energy.agwired.com

In comments to the U.S. Trade Representative this week, the Renewable Fuels Association noted that while the Trump administration has worked to enforce a 2019 trade agreement, China has failed to satisfy commitments to increase trade in ethanol and distillers grains. Accordingly, RFA calls on the United States to implement reciprocal duties on U.S. imports of Chinese ag products.

“On behalf of RFA’s membership, and the U.S. ethanol industry as a whole, we are extremely grateful to President Trump and his Administration for its steadfast commitment to fair and reciprocal trade with China,” wrote RFA President and CEO Geoff Cooper. “We applaud USTR for taking a closer look at China’s failure to deliver on its Phase One commitments, which has resulted in a lost market opportunity for U.S. ethanol producers and farmers and caused significant financial losses.”

Cooper noted that China purchased only 58 percent of the total U.S. goods and services exports in 2020 and 2021 that it had committed to buy under the Phase One Agreement signed in 2019. In fact, China ultimately failed to buy any of the additional $200 billion in goods in 2020-21, instead falling $11.6 billion short of even reaching the baseline level of purchases.

RFA pointed out that after the signing of the Phase One Agreement, China purchased only 31.7 million gallons of ethanol from the U.S. in 2020 valued at just under $51 million. The following year, China purchased just over 100 million gallons of ethanol from the U.S. valued at $162 million and since 2021, U.S. ethanol imports by China have essentially fallen to near zero and flatlined. A similar trade pattern occurred with respect to distillers grains.

“Today, as our nation’s farmers and rural communities face serious economic challenges, it is critical that our trading partners live up to their commitments and be held accountable for failing to comply with key terms and provisions negotiated in the process,” Cooper concluded. “Moreover, trading partners must act in good faith as we work to negotiate longer-lasting, more resilient trade agreements. It is critical that China work to restore its commitment to agriculture purchases under the Phase One Agreement or otherwise face reciprocal action for its failure and/or refusal to do so.”

U.S. ethanol exports increased to 188.8 million gallons (mg) in August, 15% above July and 24% ahead of year-ago levels, thanks to record-setting shipments to Canada and the European Union, accounting for nearly two-thirds of total volumes, according to the latest trade update from the Renewable Fuels Association (RFA).

Canada climbed 11% to 74.4 mg, remaining the top outlet and capturing 73% of all denatured fuel ethanol sold, while exports to the European Union skyrocketed 65% to 47.6 mg—almost entirely routed through the Netherlands, the principal destination for undenatured fuel ethanol. Beyond these markets, trade flows shifted sharply: Colombia climbed 43% to 14.1 mg to become the second-largest buyer of denatured product; India rebounded from 0.5 mg to 13.6 mg; the United Kingdom slid 50% to 10.6 mg; the Philippines eased 16% to 8.0 mg; Mexico jumped 35% to 6.7 mg; Jamaica leapt ninefold to 4.4 mg; South Korea held nearly steady at 3.8 mg; and Peru tumbled 56% to 3.7 mg. Brazil was notably absent from the market after taking 9.2 mg in July. Year-to-date U.S. ethanol exports reached 1.42 billion gallons, tracking 16% above the same period in 2024.

At the same time, U.S. exports of dried distillers grains with solubles (DDGS) were up 10% in August to 1.17 million metric tons (mt), marking multi-month highs across major destinations and record shipments to Colombia, Honduras, and New Zealand. Year-to-date DDGS exports totaled 7.64 million mt, trailing last year’s pace by 4%.