US President Donald Trump’s unexpected move to threaten a 50 percent tariff on Brazil risks roiling global commodity markets, disrupting trade on everything from beef to coffee.
The US is Brazil’s second-largest trading partner, trailing only China. But while the two nations compete directly in some markets like corn and cotton, Brazil — an agricultural powerhouse — also produces tropical goods like coffee that can’t be grown in the continental United States.
Brazil has been ramping up beef shipments to meet growing US demand, and is a key supplier of wood pulp used in everything from books to toilet paper. That’s spurring hopes that some sectors could be singled out or exempted from tariffs.
Still, Brazil’s strength in commodities gives it some flexibility, and the country could ease the impact by finding buyers elsewhere.
“It’s likely that these products will have to be redirected,” said Marcos Fava Neves, a professor at the University of São Paulo’s Ribeirão Preto Business School. “Beef is being exported to many places, orange juice is in short supply and coffee is in short supply.”
Brazil’s energy and metal industries are also evaluating potential impacts. Here’s how the tariffs could ripple through key commodities:
Coffee
The US imported nearly US$2 billion worth of coffee from Brazil in 2024, according to the US Department of Agriculture. The shipments are roughly 30 percent of US coffee consumption, Brazilian coffee exporters group Cecafé said.
“It’s a loss to our companies, and it means more costs and more inflation to American consumers,” Cecafé Chief Executive Officer Marcos Matos said.
Brazil is the world’s top grower of the premium arabica variety favoured by Starbucks Corp and most specialty coffee shops. Prices for the bean have already surged over the past year as poor weather in Brazil threatened supplies.
Tariffs on Brazil could result in coffee prices rising “quite a lot,” Giuseppe Lavazza, chairman of Italian roaster Lavazza, said on Bloomberg Television.
Beef
US meatpackers, facing the smallest US cattle herd since the 1950s, have been relying more on supplies from countries like Brazil. Demand is also rising as consumers on weight-loss drugs seek out high-protein foods. In 2024, about US$1.4 billion of beef was imported into the US from Brazil, according to the US Department of Agriculture.
Brazilian producers will likely redirect shipments, with meatpacker Minerva SA saying it can also supply the US market with its operations in Argentina, Paraguay, Uruguay and Australia. Still, the Brazilian Association of Meat Exporters pointed to risks for “global supply and food security” while pledging for more dialogue between the two countries.
Oil
Brazilian crude exports eclipsed all other foreign sales for Latin America’s biggest economy for the first time last year, with oil and derivatives shipments to the US totaling US$7.6 billion in 2024.
Brazil’s oil lobby group IBP said in a statement that the tariff move “brings uncertainty to the oil and gas sector, which today accounts for 17 percent of Brazil’s industrial GDP and 1.6 million direct and indirect jobs in the country.”
But analysts see little structural risk to the country’s production, given Brazil’s ability to divert export flow.
“Brazil has the capacity to redirect barrels currently exported to the US to refineries in Asia (China, India), Europe, or the Middle East, which demand light, low-sulfur crude such as those produced in Brazil’s pre-salt fields,” BTG Pactual analysts led by Luiz Carvalho wrote in a note to clients.
Analysts also see limited impact for state-controlled oil producer Petrobras, which exports most of its crude to China.
Orange juice
Brazil accounts for roughly 70 percent of global orange juice exports, and has played a more sizeable role in the US supply as a deadly citrus greening disease spread through Florida’s groves. While the same disease is also impacting some areas of Brazil, the northeastern part of the country has been largely untouched and is expanding production. Orange juice futures rose as much as six percent on Thursday to the highest price in nearly a month.
The new tariff would be a lot higher than the existing rate of US$415 per ton applied to Brazilian juice shipments, meaning a charge equivalent to more than 70 percent of the value of the product, industry group CitrusBR said. This would make shipments “unfeasible,” Executive Director Ibiapaba Netto said.
“Now we have to speed up production to ship the orders we still have as quickly as possible before the taxes come into effect,” said Bryan Souza, head of global operations at Sumo Brasil, a company that produces frozen concentrated orange juice.
Ethanol
Brazil has been expanding its capacity to convert corn and sugar cane into ethanol, a biofuel often blended with gasoline. The US is a key market, with incentives in California for low-carbon fuels helping to propel ethanol shipments to about 300 million litres last year. A risk of retaliation would also limit shipments to Brazil from the US, and even tighten supplies in the South American nation this year, said Bruno Lima, soft commodities business director at StoneX.
Pulp and paper
Brazil is home to Suzano SA, the world’s largest exporter of the pulp that goes into products like toilet paper. Pulp is Brazil’s fourth-largest agricultural export to the US, and paper and plywood are also among the top goods, according to Brazil’s Ministry of Agriculture and Livestock. Suzano Chief Executive Officer João Alberto de Abreu said in May that the company was passing the costs of tariffs — which were 10 percent at the time — on to US buyers. Suzano is the most exposed to tariffs among Brazilian commodity producers, as about 15 percent of the company’s revenue comes from the US, Citi analyst Gabriel Barra wrote in a note.
Sugar
While much of the United States of America’s sugar has historically been produced domestically or imported from Mexico, shipments from Brazil, the world’s top sugar grower, have boomed. The US imported a record amount from the country in 2024, topping a million metric tons, according to the USDA.
The US limits the amount of sugar that can be imported under low fees, and allocated about 14 percent of that supply to Brazil in the 2025 fiscal year. Additional Brazilian shipments, which are subject to higher fees, have totaled over 265,000 tons as of the end of May, said Mike McDougall, an analyst at McDougall Global View.
Steel
Brazil’s steel industry doesn’t see any direct impact from the tariff announced by Trump, since the sector was already subject to that rate under Section 232 of the Trade Expansion Act, said Marco Polo de Mello Lopes, chief executive officer of industry association Aço Brasil.
The move, however, may sour relations between Brazil and the US, making it more difficult to re-establish steel trade negotiations that may involve export quotas on semi-finished products, Lopes said. Brazilian steel mills produced around 60 percent of all slabs imported by the US last year to feed its industry.
Mining and steel stocks gained in São Paulo on bets that rising commodity prices and limited exposure to the US will help them weather the storm.
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