2025 U.S. Ethanol Exports Reach Second Consecutive Record High

Executive Summary

During the past 2 years, U.S. ethanol exports reached new volume and value records, fueled by growing global ethanol import demand and reduced competition from Brazil, the world’s second-largest ethanol exporter. Top ethanol-importing markets like Canada, the European Union (EU), the United Kingdom (UK), India, Colombia, and the Philippines increased ethanol consumption and drove global import demand higher. At the same time, strong domestic fuel ethanol demand in Brazil reduced exportable supplies and raised domestic prices, allowing the United States to increase export share to a growing market.

While 2026 U.S. ethanol exports are ahead of last year’s record pace through June, there are a handful of wildcards that could greatly impact exports throughout the rest of the year. Changing U.S. and global biofuel policies, the emergence and implementation of new trade agreements, and the impacts of high energy prices due to the conflict in the Middle East could all have major impacts on 2026 U.S. ethanol exports.

Increased Global Demand

The first major driver of record U.S. ethanol exports during the past 2 years was growing import demand in the world’s largest ethanol-consuming markets. In 2024, U.S. ethanol export volumes reached records in 7 of its top 10 markets, resulting in a record export volume of 7.4 billion liters (1.9 billion gallons) and a record value of $4.3 billion. In 2025, U.S. ethanol export volumes reached new records in 5 of the top 10 markets, again resulting in a record export volume of 8.4 billion liters (2.2 billion gallons) and a record value of $4.7 billion. The following section will highlight the changing market conditions and policies that boosted consumption and import demand in the top markets for U.S. ethanol. 

Canada

Canada is the world’s top ethanol importer and typically accounts for more than one-third of U.S. ethanol exports. U.S. ethanol exports to Canada reached a record 2.7 billion liters (700 million gallons) in 2024, and again at 3.1 billion liters (829 million gallons) in 2025. Growth in Canadian fuel ethanol consumption is the direct result of the national Clean Fuel Regulations (CFR) and provincial policies in the most populated provinces of Ontario, Quebec, and British Colombia. The CFR became law in the summer of 2022, incentivizing fuel ethanol consumption growth by setting carbon-intensity limits on gasoline, effective July 2023, and retaining a 5 percent minimum renewable fuel volume requirement for gasoline. Additionally, higher blending mandates in Quebec, a low-carbon fuel standard in British Colombia, and a hybrid of the two policies in Ontario pushed ethanol blending well above the national minimum in those provinces. As a result, fuel ethanol consumption grew more than 50 percent between 2021 and 2025, significantly outpacing production gains and boosting fuel ethanol import demand (Biofuels Annual Ottawa Canada_CA2025-0045).

The European Union and the United Kingdom

Although the EU and the UK are separate markets growing for different reasons, USDA groups them together because of data limitations. Storage constraints at UK ports, exacerbated by growing ethanol import volumes, cause a portion of U.S. exports to move through the Port of Rotterdam before reaching the UK. As a result, U.S. export data erroneously classify some of these shipments as deliveries to the EU instead of the UK, their true destination.

To more accurately report U.S. ethanol exports to the EU and the UK, USDA uses official UK import data to estimate the true volume of U.S. ethanol exports. Chart 3 compares official U.S. Census Bureau data with estimates of the true destination for U.S ethanol exports. In 2025, U.S. Census Bureau data incorrectly show a decline in exports to the UK, while shipments to the EU more than double; however, UK import data indicate that this was not the case. Based on UK import data, the chart above depicts a more accurate representation of the true destination of U.S. ethanol exports to Europe. Official UK import volumes provide an estimate of U.S. exports to the UK. USDA then calculates shipments to the EU by subtracting UK import volumes from the total U.S. export volume to the EU and the UK. Thus, the total U.S. export volume between the two markets matches official U.S. Census Bureau data, but the distribution of that volume between the two markets is more accurate. All further analysis in this paper for the EU and the UK will use these estimated export volumes instead of official U.S. export statistics.

U.S. ethanol exports to the UK jumped to record highs in 2024 and 2025, at 1.1 billion liters (280 million gallons) and 1.3 billion liters (355 million gallons), due to a multitude of factors. For one, the UK implemented E10 gasoline in 2021, significantly boosting consumption and import demand. Between 2021 and 2025, UK fuel ethanol consumption volume nearly doubled due to the higher blend rate (Biofuels Annual_London_United Kingdom_UK2025-0030). In addition to greater demand, the United States also benefited from greater market access after signing the U.S.-UK Prosperity Deal in the summer of 2025. The agreement created a tariff-free quota starting June 30, 2025, allowing duty-free access to the UK market for 1.4 billion liters (370 million gallons) of U.S. ethanol (prorated to 913 million liters [241 million gallons] in 2025). Eliminating the 19 percent ad valorem tariff made U.S. ethanol much more cost-competitive than both imports from other markets and domestically produced ethanol. As a result, the two major plants that produced virtually all UK ethanol closed in mid-to-late 2025. With negligible remaining domestic ethanol production, the UK became even more reliant on imports to meet fuel ethanol demand.

U.S. ethanol exports to the EU also set new records in 2024 and 2025, at 589 million liters (156 million gallons) and 836 million liters (221 million gallons), respectively. During the past 2 years, EU fuel ethanol consumption growth outpaced production gains, leading to greater import demand. Increased gasoline consumption and higher blending in some member states drove fuel ethanol consumption up. EU gasoline consumption expanded this decade, largely due to greater adoption of hybrid vehicles. As hybrid vehicle purchases grow in the EU, drivers often replace a diesel-engine car with a gasoline-burning hybrid, leading to higher annual gasoline consumption and lower diesel usage. During the past 2 years, a handful of member states drove increased ethanol consumption for different reasons: France and Germany through higher penetration of E10 sales, Poland through the introduction of E10 in 2024, and the Netherlands through higher gasoline consumption.

India

U.S. industrial ethanol exports to India reached a new record in 2024 at 718 million liters (190 million gallons). In 2025, exports fell slightly below the previous record at 711 million liters (188 million gallons). India’s fuel ethanol consumption grew rapidly during the past few years, driven by higher blending rates, the world’s fastest-growing gasoline consumption, and greater domestic ethanol production. In fact, India’s fuel ethanol consumption more than tripled between 2021 and 2025, as the average ethanol blend rate rose from about 8 percent to 20 percent (Biofuels Annual New Delhi India_IN2026-0039). This growth was mostly fueled by the diversification of feedstocks for domestic ethanol production, greatly expanding available supplies to meet the mandated target for E20 by November 2025. U.S. ethanol shipments benefited from greater fuel consumption even though imported ethanol is not allowed for fuel use. As growing domestic production shifted from non-fuel applications into fuel use, U.S. ethanol exports to India jumped to backfill volumes diverted away from industrial and chemical uses.

Colombia

U.S. ethanol exports to Colombia reached a record at 513 million liters (136 million gallons) in 2024. In 2025, U.S. export volumes declined slightly but were still the second highest ever to Colombia. The main growth drivers during that time frame were higher fuel ethanol consumption due to an increased blending mandate and competitive U.S. ethanol prices. In February 2024, Colombia reinstated its E10 mandate, up from the range of 4 to 8 percent during the previous few years. As a result, consumption gains outpaced domestic production growth, leading to higher import volumes to meet demand.

The Philippines

U.S. ethanol exports to the Philippines reached a new record in 2025 at 382 million liters (101 million gallons), making the country the sixth-largest market for U.S. ethanol. Exports rose because of greater fuel consumption and limited domestic ethanol production growth (Biofuels Annual Manila Philippines_RP2026-0016). Fuel ethanol consumption in the Philippines continues to grow despite no recent changes to the 10 percent blend mandate. Instead, growing domestic gasoline consumption, fueled by increased car purchases, increased fuel ethanol use. Additionally, the introduction of voluntary E20 blending in June 2024 slightly boosted consumption during the past 2 years. Finally, insufficient feedstock supplies limited domestic production expansion, requiring higher import volumes to satisfy growing consumption.

Reduced Competition from Brazil

In addition to growing global demand for ethanol, the United States benefited from reduced export competition from Brazil during the past 2 years. The two countries are by far the largest ethanol exporters, accounting for two-thirds to three-fourths of global exports each year. Between 2020 and 2023, the United States accounted for 48 percent of global ethanol exports and Brazil accounted for 23 percent. However, in 2025, U.S. share grew to 64 percent, and Brazil fell to 12 percent. In absolute terms, Brazil exported 955 million fewer liters (252 million gallons) in 2025 compared with 2023, despite growing global import demand. As a result, U.S. exporters benefited, growing export volumes by 3 billion liters (803 million gallons) during that same time frame.

Expanding Brazilian Production

Brazil is the second-largest global ethanol producer, behind the United States. Historically, Brazil produced virtually all ethanol from sugarcane and related byproducts of sugar production. This sugarcane reliance had two major implications for the timing and availability of ethanol in Brazil each year. First, the sugarcane harvest is in April, meaning ample sugarcane feedstock supplies exist from April through November, but supplies usually tighten in the final months before the next year’s harvest. Typically, ethanol is both more expensive and less available between December and March each year. Second, ethanol production can be volatile from year to year, depending on both the size of the sugarcane crop and the relative profitability of producing ethanol versus sugar. 

Large-scale and vertically integrated sugarcane plantations, predominantly in the Center-South Region, house many sugarcane-based ethanol facilities. Typically, those plantations contain both an ethanol plant and a sugar mill, allowing growers to easily switch between producing sugar and ethanol, depending on global and domestic prices for the two products. As a result, Brazilian sugarcane-based ethanol production has ebbed and flowed during the past decade but has remained relatively flat on average during that time frame.

Conversely, corn-based ethanol production grew rapidly in Brazil during the past decade. UNICA estimates that corn ethanol accounted for about 5 percent of total production in 2019/20, but in 2025/26 it accounted for more than 25 percent. As a result of rapidly expanding corn ethanol production in Brazil, ethanol production reached new records in each of the past 3 years.

Strong Fuel Ethanol Consumption Growth

With recent gains in ethanol production in Brazil and rising global import demand, why did Brazilian exports fall during the past 2 years? In short, strong domestic demand for fuel ethanol in Brazil absorbed a greater portion of ethanol production, limiting exportable supplies and pushing Brazilian export prices well above U.S. export prices. Increased ethanol blending, competitive pricing of ethanol compared with gasoline, and higher gasoline consumption supported strong Brazilian fuel ethanol consumption.

At a typical gas station in Brazil, drivers have the choice between two fuel options: Common gasoline and hydrous ethanol. Common gasoline, or Gasoline C, is a blend of petroleum gasoline and anhydrous ethanol. For the past decade, the mandate for Gasoline C has been 27 percent ethanol by volume. However, in August 2025, the mandate increased to E30, further boosting fuel ethanol consumption in the latter half of the year.

The other option at the pump, hydrous ethanol, is not blended with gasoline and thus is sometimes referred to as E100. Most drivers in Brazil can switch between the two fuel options because they drive flex-fuel vehicles compatible with both fuels. According to ANFAVEA, the Brazilian Association of Automotive Vehicle Manufacturers, flex-fuel vehicles accounted for about 75 percent of all registered passenger cars and light commercial vehicles in Brazil in 2025. Since the two fuel options have varying energy contents, drivers tend to prefer to use E100 when the price ratio between the two fuels is below 70, and conversely, favor Gasoline C when the ratio is above 70. The U.S. does not produce or export hydrous (E100) ethanol and only supplies anhydrous ethanol for blending into Gasoline C. Therefore, Brazil’s demand for imported ethanol will be higher when the gasoline to ethanol price ratio favors Gasoline C (see Chart 7).

Throughout nearly all of 2024 and 2025, the national average price ratio for E100 and Gasoline C was well below the ratio of 70, creating an economic incentive for drivers to fill up their tanks with E100. Not all drivers will choose hydrous ethanol when the price is favorable for a multitude of reasons. They may not own a flex-fuel vehicle, they may believe unsupported claims that E100 is harmful to engines, or they could live in regions with limited ethanol supplies where the price ratio doesn’t mirror the national average. However, in aggregate, fuel ethanol consumption grows as sales of E100 expand, owing to favorable pricing compared with Gasoline C.

In addition to higher ethanol blend rates, total gasoline demand in Brazil expanded during the past 2 years. Brazil is the world’s fourth-largest consumer of gasoline by volume (including all gasoline additives such as ethanol), behind only the United States, China, and the EU. Furthermore, Brazilian gasoline demand grew 3 percent in both 2024 and 2025, according to estimates from the International Energy Agency.

In other words, ethanol accounted for a larger share of this growing fuel market. However, strong domestic fuel consumption absorbed gains in ethanol production, boosting export prices and limiting exportable supplies. As a result, U.S. ethanol exports faced reduced competition from Brazil during a 2-year period of expanding global ethanol import demand.

Wildcards for 2026

Many of the same market dynamics that pushed U.S. ethanol exports to new records during the past few years continued during the first half of 2026. Through June 2026, U.S. ethanol exports are ahead of last year’s record pace, up 12 percent by volume and 21 percent by value. However, there are still a handful of unknowns that could drastically change the trajectory of U.S. ethanol exports throughout the rest of 2026.

Brazil

On the supply side, Brazil remains the largest wildcard from an export competition perspective. If domestic consumption continues to outpace production gains, U.S. ethanol export share will likely continue to rise. However, if corn and sugarcane ethanol production gains overtake consumption growth, Brazil could regain export market share lost during the past few years. With rapidly growing Brazilian corn production and an extra 3 billion liters of corn-based ethanol capacity forecast by the end of 2026 (Rabobank – January 2026), there is significant potential for increased exports of Brazilian corn-based ethanol in 2026 and the rest of the decade.

U.S. Policy Changes

Changes to the 45Z tax credit in last summer’s One Big Beautiful Bill Act both extended the credit to ethanol producers and eliminated the indirect land-use change clause. As a result, U.S. ethanol producers will now benefit from a tax break they previously could not use. Higher profitability should lead to increased production and potentially more competitive pricing in the export market. On the other hand, any U.S. policy changes that boost domestic consumption, such as a nationwide E15 mandate, would limit U.S. exportable supplies and push prices higher.

Geopolitical Conflicts and Energy Prices

On the demand side, the biggest wildcards are changes to policy, especially in response to high energy prices caused by the conflict in the Middle East and the closure of the Strait of Hormuz. Countries have announced intentions to increase biofuel blending mandates or speed up the implementation of planned blending increases in the face of high energy prices. In Brazil, the mandatory blend rate for Gasoline C was temporarily increased to 32 percent for 180 days in July 2026. If realized, this will create even greater ethanol consumption, reducing exportable supplies during the back half of 2026. Conversely, the Philippines gave their president the authority to temporarily reduce or suspend both fuel excise taxes and biofuel blend mandates to help alleviate high fuel prices. Currently, ethanol prices have not spiked like oil and gasoline, giving ethanol an advantage and encouraging higher blending as a method to reduce prices at the pump. During the first 2 weeks of May 2026, RBOB (wholesale unfinished gasoline ready for blending) prices, were selling for a 20 percent premium to ethanol, even after accounting for the difference in energy intensity, making ethanol financially more desirable for retailers and consumers. Conversely, if ethanol prices were to exceed gasoline, some countries would likely reduce or eliminate mandates to provide temporary price relief. Additionally, sustained high fuel prices typically lead to reduced gasoline consumption in many markets, and thus a smaller total pool for fuel ethanol consumption.

Additionally, the UK Government provided support to reopen one of the shuttered ethanol plants in April 2026 to ensure sufficient carbon dioxide (CO2) supplies after the war in Iran pushed global energy prices higher. The grant is for an initial three-month period and is expected to yield about 100 million liters (26 million gallons) of ethanol during that period. Since the plant is subsidized to produce CO2, the resulting ethanol will be able to undercut U.S. prices in the UK or EU. Thus, the longer the plant operates in 2026, the smaller the opportunity will be for U.S. ethanol exports for Europe.

Trade Agreements and New Biofuel Mandates

In addition to last year’s trade agreement with the UK that boosted 2025 U.S. ethanol exports, recent trade negotiations have also yielded greater market opportunities for U.S. ethanol in 2026.  For example, trade negotiations with Guatemala and Vietnam led to the implementation of new fuel ethanol mandates in 2026. In June, Vietnam implemented a nationwide E10 blending mandate and eliminated the availability of pure fossil gasoline. As a result, 2026 fuel ethanol consumption is forecast to be more than 8 times greater than last year. Due to limited production capacity and feedstock restraints, domestic production is forecast to cover only about one-fourth of demand, leading to a significant boost in import demand (Vietnam Biofuels_VM2026-0029). Through the first 6 months of 2026, U.S. ethanol exports to Vietnam reached 73 million liters (19 million gallons), 8 times greater than the 2025 total. 

Additionally, Guatemala began rolling out a national E10 mandate at the end of June, although domestic pushback could slow implementation. While Guatemala does produce enough ethanol to satisfy nationwide E10, it will likely continue exporting domestic ethanol at a premium price to the EU and then import cheaper corn-based ethanol to fulfill the new mandate. As a result, the United States exported 23 million liters (6 million gallons) of ethanol to Guatemala in May and June, a significant uptick for a market that has effectively never imported U.S. ethanol. All additional ethanol mandates and new trade agreements that give U.S. ethanol greater market access have the potential to further boost opportunities for U.S. ethanol exports in 2026 and beyond.