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Growth Energy Applauds U.S. House Letter to USTR on Brazil’s Ethanol Tariff Barriers

WASHINGTON, D.C. – This week, 21 members of the U.S. House of Representatives, led by Rep. Darin LaHood (R-Ill.), sent a letter to U.S. Trade Representative Katherine Tai urging her to protect U.S. farmers and biofuel producers and prioritize U.S. ethanol export competitiveness in the Brazilian market by addressing current unfair trade practices.

“We believe the double layer issue of a tariff imbalance and an impenetrable RenovaBio is unjustified and puts American ethanol and farmers at risk,” wrote the coalition. “We strongly urge you to prioritize American ethanol export competitiveness in the Brazilian market by addressing these unfair policies. Further, if Brazil continues with its unfair treatment of American ethanol, we stand ready to work with you to consider measure that protect U.S. farmers and biofuels producers and counter these unfair trade practices.”

Growth Energy CEO Emily Skor thanked the bipartisan group of members for calling attention to the current trade imbalance ethanol producers face in Brazil.

“We’re grateful to Rep. LaHood and all cosigners of the letter to Ambassador Tai for raising the concerning dual challenges that American ethanol producers face in Brazil while Brazilian ethanol exports receive duty-free treatment here in the U.S. Growth in the international export market is essential to the strength of American ethanol and our nation’s ag economy. We look forward to working with these Members and Ambassador Tai to ensure a level trade playing field.”

The full letter is available here.

Background

On February 1, 2023, the Brazilian Foreign Trade Chamber (Camex) reinstated an import tariff on American ethanol shipped to Brazil. The new tariff rate on ethanol is 16 percent this year and 18 percent in 2024. Before this announcement, American exports of ethanol to Brazil had received duty-free treatment since March 2022.

Additionally, there are non-tariff barriers that further complicate our bilateral ethanol trade with Brazil. Brazilian ethanol producers have access to our Renewable Fuels Standard and California’s Low Carbon Fuel Standard program, which recognize the inherent value of low-carbon biofuels. This treatment is not reciprocated by Brazil, where U.S. ethanol producers, after two years, have yet to be approved for Brazil’s biofuel program, RenovaBio.

Brazilian ethanol exports receive duty-free treatment in the U.S. market.

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