhbcc
Because on a fundamental level bits are bits are bits, regardless of who made
them or through what purpose.

~~~
whatshisface
Ownership isn't a physical property of atoms either, but we don't have any
trouble handling that.

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jws
_Malaysia has no track record of significant domestic ethanol production, so
it is unclear where the ethanol blended with the U.S. product originates._

I wonder if they sell the tanker of blended ethanol to the Chinese buyer,
offload 60% of it, then buy back the remaining 40% of the load which is now
clearly Chinese ethanol and head out to top off again.

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entity345
"Although China slapped retaliatory tariffs up to 70 percent on U.S. ethanol
shipments, the fuel can still legally enter China tariff-free if it arrives
blended with at least 40 percent Asian-produced fuel"

Right, so the American producers can still sell tariff-free to China provided
that they sell 40% less volume with increased costs. Nice loophole...

~~~
maxander
Where does it say they sell 40% less volume? Under this scheme, the amount of
US ethanol that can get in tariff-free is limited to two-thirds of the total
Asian ethanol production. Does the US export that much anyway?

~~~
entity345
Well it says that it must be mixed with 40% of Asian ethanol.

Let's say you're an American company and you have a contract to supply 1
million litres to a Chinese customer. If you want to avoid tariffs you now
have to use only 600,000 litres of American ethanol where you would have used
1 million before.

It may not end up that much a drop in the end, but it clearly encourages to
use less American ethanol.

~~~
ngcc_hk
Read between the line or shipping, “less formal or declared American ethanol”

