Vice President Gerard Alcumin (PSB) said this Saturday (15th) that President Donald Trump’s decision to reduce import duties on beef, tomatoes, coffee and bananas has increased the value of Brazil’s exports to the United States without additional tariffs from 23% to 26%.
The calculations provided by Alcumin take into account that exports to the United States amounted to approximately $40 billion last year. This percentage increase is primarily due to the removal of the tax rate on orange juice.
More than $10 billion of Brazil’s exports should be exempt from additional tariffs imposed by the Trump administration, the vice president said. This does not mean that the product has zero tariffs, as it may already have old tariffs that are lower than the tariffs applied by the current US president.
“We achieved 23% of Brazil’s exports with zero tariffs, which was approximately $40 billion last year. The third main destination for Brazilian exports (the United States) was 23%, but with this decision, zero Brazilian exports increase to 26% with virtually no tariffs. This is a positive thing and we will continue our work,” Alkmin said at a press conference.
The vice president said that while the tariff reductions President Trump announced yesterday are progress, there remains a “road of work” to correct what he called “distortions.”
He said that although the 10% tax has been abolished on many products around the world, the 40% surcharge remains “very high” in Brazil.
Some Brazilian products are subject to an additional 40% tariff. Coffee, for example, was subject to a 10% cut announced by President Trump on Friday, but still carries a hefty surcharge. He said the impact of tariffs continues to affect Brazil’s competition with other countries, but that President Trump’s decision is “in the right direction and the right thing to do.”
Alkmin attributed a number of factors to President Trump’s decision. These include the US government’s sensitivity to rising prices for tariffed products, pressure from business interests in the US and abroad, and Brazilian diplomatic efforts to resolve the impasse.
On Friday (14th), the US president signed a measure that lowers import duties on beef, tomatoes, coffee and bananas, with the aim of curbing domestic food inflation after the tariffs.
Among other commodity exporters, the move could benefit Brazil, the world’s largest coffee producer and second-largest beef producer after the United States, according to USDA data.
However, the executive order announced by President Trump only applies to the 10% so-called “reciprocal tariffs” imposed on all countries in April. The 40% surcharge on Brazil remains in effect.
The executive order changes the scope of tariffs based on national security, a pillar of President Trump’s strategy to address America’s “huge and persistent trade deficit.”
The decision was made following recommendations from officials tasked with overseeing the national emergency declared by President Trump in April. The government cited negotiations with trading partners, domestic demand, and U.S. production capacity as motivations for the review.
In his executive order, President Trump stated, “I have determined that it is necessary and appropriate to further change the scope of items subject to reciprocal tariffs imposed under Executive Order 14257 (Measures Applying Global Common Tariffs).”
Still, on Friday after the measure was announced, President Trump said on Air Force One that further tariff cuts were not necessary.
“We just kind of retreated,” he said. “The price of coffee was a little high, but now it will go down in a very short period of time.”
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