In April 2025, Brazil was already affected by the 10% initial tariffs imposed by the Trump administration. However, on July 9, Trump announced in a letter to the Brazilian president the implementation of 50% tariffs, which will officially take effect on August 1.
The 50% tariffs will apply to most Brazilian products but may exclude items such as semiconductors, critical minerals, and pharmaceuticals.
According to chamber of commerce data, Brazil could face losses of $10 billion due to this tariff plan, accounting for approximately 3% of the country’s total annual exports. In 2024, the U.S. was Brazil’s second-largest export destination, behind China. Brazil’s main exports to the U.S. include petroleum and semi-finished steel products.
The tariffs have already led to cancellations of shipments at the Port of Santos, particularly for food and containerized cargo. In 2024, the U.S. accounted for 12.6% of the port’s total exports, second only to China. Most cancellations stem from uncertainty and concerns among small importers and exporters, who prefer to wait rather than risk bearing the high additional costs imposed by the new tariffs.
Additionally, states with strong export performance—especially those in the southeast—are likely to be hit the hardest. São Paulo, Rio de Janeiro, and Minas Gerais will bear the brunt of the impact, as nearly 70% of Brazil’s exports to the U.S. originate from these states.
Industries Affected and Requiring Caution
● Petroleum: Although the U.S. holds a small share of Brazil’s petroleum exports (11.3% in the first half of 2025, down from the previous year), the tariffs may redirect exports to Asian countries, particularly China (already the largest buyer at 46%). Petrobras’ share of exports to the U.S. dropped from 9% to 4% in Q1 this year, and the company is considering shifting some production to Asian markets.
Experts believe the impact on petroleum will be limited due to commercial flexibility and logistics adaptability. While the sector remains resilient, it is closely monitoring indirect effects, especially in derivative markets.
● Pulp: The U.S. is Brazil’s second-largest pulp export destination, with exports growing 17% this year, far outpacing China’s 1.4% increase; China remains the top buyer, accounting for 36% of exports. Brazilian pulp may lose competitiveness compared to other countries (Canada, Chile, the EU). Suzano reports no immediate significant impact but is increasing inventories in the U.S. market and exploring alternative export destinations.
● Steel: The steel industry is already under pressure from previous Trump administration tariffs, and the new tariffs could negatively affect ongoing trade negotiations. Brazil is a major supplier of steel products to the U.S., and if tariffs are imposed, its exports may decline sharply. Bradesco Bank predicts an 11% drop in steel exports, equivalent to 1.6 million tons, resulting in $1.5 billion in losses.
Domestic steel producers will have to pivot to other competitive markets, potentially squeezing profit margins due to higher logistics costs and lower prices. ArcelorMittal and Ternium are expected to be the hardest hit, as about 80% of their semi-finished steel production is exported to the U.S.
● Commodities: Coffee, orange juice, beef, and sugar can shift to other markets but face logistical challenges and stiff competition. The U.S. is a long-standing destination for Brazilian coffee (16.7% of 2024 exports); for meat, it is Brazil’s second-largest market (16.7% of 2024 exports). The U.S. is Brazil’s second-largest orange juice export market (41.7% of 2025 exports), posing a significant risk of lost competitiveness.
Beef: U.S. firms increased purchases in July, likely stockpiling ahead of the tariffs. Meanwhile, Brazilian exporters are diversifying, such as Paraná gaining approval to export beef and pork to Chile, opening new opportunities in South America.
Orange Juice: With 41.7% of exports destined for the U.S., the sector faces high competitiveness risks. Short-term impacts are expected, but exports will shift to other countries as new contracts are secured.
Trump’s tariff measures are seen as pressure tactics against Brazil, especially during the BRICS summit. However, the Brazilian government has mentioned invoking the Law of Economic Reciprocity, signed by the president in April this year, which allows institutional countermeasures such as retaliatory tariffs on U.S. goods, suspending agreements, and exploring new markets.
If Brazil chooses to respond by imposing tariffs on certain U.S. imports under this law, it could raise costs for some domestic industries:
● Coal: U.S. exporters will be forced to find alternative buyers, while Brazil will import more from Australia and Colombia—a trend already observed this year.
● Diesel: Potential oversupply in the U.S. market may weaken profitability for American firms. Brazil could increase imports from Russia (if no additional sanctions are imposed), as U.S. diesel had been gaining market share earlier this year.
● LNG: U.S. producers and exporters will face declining margins and may redirect output to other global markets, intensifying competition. For Brazil, this could raise costs for this essential thermoelectric fuel, prompting further supply diversification—Qatar and Trinidad and Tobago may emerge as potential suppliers.
Risks and Opportunities for the Brazilian Market
● Logistics Shifts: Commodity exports may pivot to new markets (Asia, the Middle East), requiring close monitoring of trade route and operational timing changes.
● Volatility: Bulk cargo flows—especially pulp, steel, and petroleum—are expected to experience heightened fluctuations in the coming months.
● New Demand Spaces: Reduced Brazilian access to the U.S. market may create regional gaps in other destinations, presenting opportunities for commercial and logistical adjustments.
● BRICS: As a founding BRICS member, Brazil has diversified its economic structure, reducing reliance on any single market.
