SAO PAULO (Dow Jones)--Brazil's Sugarcane Industry Association, Unica, will look at options including litigation to fight against protectionist ethanol tariffs following the collapse of world trade talks, Unica's president said late Tuesday.
"We (Unica) will look at three possibilities: litigation, working with like-minded groups in the U.S. to lower tariffs and bilateral talks," Unica President Marcos Jank said in a telephone interview from Geneva. It's unlikely new WTO negotiations will start until the second half of 2009, after the U.S. presidential election, therefore the ethanol industry is considering various other strategies, he said.
Brazil is the world's leading sugarcane-based ethanol producer and exporter. Jank said that Unica expects Brazil to export around 5 billion liters of ethanol this year, which is 20% of its total production. Of the total ethanol exports, some 3 billion liters should go to the U.S., while at least 1.3 billion liters should be destined for Europe, especially Sweden.
"I had hoped to surpass 5 billion liters if the talks were successful, but now I have to forget this hope," Jank said, without providing details. But Unica still sees room for more ethanol exports to the U.S., where high price for corn and gasoline are driving demand. According to Jank, only about 10 countries currently import Brazilian ethanol, whereas some 150 countries import sugar.
Jank flew to Geneva on Friday to follow the final stages of the current trade negotiations in the Doha Development Round. "We want to export more ethanol and it's unfair to see the markets closed," he said.
-By Tony Danby, Dow Jones Newswires; 55-11-6847-4523; brazil@dowjones.com
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