Senators to Lighthizer: Engage Brazil on Unfair Ethanol Tariff

WASHINGTON, D.C. – U.S. Senator Joni Ernst (R-Iowa) joined Sens. Chuck Grassley (R-IA.), Deb Fischer (R-Neb.), Joe Donnelly (D-Ind.), Tammy Duckworth (D-Ill.), Al Franken (D-Minn.), Amy Klobuchar (D-Minn.), Debbie Stabenow (D-Mich.), Ben Sasse (R-Neb.) and Dick Durbin (D-Ill.), urging U.S. Trade Representative Robert Lighthizer to work with the Brazilian government to end a recently reinstated 20 percent tariff on ethanol imports in excess of 600 million liters (158 million gallons) annually. In 2016, the United States exported 264 million gallons of ethanol to Brazil, and current trends indicate 2017 could be even larger for U.S. producers. The United States is the primary exporter of ethanol into Brazil. U.S. producers called Brazil’s tariff plan “a trade barrier that threatens over $750 million in U.S. exports and American jobs.”

“The U.S. renewable fuels industry has invested heavily in ethanol plants, feedstock development and infrastructure over the last several decades to advance the industry,” the senators wrote. “Similar investments have been made in many other countries including Brazil. Unfortunately, seemingly arbitrary or protectionist tariffs are threatening to disrupt the growing global market that has developed for ethanol. We look forward to working with you to address the concerns regarding Brazil’s actions.”

The full text of the letter can be found below or by clicking here.

September 15, 2017

Ambassador Robert Lighthizer

United States Trade Representative

600 17th Street NW

Washington, DC 20508

Dear Ambassador Lighthizer:

As you know, the Brazilian government recently announced it will impose a Tariff Rate Quota (TRQ) on ethanol imports. The reinstatement of this 20% tariff, which is imposed on imports in excess of 600 million liters (158 million gallons) during a one year period, raises great concern. We are writing to ask that you directly engage the Brazilian government and quickly work to resolve this issue.

For several years, the U.S. and Brazil have engaged in ethanol trade which signaled the maturing and global nature of the biofuels industry. However, this new action by Brazil’s Chamber of Foreign Trade indicates a potential turning point in how ethanol moves between our respective countries. 

The U.S. renewable fuels industry has invested heavily in ethanol plants, feedstock development and infrastructure over the last several decades to advance the industry. Similar investments have been made in many other countries including Brazil. Unfortunately, seemingly arbitrary or protectionist tariffs are threatening to disrupt the growing global market that has developed for ethanol. We look forward to working with you to address the concerns regarding Brazil’s actions.

Sincerely,

Sen. Chuck Grassley

Sen. Joni Ernst

Sen. Deb Fischer

Sen. Joe Donnelly

Sen. Tammy Duckworth

Sen. Al Franken

Sen. Amy Klobuchar

Sen. Debbie Stabenow

Sen. Ben Sasse

Sen. Dick Durbin