Friday, 06 Dec, 8.15 am Deccan Herald

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Trump's tariff tweet halts talks over Brazil steel

Reuters,

Negotiations over future Brazilian steel exports to the United States have been halted since President Donald Trump tweeted earlier this week that he would slap tariffs back on them, the head of Brazil's steel mills body IABr said on Thursday.

Trump stunned Brazil and Argentina on Monday, tweeting that U.S. steel and aluminium imports from both countries would be subject to tariffs immediately because both had been "presiding over a massive devaluation of their currencies, which is not good for our farmers."

Marco Polo de Mello Lopes, executive president of Instituto Aco Brasil (IABr), the group that represents Brazilian steel mills, said Trump's decision defied protocol and proper procedure.

"Long-term contracts are being fulfilled, but negotiations with other customers are suspended," Mello Lopes said.

"Nothing has been formalized yet by the U.S. government, but customers want to know if prices will be subject to a 25% tariff increase or not, and without knowing that there is no way to do business."

Without giving details, he said that about half of Brazil's steel shipments to the United States are built into long-term contracts. Citing U.S. Department of Commerce figures, the IABr said that Brazil accounted for 13% of U.S. steel imports last year that totaled 30.57 million tons.

Brazil's President Jair Bolsonaro, who has styled himself as a close ally of Trump, said he is "not disappointed" with the U.S. president yet, because the proposed tariffs have not become effective.

But his Economy Minister Paulo Guedes said that Trump is making a "very serious mistake" and that the decision was taken purely for domestic political purposes.

The IABr said on Thursday it expects Brazilian steel production next year to rise 5.3% to 34.2 million tons, and sales should increase 5.1% to 19.4 million tons.

For 2019, IABr expects production to fall 8.2% from last year to 32.5 million tons, and domestic sales to be 2.3% lower at 18.5 million tons.

Dailyhunt
Disclaimer: This story is auto-aggregated by a computer program and has not been created or edited by Dailyhunt. Publisher: Deccan Herald
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