In turn, Brazil is to recognise both bourbon and Tennessee whiskey as US distilled spirits.

The Distilled Spirits Council (DISCUS) called the agreement by US trade representative Ron Kirk and Brazilian trade minister Fernando Pimentel “an historic event that is sure to contribute to further acceleration of trade in distilled spirits between the two countries.”

The signing ceremony involved an exchange of letters detailing the process by which each country will formally recognise each other’s distinctive distilled spirits categories; bourbon and Tennessee whiskey by Brazil and cachaça by the US.

DISCUS president Peter H Cressy said: “This is a historic day for exporters of bourbon and Tennessee whiskey to Brazil, which is a rapidly growing market for American whiskeys.” He noted that US whiskey exports to Brazil shot up 519% from 2001 to 2011, growing from $517,000 to $3.2 million.

“Brazilians are rapidly acquiring a taste for the finest American whiskeys, and today’s agreement - when implemented - will ensure the integrity and authenticity of these world class drinks,” Cressy added.

Under the agreement, the US government will begin its process seeking public comments regarding recognising cachaça as a distinctive product of Brazil. Once a final rule is issued by the Treasury Department’s Tax and Trade Bureau (TTB) formally recognizing Cachaça, Brazil will then work to complete its regulatory process within a set timeframe to officially recognize bourbon and Tennessee whiskey as distinctive products of the United States.

“Formal recognition for bourbon and Tennessee whiskey producers is critical because it will ensure that only those products produced in accordance with strict US standards will be permitted for sale in the Brazilian market. We wish to thank USTR and TTB staff, in particular, for their tireless efforts over the past several years to secure today’s important agreement,” Cressy concluded.