After U.S. eliminated ethanol import tariffs, Brazil state erected barriers to U.S. product
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Brazilian President Dilma Rousseff, set to visit the White House April 9, will hear about US concerns of a new Brazilian barrier to U.S. ethanol exports.
Meanwhile, the U.S. and Brazil this week will hold the first meeting of the US-Brazil Commission on Economic and Trade Relations, established during President Obama's visit last year to Brazil.
Background: The Brazilian barrier is a decree issued by the state of Sao Paulo in January that ended, as of Feb. 29, a waiver for a 25% value-added tax on imported ethanol. The decree extended the waiver for domestic (Brazilian) ethanol producers.
Of note, virtually all U.S. ethanol exports to Brazil come via the port of Santos, in the state of Sao Paul.
Comments: Recall that last year the US Congress eliminated the 54-cents per gallon import tariff on Brazilian ethanol imports. That move came after years and years of Brazilian pleading that the import tariff was a trade barrier and unnecessary subsidy. Hmmm. Sen. John Thune (R-S.D.) last week asked U.S. Trade Representative Ron Kirk about the Brazilian action and Kirk assured Thune he and the Obama administration would look into the matter and discuss it with the Brazilian president.
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