On June 2, the Trump administration moved to impose a new 25% tariff on Brazilian goods. The stated grounds are “unfair trade practices” — but the move is shadowed by political anger over the Lula government’s prosecution of former president Jair Bolsonaro.
From “sanction” to “negotiation”
The 25% tariff stands in for the 50% rate imposed last year. That 50% rate, however, rested on the International Emergency Economic Powers Act (IEEPA), and it lapsed after the U.S. Supreme Court ruled in February 2026 that IEEPA does not authorize such tariffs. The new 25% is being pursued under a different legal basis — Section 301 — leaving room to negotiate line by line rather than squeezing across the board. A public hearing is set for July 6; as of this writing it is not yet a final measure. (The hearing was held on July 6–7, and the 25% was finalized on July 15.) The unfair-trade items cited by the U.S. Trade Representative (USTR) span several areas, from digital-trade rules to exports linked to illegal logging.
Where economics meets politics
The U.S. runs a trade surplus with Brazil, so a “tariff to fix a deficit” logic barely holds. What is cited as the reason the hard line persists is the Lula government’s prosecution of Bolsonaro. The Trump administration reads it as the persecution of an allied politician, and several outlets report that last year’s 50% tariff was part of the same response. A diplomatic clash has migrated straight into trade policy.
The ambivalence of the China “exit”
Over recent years Brazil has rapidly diversified its export markets toward China and the Global South. China is the largest buyer of soybeans, iron ore and crude, and the harder the U.S. squeezes, the faster that shift goes. But it also creates a new instability: dependence on China. Brazil’s 2026 growth outlook sits at around 2% — the market consensus in the central bank’s Focus survey runs 1.9–2.0% — below the regional average, and fiscal room is limited. If the 25% tariff is confirmed, the hit to manufacturing and farm-machinery sectors would be hard to ignore. Whether Brazil can keep a diplomatic space where it need not choose “the U.S. or China” is the question ahead.
A tariff justified as “fair trade” often works, instead, as an instrument of politics.
References
- USTR Section 301 Determination on Brazil's Unreasonable Acts, Policies, and Practices (2026-06-01) | USTR — ustr.gov
- USTR Section 301 Action on Brazil's Unreasonable Acts, Policies, and Practices (2026-07-15, final action) | USTR — ustr.gov
- US targets Brazil with new tariffs over trade practices | Al Jazeera — aljazeera.com
- BNN Bloomberg — bnnbloomberg.ca
- Bloomberg — bloomberg.com
- FTI Consulting — fticonsulting.com
- Oxford Economics — oxfordeconomics.com
※ This article is the author’s commentary based on public information. Please confirm the latest figures, dates and procedures with governments and primary sources. Quotations are kept minimal and sources are cited.