According to the Economy Ministry, Brazil has not renewed the 750 million liter quota for ethanol imports at zero tariffs. As a result, since last Monday, August 31, purchases from outside Mercosur have a 20% tax applicable to them. According to a note from the ministry, the ordinance that established the quota expired on August 30. But, according to a government source, a decision was made on the 31st not to renew this. The non-renewal of the annual quota is a request from the powerful agricultural lobby in Brazil. Despite this, there is nothing to prevent the government from adopting any new measure to reduce tariff barriers to ethanol and stop harming the United States, the major exporter of the product to Brazil, according to a government source. According to the source, with the end of the quota, Brazil should now seek a commercial negotiation with the Trump administration, to avoid possible American retaliation.
Source: Reuters