Brazil responds to United States report and contests 25% tariff Public hearings promoted by the Office of the United States Trade Representative (USTR) begin this Monday (6), a stage considered decisive in the American trade investigation that proposes an additional 25% tariff on Brazilian products. Hearings are part of the process, based on Section 301 of US trade law, and allow companies, associations, governments and other interested parties to present their arguments before the United States makes a final decision. (learn more about the hearings) ? The USTR is the body responsible for formulating United States trade policy. It also conducts investigations into practices considered harmful to American commerce and can recommend measures such as the imposition of tariffs. Representatives from Brazilian industry and agribusiness will be among the participants. They intend to convince the American government that the surcharge would harm not only Brazilian exporters, but also US companies, consumers and production chains. Among the participants are the National Confederation of Industry (CNI), the Federation of Industries of the State of São Paulo (Fiesp), the Brazilian Association of the Machinery and Equipment Industry (Abimaq) and the Confederation of Agriculture and Livestock of Brazil (CNA), as well as representatives from the coffee, rice, sugar, corn ethanol, pig iron, ornamental rocks, wood, paper, footwear, honey and intellectual property sectors. Meanwhile, technical teams from the governments of both countries are expected to meet later this week to align preparations for a final round of high-level negotiations before July 15, the deadline in which Washington will decide whether to move forward with the imposition of tariffs. The defense of Brazilian industry The Brazilian industry's strategy is to show that the economies of the two countries are strongly integrated and that the tariff would also increase costs for American companies. ?? Manufacturing industry Fiesp, which represents industries in São Paulo, will argue that the 25% tariff has no technical or economic justification and could harm companies and consumers in both countries. In São Paulo, the most exposed segments are precisely those with the highest added value, such as machinery and equipment, auto parts, processed foods, wood, furniture and other manufactured products. According to CNI estimates, if the measure is adopted: 31.6% of Brazilian exports to the United States will pay a total tariff of 37.5% (sum of 25% from the commercial investigation with another 12.5% ??from another American accusation, of “failure to combat forced labor” in the country); 35.2% of all Brazilian exports to the American market will be affected by the new surcharge; Added to the already existing Section 232 tariffs, 54.1% of Brazilian exports to the United States will be subject to some type of additional tariff. During the hearing, the entity also intends to refute four points of the US investigation: Intellectual property: it will argue that Brazil reduced the stock of patents at the INPI, reinforced the fight against piracy and expanded inspection actions; Import tariffs: will state that Brazilian trade agreements have limited scope and that around half of imports from the USA already enter the country with zero tariffs or reduced tariffs through special regimes; Deforestation: will argue that the growth in agricultural production results mainly from gains in productivity and technology, and not from expansion into forest areas; Bilateral relationship: will defend greater commercial integration and technical cooperation between Brazil and the United States, instead of creating new barriers. Fiesp: 'Tariff doesn't make economic sense' Roberto Azevêdo, Superior Council of Foreign Trade at Fiesp Disclosure The president of the Superior Council of Foreign Trade at Fiesp, Roberto Azevêdo, told g1 that the entity intends to demonstrate that the accusations made by the USTR are not sustainable. "The Brazilian practice is not discriminatory, it is not unfair or illegal from the point of view of international trade rules, and it does not harm American companies", says Azevêdo. In the investigation, the American government questions Brazil's trade agreements with countries such as Mexico and India, alleging that they grant preferential tariffs to products from specific sectors. The Brazilian government counters, stating that these agreements are legitimate, follow WTO rules and cannot be considered a practice subject to trade sanctions. Azevêdo, who is also former director general of the World Trade Organization (WTO), highlights that the proposed tariff will also not produce the effects intended by the USA. "This tariff does not make sense from an economic point of view. It will not solve the problems highlighted by the USTR. On the contrary, it will increase the costs of production chains in Brazil and the United States, raise prices for consumers and harm companies in both countries." According to Azevêdo, the path involves expanding negotiations between governments. "The Brazilian government could be even more proactive and creative in the search for solutions. Negotiating is not surrendering or losing sovereignty. It is seeking reciprocal gains for both sides." Brazil sent, on Wednesday (1st), a response to the USA about the investigation opened by the Donald Trump government. In the document, signed by Chancellor Mauro Vieira, Brazil states that the American government's criticism of Pix and the decisions of the Federal Supreme Court (STF) are not related to trade, but to disagreements over internal policies. Roberto Azevêdo states that, although the technical defense presented by Brazil is consistent, the solution depends on political articulation. "It is not enough to present legal arguments; political bodies must be constantly involved to seek a solution." CNI defends dialogue to avoid losses to both countries Pecém Industrial and Port Complex Divulgação/CNI The National Confederation of Industry (CNI) will defend, during the hearing, that the additional tariff of 25% has no legal, economic or strategic justification and could harm Brazilian and American companies. In an interview with g1, CNI's Trade and International Integration manager, Constanza Negri, stated that there is no evidence that American companies are discriminated against in Brazil. "From our perspective, it is clear that these measures have no justification in any of the three plans: legal, economic or strategic," he stated. According to her, the commercial relationship between the two countries is complementary and the surcharge would increase costs for the entire production chain. "Any measure that makes this relationship more expensive or creates barriers will bring harm not only to Brazil, but also to the United States," he said. The executive also stated that the industry defends the prioritization of negotiations between governments and warned that the sector's main concern is the uncertainty generated by successive changes in US trade policy. "The private sector has been suffering not only due to the drop in exports, but also due to the great unpredictability. Companies do not know which tariff they will be subject to", he stated. ?? Machines and equipment Disclosure The United States is the main destination for Brazilian exports of machinery and equipment The Brazilian Association of the Machinery and Equipment Industry (Abimaq) will ask for the sector to be excluded from a possible additional tariff of 25%, arguing that the commercial relationship between Brazil and the USA is based on integrated production chains, and not on direct competition. The United States is the main destination for Brazilian exports of machinery and equipment and accounts for around a quarter of the sector's foreign sales. In 2025, however, tariffs imposed by the American government led to a drop of more than 9% in these exports. ? In addition to the 10% global tariff in force since February 2026, some products are also subject to Section 232 tariffs, applied to steel and aluminum. Before all the tariffs, most Brazilian machines entered the American market with zero tariffs. Abimaq's main line of defense will be to show that a surcharge would also harm American industry. According to the entity, 82% of Brazilian machinery exports to the United States occur between companies in the same economic group, such as an American headquarters and its branch in Brazil. For Abimaq, this shows that the production chains of the two countries are highly integrated and that a surcharge would increase the costs of the American industry itself, which depends on these components and equipment. Speaking to g1, Abimaq's Director of Foreign Trade, Patrícia Gomes, stated that much equipment is developed to order, goes through certification processes and requires a long-term relationship between manufacturers and customers. "It is very difficult to replace a supplier of machinery and equipment. We are talking about medium and long-term projects, with certified equipment and developed together with customers." According to the executive, a rupture in these chains would increase the costs of the American industry itself and would affect investments in strategic sectors, such as construction, logistics, mining, energy and transport. Despite defending the complete exclusion of the sector, Abimaq recognizes that the scenario is still uncertain and considers it more likely to expand the list of exempt products. (learn more) "Our objective is to seek the exclusion of the machinery and equipment sector. But, given the uncertainties, we are also working to expand the list of exceptions if the tariffs are maintained." ?? Steel The Iron Industry Union in the State of Minas Gerais (Sindifer), which represents companies producing pig iron in the main exporting state of the product in the country, will ask for the exclusion of Brazilian pig iron from the tariff. ?? Pig iron is the raw material used in the manufacture of steel and cast iron parts. The product supplies steel mills and foundries and is considered an essential input for several industrial segments. The entity states that the product is essential for American steel mills, has no relation to the issues investigated by the USTR and is difficult to replace. It also highlights that around 83% of Brazilian pig iron exports are destined for the USA and that national production uses charcoal from planted forests, reducing carbon emissions ?? Agribusiness Soluble coffee. is among the products outside the exemption list and that can be taxed. Consciência Café. - Disclosure. In the case of agribusiness, three Brazilian segments — honey, instant coffee and fish — are participating in the hearings in the United States to try to avoid the new tariff proposed by Trump. The central strategy is to demonstrate that the measure can put pressure on consumer prices, increase inflation and also affect production chains within the American economy itself, entities such as: Confederation of Agriculture and Livestock. of Brazil (CNA); Brazilian Rural Society; Brazilian Soluble Coffee Industry Association (ABICS); National Corn Ethanol Association (UNEM); 5 million rural producers, states that the tariffs harm a commercial relationship considered complementary between the two countries. In a statement sent to the USTR, the entity maintains that Brazilian trade agreements with countries such as Mexico and India follow WTO rules and do not cause harm to the United States. According to the CNA, these agreements represent around 1.9% of Brazilian imports, while the United States remains the second largest supplier to the Brazilian market. ? The CNA also disputes the association between the growth of agribusiness and illegal deforestation, stating that the increase in production occurred mainly due to productivity gains and technological innovation. As an example, he mentions that, between 2005 and 2026, grain production grew 213%, while deforestation in the Amazon fell 79%. As an alternative to tariffs, the entity defended the strengthening of bilateral cooperation in areas such as sustainable agriculture, biofuels and trade facilitation, also highlighting the dependence of Brazilian agriculture on inputs imported from the United States.