What specific tariff threat is facing Brazilian goods, and how does the American Chemistry Council propose to address it?

The US is considering two tariff proposals against Brazil: a 25% surcharge from a Section 301 investigation targeting Brazil specifically, and an additional 12.5% from a broader forced labor investigation—resulting in a cumulative 37.5% tariff burden on affected goods. The American Chemistry Council (ACC) opposes a 'broad-tariff based' response and instead urges the US Trade Representative (USTR) to pursue a targeted, sectoral approach—a chemical sectoral initiative with Brazil—to address tariff and non-tariff barriers while preserving integrated supply chains and expanding tariff exemptions for critical chemicals.

Why does the ACC argue that broad tariffs on Brazilian goods would harm the US chemical industry?

The ACC argues that broad tariffs would undermine highly integrated US–Brazil supply chains that benefit US manufacturing and sustain a nearly $7 billion US chemical trade surplus with Brazil—the fifth-largest destination for US chemical exports; such tariffs would raise input costs for US manufacturers, potentially divert sourcing away from the US entirely, and weaken the 'win-win' reshoring trend where ACC members have shifted production from Asia to the US and Western Hemisphere using Brazilian raw materials.

US Chemical Industry Pushes for Sectoral Deal with Brazil Amid 37.5% Tariff Threats

Jul 7, 2026

The American Chemistry Council urges the USTR to negotiate a sectoral tariff deal with Brazil rather than imposing broad levies up to 37.5%, warning that such measures would disrupt integrated supply chains and benefit Asian competitors.

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US Chemical Industry Pushes for Sectoral Deal with Brazil Amid 37.5% Tariff Threats

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