Recently, former President Donald Trump announced a 50% tariff on Brazilian products starting August 1, 2025, citing political reasons linked to the legal treatment of former President Jair Bolsonaro, but the impact on trade relations could be significant.
Economic and Commercial Impacts:
- Affected sectors: coffee, beef, pulp, copper, and domestic aircraft — negative effects have already been reported in companies like Embraer, whose US share represents up to 60% of revenue.
- Increasing costs: With rising commodity prices, American consumers may face pass-through costs, especially for coffee and orange juice.
- Possible retaliation: The Brazilian government announced the approval of a reciprocity law and declared its readiness to retaliate, posing a risk of escalating trade.
Effects for Investors:
- Exchange rate volatility and dollar rebound, which may affect portfolios with international exposure;
- High regulatory risk, requiring attention to FDI operations and commercial compliance;
- Strategic opportunity: possible migration of investments to alternative markets and renegotiation of contracts.
How LTC Group can help:
- Customized assessment of tariff impact by sector and asset;
- Restructuring of supply chains and global portfolios;
- Support in regulatory compliance, international contracts and due diligence;
- Continuous monitoring of trade disputes and sanctions developments.
