Floods Create Opening For Brazilian Ethanol
Wall Street Journal:
Floods in the Midwest are making coast-bound shipments of American corn ethanol nearly impossible, creating an opportunity for ethanol from Brazil.
Demand might really jump if a 54-cents-per-gallon import tariff on Brazilian sugarcane ethanol is removed, which may spark another wave of investment in the South American nation. Two U.S. senators proposed such legislation this month as a way to lower ethanol prices in many parts of the country.
“I would say that without any tariff, we would export around two billion liters (527.7 million gallons) more this year and with a lower tariff, around one billion,” said Antonio Padua Rodrigues, technical manager at Brazil’s Union of Sugarcane Industries, or Unica.
Brazil expects to export around 4.8 billion liters of ethanol this year, according to industry consultants at Datagro in São Paulo, up from 3.5 billion exported last year. Most of the fuel is sent to the U.S., either directly to U.S. ports, or indirectly through the Caribbean, which enjoys duty-free access to the U.S.
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