Trump’s Brazil Tariffs Could Impact Beef & Coffee Trade

President Donald Trump's unexpected move to threaten a 50% tariff on Brazil risks roiling global commodity markets, disrupting trade on everything from beef to coffee.

The U.S. 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 U.S. Brazil has been ramping up beef shipments to meet growing U.S. 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.

Agri-Pulse's Oliver Ward reported that "some farm-state lawmakers are eyeing potential opportunities for the U.S. agricultural sector should President Donald Trump follow through on his threat to impose steep new tariffs on Brazil."

"I'm very happy to keep Brazil out of my agriculture market,” Senator Roger Marshall, R-KS, told Agri-Pulse. "Brazil manipulates our markets when it comes to sugarcane being used for ethanol."

Senator Deb Fischer, R-NE, said, “I’m not surprised that the President opted to hike duties on Brazil. I think that he is trying to level the playing field for agriculture. Brazil can import to the United States duty-free, but when U.S. ethanol producers, like those in my state, send product to Brazil, they face an 18% tariff.”

How Beef Trade Could be Impacted

For beef, American meatpackers, facing the smallest U.S. 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 $1.4 billion of beef was imported into the U.S. from Brazil, according to USDA.

Brazilian producers will likely redirect shipments, with meatpacker Minerva SA saying it can also supply the U.S. 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.

Reuters' Maytaal Angel and Marcelo Teixeira reported, however, that the tariff has been welcomed by U.S. cattle producers. “We fully support this tariff on Brazil. Brazil's exports have contributed to the shrinking of our U.S. cattle industry. We need to rebuild and reduce our nation's dependency on imported food. This is a step in the right direction,” said R-CALF USA."

How Coffee and Orange Juice Trade Could be Impacted

According to USDA, the U.S. imported nearly $2 billion worth of coffee from Brazil in 2024. The shipments are roughly 30% of U.S. coffee consumption, according to Brazilian coffee exporters group Cecafé.

"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. “Tariffs on Brazil could result in coffee prices rising quite a lot,” Giuseppe Lavazza, chairman of Italian roaster Lavazza, said on Bloomberg Television recently.

Angel and Teixeira reported that more than half of the orange juice sold in the U.S. comes from Brazil, meanwhile, while the South American country also sells sugar, wood products, oil and oil products.

U.S. Commerce Secretary Howard Lutnick said last month during a Congress hearing that some natural resources that are not available in the U.S., such as tropical fruits and spices, could be exempt from tariffs, depending on negotiations with the countries producing and exporting them.

Brazil Says it Will Respond with Reciprocity

Brazilian President Luiz Inacio Lula da Silva said that his country will respond with reciprocity to U.S. President Donald Trump's newly announced 50% tariff rate on his country's exports, citing a recently adopted Brazilian law that authorizes the government to take proportional countermeasures.

"Brazil is a sovereign country with independent institutions that will not accept being lectured by anyone,” wrote da Silva in a social media post.

EDITOR’S TAKE:

It’s complicated! This article makes it abundantly clear that blanket tariffs are not always the best policy. Simply using a single level tariff against Brazil, for instance, could significantly increase the retail price for several products we are unable to grow domestically. Special carveouts are needed to allow for no tariff or lower tariffs on such items. In addition, non-tariff barriers such as phytosanitary inspections, shipping regulations and others, further complicate the picture. It is important to recognize these idiosyncrasies to ensure the end result of “fair trade” is achieved. It is a delicate balance to protect our farmers/ranchers as well as our consumers in this process.

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