Ethanol is quietly moving from the gas pump to the engine room, as shipowners seek to decarbonize. The International Maritime Organization (IMO) recently defined the carbon footprint of Brazil’s corn ethanol giving Brazil a regulatory head start in a market that could become a major new outlet for low-carbon liquid fuels. Still, it’s raised questions as to why the US has not pursued the same path.
With the International Maritime Organization (IMO) enforcing strict mandates to reach net-zero greenhouse gas emissions by 2050—and achieving a 20% reduction by 2030—shipowners are desperately searching for scalable, low-carbon alternatives to heavy bunker fuel. The shipping industry’s ethanol work is riding on the back of methanol’s early success.
Engine makers are extending methanol‑capable platforms to handle ethanol or ethanol–methanol blends, rather than designing completely new systems. Everllence (formerly MAN Energy Solutions), for example, has run a dual‑fuel marine engine on ethanol at its test facilities, confirming that alcohol‑fuel engines can be calibrated to burn ethanol across the load range.
The flagship project so far is Maersk’s Laura Mærsk, the first container vessel designed to sail on methanol, which is now doubling as a floating test lab for ethanol. In early 2026, the company completed what it describes as the first sailing on 100% ethanol in a dual‑fuel methanol engine, proving that the hardware can run on neat ethanol as well as methanol.
In May 2026, the IMO established a baseline CO2e emission value for Brazilian corn ethanol at 20.8 grams CO2e per megajoule, specifically for biofuel produced from the country’s second-crop corn. The default value serves as an official carbon-intensity benchmark that shipping companies can use when evaluating fuel choices under the IMO’s emerging greenhouse-gas framework. Without that benchmark, a fuel may look promising in theory but remain difficult to commercialize at scale because buyers cannot reliably count its emissions benefit inside the IMO system.
Brazilian officials now say that second-crop corn ethanol is the first shipping-compatible biofuel to have its carbon footprint defined and approved by the IMO. The country is also seeking technical approval at the IMO for sugarcane ethanol, biodiesel made from soybean oil and animal fat, and other biofuels for maritime transport. In other words, Brazil is treating the IMO as a market-making arena where early approvals can translate into commercial advantage.
The Renewable Fuels Association estimates that capturing just 5% of the global marine fuel market would add 4 to 5 billion gallons of ethanol demand, translating to 1.5 billion bushels of corn. However, despite having the world’s largest corn ethanol industry, the US has not sought the same kind of IMO default value for its ethanol. The reason is a mix of regulatory, scientific, and geopolitical blockades.
The primary reason the US hasn’t applied for specific fuel approvals is that the US government is fundamentally at odds with the overarching regulatory framework the IMO is trying to build. The Trump administration has aggressively opposed this system, labeling it a “global carbon tax” that harms American trade sovereignty. Because the IMO works by consensus, the US successfully lobbied to freeze and delay the final vote on the framework. Until the broader international rules are agreed upon, the US is refusing to participate in the individual fuel-approval pipeline.
Another major point of contention is the IMO’s stance on how fuels are grown. The European Union’s powerful FuelEU Maritime regulations heavily influence the global shipping market and IMO debates. Those regulations place heavy statistical weight on “Indirect Land Use Change” (ILUC). Their mathematical models argue that using American land to grow corn for fuel forces other countries to clear forests or grasslands to replace that lost food, drastically driving up the “well-to-wake” lifecycle emissions of US corn. In other words, even if the US submitted its corn ethanol to the IMO’s scientific panel, the unfavorable carbon accounting would render US corn ethanol uncompetitive compared to Brazil’s corn ethanol.
Rather than seeking piecemeal product approvals, the US biofuels industry is working to change the rules from the inside out. Through the recently formed American Biofuels Maritime Initiative (ABMI), the Renewable Fuels Association (RFA) and the American Biogas Council are aggressively lobbying the US State Department to use its massive geopolitical leverage at the IMO. Instead of accepting the UN’s current draft, the US is pushing for a completely restructured, “technology-neutral” global maritime fuel market. Their goal is to force the IMO to drop the crop-based exclusion, adopt American-style carbon lifecycle accounting, and allow US fuel producers to open a multi-billion-gallon export market on their own terms. (Sources: Ethanol Producer, Bloomberg, IMO, Ship and Bunker, Argus)
