“Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries,” Trump tweeted early Monday morning from Washington.
The President, in a series of tweets announcing the tariffs on Monday, also called on the Federal Reserve to “act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies.”
Both Argentina and Brazil have benefited from warmer trade relations with the US under Trump as a result of the US-China trade war, but the two countries have recently seen the values of their currencies drop. The Brazilian real is down more than 8% against the dollar this year, and the Argentine peso is down 37%. That is more than other major emerging market currency, including the South African rand, Mexican peso and South Korean won. The Turkish lira is also down 8% this year.
The United States has bought more steel from Brazil than any other country besides Canada during the first nine months of this year, making up nearly 11% of all steel imports, according to Census Bureau data. It relies on Argentina much less for steel, which made up for less than 1% of imports.
But both countries are benefiting from Trump’s trade war with China, which has hurt American farmers. Brazil is the second biggest soybean producer in the world, and it’s where China’s farmers have been getting a lot of their soybeans since Beijing imposed retaliatory tariffs on US agriculture. Argentina recently made a deal with China that will allow it to import soymeal starting next year.
During Brazilian President Jair Bolsonaro’s visit to the White House earlier this year, Trump announced that the US would be designating Brazil as a non-NATO ally. And recently, a joint communique from the US-Brazil CEO Forum in late November described joint recommendations for enhancing the US-Brazil economic relationship.
The statement on the forum, which was attended by US Commerce Secretary Wilbur Ross, US Director of the National Economic Council Larry Kudlow, did not hint at any changes to the state of Brazil’s steel tariff exemption.
CNN’s Katie Lobosco and Anneken Tappe contributed to this report.