The Brazilian president Luiz Inacio Lula da Silva announced an impending trade deal with the US, following commitments from the president Donald Trump.
Lula mentions Brazil’s strategic role
President Lula revealed during a briefing at the ASEAN summit in Malaysia that Trump had “guaranteed” his word on a trade deal between the two countries, Reuters reported on Monday. Lula expressed confidence that the deal would be completed “faster than anyone thinks.”
However, Lula described recent US actions against Brazil as “incorrect.”
He also expressed his willingness to engage with Trump on any issue and offered to help the US with the situation in Venezuela. Lula stressed the importance of taking into account Brazil’s experience as the largest and most economically important country in South America.
This development follows a series of events that have strained US-Brazil relations.
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Coffee price hike amid tariffs in Brazil
The recent development comes after a friendly conversation between President Lula and Trump, in which Lula urged Trump to lift tariffs and sanctions on Brazil. This was the first major conversation between the two leaders since the US imposed 50% tariffs in July.
Trump imposed tariffs on Brazilian imports, citing the former president’s trial Jair Bolsonaro as one of the reasons behind the tariffs. Trump’s ideologically driven move to punish the country for the capture of “insurgents” led to a shift in Brazilian coffee exports to China. This has also resulted in higher prices for American consumers. According to the Federal Reserve Bank of St. Louis, the average price of a pound of ground coffee was $9.14 in September, up 3% from the average of $8.87 in August.
The move was criticized by economists, who argued it would hurt American consumers without improving domestic supply chains. Economist Justin Wolfers. He criticized the idea of imposing tariffs on commodities like copper and coffee, arguing that they do not stimulate domestic production and are therefore “literally a tax on Americans.”
As he put it, “We can’t import the mines from other countries. We can’t bring the coffee industry back to the United States — not nearly enough.”
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Disclaimer: This content was produced in part using AI tools and was reviewed and published by Benzinga’s editorial staff.
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