The Brazilian government has upheld its 18% tariff on American ethanol to the dismay of U.S. industry groups.
The Biden administration had joined the U.S. industry in appealing to Brazil during a public consultation period to remove the duty, but the Foreign Trade Chamber at Brazil’s Ministry of the Economy on June 13 upheld the tariff.
“We remain extremely disappointed with this result and urge CAMEX and the Brazilian government to remove tariff barriers on U.S. ethanol and use this as an opportunity to strengthen the bilateral agenda and stimulate trade cooperation between Brazil and the United States,” the U.S. Grains Council, Growth Energy and the Renewable Fuels Association said in a joint statement Tuesday.
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“This tariff has placed a heavy financial burden on Brazilian consumers in a misdirected effort to protect the domestic Brazilian ethanol industry, which enjoys free and increasing access to the U.S. market.”
Sales of U.S. ethanol to Brazil were virtually duty-free between 2011 and 2017, but between 2017 and January 2022, Brazil imposed a tariff-rate quota and later a 20% Mercosur common external tariff on ethanol imports. The tariff was suspended in March 2022 but reimposed last January at 16%. It currently stands at 18%.
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