Brazil announced on Wednesday it will evaluate all potential countermeasures – including formal action through the World Trade Organization – against new U.S. tariffs on steel and aluminum imports that took effect this week. The measures target President Donald Trump's decision to raise duties as part of a broader strategy to reshape global trade flows.
The Brazilian Foreign Ministry and Ministry of Development warned the tariffs could impact $3.2 billion in annual steel and aluminum exports to the U.S., calling the move "unjustified" given decades of economic cooperation. Brazil remains a critical trade partner for Washington, serving as the top exporter of semi-finished steel and third-largest buyer of U.S. steelmaking coal.
While the U.S. recorded a $7 billion trade surplus with Brazil in 2024 for goods alone, tensions now loom over one of South America's most significant economic relationships. President Luiz Inacio Lula da Silva has directed his economic team to pursue dialogue with U.S. officials, according to Finance Minister Fernando Haddad.
"We've negotiated under more challenging circumstances before," Haddad said after meeting with steel industry representatives, emphasizing Brazil's intent to protect national interests. Analysts suggest WTO arbitration could take years, prompting immediate concerns for Brazilian manufacturers reliant on U.S. markets.
The dispute highlights growing uncertainties in global supply chains as major economies recalibrate trade policies. For Asian investors and businesses, the friction underscores the need to monitor shifting regulatory landscapes across multiple jurisdictions.
