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World risk · Trade, tariffs and sanctions · US trade & foreign policy

The US raises its Section 301 duty on Brazil or strips its exemptions

The test Between 26 Oct 2026 and 25 Oct 2027, USTR raises the Section 301 duty on products of Brazil to 35% or more, or removes from its exemption annexes products worth US$2bn or more of 2024 US imports from Brazil.

Not under way · Confidence: medium · Reviewed 28 Oct 2026 · Scores from 1 to 10

This page answers: What could happen, how it is scored, and who is exposed?

Using this page
  1. Read the two scores: Likelihood and Impact are kept apart.
  2. Check what is happening, each fact with its source.
  3. Use the calendar for the dates to watch.

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Likelihood
3Low falling this month

Likelihood ↓ Since 30 Sep 2026: the US and Brazil agreed to create a working group on trade (MDIC).

Impact
4Elevated steady this month
Breadth4
Depth1
Duration7
Hard to substitute4
Canada pointNot added0

Impact is the average of the four parts, rounded, plus one point when Canada is directly hit on two or more channels, up to 10.

Two separate scales from 1 to 10. Strature never multiplies or merges them.

What changed

Dated, newest first

  1. On 27 Oct 2026 Flávio Bolsonaro flew to the US despite a court order to hand over his passports and not to leave Brazil; a senior State Department official told Reuters the department will issue visas to him and his family. [16]
  2. Brazil's exports to the US were US$27.46bn in Jan-Sep 2026 against US$29.37bn in Jan-Sep 2025. [8]
  3. Lula was re-elected on 25 Oct 2026 on the TSE's count: with 100% of sections totalled, 51.79% of valid votes to 48.21% for Flávio Bolsonaro [15]
  4. Agencia Brasil reported Lula re-elected on the evening of 25 Oct 2026 [9]
  5. On 30 Sep 2026 Brazil and USTR agreed to create a working group; the US is to send a scope document in the coming weeks. [3]

Why it matters

The US has charged an extra 25% on Brazilian goods under Section 301 since 22 Jul 2026, but wide exemptions leave about a fifth of US imports from Brazil paying the full rate. The two governments agreed on 30 Sep 2026 to set up a working group on a possible deal, and Lula was re-elected in the 25 Oct runoff. A higher rate or a narrower exemption list would hit manufactures and dissolving pulp first, not Brazil's oil and coffee.

Why Likelihood 3 Pushes: 2025 US duties on Brazil over the Bolsonaro prosecution; the President judged a lower rate less effective, and USTR may modify the action under section 307; a watch item: the State Department said on 27 Oct 2026 it would issue visas to Flávio Bolsonaro and his family.

Why Impact 4 Threshold case: the rate on US$8.5bn of goods (2024 base) rises from 25% to 35%. Mean (4 + 1 + 7 + 4) / 4 = 4.0, so 4.

The other facts on file (8)
  • USTR imposes a 25% Section 301 duty on all imports of Brazil, with exemptions, for goods entered from 22 Jul 2026; high-purity dissolving pulp pays the full rate; USTR will monitor and may modify the action under section 307. [1] (15 Jul 2026)
  • On the 2024 base, US$8.5bn of US$39.6bn of US imports from Brazil pays the full 25%; annex exemptions cover US$20.1bn and Section 232 goods US$7.3bn. [2] (16 Jul 2026)
  • A separate Section 301 forced-labour action charges 12.5% on products of Brazil from 24 Jul 2026. [5] (28 Jul 2026)
  • Lula's office said it repudiated the US decision and would use Brazil's Reciprocity Law and the WTO. [6] (16 Jul 2026)
  • Canada-Brazil merchandise trade was C$14.7bn in 2025. [11] (30 Jun 2026)
  • USTR Greer said on 10 Dec 2025 that Trump had several constructive interactions with Lula on trade and that he wanted some kind of deal with Brazil; the US imposed duties on Brazil in 2025 over the Bolsonaro prosecution. [7] (10 Dec 2025)
  • The Supreme Court held on 20 Feb 2026 that IEEPA does not authorise tariffs. [13] (20 Feb 2026)
  • Brazil requested WTO consultations (DS646) on 27 Jul 2026 against both the 25% and the 12.5% Section 301 duties. [12] (27 Jul 2026)

Where it sits

11. The US raises its Section 301 duty on Brazil or strips its exemptions: Elevated impact · unlikely1 · Elevated impact · unlikelyOttawaMexico CityCANADAMEXICOUNITED STATESPACIFIC OCEANATLANTIC OCEANGULF OF MEXICO01000 kmat 40°NMap data: Natural Earth (public domain).
11. The US raises its Section 301 duty on Brazil or strips its exemptions: Elevated impact · unlikelyWashingtonCANADAMEXICOUNITED STATESGULF OF MEXICO0500 kmat 40°NMap data: Natural Earth (public domain).

How it spreads

If

Between 26 Oct 2026 and 25 Oct 2027, USTR raises the Section 301 duty on products of Brazil to 35% or more, or removes from its exemption annexes products worth US$2bn or more of 2024 US imports from Brazil.

Not under way

Channels 4 on the card

  1. CanadaCanadian pulp and metals may win some US orders (Strature's view); Canada-Brazil merchandise trade was C$14.7bn in 2025 [11]; no Canadian loss sourced.
  2. Brazilian exportersUS$8.5bn at the full rate [2] would pay at least 35% under a 10-point rise (Strature's threshold); a narrower annex brings oil, coffee or pig iron in.
  3. US buyersExempt goods were chosen to protect US supply; pulling them in raises input costs (Strature's view).
  4. Trade policyA rise during talks would end the working group's track [3] and invite Brazil's Reciprocity Law [6] (Strature's view).

Goods 1

Sectors 2

  • Agriculture and food
  • Mining and metals

Countries 3

Who is exposed

Countries
Brazil, United States
Sectors
Agriculture and food, Mining and metals, Autos
Goods
Dissolving pulp, Crude oil, Coffee, Aircraft

Three scenarios and their signposts

  1. S1

    A deal trims the duty

    The working group agrees a scope and the US cuts or suspends part of the 25%.

  2. S2

    Status quo

    Talks drag; the 25% and 12.5% duties and the annex stay.

  3. S3

    Escalation

    A breakdown in talks or a political trigger leads USTR to modify the action under section 307.

The signposts of each scenario
PathSignpost
S1The US scope document reaches Brasilia
S2No Federal Register modification by mid-2027
S3A USTR request for comments on modifying the Brazil action

No probability is given for the three paths.

Dates to watch

Calendar

The dates to watch

A dot is a day, a bar a month or a year; a hollow mark is tentative. The line marks today.

  1. Nov 2026 US document on the scope of talks, due in the coming weeks [3] Tentative · Outside event
  2. 5 Jan 2027 Lula's new term begins (Constitutional Amendment 111) [14] Declared · Outside event

    Remind me

  3. 25 Oct 2027 Scored window closes [1] Declared · Strature date

    Remind me

Sign in, with alerts on, for an email 7 days and 1 day before.

SourceStrature world-risk card; the dates cite the sources below.
Exhibit R-3 · WORLD · strature.net

The other side

A deal would remove a 25% charge on US$8.5bn of Brazilian sales [2] and could follow from the working group agreed on 30 Sep 2026 [3]. Canadian pulp and metals sellers face a weaker Brazilian rival in the US while the duty lasts (Strature's view).

Connected in Strature

Sources

14 sources, numbered as the text cites them

  1. Notice of Action: Brazil's Acts, Policies, and Practices (Section 301 final action). Office of the US Trade Representative · 15 Jul 2026 · Official · confidence high · retrieved 25 Oct 2026
  2. Brazil Section 301 final action. Global Trade Alert · 16 Jul 2026 · Think tank · confidence medium · retrieved 25 Oct 2026
  3. Reuniao presencial Brasil-EUA sobre temas comerciais. MDIC · 30 Sep 2026 · Official · confidence high · retrieved 25 Oct 2026
  4. Notice of Actions in Section 301 Investigations (forced labor import prohibitions), FR Doc. 2026-15181. Office of the US Trade Representative, Federal Register · 28 Jul 2026 · Official · confidence high · retrieved 25 Oct 2026
  5. Brazil condemns U.S. decision to impose 25% tariffs, vows to retaliate. Time · 16 Jul 2026 · News · confidence medium · retrieved 25 Oct 2026
  6. Trump had several constructive interactions with Brazil's Lula on trade, Trade Representative Greer says (Reuters). Yahoo News · 10 Dec 2025 · News · confidence high · retrieved 25 Oct 2026
  7. Brazil's exports to the United States, Jan-Sep and Jul-Sep 2025 and 2026, FOB. MDIC, Comex Stat API · 25 Oct 2026 · Official · confidence high · retrieved 25 Oct 2026
  8. Lula e reeleito presidente do Brasil em virada historica. Agencia Brasil · 25 Oct 2026 · Official · confidence high · retrieved 26 Oct 2026
  9. Canada-Brazil relations. Global Affairs Canada · 30 Jun 2026 · Official · confidence high · retrieved 25 Oct 2026
  10. DS646: United States - Additional Duties on Certain Products from Brazil. World Trade Organization · 27 Jul 2026 · Official · confidence high · retrieved 26 Oct 2026
  11. Learning Resources, Inc. v. Trump, No. 24-1287 (slip opinion). Supreme Court of the United States · 20 Feb 2026 · Official · confidence high · retrieved 26 Oct 2026
  12. Emenda Constitucional n. 111, de 28 de setembro de 2021. Presidencia da Republica (Planalto) · 28 Sep 2021 · Official · confidence high · retrieved 26 Oct 2026
  13. Results file, 2nd round, President, Brazil (br-c0001-e006258-u.json; 25/10/2026 23:27:02; 100% of sections totalled). Tribunal Superior Eleitoral · 25 Oct 2026 · Official · confidence high · retrieved 27 Oct 2026
  14. Flávio Bolsonaro viaja para os EUA após derrota na eleição (Reuters). Investing.com Brasil · 27 Oct 2026 · News · confidence medium · retrieved 28 Oct 2026

Reviewed 28 Oct 2026 · version 1 · last change: reviewed · All risks