Brazilian exporters are facing a turbulent new reality as U.S. tariffs, imposed by President Donald Trump, disrupt longstanding trade flows and send shockwaves through global markets. On August 6, 2025, the Trump administration implemented a sweeping 50% tariff on most Brazilian goods, including coffee, steel, construction equipment, and a host of other industrial and agricultural products. The move has left key sectors scrambling for alternatives and exposed the vulnerabilities of Brazil’s export-dependent economy.
According to a recent study by the Institute for Studies in Industrial Development (IEDI), just 20 Brazilian products—highly reliant on the U.S. market and directly impacted by the new tariffs—account for a staggering $8.4 billion in annual exports. That’s roughly one-fifth of Brazil’s total sales to the United States. The study, based on data from the Foreign Trade Research Center Foundation (FUNCEX), analyzed 3,474 items exported by Brazil to the U.S. over the 12 months ending in June 2025. Researchers defined high dependency as products for which the U.S. represented at least 50% of Brazil’s export volume during that period. Out of 579 products meeting this threshold, 506 were hit by U.S. trade measures, collectively making up 26% of Brazil’s total exports to the U.S.
Rafael Cagnin, IEDI’s chief economist, underscored the gravity of the situation: "These are the goods most likely to suffer under the tariff hikes and could face difficulties finding new markets to absorb what’s lost in U.S. demand." He emphasized that for the top 20 most exposed items, "virtually the entire external market is the U.S." Even when the aggregate value isn’t eye-popping, Brazil’s presence in alternative markets is minimal to nonexistent. These products include semi-manufactured non-alloy iron or steel (which alone generated $2.94 billion in sales to the U.S. last year, 83% of Brazil’s global exports of that item), various steel alloys, construction equipment such as loaders and tractors, transformers, wire rod, honey, and a range of fish and food products.
The IEDI study mapped out possible fallback destinations for these exports. For non-alloy semi-manufactured iron and steel, Canada is the second-largest buyer at a modest 5%, followed by Mexico at just 2%. Latin American countries and European nations appear as secondary or tertiary destinations for many of the top 20 products, but their market share is dwarfed by the U.S. dominance. Over the past decade, Brazil’s exports to both Mercosur and the European Union have shrunk: the EU’s share dropped from 16.4% in 2014 to 14.3% in 2024, and Mercosur’s from 9.2% to 6%. The decline is even sharper for manufactured goods—the very products most affected by the new tariffs.
As exporters grasp for solutions, the government’s "Sovereign Brazil" program has stepped in with R$30 billion in tax and credit relief. But Cagnin warns that these measures are only temporary. "Besides trying to reverse the tariffs, Brazil must find alternative markets—something all U.S. trade partners are now likely pursuing," he said. He advocates for a renewed push to strengthen trade ties with traditional partners or forge new ones, particularly in Latin America and Europe. The long-stalled Mercosur-EU trade agreement, he argues, is "ready, and now we need the political will to move it forward."
The coffee sector, a symbol of Brazil’s agricultural might, has been especially hard-hit. On the very day the tariffs took effect, Marcio Ferreira of the Brazilian Coffee Exporters Council (CECAFE) flatly dismissed the idea of re-exporting Brazilian coffee via other countries as a workaround. "Re-exporting via other countries isn't a feasible solution," Ferreira told journalists, explaining that such attempts would be "very easy for the American government to spot." He added, "The tariffs disrupted the market and opened the door to speculative movements."
The numbers tell a sobering story. According to CECAFE, Brazilian coffee exports to the United States plummeted by 46% in August 2025 compared to the same month last year. U.S. imports of Brazilian coffee fell to 301,099 60-kilogram bags, down from 562,723 bags in August 2024. The fallout has been even more severe for Brazil’s instant coffee industry: exports to the U.S. in August 2025 dropped 59.9% to just 24,460 bags, compared with 65,914 bags a year earlier, according to ABICS, the Brazilian instant coffee association.
With the U.S. market suddenly blocked, Brazilian exporters have scrambled to redirect shipments to other destinations. Sales of Brazilian coffee to Mexico and Colombia surged by 90% and 578%, respectively, in August 2025. Despite a drop in total exports to Germany, it remained the top importer of Brazilian coffee that month, accounting for 414,109 60-kilogram bags. But these shifts, while impressive, are not enough to compensate for the loss of the U.S. market, the world’s largest consumer of coffee.
The broader impact of the tariffs is already being felt at home. The International Coffee Organization and Brazil’s national crop agency, Conab, have both warned that the tariffs could push coffee prices higher globally. Celirio Inacio, executive director at the Brazilian coffee industry association (ABIC), cautioned that "coffee is becoming more expensive for consumers again, and this is causing complaints from consumers and will directly contribute to inflation here in Brazil." With Brazil itself ranking as the world’s second-largest coffee consumer, any sustained price spikes could have ripple effects throughout the economy.
Industry experts are unanimous: finding new markets for highly U.S.-dependent products is no small feat. Lia Valls, head of economic analysis at Rio de Janeiro State University and associate researcher at think tank FGV Ibre, noted, "Shifting exports from one destination to another isn’t immediate. It’s also essential to analyze product by product who Brazil competes with in supplying the U.S." The challenge, she says, is not just finding demand elsewhere, but also contending with fierce competition in those markets.
José Augusto de Castro, president of the Brazilian Foreign Trade Association (AEB), stressed the need for a nuanced approach. He argued that any analysis of trade opportunities should consider how Brazilian exports to the U.S. fit into global supply chains. For some products, like coffee and beef, the pain is less acute—only 16% and 12% of their respective export volumes go to the U.S.—but for others, the American market is nearly irreplaceable.
For now, Brazilian exporters are bracing for continued volatility. The search for new markets and the push for greater competitiveness have never been more urgent. As Cagnin put it, "In this game, a competitiveness agenda is essential." Whether Brazil can adapt quickly enough to weather the storm remains an open question, but the stakes—for industries, workers, and consumers alike—could hardly be higher.
