BRAZIL TO EXPORT 80,000 TONS OF SUGAR TO USA WITHIN QUOTA BY OCTOBER

According to the United States Trade Representative (USTR), Brazil will provide most of the additional American sugar import quota for the current harvest (2019/20), the validity of which has been extended until October. Of the 90,700 tons of raw sugar added to the current harvest quota, 80,000 tons will be from Brazil. The remaining 10,700 tons will be exported by Australia.

The decision in favor of Brazil comes shortly after the Brazilian government suspended tariffs for 90 days on 187.5 million liters of ethanol, a measure that benefited the United States. With that, the Brazilian sugar quota for the United States United increased from 230,000 to 310,000 tons, and, by law, should benefit producers in the northeast region of Brazil.

For Brazil, however, the additional volume of the sugar quota represents a very small share of exports of the commodity, which in August alone totaled 3.7 million tons. At current average prices, revenue for Brazilian exporters from these shipments represents an additional US$ 23 million.

This was the second time during this harvest that the USA increased the volume of sugar imports within the mandatory quota, agreed during the Uruguay Round of the World Trade Organization (WTO), amid an adjusted global supply.

See the chart below for the history of Brazilian sugar exports to the USA:

Brazilian Sugar Exports (HS 1701) to the USA | Jan 2017 to July 2020 | WTMT

Graph source: DataLiner (To request a DataLiner demo click here)

Report source: Valor Econômico

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