Brazil May Challenge Ethanol Tariff
Brazil is considering a World Trade Organization challenge over the United States ethanol import tariff.
Brazil’s Foreign Minister Celso Amorim told reporters in Rio de Janeiro on Tuesday that they have “a very strong case and there is a good chance” that they will challenge the 54 cent per gallon tariff on Brazilian ethanol.
The tariff was extended through 2010 and is designed to keep foreign ethanol producers from taking advantage of the blenders tax credit that was recently cut from 51 cents to 45 cents per gallon under the 2008 Farm Bill. All ethanol blended with gasoline in the U.S. qualifies for the VEETC or blenders’ credit, no matter where the ethanol comes from. Under the Caribbean Basin Initiative, ethanol from certain nations may be imported tariff free.