Trump's 50% tariff threat hits Brazilian chemical exports as US orders cancelled

Indian Express

2 days ago

Brazilian chemical exporters are seeing contracts cancelled after US President Donald Trump announced plans to impose a 50% tariff on Brazilian goods starting 1 August, Reuters reported.
Brazil exported about $2.4 billion worth of chemical products to the United States last year. Since the tariff threat, orders for some products including resins and compounds used to make fertilisers have been cancelled, said Andre Cordeiro, head of Brazilian chemical industry group Abiquim.
'These decisions are being made because people believe he will actually go ahead with the tariff,' Cordeiro told Reuters on Friday.
He said one company had all of its US export contracts cancelled, while others lost parts of their orders. In some cases, exporters had already arranged financing before the cancellations. Cordeiro did not name the affected companies.
The impact is not limited to direct chemical exports. 'No one produces coffee, even grains, without some kind of chemical product in the process,' he said.
According to Cordeiro, chemical firms are also losing domestic sales to Brazilian companies that export to the US. He cited plywood manufacturers, who use chemicals for bonding and have also lost orders, and orange juice producers, who rely on chemical preservatives. Last year, 42% of Brazil's orange juice exports went to the US.
Large firms such as Braskem and Dow Chemical may also be affected. Braskem has operations in the US, while Dow, which runs 10 plants in Brazil, exports silicon metal to the American market. Neither company commented when contacted by Reuters.
Exxon Mobil, which also operates in Brazil, declined to comment. Abiquim says the tariffs are unjustified, pointing out that Brazil's chemical sector runs a $7.9 billion trade deficit with the United States.