Brazil’s Finance Minister Fernando Haddad has confirmed that the country is preparing for a wide-ranging negotiation on tariffs with the United States, with sugar and ethanol trade expected to be key points of discussion. Speaking to Reuters, Haddad acknowledged the complexity of the talks, given the broader trade frictions involving the U.S.
The planned negotiations follow growing concerns over potential U.S. tariffs on Brazilian ethanol. Brazil’s Energy and Mining Minister Alexandre Silveira has described such tariffs as unreasonable, citing the long-standing history of sugar and ethanol trade between the two countries. Brazil, one of the world’s top sugar producers, primarily produces ethanol from sugarcane, in contrast to the corn-based ethanol production in the U.S.
Brazil produced some 35 billion liters of ethanol in 2024 but exported less than 6%, of which only some 300 million liters went to the U.S., a report from BTG Pactual showed.
Data from IndexBox highlights the importance of sugar exports to Brazil’s trade portfolio, suggesting that any shift in tariff policy could have a major impact on the sector. Brazilian authorities have voiced concern over what they see as an imbalance, noting that U.S. tariffs on sugar imports are considerably higher than Brazil’s tariffs on ethanol.
In addition to agricultural goods, Haddad suggested that trade in services could also form part of the discussions, pointing out that the U.S. is a dominant exporter in that sector, while Brazil has a limited presence. He stressed that Brazil’s approach would focus on reciprocity rather than retaliation, with the government undertaking a broader review of the country’s import and export priorities as it prepares for talks.
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