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Brazil delays decision on ethanol import tariff

U.S. groups say tariffs could have "wide-ranging and long-standing impacts" on industries and global fuel supply.

The Executive Management Committee of CAMEX, Brazil’s Chamber of Foreign Trade, announced Wednesday that it would delay a decision on a pending proposal to impose a tariff of up to 17% on Brazil’s imports of U.S. ethanol.

UNICA had proposed a 16% tariff on imported ethanol, while other producer groups have requested a return to the 20% duty that was discontinued in 2010.

The industry welcomed the delay. A joint statement from U.S. Grains Council president and chief executive officer Tom Sleight, Renewable Fuels Assn. president and CEO Bob Dinneen and Growth Energy CEO Emily Skor said they were encouraged to see Brazil’s continued postponement of a decision regarding a pending proposal to impose tariffs on U.S. ethanol imports.

“Our organizations have been tracking this issue for months and have worked heavily in Washington, D.C., and Brasilia (Brazil) to provide all necessary information to the Brazilian government on this issue,” the groups said in their joint statement. “Imposing tariffs on U.S. ethanol imports will hurt Brazilian consumers by driving up their costs at the pump.

“Additionally, this action on U.S. ethanol imports will go against Brazil’s own long-standing view that ethanol tariffs are inappropriate and will harm the development of the global ethanol industry," they added. "We will continue this work and appreciate the thoughtful consideration Brazilian officials are taking on a proposal that could have wide-ranging and long-standing impacts on both our industries and the global fuel supply.”

As of March, U.S. ethanol producers have already shipped a total of 146.4 million gal. to Brazil in the first quarter of 2017, meaning the country has accounted for almost 40% of total year-to-date exports. Brazil was again the top recipient of U.S. ethanol in March and April, bringing in 36.7 million gal. (29% of total market share) in March and 44.5 million gal. (slightly more than half of the total volume) in April.

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