Brazil’s sugarcane industry association Unica expects a trebling of sugar and ethanol exports to the EU with the recent changes to the EU-Mercosur agreement.

Back in 2004, the EU proposed reduced tariffs on an annual quota of 600,000 tonnes of ethanol imports from Mercosur members. It was announced recently that an agreement has been reached on different terms, allowing 562 million liters of ethanol for industrial to enter the EU without a tariff every year, and 250 million litres to receive lower tariffs.

Also, the tariff will be zero for 180,000 tonnes of sugar imports per year. 

Unica said these quantities could bring the value of annual exports from Brazil to the EU to BRL 2 billion (USD 521m/EUR 461m), up from BRL 600 million in the past.

At the end of June, the European renewable ethanol association (ePURE) warned that the impact of the last-minute concessions to Mercosur countries would be devastating. These “essentially sacrifice the EU agriculture sector in exchange for gains elsewhere”, the organisation said.

Mercosur now includes Argentina, Brazil, Paraguay, Uruguay and Venezuela.

(BRL 10 = USD 2.61/EUR 2.31)