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Rangel Introduces Bill to Extend Ethanol Duty, Benefitting U.S. Producers and Refiners in the Caribbean and Central America

Press Release

Date: Dec. 5, 2011
Location: Washington, DC
Issues: Oil and Gas Trade

Congressman Charles Rangel on December 2, 2011, introduced legislation to extend "other duty or charge" (ODC), a key component of the Caribbean Basin Economic Recovery Act (CBERA), that provides duty-free treatment to ethanol imports from the Caribbean and will expire at the end of this year. Rangel's bill will extend the duty for three years, until December 31, 2014.

"My legislation would preserve duty-free ethanol for the U.S. as well as ensuring that the gains achieved for the Caribbean remain intact," stated Rangel. "Extending the ODC for three years will help maintain U.S. investments in the Caribbean, which benefits our long-term trade relationships in the region."

As a result of the ODC, Caribbean and Central American countries have developed a vibrant refining industry, with over $300 million in investment and the capacity to produce approximately 700 million gallons of ethanol annually for the U.S. market. Permitting the ODC to expire will restore the ethanol duty to a $0.54 per gallon, impact Carribbean ethanol industry and greatly benefit Brazil -- a major agricultural trade competitor of the United States and the only other major sugar cane ethanol producing country.

"It is critical for U.S. businesses and consumers to help our partners in the Caribbean Basin Initiative retain a vibrant ethanol refining industry," added Rangel "Allowing a single country to have an advantage over this critical energy source could devastate businesses in the region and drive up energy costs. It would also create market instability at a time when our country continues to steer a stable economic recovery."

The Caribbean currently has the capacity to supply virtually the entire foreseeable U.S. demand for sugar based ethanol duty-free under the CBERA for the next several years.

"I urge Congress to pass this extension and continue the pace of good news for businesses and consumers heading into the New Year."


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