Partial withdrawal of the US tariff maintains competitive risk to Brazilian coffee

The United States government announced at the end of last week the withdrawal of the 10% tariff, applied in April of this year in a generalized manner to American imports. However, the country has maintained the 40% surcharges that specifically affect Brazilian coffee, which still generates concerns in the exporting sector. According to researchers from Cepea, the maintenance of the 40% tariff tends to reduce the competitiveness of national coffee in the United States, since relevant competitors of Brazil have had barriers completely eliminated or substantially reduced. The central risk pointed out by sector agents consulted by Cepea is the possible structural substitution of the Brazilian product in the American consumption pattern. On the one hand, the withdrawal of the 10% tariff signals a disposition of the U.S. to ease trade relations. On the other hand, it shows that Brazil still occupies a vulnerable position and is dependent on the complete withdrawal of the surcharge to ...