Lula Condemns New 25% US Tariffs on Brazil, Warns of Seeking Other Trade Partners
Lula denounces proposed US tariffs on Brazil after Washington unveils 25% levies; probe cites deforestation, ethanol access and alleged unfair trade practices.
Brazilian President Luiz Inacio Lula da Silva on Wednesday strongly rejected a new proposal from the United States to impose 25 percent tariffs on certain Brazilian imports, saying he “could not accept the treatment” meted out to his country. The move, announced by the Trump administration, comes after signs of an improving rapport following a May White House meeting that Lula said left him optimistic. The proposed US tariffs on Brazil mark a sharp turn in relations and have already prompted warnings from Brasília that it will explore alternative markets and deepen institutional ties elsewhere if necessary.
U.S. Moves to Impose 25% Tariffs on Select Brazilian Goods
The proposed measures would levy a 25 percent duty on targeted Brazilian products after a U.S. inquiry into trade practices between the two nations. The Office of the U.S. Trade Representative framed the action as a response to what it called unreasonable practices that burden U.S. commerce. A public comment period will follow the proposal and is scheduled to close in early July, giving exporters, governments and other stakeholders a window to submit feedback.
Lula Expresses Surprise and Rebuffs Treatment
President Lula said he was taken aback by the tariff announcement, noting that discussions with the U.S. had been ongoing and that he had left the White House in May hopeful about prospects for better bilateral cooperation. He reiterated Brazil’s desire to build institutional relations with the United States while making clear Brasília would diversify trade partners if U.S. actions proved hostile. The Brazilian leader’s reaction reflects both diplomatic frustration and political calculation as domestic and international audiences assess the fallout.
USTR Cites Deforestation, Ethanol Access and Corruption
U.S. Trade Representative Jamieson Greer told media that the tariff action stems from an investigation into alleged unfair trade practices, highlighting concerns such as illegal deforestation, barriers to ethanol market access and enforcement of anticorruption measures. The USTR summary of the probe concluded these issues amount to unreasonable practices that restrict U.S. commerce, providing the administration with grounds to threaten or impose sanctions. Brazilian officials have disputed aspects of the findings and signalled they will use the public comment phase to contest the U.S. conclusions.
Dispute Over Trade Balances and Data
One focal point of the debate is Washington’s characterization of a “giant” trade deficit with Brazil, a claim Greer reiterated in broadcast remarks. Public trade data, however, show the United States running a surplus with Brazil in recent months, including a reported $420 million U.S. surplus in March when Brazil purchased more goods from the United States than it exported. Economists and trade analysts say such discrepancies fuel the diplomatic spat and complicate efforts to negotiate a mutually acceptable path forward.
Legal Shift: From Global Emergency Powers to Section 301
Analysts note the administration is pursuing tariffs under Section 301 of the Trade Act of 1974 rather than the broad global authority previously used. The pivot follows a U.S. Supreme Court decision in February that struck down sweeping global tariffs imposed under the International Emergency Economic Powers Act, prompting officials to rely on more traditional trade statutes. Section 301 gives the U.S. executive latitude to levy penalties for trade practices deemed unfair, and it has been used in recent years as a targeted tool to address perceived market distortions and regulatory barriers.
Products Exempted and Next Steps in the Trade Process
The current proposal exempts several strategically important Brazilian exports, including beef, coffee, rare earths and other metals, energy commodities and aircraft parts, insulating some key sectors from immediate duties. If the tariffs move forward after the comment period, they could be phased in or adjusted, and both sides could still seek negotiations to narrow differences. Trade groups in both countries are expected to file substantive comments during the public consultation, which will shape the final scope and timing of any measures.
Political turbulence in Brasília and Washington underscores the broader stakes of the dispute, which arrives as President Lula prepares for a tight re-election contest in November against Senator Flavio Bolsonaro, the eldest son of former president Jair Bolsonaro. The tariff announcement revives memories of last year’s rounds of U.S. duties that reached 50 percent on many goods after Bolsonaro’s trial on charges of trying to subvert Brazil’s democracy; Bolsonaro was ultimately convicted and sentenced, a development that has factored into bilateral tensions. With elections looming, economic pressure from abroad could become a salient issue in domestic campaigning and in negotiations over trade policy.
The coming weeks will test whether diplomacy can contain the dispute or whether both governments will harden positions and pursue retaliatory measures, with implications for exporters, supply chains and political calculations on both sides.