How Trump tariffs are reducing meals costs in Brazil, Mexico – DW – 09/18/2025 | EUROtoday

Customers at a grocery store on Avenida Rua Bolivar in Rio de Janeiro, Brazil, are positively shocked on the value modifications they have been experiencing over the previous few weeks, as they’re now paying considerably much less for espresso and meat, for instance.

“Finally, some good news in these difficult times,” says shopper Julienne Freitas, whereas talking with DW.

Her expertise isn’t anecdotal, however reasonably echoed by a current survey from Brazil’s Inter-Union Department of Statistics and Socio-Economic Studies (DIEESE) — a analysis institute affiliated with commerce unions that produces scientific research.

Compiled with the collaboration of presidency company CONAB, the survey discovered that meals costs fell in 24 of Brazil’s 27 regional state capitals within the month of August, in contrast with July, with fundamentals similar to tomatoes, rice, meat and occasional all turning into cheaper.

Tariffs and agricultural cycles

Part of the decline comes from pure cycles typical for agriculture, says Leandro Dias from the agricultural commodities buying and selling platform AgroDeri in Sao Paulo, Brazil.

“Coffee had a strong harvest, which increased supply and pushed down prices. With beef, the livestock cycle is in a phase with plenty of cattle ready for fattening, which the domestic market is now feeling,” he instructed DW.

But US tariffs on Brazilian imports are additionally taking part in a task, he added, referring to US President Donald Trump’s 50% tariff fee on most items earlier this yr. Such extreme tariffs would usually trigger “inflation at home and slow competitiveness abroad,” mentioned Dias.

As a end result, US customers would face rising costs on meals focused by Washington’s commerce measures, whereas costs for those self same items have been falling in producing international locations.

Economist Douglas Eustaquio of Grupo Boticario — one of many largest cosmetics corporations in Brazil — argues that tariffs are reshaping provide and demand in Brazil.

Products that have been partly or totally supposed for the US market, he instructed DW, are actually staying in Brazil and “supplying the domestic market,” he mentioned, noting that beef costs are adjusting extra slowly however are additionally trending downward at the moment.

Political fallout over Bolsonaro trial

Donald Trump’s tariffs imposed on Brazil are linked to the trial of former President Jair Bolsonaro, who wassentenced by Brazil’s Supreme Court to 27 years in jail for making an attempt a coup. Washington imposed punitive tariffs in response to the trial, citing issues over the suppression of opposition and free expression.

Brazil’s authorities, nonetheless, insists its judiciary is unbiased. The nation’s leftist president, Luiz Inacio Lula da Silva, has criticized the tariffs as unfair, mentioning that the US already runs a commerce surplus with Brazil.

Between January and July 2025, Brazilian exports to the US totaled $23.7 billion (€20 billion), the best ever for that interval. At the identical time, imports climbed 12.6% to $26 billion, pushing the US commerce surplus with Brazil to $2.3 billion.

Economic dangers from falling costs

The same droop in meals costs is at the moment unfolding in Mexico, the place tomatoes, for instance, have grow to be considerably cheaper lately.

“In the region, there is high production, and producers in the north of the country are selling to central [Mexican] states instead of exporting to the United States, so the price is falling,” Javier Reyes Escamilla, president of the Livestock Association of the Mid-North Region of the State of Mexico, instructed multiplatform information group Milenio.

But whereas customers in producing international locations are benefiting within the brief time period, the outlook is probably not so shiny within the longer run, says Brazilian economist Dirlene Silva.

“If producers lose access to an important market like the American one, they no longer have an incentive to invest. That means less technology, lower productivity, and even losses in quality,” she instructed DW

Eventually, manufacturing might shrink, she warned, sending costs again up — this time to the detriment of native customers in Brazil and past.

This article was initially written in German.