Brazil Tariff Decision ‘Devastating’ For US Ethanol

Source: By Cindy Zimmerman, AgWired • Posted: Thursday, December 17, 2020

Brazil’s decision to impose a 20 percent tariff on all U.S. ethanol imports is devastating for the U.S. ethanol industry, according to organizations that work to promote ethanol exports.

The leadership of the Renewable Fuels Association, U.S. Grains Council, Growth Energy, and the National Corn Growers Association say the action jeopardizes the future of cooperation and coordination between the U.S and Brazil and “marks a dramatic turn in our bilateral trade relationship.”

“Today, Brazilian ethanol receives unfettered access into the U.S. market, while U.S. producers are denied reciprocal market access due to a restrictive import tariff designed solely to make U.S. product less competitive. This unjust imbalance must be addressed. We urge the incoming Biden Administration to respond with strength, leveraging various U.S. government tools and authorities to make it clear that protectionist barriers are unacceptable. However, it seems clear from today’s decision that Brazil is more focused on keeping U.S. ethanol out of Brazil than true two-way trade.”

American Coalition for Ethanol (ACE) CEO Brian Jennings added. “One of the most urgent priorities for USTR nominee Katherine Tai will be to sit down with her Brazilian counterparts to try and negotiate a much better outcome. Sanity must be restored to Brazil’s protectionist policy toward ethanol trade.”

Since May, U.S. exports to Brazil have fallen to less than 4 million gallons. Over the same time period, Brazil has exported nearly 96 million gallons of fuel ethanol to the United States.

RFA President and CEO Geoff Cooper says the tariff will have an immediate impact on U.S. ethanol exports. “Brazil has been our top market in the past few years and if this tariff remains in place we certainly expect that to change,” said Cooper.

PlayRFA CEO Comments on Brazil ethanol tariff (1:26)