The United States government will start negotiations with Brazil over the Section 232 tariffs set on US imports of steel and aluminium, Brazilian president Michel Temer said.
The import duties, set to go into effect on Friday March 23, will not be applied to Brazilian products before negotiations between the countries are concluded, Temer said late Wednesday, according to a report from the country's official news agency, Agência Brasil.
US President Donald Trump set blanket tariffs of 25% on steel imports and 10% on aluminium imports on March 8.
At that time, the Brazilian government said that, along with other countries, it was considering filing a complaint with the World Trade Organization (WTO) against the US decision to impose tariffs if an amicable solution was not reached quickly.
Temer commented on the negotiations over import tariffs based on a statement made by US trade representative Robert Lighthizer on Wednesday, according to the Brazilian government.
Later Wednesday, Brazilian foreign trade ministry MDIC noted that Lighthizer had said that the US government “evaluates” the suspension of import tariffs on steel and aluminium goods during bilateral negotiations with some countries, including Brazil.
MDIC considered this move a “positive signal” and expects a “positive outcome” for this case, in which Brazil would not be affected by trade restrictions.
The start of negotiations between the Brazilian and US governments has been expected by market participants.
“We remain optimistic that Brazilian steel, especially slab, will not be included [in the Section 232 action],” a Brazil-based trader said.
A second source concurred, saying that trade between the US and Brazil continues as normal.
“As prices in the US increased, even with a 25% [import] tariff, Brazil-origin, high-priced products are already being accepted in the US market,” Marcelo Araújo, a trader at AMS Crossborder Consulting, told Metal Bulletin.
“Slab sales [to the US] are also on track,” he added.
Metal Bulletin’s weekly price assessment for Brazilian slab exports increased to $580-590 per tonne fob on March 16 from $560-570 per tonne fob a week earlier.