Brazil Announces Measures Against Imported U.S. Corn-Based Ethanol

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – The Brazilian government announced on Monday that it will adopt measures to protect Brazilian sugarcane-based ethanol producers from imported biofuel. The measures include limiting the import of corn-based ethanol from the United States.

According to the Minister of Mines and Energy, Fernando Coelho Filho, the limit to be imposed on corn-based ethanol will protect the domestic industry.

“It is not barring, but creating some limitations for the importation of ethanol, mainly from corn. We should create some mechanisms so that we can protect our sugarcane-based ethanol from corn-based ethanol from the United States,” said the official during the Brasil Futuro conference.

For Coelho Filho the introduction of import taxation now, as some Brazilian ethanol industry representatives demand, is counterproductive, since it would possibly spark retaliation and make ethanol (domestic and imported) more expensive in the long run.

According to the resolution by the National Council of Energy Policy published on Monday’s Union Registry importers of biofuels will now need to meet the same requirements of the domestic producers, including the maintenance of a minimum level of stocks and proof of its ability to service the market.

“The importer of biofuels must be required to maintain a portion of the volume imported in own stock, with each import, observing the same proportions of volumes and periods established for producers,” says the statement from the council explaining the resolution.

According to Coelho Filho, the ethanol industry has suffered significantly in recent years and the government is working towards helping help producers. “If the energy and electricity suffered (with economic crisis), the ethanol industry suffered a lot more,” he noted.

For the minister the latest measures will also help Brazil meet the commitments it made during the Paris Climate Conference in 2015.

“We are laying the groundwork for a program for the future. In the Paris Agreement we committed ourselves to producing 50 billion liters of ethanol by 2030. Our production last year was 27 [billion liters],” he concluded.