Ethanol Blog

LINCOLN, Neb. (DTN) -- The Trump administration launched a trade investigation of Brazil including duties placed on ethanol imported from the U.S., the U.S. Trade Representative announced on Wednesday.

In June 2024 a key trade agency the Brazilian government reviewed and upheld a proposal to increase the tariff on U.S. ethanol from 16% to 18%.

This action came even after U.S. ethanol groups joined efforts by the Brazil Association of Fuel Importers to advocate for the permanent removal of the tariff. The tariff was reinstated on Feb. 1, 2023.

USTR said in a news release it launched an investigation under Section 301 of the Trade Act of 1974.

"The investigation will seek to determine whether acts, policies and practices of the government of Brazil related to digital trade and electronic payment services; unfair, preferential tariffs; anti-corruption interference; intellectual property protection; ethanol market access; and illegal deforestation are unreasonable or discriminatory and burden or restrict U.S. commerce," the USTR said.

USTR is required to consult with the Brazilian government and has scheduled a hearing in connection with the investigation on Sept. 3, 2025. Written comments and requests to appear at the hearing, along with a summary of the testimony, are required to be submitted by Aug. 18, 2025.

"We applaud the Trump administration for this important action," RFA President and CEO Geoff Cooper said in a statement.

"For almost a decade now, we have spent precious time and resources fighting back against an unfair and unjustified tariff regime imposed by Brazil's government on U.S. ethanol imports. What's more ironic is that these tariff barriers have been erected against U.S. ethanol imports while our country has openly accepted -- and even encouraged and incentivized -- ethanol imports from Brazil."

The USTR's investigation is focusing on several fronts including digital trade and electronic payment services; "unfair, preferential" tariffs;

anti-corruption enforcement; intellectual property protection; and "illegal" deforestation that the USTR said is "undermining the competitiveness of U.S. producers" of timber and agricultural products.

In October 2023, Brazilian fuel importers formally requested a reduction in ethanol duties because the tariff reportedly raised fuel costs for domestic consumers.

In anticipation of an open comment period held by the Brazilian government, the three groups submitted joint comments:

"Considering this significant discrepancy in our historically productive commercial relationship between countries, we would like to stress that the U.S. industry will continue to advocate for restrictive measures to entry for Brazilian ethanol into the U.S. in the case that the Brazilian government does not rethink the current tariff policies," the groups said.

"Despite the promising opportunities emerging new ethanol export markets could bring to both countries, we stress that we are not willing to cooperate with Brazil in any possible partnerships, nor with technology transferring or within new uses for ethanol such as SAF (sustainable aviation fuel), in case the market is not completely open for free trade for ethanol. We strongly consider the permanent reinstatement of the duty-free access for ethanol as a window of opportunity to strengthen the bilateral agenda and stimulate trade cooperation between Brazil and the United States."

Todd Neeley can be reached at todd.neeley@dtn.com

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