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Diving overview:
- The United States has activated tariff exemptions for hundreds of food and agricultural products from Brazil under an executive order signed by President Donald Trump on Thursday.
- The exemption largely mirrors one the Trump administration established last week to align global reciprocal tariffs for 238 classes and 11 categories of food and agricultural products, following a notification from U.S. Customs and Border Protection. Exempted items include coffee, beef, spices, tropical fruits and fruit juices.
- Likewise, the waiver will be retroactive to November 13 and all refunds will be processed by U.S. Customs and Border Protection through standard procedures.
Dive Insights:
The Trump administration’s recent exemptions have eased the burden of high tariffs on Brazil’s most important exports, especially coffee.
Brazil accounts for 37% of annual global coffee production, according to the latest data from the U.S. Department of Agriculture. Levies on goods placed additional pressure. Prices already soaring, Yields are decreasing due to climate change.
In addition to last week’s revised U.S. global reciprocal tariffs, an additional 40% tariff was imposed on Brazilian imports starting August 6 under President Trump’s previous executive order. In the order, President Trump declared a national emergency, claiming Brazil’s policies threaten U.S. national security, foreign policy, and economic interests.
Trump also condemned the prosecution of former Brazilian President Jair Bolsonaro and fines against American companies ordered by Brazil’s Supreme Court. The companies included X, formerly Twitter; Meta, owner of Facebook and Instagram; And Google.
President Trump announced the waiver this week because of “early progress” in trade talks with Brazil. President Trump spoke by phone with Brazilian President Luiz Inácio Lula da Silva on Oct. 6 and began negotiations, which are ongoing, according to an executive order Thursday.
The Trump administration launched a Section 301 investigation into Brazil’s trade practices in July. Ongoing investigations are assessing digital trade, anti-corruption enforcement and ethanol market access.
