By Lisandra Paraguassu
BRASILIA, July 14 (Reuters) - Brazil is bracing for the United States to impose a new 25% tariff on thousands of its imports after months of intensive but largely unproductive negotiations, three people familiar with the matter told Reuters, in a move expected to kick off a broader round of U.S. tariffs affecting multiple countries.
The announcement from the administration of U.S. President Donald Trump, expected this Wednesday, may affect more than 4,000 products, from sugar
to pig iron, exported from Brazil to the U.S. market, representing about $15 billion in annual trade, according to a survey by the National Confederation of Industry, Brazil's top industry lobby.
"There were dozens of meetings, six or seven in the last month alone," said one Brazilian official who asked not to be named because they were not authorized to discuss the matter publicly. "But they want the impossible."
U.S. demands included exclusive lower tariffs on some of its exports, concessions that Brazilian law does not allow the government to grant unilaterally to a single country, officials said.
Brazil would be the first country targeted under the Trump administration's new tariff strategy, which relies on Section 301 of U.S. trade law, a provision that authorizes investigations into alleged unfair trade practices.
The approach gained prominence after the U.S. Supreme Court struck down its global tariff policy in February.
With close to 80 trade investigations opened by the U.S. Trade Representative, Brazil appears poised to become the first test case for a new wave of tariffs that could eventually be applied to dozens of countries.
The investigation into Brazil, opened last July, cited several alleged unfair practices, including illegal deforestation and Brazil's instant payment system, Pix, which the U.S. government argues disadvantages credit card companies.
Brazil vehemently refuted all the allegations. In a letter sent to U.S. Trade Representative Jamieson Greer, Brazil's Minister of Foreign Affairs Mauro Vieira said the U.S. has not confirmed its allegations. He added the investigation was "arbitrary" and part of "widespread economic pressure imposed by the U.S."
According to the Brazilian National Industry Confederation, the tariff increases affect products for which Brazil is a leading supplier to the United States, including pig iron, wood moldings, cane sugar, ethanol, and tobacco.
This tariff increase, the group's president, Ricardo Alban, said in a statement, "harms companies in both countries."
'SHOOTING THEMSELVES IN THE FOOT'
The proposed Section 301 tariffs are expected to exempt several categories of Brazilian goods, such as beef, coffee, rare earths, and aircraft parts, that make up the majority of the country's exports to the U.S.
Those products had already been exempted from the previous 40% tariffs the Trump administration imposed on Brazilian goods, which were politically motivated by the arrest of former Brazilian President Jair Bolsonaro, a Trump ally who is now serving time under house arrest for attempting to overthrow democracy after he lost the 2022 election.
Relations between Trump and Brazilian President Luiz Inacio Lula da Silva, one of Latin America's most prominent leftist leaders, have improved since then, easing political tensions.
The tariffs are expected to kick in less than three months before Brazil's presidential election, when Lula is expected to run against Bolsonaro's son, Senator Flavio Bolsonaro.
According to Brazilian government sources, the country may retaliate once the U.S. tariffs are in place, depending on their impact.
Brazil has also been included in a separate 301 investigation by the USTR, due to conclude on July 24, into connections to forced labor in the supply chains of dozens of countries.
The probe is expected to result in an additional 12.5% tariff, bringing the total burden for Brazilian products to 37.5%.
The measures risk further straining a trade relationship that has already begun to deteriorate.
Data from the American-Brazilian Chamber of Commerce show that the U.S. share of Brazil's total trade fell to 9.7% in the first half of this year, compared to the same period in 2025, when it represented 12.1%, and it is the lowest level since records began in 1997.
Brazilian officials say the U.S. tariffs did not bring the country to its knees, but forced companies to seek other partners, tightening relations with China.
"They are shooting themselves in the foot," one official said of the Trump administration. "They're pushing Brazil and other countries further and further toward Asia."
(Reporting by Lisandra Paraguassu, editing by Manuela Andreoni and Aurora Ellis)
