US tariff plan puts Brazilian exports on alert

A new tariff package under consideration in Washington could significantly raise the cost of Brazilian goods entering the United States, according to a study by Brazil’s National Confederation of Industry, known as CNI, the country’s main industrial lobby.

The CNI estimates that 31.6% of Brazilian exports to the U.S. could be exposed to a 37.5% tariff if the measures proposed by the Office of the United States Trade Representative, or USTR, are adopted. Those products currently face a 10% rate, meaning the change would add 27.5 percentage points to the import bill.

A further 3.6% of shipments from Brazil to the American market could see tariffs rise from 10% to 12.5%. Taken together, the new measures would cover 35.2% of Brazil’s exports to the United States. If existing sector specific measures under Section 232 of U.S. trade law are included, the share of Brazilian goods subject to some form of additional taxation could reach 54.1%, the CNI said.

Brazilian shipments in the firing line

The most exposed products include non alloy pig iron, cane sugar in solid form, non edible tallow, undenatured ethyl alcohol and standard pine wood mouldings. These are among the items that could face the higher 37.5% levy.

Non alloy pig iron is particularly important. Brazil exported US$1.5 billion of the product to the United States in 2024, according to the CNI. Under the proposal, it would move from the current 10% tariff applied under Section 122 to an additional charge of 37.5%.

A second group of goods could be subject to the 12.5% rate. That list includes iron ore and concentrates in agglomerated pellets, quartzite slabs, orange citrus essential oils, silicon, and chemical wood pulp made by the sulphate or soda process in dissolving grades.

The CNI based its calculations on exemption lists released by the USTR. Its methodology treats exports already covered by Section 232 measures as exempt from the new proposals, in line with reports published by the U.S. trade office.

Ricardo Alban, president of the CNI, warned that higher tariffs would reverberate through production networks in both countries.

“The possible imposition of new tariffs benefits neither side. They would raise costs for companies, reduce competitiveness and create uncertainty for investment. The most efficient path is dialogue, based on technical criteria and the search for solutions that preserve a strategic economic partnership for both countries,” Alban said.

Why Washington is considering the levies

The proposed tariffs stem from two USTR investigations conducted under Section 301 of U.S. trade law, a mechanism used to examine practices that Washington considers unfair or burdensome to American commerce.

One investigation focused directly on Brazil and began in July 2025. In June this year, the USTR concluded that several Brazilian practices were restrictive or costly for U.S. trade. The areas cited included digital trade, preferential tariffs, anti corruption efforts, intellectual property, access to Brazil’s ethanol market and measures linked to combating deforestation.

As a response, the USTR suggested an additional 25% tariff on Brazilian goods. The proposal includes exemptions for 1,698 tariff codes, covering items such as coffee, beef and orange juice.

A separate investigation looked at forced labour issues across almost 90 countries. The USTR placed Brazil among the countries that, in its assessment, do not adopt or effectively enforce restrictions on imports of goods made with forced labour. In that case, the proposed additional tariff is 12.5%, with exemptions for 1,655 tariff codes.

When both measures apply to the same product, the combined surcharge can reach 37.5%.

Earlier in June, the United States also signalled a broader tariff framework for imports from major trading partners. Countries and blocs such as Canada, Mexico, the European Union, Taiwan and the United Kingdom would be subject to a minimum 10% rate. Products from economies including China, India, Japan, South Korea, Brazil and Switzerland would face 12.5%, according to the proposal.

What businesses should watch next

The tariffs are not yet in force. The U.S. process requires public consultation before any final decision. Hearings are scheduled for July 6 and 7, and companies, industry groups and governments may also submit written comments. The deadline for written submissions is July 6.

For Brazil, that consultation period is more than a procedural step. The CNI sees it as a chance to present technical evidence, challenge the proposed measures and spell out the potential damage to bilateral trade.

The stakes are high because the U.S. is one of Brazil’s most important commercial partners, especially for higher value industrial and semi industrial goods. If the measures advance, Brazilian exporters will need to review pricing, contracts, supply routes and customer exposure. U.S. buyers may also have to absorb higher costs or search for alternative suppliers.

For investors and companies doing business across Brazil and the United States, the episode is a reminder that trade policy can move quickly and reshape margins in sectors that looked stable only months earlier.

Brazil Business Club helps international investors and operators understand these shifts, identify local partners and assess opportunities in Brazil with the right context. If your company is investing in Brazil, sourcing from the country or building a cross border strategy, connect with the club to stay close to the market as this tariff debate unfolds.