From the office of the United States Trade Representative Robert Lighthizer:
?Brazil and the United States have held consultations regarding their bilateral trade on ethanol. As a result, they have decided to conduct results-oriented discussions on an arrangement to improve market access for ethanol and sugar in Brazil and the United States. They will also consider an increase in market access for corn in both countries. The two countries will also discuss ways to ensure there is fair market access along with any increase in the consumption of ethanol, as well as to coordinate and ensure that the ethanol industries in both countries will be treated fairly and benefit from future regulatory changes on biofuel products in Brazil and the United States. The discussions should aim to achieve reciprocal and proportional outcomes that generate trade and open markets to the benefit of both countries.
?Such discussions will take place over a 90-day period starting on September 14, 2020. During such time, Brazil will maintain a pro-rata tariff-rate quota (TRQ) for ethanol proportional to the total annual volume of the TRQ that was in force on August 30, 2020.
?Brazil and the United States agreed to proceed in this manner in the spirit of the economic partnership created under the leadership of Presidents Trump and Bolsonaro, acknowledging the need to continue to constructively address the effects of the crises generated by the COVID-19 pandemic on their bilateral trade and domestic production.?
After expiring on August 31 and a 20 percent tariff was temporarily applied to all U.S. ethanol, Brazil?s tariff-rate quota (TRQ) has been extended for a further 90 days starting on Sept. 14. The following is a joint statement from Geoff Cooper, President and CEO of the Renewable Fuels Association; Ryan LeGrand, President and CEO, U.S. Grains Council; Emily Skor, CEO, Growth Energy; and Jon Doggett, CEO of the National Corn Growers Association:
?The Renewable Fuels Association, U.S. Grains Council, Growth Energy, and the National Corn Growers Association believe the 90-day extension of the TRQ serves neither Brazil?s consumers nor the Brazilian government?s own decarbonization goals, especially while Brazil?s ethanol producers continue to be afforded virtually tariff-free access to the U.S. market. The extension falls during Brazil?s annual inter-harvest period when U.S. ethanol exports to Brazil are traditionally low, causing greater uncertainty for U.S. exporters looking to make selling decisions now for the traditionally higher Brazilian demand in the winter months. While the Brazilian ethanol market has not been fully reopened to imports, we appreciate the continued support and efforts of the U.S. government as we use this 90-day period to aggressively pursue an open and mutually beneficial ethanol trading relationship with Brazil.
?The U.S. ethanol industry actively sought, through repeated dialogue with local industry and government, to illustrate the negative impacts of tariffs on Brazilian consumers and the Brazilian government?s own decarbonization goals. However, it seems Brazil?s government has left its own consumers to pay the price through higher fuel costs once again. While we would have preferred Brazil abandon its ethanol import tariffs entirely and resume its free trade posture on ethanol, which it held for several years before the TRQ, we view its decision to temporarily extend the TRQ on ethanol at the current level as an opportunity to continue discussions toward that end.
?The U.S. ethanol industry remains focused on expanding the global use of low-carbon ethanol, reducing barriers to trade and elevating its prominence in energy discussions. We remain eager to collaborate and cooperate with other nations that share in the vision of a free and open global ethanol market.?
