Brazil Turns to China as Trump Hits Lula With New 25% Tariff Threat

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Washington Turns Up the Heat on Brasília

The United States has proposed a new 25% tariff on a broad range of imports from Brazil. The announcement came from the Office of the United States Trade Representative (USTR) — the government agency responsible for U.S. trade policy — following the completion of a formal investigation under the so-called Section 301 trade statute, the same legal tool previously used against China.

According to the USTR, the investigation found that Brazil's policies in several areas — including anti-corruption enforcement, intellectual property protection, ethanol market access, and illegal deforestation — are unreasonable and burden or restrict U.S. commerce.

The proposed tariff would exclude certain goods, including beef, coffee, rare earths, other metals, energy products, and aircraft parts. A public comment period is open until July 1, with a public hearing scheduled for July 6. A final decision is expected by July 15.

Lula Looks East — Not North

Brazilian President Luiz Inácio Lula da Silva wasted no time in signaling his response. Rather than seeking compromise with Washington, the left-wing leader pointed toward Beijing.

On the same day the tariff proposal was announced, China officially recognized Brazil as free of foot-and-mouth disease — a move with significant economic implications for Brazilian beef exports to the Chinese market. Lula publicly celebrated the news as a direct counterpoint to the U.S. announcement.

"If you don't want to buy from me, I will sell to someone else," Lula declared at an event in the state of Goiás.

The leftist leader said he had learned of the tariff proposal during ongoing trade talks and added that U.S. and Brazilian negotiators had met three times in recent weeks without reaching a deal.

A Long-Running Trade War — With Political Roots

This latest escalation does not come out of nowhere. The conflict between Washington and Brasília has been building for over a year, and it has always carried a strong political undercurrent.

In July 2025, the Trump administration imposed tariffs of 50% on Brazilian imports — among the highest on any country — partly in connection with the prosecution of former Brazilian President Jair Bolsonaro, a close Trump ally who was later convicted for attempting to overthrow democracy.

The U.S. Supreme Court struck down those emergency tariffs in February 2026, ruling that the administration lacked authority to impose them under emergency powers. That left Brazil subject to a 10% global tariff, along with separate sector-specific duties on steel, aluminum, and copper.

Earlier in May, Trump and Lula held a closed-door meeting at the White House. Trump described it as going "very well" and said both sides would continue discussions on key trade issues — but the new tariff proposal suggests those discussions have stalled.

Blame Game: Lula Points the Finger at Flavio Bolsonaro

Lula did not hold back in assigning blame. He publicly accused Flávio Bolsonaro — senator and son of former President Jair Bolsonaro, who is widely expected to run for president — of lobbying the Trump administration to impose tariffs on Brazil.

Lula also attacked U.S. Secretary of State Marco Rubio, accusing him of being hostile toward Latin America and Brazil specifically.

Flávio Bolsonaro, for his part, rejected the accusations and stated he had in fact urged Trump not to impose tariffs on Brazilian companies.

The Bolsonaro family's political maneuvering in Washington has long been a source of tension. A Reuters interview earlier this year captured Lula saying Bolsonaro should face additional legal charges for allegedly inciting the United States against Brazil and causing harm to the Brazilian economy and its workers.

The Beijing Factor

Lula's pivot toward China is not new, but it is becoming more explicit. As Washington pressures Brasília, Beijing is stepping in as an alternative partner — and the timing of China's foot-and-mouth disease announcement appears carefully coordinated.

In response to fraying ties with Washington, Brasília has increasingly sought closer relations with Beijing. However, that strategy carries domestic risks: polling has shown that roughly 75% of Brazilians distrust China.

For now, Lula is betting that economic necessity will override public skepticism. Brazil is the world's largest beef exporter, and access to the Chinese market represents a massive commercial opportunity. Whether that bet pays off — or whether it deepens Brazil's dependence on an authoritarian regime — remains to be seen.

What Happens Next

The proposed 25% tariff is not yet in force. The USTR process includes public hearings and a comment period before any final decision is made. Negotiations between Washington and Brasília could still produce a last-minute deal before the July 15 deadline.

U.S. Trade Representative Jamieson Greer acknowledged that despite several constructive meetings between Trump and Lula, the two countries continue to have substantial differences on the issues identified in the investigation.

For Brazil's economy — and for the geopolitical balance in the Western Hemisphere — the outcome of those talks will matter greatly. A Brazil that drifts deeper into China's orbit is a strategic concern that goes well beyond steel and soybeans.

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Sources

1. USTR – Section 301 Investigation into Brazil's Trade Practices: https://ustr.gov
2. CNBC – Trump Proposes 25% Tariff on Brazil (June 2, 2026): https://www.cnbc.com/2026/06/02/trump-proposes-25-tariff-on-brazil.html
3. Modern Diplomacy – Trump Administration Proposes 25% Tariff on Brazil: https://moderndiplomacy.eu/2026/06/02/trump-administration-proposes-25-percent-tariff-on-brazil-over-trade-disputes-and-market-access-concerns/
4. US News / Reuters – Trump Administration Proposes 25% Tariff to Punish Brazil: https://www.usnews.com/news/top-news/articles/2026-06-01/trump-administration-proposes-25-tariff-to-punish-brazil-over-trade-practices
5. The National Desk – Trump Administration Targets Brazil With New 25% Tariff Proposal: https://thenationaldesk.com/news/americas-news-now/president-donald-trump-administration-office-of-the-united-states-trade-representative-targets-brazil-with-new-25-percent-tariff-proposal-us-commerce-unfair-foreign-practices-president-luiz-inacio-lula-da-silva
6. Al Jazeera – Brazil's Lula Meets Trump Amid Trade Tariff Tensions (May 2026): https://www.aljazeera.com/news/2026/5/7/brazils-lula-meets-trump-amid-efforts-to-avert-new-us-trade-tariffs
7. Reuters (via AOL) – Lula Says Bolsonaro Should Face Charges for Inciting U.S. Against Brazil: https://www.aol.com/news/exclusive-lula-says-bolsonaro-face-190412445.html

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