Brazil is keeping negotiations with Washington open as additional tariffs remain in place, raising questions about exports, businesses and the impact on the Brazilian economy.
Relations between the United States and Brazil entered a new phase this week as both governments continued commercial discussions while additional U.S. tariffs on some Brazilian products remain in effect. The issue returned to the center of attention as Brazilian President Luiz Inácio Lula da Silva indicated that Brazil intends to keep negotiating before adopting reciprocal measures against American goods. The discussions are taking place during an intense period of diplomatic activity in New York surrounding the United Nations General Assembly, where officials from both countries have also addressed political and economic issues. For Brazilians, the dispute goes beyond diplomacy: tariffs can affect exporters, supply chains, prices, investments and even the relationship between the Brazilian real and the U.S. dollar. The key question now is what could happen if negotiations produce an agreement — or if the talks fail to resolve the dispute.
Why U.S. tariffs remain at the center of the relationship with Brazil
The current trade dispute between Brazil and the United States stems from several measures adopted by the U.S. government during 2026. In July, the Office of the United States Trade Representative, or USTR, announced an additional 25% tariff on certain Brazilian products following a Section 301 investigation. According to the U.S. government, the investigation examined issues including digital trade, electronic payment services, intellectual property, access to Brazil’s ethanol market and other Brazilian policies that Washington considers harmful to U.S. commerce. The Brazilian government has challenged some of the arguments presented by the United States and has sought to preserve a channel for negotiations. U.S. Trade Representative announcement
The tariff structure is important because not every Brazilian product entering the U.S. market is necessarily subject to the same charge. Brazil’s Ministry of Development, Industry, Foreign Trade and Services reported in July that the additional measures announced by Washington covered 23.1% of Brazilian exports, while 52.7% remained outside additional country-specific or sector-specific tariffs against Brazil at that point. The Brazilian government also introduced mechanisms to assist exporters affected by the new trade barriers, including extensions involving the drawback export-support regime. This means the dispute is not limited to political relations between presidents: companies selling to the American market must assess contracts, costs, profit margins and possible alternative destinations for their products. Brazilian Ministry of Development and Foreign Trade
What changed this week in negotiations between Washington and Brasília
The most significant recent development was Brazil’s indication that it intends to continue negotiations before applying reciprocal measures against the United States. In an interview released on September 21, Lula said his government did not intend to immediately use Brazil’s Reciprocity Law while trade discussions remained underway. The position keeps the possibility of additional measures open if negotiations fail to produce progress, while preserving diplomatic space for a negotiated solution in the short term. Reuters reported that the U.S. tariffs include a 25% charge on certain Brazilian products, alongside another 12.5% surcharge associated with broader U.S. trade measures. Reuters report on Brazil-U.S. trade talks
The development also comes during a week of intense diplomatic activity in the United States. Lula and U.S. President Donald Trump participated in the United Nations General Assembly agenda in New York, while relations between the two countries included discussions involving trade, foreign policy and issues connected to Brazil’s political environment. Agência Brasil reported on the broader context of the bilateral relationship as Brazilian officials sought to maintain diplomatic and commercial ties with Washington. At the same time, Lula used his UN appearance to argue that electoral processes should not face foreign interference, while American authorities continued to express their own positions on the bilateral relationship. Agência Brasil — Brazil-U.S. relations
For Brazilian companies, the most important point is that diplomatic negotiations can affect economic decisions even before a formal change in tariffs takes place. Exporters need to monitor possible product exclusions, changes in tariff rates, implementation deadlines and customs rules. The Brazilian government has already adopted a specific measure for affected companies: a provisional measure allows exceptional extensions of certain tax suspension periods under the drawback regime when export commitments are disrupted by U.S. tariffs. In practice, this can reduce some of the financial pressure on companies that import inputs to manufacture goods destined for foreign markets. Brazilian government — Provisional Measure on drawback rules
How the U.S.-Brazil trade dispute could affect Brazilian consumers
For Brazilian consumers, the effects of a trade dispute between the two countries do not necessarily appear as a direct charge. They can emerge indirectly, depending on which products are affected, how much companies can pass on in additional costs and what alternatives exporters have available. When a Brazilian product becomes more expensive in the U.S. market, a company may reduce its profit margin, seek buyers in other countries or change its production strategy. If the changes affect important export sectors, they can also influence investment, employment and the flow of dollars into Brazil. That is why the tariff dispute matters even to Brazilians who have never exported anything to the United States.
The exchange rate is another important transmission channel. Companies receiving dollars from exports must monitor both the U.S. currency and their costs in Brazilian reais, while Brazilian businesses importing equipment, components or services from the United States are also exposed to exchange-rate movements. Brazil’s Federal Revenue Service publishes specific dollar exchange rates for certain tax purposes involving foreign-currency transactions, illustrating how deeply the U.S. currency is integrated into different economic operations in Brazil. In September, the agency recorded reference rates of R$5.2230 for dollar purchases and R$5.2236 for sales for certain tax-related purposes. Brazilian Federal Revenue Service — 2026 currency conversion tables
There is also an effect on Brazil’s broader trade strategy. If certain Brazilian products face greater difficulty entering the American market, companies may seek to expand sales to Europe, Asia, the Middle East and other destinations. Diversification can reduce dependence on a single buyer, but it also requires changes in contracts, logistics, certifications and market conditions. The Brazilian government has been promoting broader trade partnerships while continuing its dialogue with Washington. The Ministry of Development also continues to publish weekly trade-balance data, allowing businesses and analysts to monitor how exports and imports are evolving during the period of tariff uncertainty. Brazilian Ministry of Development — September 2026 trade balance
For Brazilians living in the United States, the situation is also worth watching, although trade tariffs are not immigration measures. The economic relationship between the two countries affects Brazilian-owned businesses operating in the U.S., workers connected to international trade and sectors that depend on Brazilian products. For people living in Brazil, the most visible effects are more likely to appear through prices, opportunities for exporting companies, dollar flows and investment decisions. The scale of those effects will depend on which products remain subject to tariffs and how the two governments conduct the next rounds of negotiations.
The situation this week is therefore one of ongoing negotiations without a definitive outcome. Brazil has signaled that it wants to continue talking before adopting additional measures, while U.S. tariffs remain one of the main sources of commercial tension between the two countries. For Brazilians, following political statements alone is not enough: changes in tariff rates, affected products, import rules and trade data will be equally important. If an agreement is reached, some companies could gain greater predictability to reorganize their businesses; if negotiations fail, additional measures could once again change trading conditions. The next step will be to see whether talks between Brasília and Washington can turn the current tariff dispute into more stable rules for companies in both countries.
Sources: Reuters · U.S. Trade Representative · Brazilian Ministry of Development · Agência Brasil · Brazilian Federal Revenue Service.
