Global Biofuel Battles Intensify With Brazil Hitting Ethanol Imports with Duties

Brazil's foreign trade chamber Camex finally approved putting an import duty on ethanol imports that surpass 600 million liters (159 million gallons). Camex has repeatedly held off imposing the duties until their session Wednesday in which they approved a 20-percent tax on imports above that 600 million liter mark.The duties will be in place for two years, and will then be reevaluated. The measures enter into force after publication in the official gazette, which is expected in the coming days.Brazil imports the first half of 2017 have totaled 1.29 billion liters, primarily from the U.S., up 330% compared to the same period in 2016. A coalition of U.S. groups responded with dismay at the move since both the U.S. and Brazil had essentially agreed to keep the ethanol market free of trade-related limits. "We are disappointed and discouraged to see the ruling out of Brazil today," the Renewable Fuels Association (RFA), U.S. Grains Council (USGC) and Growth Energy said in a joint statement. "This action goes against Brazil's longstanding view that ethanol tariffs are inappropriate and will effectively close off an open and bilateral trading relationship that benefits all sides."Meanwhile, Brazil's top sugar industry group, Unica, hailed the move – virtually all ethanol produced domestically in Brazil is made from sugar cane. "The decision will give us some short-term relief," said director Eduardo Leao. He argued there is a "structural surplus" of ethanol in the U.S. due to restrictions in traditional export markets for the country, including China and Europe. "Brazil became the destiny of that surplus," he concluded.