Insight Focus
The US has imposed 25% tariffs on Brazilian ethanol imports. This follows an investigation into unfair trade practices, straining Brazil-US cooperation and impacting ethanol and sugar exports. Meanwhile, India maintains a 20% ethanol blend in gasoline without plans to increase it, and Vietnam expects a significant rise in ethanol imports due to its E10 gasoline rollout, with the US as a primary supplier.
New Tariffs for Brazilian Ethanol
The US will begin charging 25% tariffs on imports of certain goods from Brazil following an investigation alleging that the country engaged in unfair trade practices. The year-long inquiry “found a number of Brazil’s practices to be unreasonable and discriminatory, restricting the competitive position of American farmers, workers, innovators, and exporters,” the Office of the US Trade Representative Jamieson Greer said in a post on July 22.
Ethanol would be subject to the new tariffs. The tariffs went into effect on July 22. “The tariff action is necessary to address these unfair trade practices to ensure US workers and companies can compete on a level playing field,” Greer said in a statement. “Extensive negotiations with Brazil over the past year have not resolved these issues, but we remain open to continuing negotiations with Brazil to bring about long-needed changes to the problems identified in this investigation.”
The US administration put a 40% tariff on many Brazilian exports last year. But President Donald Trump walked some of the tariffs back in an executive order in November after meeting with Brazil’s president, Luiz Inácio (Lula) da Silva. Then in February, the Supreme Court ruled that Trump’s use of an emergency law to impose those tariffs was unlawful, forcing him to remove the remaining tariffs on Brazil and other countries.
Brazil-US Cooperation Strained
Brazil’s ethanol and sugar producers were upset at the imposition of new 25% tariffs on Brazilian goods, lamenting a rollback in cooperation between the two countries. According to the Union of the Sugarcane and Bioenergy Industry (UNICA), the US accounted for 253 million litres of ethanol exports in 2025, worth USD 163 million, making the North American country the sector’s second-most important foreign market after South Korea.
Source: UN Comtrade
In the same year, the US also accounted for 420,000 tonnes of sugar exports from Brazil, the world’s top sugar producer, representing a significant drop from the 1.12 million tons Brazil exported to the North American country in 2024. “The decision disregards significant asymmetries in the trade relationship between the two countries,” UNICA said in a statement. “Brazilian sugar exports remain subject to tariffs and market access restrictions imposed by the US, whereas Brazil maintains a non-discriminatory policy regarding ethanol.”
Brazilian news sources reported that the additional 25% US tariff on Brazilian ethanol is expected to hurt some exporters without significantly affecting Brazil’s broader economy, as the US market represents a relatively small share of the country’s overseas sales. The US received less than 16% of Brazil’s ethanol export volume in 2025, according to industry data cited by Agência Brasil. Economists interviewed by the news agency said the measure carries a strong political component and is unlikely to cause widespread disruption across Brazil’s biofuel industry.
Meanwhile in India
India has no plans to raise the ethanol content in gasoline beyond the current 20%, junior oil minister Suresh Gopi said recently, amid fears of further increases and criticism that the blend reduces efficiency and vehicle performance. E20 became the only fuel sold at India’s 90,000 petrol pumps at the end of last year, causing uproar among motorists in the world’s third-largest car market.
Any decision to increase the ethanol share in gasoline will be taken only after “detailed scientific and technical studies” and consultations with stakeholders, including automakers, fuel retailers and feedstock suppliers, Gopi said in written answers to parliament. Gopi said there was no plan to revert to E10 or pure gasoline, and the government wanted to move forward with a “superior fuel”.
And in Vietnam
Vietnam’s fuel ethanol imports are expected to increase more than forty-fold to 490 million litres this year following its nationwide rollout of E10 gasoline on June 1, according to a recent USDA Global Agricultural Information Network report.
RON92 gasoline can still be sold as E5 in Vietnam through 2030, while all higher-grade gasoline must contain 10% ethanol under the country’s Ministry of Industry and Trade (MOIT) Circular 50, which was issued in November 2025. Fuel ethanol consumption was estimated at 80 million litres in 2025 before the expanded blending requirements took effect, with the US being Vietnam’s primary supplier of ethanol.
