After a new round of technical meetings with representatives from the Office of the United States Trade Representative (USTR), the Minister of Development, Industry, Trade and Services (MDIC), Márcio Elias Rosa, reiterated on Tuesday (7) that ethanol should remain outside the scope of trade negotiations between the two countries. According to Márcio Elias Rosa, discussing only the biofuel tariff ignores the relationship between the ethanol and sugar production chains, as well as the impacts on the national industry, says a note from "Agência Brasil". "The government has been advocating that ethanol not be addressed in this discussion. It is a shame that other people think differently so that American ethanol can easily enter the Brazilian market," he stated. He also highlighted that the sector is strategic, especially for the Northeast, and recalled that Brazilian sugar faces strong barriers to entering the American market. "Our sugar has a surcharge in the United States of almost 100%. It is impossible to dissociate the two chains," he said. Given the tight deadline for an agreement, the minister stated that the government will concentrate its efforts on the points where there is a possibility of progress. "The deadline is short. We have to focus on what can yield positive results," he stated.
Sector supports
During the public hearing promoted by the USTR, representatives from the Brazilian Sugarcane and Bioenergy Industry Union, the National Corn Ethanol Union, and the Brazilian Confederation of Agriculture and Livestock reinforced the position defended by the Brazilian government. These entities argued that the decline in imports of American ethanol is not solely due to tariffs, but primarily to the expansion of domestic corn ethanol production, which has reduced the need for external purchases. In the sector's assessment, Brazil and the United States, the two largest ethanol producers in the world, should prioritize expanding the international biofuel market instead of escalating bilateral trade disputes.
What is Section 301?
The negotiations are taking place in parallel with the investigation opened by the USTR based on Section 301 of the United States Trade Act. This instrument allows the American government to investigate trade practices of other countries considered unfair or harmful to US companies. At the end of the process, Washington can apply measures such as surcharges on imported products or other trade restrictions. In the Brazilian case, the investigation questions policies related to digital commerce, intellectual property, government procurement, and other issues. Before the final decision, the American government conducts a public consultation with interested companies and entities.
This text was translated by machine from Brazilian Portuguese.