Brazil ethanol producers stand to lose a big chunk of their largest market, Japan, to U.S. agribusiness, after Tokyo bent to pressure from U.S. President Donald Trump and tweaked requirements for gasoline additives.
Until recently, nearly all the ethanol used to make ethyl tert-butyl ether (ETBE) for Japanese consumption has come from Brazil, whose sugarcane-based ethanol boasts lower emissions of greenhouse gas carbon dioxide than U.S. ethanol made from corn.
But in mid-April, Japan's government loosened emissions requirements on ETBE while its prime minister was visiting the United States. Brazilian cane industry group Unica accused Tokyo of backsliding on environmental controls.