(Bloomberg) -- President Donald Trump told Brazilian President Jair Bolsonaro Friday he won’t reimpose tariffs on steel and aluminum from the Latin American nation, a person familiar with the discussions said.
The American president had a phone call with his Brazilian counterpart to discuss trade, he said on his Twitter account. This comes amid uncertainty over whether the White House planned to follow through with a threat to impose the duties on Brazil and Argentina. The person confirming the tariffs won’t return declined to be identified.
Trump on Dec. 2 accused the countries of manipulating their currencies to the detriment of U.S. farmers and said he planned to reimpose metal tariffs “effective immediately.” But White House economic adviser Larry Kudlow said a week later that the administration still hadn’t made an official decision, and the Brazilian government has not yet been formally notified by the U.S. about a tariff increase.
Bolsonaro, who has enjoyed a close relationship with Trump in the past, said at the time that he was confident the U.S. president would listen to his economic concerns.
“I’m going to call him so that he doesn’t penalize us,” Bolsonaro said in a radio interview with Brazil’s Radio Itatiaia, adding that he saw the U.S. economy as “not comparable with ours.”
Trump’s action amount to retaliation against two nations that have become alternative suppliers of soybeans and other agricultural products to China, grabbing market share away from the U.S. Rural voters, including farmers, are a key constituency for Trump as he heads into the 2020 presidential election.
While the steel tariffs could crimp trade, the South American countries gain much more shipping crops to Chinese buyers. In the first 10 months of the year, Brazil has shipped $25.5 billion in farm products including soybeans and pork to China. That’s more than 10 times the value of steel and iron products sold to the U.S.
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