WASHINGTON, DC, US — Brazil’s decision to enact a 20% tariff on all imports of US ethanol is devastating to US ethanol, industry associations said.

Brazil is letting the current tariff rate quota (TRQ) expire and replacing it with the tariff on all imports.

“Brazil’s decision to impose a 20% tariff on all US ethanol imports is devastating for the US ethanol industry, the future of cooperation and coordination between our nations,” said the US Grains Council, Growth Energy, the Renewable Fuels Association and the National Corn Growers Association. “Not only does this decision risk destroying the great progress our two nations have made as global leaders in ethanol production, it marks a dramatic turn in our bilateral trade relationship. 

“Today, Brazilian ethanol receives unfettered access into the US market, while US producers are denied reciprocal market access due to a restrictive import tariff designed solely to make US product less competitive. This unjust imbalance must be addressed. We urge the incoming Biden administration to respond with strength, leveraging various US 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 US ethanol out of Brazil than true two-way trade.”

The US ethanol industry said it actively illustrated the negative impacts of increased tariffs on Brazilian consumers and the government’s decarbonization goals.

“However, it seems Brazil is more focused on taxing imports to protect their national industry than reducing carbon emissions and developing a global industry,” the US ethanol groups said.

Since May, US 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. A 20% tariff will only further imbalance trade between the two countries, the groups said.