When U.S. President Joe Biden meets newly elected Brazilian President Luiz Inácio Lula da Silva, known commonly as Lula, Friday afternoon in the White House, several Republican and Democratic U.S. senators are hoping ethanol trade will be on the agenda.
The 10 senators are asking Biden to press for Lula to end Brazil’s tariffs on U.S. ethanol just days after the country reinstated it.
“The U.S. exports about 9 to 10 percent of its ethanol production across the globe, totaling 1.4 billion gallons per year,” the senators said in a letter to Biden dated Thursday, Feb. 9. “Brazil is one of America’s largest ethanol trading partners and a tariff of 16 or 18 percent on ethanol is unnecessary and counterproductive," given that the United States provides duty-free access to Brazil.
Brazil, in an effort to cut rising domestic prices, suspended its 18% tariff on U.S. ethanol imports in March last year. The suspension was planned to stay in place through the remainder of 2022, but it was not reimposed by the country’s Ministry of Economy until last week.
The newly reinstated Brazilian tariff is set lower at 16%, but that is scheduled to go back up to 18%, according to the Renewable Fuels Association.
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Sens. Chuck Grassley, R-Iowa, Amy Klobuchar, D-Minn., Joni Ernst, R-Iowa, Tammy Duckworth, D-Ill., John Thune, R-S.D., Sherrod Brown, D-Ohio, Mike Rounds, R-S.D., Pete Ricketts, R-Neb., Deb Fischer, R-Neb., and Roger Marshall, R-Kan., all signed the letter asking Biden to personally address the tariff imbalance between the two countries.
“We hope the Biden administration will work with President Lula da Silva and his administration to restore an open market and reciprocal ethanol trade between our nations,” RFA President and CEO Geoff Cooper said in a statement Friday. “As the world’s leaders in the production and use of low-carbon ethanol, we must set an example of free trade and open markets for other nations to follow.”
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