U.S. President Donald Trump has announced a sweeping 50% tariff on all imports from Brazil, a move set to take effect on August 1, according to an official notification sent to Brazilian President Luiz Inácio Lula da Silva.
The letter, which details the rationale behind the decision, cites the U.S. trade deficit with Brazil as a primary justification. However, trade data shows that Brazil has actually maintained a trade deficit with the U.S. since 2009, casting doubt on the accuracy of the administration's claims.
Adding to the controversy, the letter reportedly includes references to Brazil’s internal legal proceedings, specifically criticizing the country’s Supreme Court for its handling of former president Jair Bolsonaro’s legal cases—an unusual move seen by analysts as interference in Brazil’s domestic judicial affairs.
Economic Fallout Likely
In 2024, Brazil exported 4.29 million metric tons of steel slabs to the U.S., valued at $2.77 billion. Industry sources say the new tariff could severely disrupt this trade flow.
The Brazilian facilities most at risk include:
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ArcelorMittal's plants in Tubarão and Pecém
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Ternium's slab-producing plant in Rio de Janeiro
Steel market analysts warn that FOB export prices for Brazilian slabs have already fallen, now standing at $475 per metric ton, compared to $530–$540/mt between August 2024 and March 2025, before earlier tariff threats emerged.
If implemented, the tariff could upend Brazil-U.S. steel trade, threaten jobs in Brazil’s industrial regions, and further strain relations between the two largest economies in the Americas.
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