September 2, 2019 / 1:19 PM / 18 days ago

Brazil to raise ethanol import quota after Trump meeting -report

BRASILIA (Reuters) - Brazil will raise the tariff-free quota for ethanol imports to 750 million liters (198 million gallons) per year, following a meeting between top officials and U.S. President Donald Trump, according to Brazilian newspaper Valor Economico.

The previous tariff-free quota was 600 million liters and expired over the weekend. Imports beyond the quota are subject to a 20% import tariff. Raising the quota is seen mainly benefiting the United States, the world’s largest ethanol producer.

The shift would result in a reduction of 270 million reais ($65.54 million) in tariff collections, Valor reported on Saturday.

Brazil’s Foreign Minister Ernesto Araujo and President Jair Bolsonaro’s son Eduardo met with Trump at the White House on Friday, telling reporters afterward that the conversation ranged from trade to the Amazon rainforest fires but that there was nothing to immediately announce.

Brazil’s Foreign Ministry and Agriculture Ministry did not immediately respond to requests for comment.

Brazil sugar industry group Unica praised the decision as a step toward market openness and an eventual opening of the United States to more Brazilian sugar.

“It was important for Brazil to make a gesture in favor of trade openness with the U.S., with home we’re seeing a broad free trade agreement,” Unica said in a statement.

Reporting by Jake Spring and Luciano Costa; Editing by David Gregorio

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