U.S. ethanol exports take center stage as E15 prospects falter

The challenge of expanding the U.S. market for ethanol is putting a spotlight on exports of the corn-based biofuel.

Global shipments have been a bright spot for an industry under pressure to find and grow new markets as electric vehicles are expected to slash demand for motor liquid fuels in coming years.

U.S. ethanol exports last year hit an all-time high of 2.2 billion gallons, a 13% jump from the prior year’s record-breaking level. Ethanol saw a trade surplus of 2.1 billion gallons, valued at $4.6 billion.

The industry is struggling to change federal law so higher blends of ethanol, known as E15, can be sold year-round across the nation. With roughly 40% of America’s corn harvest each year used to make ethanol, domestic expansion is crucial in maintaining “King Corn” as the U.S.’s biggest cash crop, especially as production of the grain hits record highs.  

“We need this market for corn,” Emily Skor, chief executive officer of top ethanol trade group Growth Energy, told Agri-Pulse. “If every car today on the road were driving with e15, that would be 2.4 billion bushels of additional demand."

Emily Skor (Agri-Pulse photo)

Still, even if Congress can craft and move forward with legislation that satisfies both the agriculture and fossil fuel sectors, E15 is only a short-term solution to bridge the demand gap from now until new markets like sustainable aviation and marine fuels are developed, according to Iowa Renewable Fuels Association executive director Monte Shaw, citing a recent study.

That means ongoing expansion of ethanol exports is especially critical. Further, Brazil, the second largest global ethanol shipper after the U.S., is rapidly increasing its corn ethanol production alongside its traditional output of the biofuel made from sugarcane.

The Office of the U.S. Trade Representative is currently investigating Brazil’s ethanol trade practices, which critics say have been historically anti-competitive.

Meanwhile, U.S. sales of ethanol to China, the biggest global market for ag products, have essentially vanished since 2021. The Asian nation was the country’s third largest market 10 years ago. There's been no indication that the recent U.S. trade agreement with China, announced by Trump late last year, includes ethanol. 

Brazil earlier this month began sending China dried distillers grains, a high-protein byproduct of ethanol production used to feed poultry, cattle and other livestock. 

The boost in ethanol output from Brazil comes as markets like Canada, the U.S.’s biggest buyer of the biofuel, Vietnam and Japan move toward higher ethanol fuel blends.

“Canada continues to be the north star,” Skor said. “They've got a clean fuel regulation and, quite honestly, may get to E15 before we do.”

Vietnam has a mandate for a 10% ethanol blend starting this year, Deputy Agriculture Secretary Stephen Vaden said.

“We need E15 in this country, American farmers need it,” Vaden said last week at USDA's annual Agricultural Outlook Forum.  “For heaven’s sake, starting this summer, Vietnam will have E10. Surely, we can beat Vietnam.”

More than 60 countries have ethanol blending policies, according to Ryan LeGrand, CEO of the U.S. Grains & BioProducts Council

Here’s a look at export prospects for key markets:

• Canada: The U.S.’s biggest ethanol market set a yearly record in U.S. purchases in 2025, at more than 792 million gallons. The country is blending at about 10% nationwide, with some provinces already at E15. Canada could become the U.S.’s first billion-gallon market, LeGrand said.
   
• United Kingdom: Britain was an early dealmaker following President Donald Trump’s tariff blitz last year. The agreement gives the U.S. 50% more access to the market, Skor said. Still, higher exports were sluggish to materialize last year, Agri-Pulse reported in December.

• European Union: A “great” customer, though the U.S. is working to get the EU to lift its import cap on crop-based ethanol, LeGrand said. “They’ve not been easy to convince, but we’re not giving up.”

• Nigeria: The African country has built the largest oil refinery in the world and has dedicated space for ethanol storage. It’s a potential 300-million-gallon market, according to LeGrand.

• India: Ethanol isn't expected to be part of a new trade agreement with the U.S., though the deal isn't yet finalized. The world’s most populated country is at E20 blends, but it’s all from national production as fuel-grade imports are prohibited. India has the installed capacity to move up to E30 blends, LeGrand said. The U.S. isn’t giving up on trying to convince India to let foreign ethanol for fuel use into the country, but it’s tough, he said. Skor sees India as an industrial-grade ethanol market for the U.S. One possible new market for ethanol exports in India is ethanol-powered cooking stoves, a move that would improve the health of millions of people, according to LeGrand. 

• Japan: The U.S. during Trump’s first term was able to start selling ethanol into Japan’s ETBE fuel market. A new deal forged last year is expected to drive more ethanol business between the two nations, according to Skor. Japan’s expected move to E10 by 2030 will be a 1.2-billion-gallon market. While Brazil is likely to get some of that business, the U.S. will get the “lion’s share” of it in a few years, LeGrand said. “You’re going to see exports really take off to Japan,” he said.

• Vietnam: Vaden said earlier this month he had a meeting with Vietnam’s trade minister on securing access to U.S. ethanol. The Southeast Asian nation is adopting premium grade E10 in a few months, a market of more than 100 million drivers. The country also seeks U.S. corn to be a key feedstock as it develops domestic production of ethanol, Vaden said.  By 2030-31, Vietnam plans to move to full E10 nationwide, meaning 240 million gallons the U.S. doesn’t have today, LeGrand said.

• Guatemala: The Latin American country is putting an E10 mandate into effect this year, and a recent deal with USTR calls for purchases of U.S. ethanol. The agreement also allows for Guatemala’s local production to continue so the nation can “have a piece of that pie,” LeGrand said. The pact is likely to lead to sustained demand of 70 million to 100 million gallons in Guatemala, he said.

• Mexico. A move to E10 nationwide was struck down by Mexico’s high court in 2020, though the current Mexican president is a “big believer in ethanol," LeGrand said. “I feel there's some momentum coming in Mexico. We hope to see that market open back up,” he said, adding that E10 there is about a 1.3-billion-gallon market. Mexico is a top U.S. export market for corn and DDGs. “The missing puzzle piece with one of our greatest trading partners is ethanol,” LeGrand said.

With contribution from Oliver Ward.