An energy expert tells Reuters he expects the North American biofuels industry to contract if the uncertainty of tariffs continues to drag on.
Paul Niznik is the Director of Energy at Capstone LLC, he says that while he expects the industry to contract, it will not disappear entirely. He says that tariff unknowns have left little room for prices to catch up, but tariffs are not the industry’s only concerns.
A lack of 45Z tax credit guidance continues to impact the industry.
Brazil’s ethanol industry also faces some tough choices as tariffs loom.
To avoid reciprocal duties from teh U.S., Brazil would have to lower its 18% duty on American ethanol, and while ithis would allow Brazil to keep the U.S. as a key export market, opening itself up to U.S. ethanol would hurt its local industry.
Brazil shipped nearly 300 million liters of ethanol to the U.S. last year.
USDA Under Secretary Richard Fordyce says the department stands ready to provide technical assistance with the Farm Bill if Congress requests it.
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