Brazil will not retaliate against U.S. steel tariffs immediately, mulls all actions

Brazilian Economy Minister Fernando Haddad attends a press conference to review the G20 Finance Ministers and Central Bank Governors Meeting, in Rio de Janeiro, Brazil, Friday, July 26, 2024. (AP Photo/Bruna Prado) (Bruna Prado/AP)

BRASILIA — Brazil’s Finance Minister said on Wednesday that the country would not immediately retaliate against tariffs imposed by the U.S. on steel and aluminum imports, instead seeking talks, with the government noting it will consider all actions.

U.S. President Donald Trump’s increased tariffs on all steel and aluminum imports took effect on Wednesday, stepping up a campaign to reorder global trade in favor of the U.S. and drawing swift retaliation from Canada and Europe.

In a statement, the Brazilian government said it regrets the “unjustifiable” move by the U.S., citing a history of cooperation and economic integration between the two countries.

Brazil, one of the largest sources of U.S. steel imports, said its government will assess in the next few weeks all possible measures in reaction, including at the World Trade Organization.

President Luiz Inacio Lula da Silva has ordered his economic team to seek dialog with the Trump administration, Finance Minister Fernando Haddad told reporters earlier on Wednesday after a meeting with members of the local steel industry in Brasilia.

“President Lula told us to remain calm, noting that in the past we have negotiated under conditions that were even more unfavorable than the current ones,” Haddad said.

Brazil’s Vice President Geraldo Alckmin last week held what his office described as a “positive” call with U.S. Commerce Secretary Howard Lutnick on U.S. tariff policy. They agreed that dialog between the two governments would continue.

Brazil in 2018 agreed to a quota system deal with the previous U.S. Trump administration, allowing it to export up to 3.5 million tons for semi-finished steel to the U.S. without facing tariffs on its goods.

In a statement, Brazil steel lobby Aco Brasil defended the quota system that was scrapped on Wednesday as the new tariffs were deployed.

Brazil’s presidential chief of staff, Rui Costa, said on Wednesday that Brazilian and U.S. government officials have a meeting scheduled for Friday to seek an understanding on tariffs.

Costa noted that the standard procedure in diplomacy would be “reciprocity,” but added that a final decision would only be made after Friday’s meeting.

Brazil said its steel industry has maintained a relationship of “mutually beneficial complementary” with the United States, being the third largest importer of U.S. steelmaking coal and the largest exporter of semi-finished steel to U.S.

Reporting by Marcela Ayres and Lisandra Paraguassu in Brasilia; additional reporting by Andre Romani and Alberto Alerigi Jr. in Sao Paulo; Editing by Nick Zieminski and Aurora Ellis.