Trump tariff on Brazil narrows but may hit 40% of exports to U.S.
Marco Rubio and Donald Trump
Yves Herman/Reuters
The United States confirmed late Wednesday (15) that it will impose a new round of tariffs on Brazilian products, this time following a Section 301 investigation conducted by the Office of the U.S. Trade Representative (USTR).
A 25% duty will take effect next Wednesday (22). As officials in President Luiz Inácio Lula da Silva’s administration had expected, the measure includes a list of exemptions. Coffee, meat, orange juice and aircraft parts were among the products spared because they are either not produced in the U.S. or their absence could disrupt the American economy. Ethanol, however, will face the additional tariff.
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The measure could affect 40.2% of Brazilian exports to the U.S., down from an initial estimate of 45.8% based on 2024 foreign-trade data, before Donald Trump returned to power and introduced additional duties.
Pig iron emerged as the biggest beneficiary after being added to the exemption list. Leather and seafood products were also among the sectors spared.
Exemption list
The number of exempted products rose from 986 in June to 1,231, based on six-digit Harmonized System codes. In practice, however, only 758 products that Brazil actually exported to the United States in 2024 are covered by the exemptions.
Even so, the Brazilian government said it would begin the procedures required to invoke the Reciprocity Law, which facilitates the imposition of tariffs on goods exported to Brazil by countries that adopt measures against Brazilian products.
As the government awaited the White House announcement throughout Wednesday, the Lula administration began shaping its strategy for both possible retaliation and measures to cushion the impact of the tariff increase on the domestic economy.
Brazil’s response, including the possible use of the Reciprocity Law, will depend on an assessment of the measure’s scope.
The government is also considering issuing a provisional presidential decree to assist the hardest-hit sectors. Officials are particularly concerned about seafood, ornamental stone, wood, textiles and footwear.
U.S. allegations
The USTR argues that Brazil burdens or restricts trade with the United States through mechanisms such as Pix, Brazil’s instant-payment system, and practices including illegal deforestation.
Earlier this month, Foreign Minister Mauro Vieira sent the U.S. government a 29-page letter rebutting the allegations. Brazilian officials also reject opposition claims that the government failed to engage in negotiations.
Valor has learned that Brazilian negotiators told their U.S. counterparts at a meeting Tuesday (14) that failing to expand the exemptions would hurt American producers themselves, as inputs supplied to U.S. industry could be taxed.
During the talks, Brazil made clear to U.S. Trade Representative Jamieson Greer that it considered another sweeping tariff increase unfair and lacking any technical basis.
Other issues cited in the USTR investigation include court decisions involving social-media platforms, Brazil’s trade agreements with other countries, barriers to U.S. ethanol, shortcomings in intellectual-property protection and weaknesses in the fight against corruption.
Brazilian sources said negotiators indicated that the U.S. could be offered access to the Brazilian market similar to that already granted to India and Mexico through bilateral agreements.
On illegal deforestation, Lula’s representatives presented data on steps taken by the current administration and highlighted what they described as an inconsistency: the Trump administration is demanding action from Brazil while withdrawing from the main multilateral initiatives coordinating the fight against climate change.
“Extensive negotiations with Brazil over the past year have not resolved these issues, but we remain open to continuing negotiations with Brazil to advance the long-overdue changes needed to address the problems identified in this investigation,” Greer wrote in a statement Wednesday.
Political pressure
Behind the scenes, Brazilian officials believe the USTR’s work has been influenced by the ideological wing of the Trump administration and the State Department’s position.
In recent weeks, government sources also concluded that the USTR had become trapped by the political circumstances surrounding the case. Had it recommended postponing the tariffs, the agency could have been accused of bowing to political pressure and handing an electoral advantage to Senator Flávio Bolsonaro of the Liberal Party (PL), potentially undermining its technical standing and institutional credibility.
The leading opposition candidate for president, Flávio–the eldest son of former President Jair Bolsonaro–submitted a memorandum and took part in a USTR hearing held as part of the Section 301 investigation into Brazil. He said imposing the tariffs before the election would benefit Lula’s reelection campaign.
The Lula administration, however, remains determined to show the White House that Brazil will stay at the negotiating table.
Even the initial steps toward invoking the Reciprocity Law—a bargaining tool reserved for a more adverse scenario—would leave room for bilateral negotiations while strengthening Brazil’s position when talks resume.
The decree regulating the law establishes procedures and deadlines that can be adapted to the government’s preferred strategy.
“It can take as long as we want,” a senior official said.
Reciprocity process
Under the regulations, the Interministerial Committee for Economic and Trade Negotiations and Countermeasures, linked to the Ministry of Development, Industry, Trade and Services, may adopt provisional countermeasures against a country responsible for unilateral actions that hurt Brazil’s international competitiveness.
Once provisional decrees are introduced, the committee begins assessing permanent countermeasures. That deliberative process can take several months and may be suspended depending on the progress of diplomatic negotiations.
In August 2025, after the first tariff increase announced by Trump, the Foreign Ministry asked the Foreign Trade Chamber, or Camex, to begin consultations on applying the Reciprocity Law. The process became moot after the U.S. government backed down and announced several exemptions.
On Wednesday morning, before the U.S. announcement, Finance Minister Dario Durigan said the government would assess which sectors were likely to suffer the greatest economic impact before deciding on support measures.
As it has done on other occasions, he said, the government “will not abandon Brazilian farmers, business owners and families.”
“Brazilian business owners, Brazilian families, Brazilian truck drivers and Brazilian farmers cannot be harmed by unfair measures adopted by other countries,” Durigan said at a news conference in Brasília on provisional presidential decree providing for the renegotiation of rural debt.
U.S. criticism
U.S. Secretary of State Marco Rubio said on X that Lula and his government “did not negotiate in good faith.”
“President Lula and his government have not negotiated with the U.S. in good faith,” Secretary of State Marco Rubio wrote on X. “His economic policies are bad for Americans and bad for Brazilians. For the past year, Lula has put his own ego ahead of making a deal for the welfare of the Brazilian people, and these tariffs are the price for that.”
