Brazilian shoemakers eye growing U.S. demand

Brazilian footwear companies such as Grendene and Vulcabras are looking to expand exports to the U.S., anticipating stronger demand following President Donald Trump’s tariff crackdown—particularly targeting China and other Asian exporters. Grendene CFO Alceu Albuquerque, says the company is operating with 30% to 40% spare capacity, which would allow it to quickly ramp up shipments to the U.S. without needing to invest in new production facilities.

Vulcabras, the company that distributes Under Armour in Brazil, was approached earlier this month to take on part of the brand’s manufacturing previously done in Asia. According to CEO Pedro Bartelle, Vulcabras had supplied Under Armour during the pandemic, exporting some volumes to the U.S.. Talks are ongoing but hinge on securing a long-term contract that would justify new investments.

“There’s been no discussion of volumes yet, but we need Under Armour to commit to buying for at least 18 to 24 months,” Mr. Bartelle told Valor. “Even if we make the decision today, we’d need at least six months to prepare. We’re not operating with idle capacity.”

Last Friday, Mr. Trump stated that an 80% tariff on Chinese imports “sounds about right.” Earlier this year, amid rising trade tensions, tariffs as high as 145% were floated. In the athletic footwear segment, major global brands like Nike and Adidas still rely heavily on Chinese and Southeast Asian production, including factories in Vietnam and Indonesia—countries also on the list for reciprocal tariffs. Vietnam, however, is negotiating with the Trump administration to avoid a 46% import tax.

Here is a historical overview of Brazilian footwear exports to the United States starting from 2022. The chart was created using DataLiner data:

Brazilian Footwear Exports to the United States | Jan 2022 – Mar 2025 | TEUs

Source: DataLiner (click here to request a demo)

Nike CFO Matthew Friend said during the company’s Q3 2025 earnings call that management remains confident in the brand’s growth “despite global macroeconomic uncertainties.” Nike estimates its gross margin will decline by 0.4 to 0.5 percentage points in Q4, in part due to the U.S. tariffs on Chinese and Mexican imports. Last quarter, gross margin was 41.5%.

Adidas, in its Q1 2025 earnings report, reiterated its guidance for the year but flagged “growing uncertainty from U.S. tariffs and increasing macroeconomic risk.” The company acknowledged being “somewhat exposed to tariffs,” even though it has already cut Chinese exports to the U.S. to a minimum. Both Nike and Adidas declined to comment when contacted by Valor.

For Grendene, the tariff war represents “a major opportunity,” according to Mr. Albuquerque. While Brazilian shoes may face a 10% U.S. tariff, that rate is far lower than what will apply to Chinese products. “Grendene is highly competitive, both in cost and quality. We’re seeing strong interest from American buyers—new clients and existing ones looking to boost orders to replace Chinese imports,” he said.

Brands like Ipanema, Azaleia, and Zaxy—part of Grendene’s portfolio of women’s shoes—are seen as “natural substitutes” for Chinese goods. Grendene plans to use its idle capacity to serve U.S. demand. It currently produces around 140 to 150 million pairs annually, with the ability to scale up to 250 million pairs if needed.

That strategy is also being adopted by Kidy, a children’s footwear manufacturer that expects to more than double exports this year. CEO Ricardo Gracia says weaker domestic demand—due to high interest rates and shifting consumer behavior—has left the company with excess capacity. “The multi-brand retail channel, where we sell heavily, is struggling with the rise of online platforms and shrinking physical retail. We’ve had to reduce production accordingly,” he told Valor.

Kidy plans to invest at least R$1 million this year in efficiency upgrades, including robotic forklifts and automated sewing equipment. Mr. Gracia says the company’s current capacity can meet projected sales growth.

The company is also in talks with major U.S. department store chains such as Macy’s, Target, and Nordstrom. If successful, deals would be closed through a trading partner. Kidy’s broader strategy includes regaining lost market share in the United Arab Emirates, which should help boost exports by 110% this year, lifting foreign sales to 12% of total volume. The company expects gross revenue to reach R$183.5 million in 2025, a 13% year-over-year increase. By 2027, Kidy aims to export 20% of its annual output of 3.5 million pairs.

The U.S. and UAE are the next key markets targeted by the Brazilian Footwear Industries Association (Abicalçados) for international trade shows, alongside Colombia, Chile, Japan, and the U.K. According to Abicalçados, one of the criteria for choosing these destinations was the presence of tariff barriers. In March, U.S. imports of Brazilian shoes reached 1 million pairs—a 34.8% increase compared to March 2024. In value terms, imports rose 12% to $17.54 million. Brazil’s market share remains modest at around 0.5%.

However, Abicalçados also warns of a potential “flood” of Asian products entering Brazil and neighboring South American markets such as Argentina and Chile. Grendene’s Mr. Albuquerque says the company is well-positioned to compete at home thanks to its cost-effective women’s footwear lineup. “What could hurt us is the international market—we export to over 100 countries, and Asian production isn’t going away,” he noted.

Source: Valor International

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