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Brazil opens 60-day trade consultation over US tariffs, risks retaliation
Brazil starts 60-day trade talks with the U.S. after tariffs up to 37.5% on $7.4B of exports. Steel, sugar sectors most exposed. Embraer exempt. Risk of retaliation or deal before October elections.
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Brazil formally launched a trade reciprocity process Thursday, opening a 60-day window for direct talks with the United States before possible retaliation against American goods. The move follows a 25% tariff the Trump administration imposed on Brazilian exports in July, and a second 12.5% levy tied to forced-labor allegations.
Brazil's Foreign Ministry said it will notify the U.S. government and request diplomatic consultations. The goal is to reduce or eliminate the trade restrictions that now hit roughly $7.4 billion of Brazilian exports, or about 18% of the country's shipments to the U.S., according to the Office of the U.S. Trade Representative.
The combined tariffs can reach 37.5% on specific categories including sugar, apparel, paper and steel. More than 2,200 product lines were exempted, among them coffee, beef, fertilizer and Embraer aircraft.
Brazil's Economic Reciprocity Law, passed in response to the original tariff increase, allows the government to suspend trade concessions, impose new taxes, eliminate exemptions, or restrict imports from the offending country. The law says countermeasures should be proportional to the economic damage caused.
Brazil has described the U.S. tariffs as "arbitrary, unjustified and illegal" and said it submitted technical evidence disputing the claims of unfair trade practices. The United States ran a $1.5 billion trade surplus with Brazil in the first half of 2026.