Brazil expected to ask WTO to investigate US ethanol subsidies

Brazil is expected to ask the World Trade Organization to investigate U.S. ethanol subsidies. If the WTO takes on the case, it will be the first time the organization has ruled on energy subsidies. The US regards ethanol support as an industrial subsidy, which is permissible under WTO rules.

The convergence of energy and agriculture in the biofuels industry is expected to pose thorny questions for the WTO if it takes on the case. While neither sector has enjoyed free trade conditions, the subsidy mechanism which has supported national agriculture interests has attracted negative attention far more than the cartel approach employed in the oil industry.

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