Brazilian exports to U.S. fall to 30-year low after tariffs

Based on investigations under Section 301, Brazil was the target of two surcharge recommendations in the first week of June by the U.S. Trade Representative’s office. One was a 12.5% tariff, applied to a total of 60 countries, including Brazil, in an investigation into origins that allegedly fail to combat forced labor.

The other, a 25% tariff, is considered more worrying because it specifically targets Brazil. It was recommended in an investigation into seven issues that allegedly harm U.S. companies, including deforestation, intellectual property, corruption, preferential agreements with Mexico and India, and the use of Pix, Brazil’s instant-payment system.

According to estimates by Goldman Sachs economist Sergio Armella, if the two surcharges are effectively applied and stacked, the average effective tariff imposed by the U.S. on imports of Brazilian goods would rise to 18.2%, 8.6 percentage points above the current level.

In a report released by the bank, Armella noted that Brazil is also currently subject to a global 10% tariff imposed by the U.S. under Section 122, which is expected to remain in effect until July 24 unless extended by the U.S. Congress. The expectation, he said, is that the new Section 301 tariffs will replace the 10% tariff under Section 122.

The additional 25% tariff under Section 301 specifically targeting Brazil came with a list of exceptions covering 666 products, considering six-digit codes among goods effectively exported by Brazil to the United States.

Valor’s calculations, based on 2024 shipments to the U.S. before the current Trump administration’s tariff policy took effect, show that the tariff would hit 45.8% of Brazilian exports to the U.S. if implemented. The federal government puts the impact lower, at 21%.

The effect on states, however, is expected to be uneven. Using the same criteria as Valor’s calculations, more than half of Brazil’s 26 states and the Federal District would have more than 50% of their exports affected if the 25% tariff takes effect.

In all, 14 states and federal entities would be among the most affected: Alagoas, Amapá, Amazonas, Ceará, the Federal District, Pará, Paraíba, Paraná, Pernambuco, Piauí, Rio Grande do Norte, Rio Grande do Sul, Roraima and Santa Catarina.

The five states that exported the most to the U.S. market in 2024, in absolute terms, were São Paulo, Rio de Janeiro, Minas Gerais, Espírito Santo and Rio Grande do Sul, in that order. Of this group, the first four are outside the list of states that could have more than half of their shipped value affected if the new tariff materializes.

The profile of products affected by the proposed 25% tariff under Section 301 also varies widely by state. Loaders and wheel loaders are among the main products shipped from São Paulo that would be affected by the recommendation. In Paraná, the same item appears alongside wood products. In Rio Grande do Sul, affected products include wood, footwear and transformers. In Piauí, Paraíba and Ceará, fish products or lobster appear on the list.

The new tariffs suggested by the USTR have a different legal basis from the tariff shock that raised duties on Brazilian goods to as much as 50% starting in August of last year. That tariff package, applied under the IEEPA, the U.S. law for emergency economic measures, was struck down by the U.S. Supreme Court in February.

Legal strategy

Carol Monteiro de Carvalho, a lawyer specializing in international trade and a partner at law firm Monteiro e Weiss Trade, said that, unlike the surcharge based on the IEEPA, Section 301 tariffs are institutionalized within the U.S. legal framework and are harder to take to the Supreme Court.

The path, she said, is to defend Brazil’s position in the public consultation process opened by the USTR. It is necessary, she said, to present elements showing why the measures should not be applied, working together with U.S. importers so they can spell out the impact that potential new tariffs would have on their costs.

“But even if they are implemented, the tariffs, looking further ahead, may go through review processes. There are even precedents of measures that were revoked.”

From a commercial standpoint, she said, the way out is to seek alternative markets, although that cannot be done “overnight” and may also involve steps such as obtaining new certifications.

José Velloso, executive president of Abimaq, which represents Brazil’s machinery and equipment industry, said the sector was hit by the IEEPA-based tariff package last year and, if the USTR recommendation is implemented, will likely be affected by the 25% Section 301 tariff. In 2025, he said, the sector’s exports to the U.S. fell 9.2% because of the tariff shock.

The industry is currently preparing its defense, to be submitted by July 1, and plans to have representatives at the public hearing scheduled for July 6 in Washington D.C., Velloso said. One of its arguments, he added, will be that 82% of Brazilian machinery exports to the U.S. are intracompany shipments. In other words, they are exports from subsidiaries in Brazil to U.S. parent companies or to Brazilian companies from the same group that have set up operations in the United States.

“As the U.S. is seeking investment, Brazilian investment there is put at risk.” In addition, Velloso said, Brazil supplies parts and components to the U.S. machinery industry, which would make production in the United States more expensive. The main states exporting sector items to the U.S., in order, are São Paulo, Paraná, Santa Catarina and Rio de Janeiro, he said.

Fish and seafood

In fish and seafood exports, Eduardo Lobo, president of Abipesca, which represents the industry, said the main states of origin for shipments to the U.S. are Paraná and São Paulo for farmed fish products, and Santa Catarina and the Northeast for products from fishing. In Ceará, he said, lobster is one of the highlights among shipments to the U.S. Last year, Lobo recalled, the state managed to redirect part of its exports to China because of the tariff shock.

Port throughput data obtained by Datamar shows that Brazil exported 303 TEUs of frozen fish to the United States in the first four months of the year. The chart below provides a year-over-year comparison:

Frozen Fish Exports to the United States | Jan 2023 – Apr 2026 | TEUs

Source: DataLiner (click here to request a demo)

Castro, of AEB, said the U.S. tariff package in 2025 ended up redirecting products such as Brazilian beef from the U.S. to China. In November, the U.S. government exempted beef, among other products, from the tariff package. Even so, he said, U.S. tariff policy has led to greater market diversification and also brought Brazilian exporters closer to Asian markets, especially China.

During the 2025 tariff shock, Lobo said, the sector managed to get through the most difficult moment, but revenue fell. The expectation, he said, had been to export about $450 million worldwide, but revenue ended up close to $370 million because of the lower value shipped to the U.S. The American market represents 50% of the sector’s exports, he said.

In specific items, such as tilapia, the U.S. share exceeds 90%, he said.

Footwear

Haroldo Ferreira, who heads Brazilian footwear industry group Abicalçados, said a 25% tariff specifically targeting Brazil would make it difficult to compete with other suppliers.