Brasilia/Sao Paulo: Brazil’s Energy and Mining Minister Alexandre Silveira criticised a potential U.S. tariff on Brazilian ethanol on Thursday, calling it unreasonable. He emphasised that historically, Brazil and the United States have negotiated ethanol and sugar trade together, reports Investing.com.
His comments follow U.S. President Donald Trump’s move to increase tariffs, ending decades of low rates. A White House statement justified the plan by pointing to Brazil’s ethanol tariffs as an example of unfair trade.
“The U.S. tariff on ethanol is just 2.5%, while Brazil charges an 18% tariff on U.S. ethanol exports. In 2024, the U.S. imported over $200 million in ethanol from Brazil but exported only $52 million to Brazil,” the White House document stated.
Silveira argued that for Trump’s plan to be fair, as he claims, the U.S. should eliminate tariffs on Brazilian sugar.
“President Trump’s decision is unfair since it does not consider allowing more Brazilian sugar exports to the U.S.,” Silveira said in a statement.
Although Trump’s announcement does not have an immediate effect, it could lead to higher tariffs for major trading partners by early April, triggering negotiations to lower trade barriers.
Brazilian Finance Minister Fernando Haddad said on Thursday that he sees an opportunity for tariff negotiations with the U.S.
Brazil, one of the world’s largest sugar producers, produced around 35 billion litres of ethanol in 2024 but exported less than 6% of it, with only about 300 million litres going to the U.S., according to a BTG Pactual report. Meanwhile, Brazil imported 192 million litres of ethanol in 2024, 109 million of which came from the U.S. Most U.S. ethanol is made from corn, while Brazil primarily produces sugarcane-based ethanol.
Silveira pointed out that the U.S. imposes a $360-per-tonne tariff on sugar imports outside preferential quotas, which translates to an 81.2% tax based on current prices—far higher than Brazil’s 18% ethanol tariff.
He also noted that the U.S. set a sugar import quota for Brazil at 147,540 tonnes last harvest, representing only 0.4% of Brazil’s total sugar exports.
“For years, Brazil has only been able to export small quotas of sugar to the U.S. due to high tariffs,” said Evandro Gussi, head of Brazil’s sugar and ethanol lobby group Unica.
On the other hand, the U.S. Renewable Fuels Association, an ethanol trade group, welcomed Trump’s move. In a statement, the group thanked him “for his commitment to re-establishing a fair and reciprocal ethanol trading relationship with Brazil.”
For detailed information and further insights, please refer to BioEnergyTimes.com, which provides the latest news about the Ethanol Industry
