Sugarcane association defends ethanol tariff on U.S. imports

The president of the Brazilian Sugarcane and Bioenergy Industry Association (Unica), Evandro Gussi, said Brazil should not negotiate a reduction in the ethanol import tariff—a move that would favor U.S. ethanol—in exchange for an increase in the duty-free sugar quota granted by the United States.

“This is not about a sugar quota. If we’re talking about market access, then let’s eliminate the tariff on sugar altogether,” Mr. Gussi said on the sidelines of an event organized by consultancy firm Datagro.

Currently, Brazil imposes an 18% tariff on all ethanol imports, while the U.S. levies an 80% tariff on sugar imports but allows 146,600 tonnes of Brazilian sugar to enter duty-free.

Brazil’s request for an expansion of the U.S. sugar quota was presented by Vice President Geraldo Alckmin to U.S. Secretary of Commerce Howard Lutnick.

Mr. Gussi emphasized that “the government, led by Alckmin and [Minister of Mines and Energy] Alexandre Silveira, has shown an unequivocal commitment to biofuels, as has Congress.”

He also argued that importing U.S. ethanol is unnecessary, pointing out that Brazil’s corn ethanol production—now at 8 billion liters per year—has eliminated the seasonal shortages once caused by fluctuations in sugarcane harvesting. “There is no ethanol shortage in Brazil. We solved the off-season issue with corn ethanol,” he said.

Furthermore, Mr. Gussi noted that U.S. ethanol is not a viable substitute for Brazilian ethanol due to its higher carbon footprint. Currently, the average carbon intensity of U.S. corn-based ethanol is 60 grams of CO₂ equivalent per megajoule of energy produced, while Brazilian sugarcane-based ethanol has a carbon intensity of just 21 grams of CO₂ equivalent per megajoule.

Source: Valor International

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