Brazil’s Foreign Trade Chamber reinstated the 18 percent import tariff on ethanol, making U.S. imports less price competitive in the country. The recent zero percent import tariff got put in place last year by Brazil’s former president to help fight rising inflation. The current administration let the zero percent tariff expire on February 1.
SP Global says the 18 percent import tax will protect Brazil’s domestic ethanol producers, especially those in the north and northeast regions. Multiple sources say the move reduces competitively-priced ethanol imported from abroad. The Ministry of Agriculture and Livestock said in an official statement that the increased import tax will also have a minimal impact on the end-user in Brazil.
Last year, Brazil imported 312 million liters of ethanol, and the U.S. supplied 65 percent of total ethanol imports. Brazil extended the current exemption for federal taxes on fuel for the first 60 days of 2023.