Fávaro rules out linking U.S. ethanol imports to talks over tariff dispute

Brazil’s Minister of Agriculture, Carlos Fávaro, said on Tuesday (Nov 4) that linking the possible removal of U.S. tariffs on Brazilian exports to concessions for American ethanol imports is “pure speculation.”

When asked whether the government might lower Brazil’s 18% import tax on U.S. ethanol as part of trade negotiations, Fávaro said the issue is not central to the talks.

“I think this talk [about a Brazilian concession on ethanol] is premature. What I have as concrete information is the president’s statement today — that if by the end of COP the United States has not set a date for negotiations, he will personally call President Donald Trump to define it,” Fávaro told reporters after an event in Brasília.

“Beyond that, it’s pure speculation. After all, if the president himself said the meeting hasn’t even been scheduled, who’s to say ethanol is a key issue for the United States? It’s not the time for that kind of comment,” he added.

Guilherme Nolasco, CEO of the National Union of Corn Ethanol (Unem), also said ethanol is not part of the trade discussions. “We must trust a government that has done more for biofuels over the past decade — restoring competitiveness by reintroducing import tariffs and approving laws such as Combustível do Futuro, PATEN, and Move. These are clear examples that biofuels are central to Brazil’s energy transition strategy,” Nolasco told Valor Econômico.

Despite Fávaro’s denials, government sources say the topic will likely be raised in negotiations. The U.S. has repeatedly pushed for greater access to Brazil’s ethanol market, which is currently taxed at 18%.

Amid criticism from domestic producers, Brazilian negotiators are considering offering better conditions for U.S. ethanol in exchange for progress on removing the American tariffs. Internal discussions include possible tariff reductions, import quotas — both previously used — or requirements such as designating specific entry ports, which would help mitigate impacts on the country’s Northeast region, the area most affected by ethanol imports.

Source: Globo Rural

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