Analysis
June 19, 2026
Brazil, US pig iron deals pause on tariff uncertainty
Written by Stephen Miller
There has been a pause this month in new pig iron transactions between Brazil and the US due to uncertainty around US tariffs, sources said.
Although supply is still short and prices are still firm to up, this is not the reason for the impasse. Concerns center around the uncertainty of tariff levels for shipments to the US after the Section 122 tariffs expire on July 24. The section 122 tariff stands today at 10%.
The US has become largely reliant of Brazilian pig iron shipments since the onset of the Ukrainian/Russian conflict and the sanctioning of imports from Russia. Ukrainian imports have continued after a year-long pause earlier in the conflict. Since then, Ukrainian shipments have admirably complemented the Brazilian supply.
According to the Brazilian SECEX, the country exported 161,000 metric tons (mt) to the US in May. The brings the total shipped through May to 1.2 million mt. Last year’s total exports to the US were 3.4 million mt. So, the pace of shipments is a bit behind 2025 levels.
The Ukrainian State Customs Service reported exports to the US through April reached 585,420 mt. Sources have estimated in May, Ukraine exported ~100,000 mt, but the official number is unavailable.
Recently, India has been able to export pig iron to the US. The reduction of tariffs and the soaring price of pig iron have mitigated the higher logistical costs for US-destined cargoes. Sources indicate three Panomax-sized cargoes have been dispatched.
Despite these other sources, the US flat-roll steel industry needs to maintain Brazil as its main importer.
The US Trade Representative (USTR) has proposed tariffs under section 301 on Brazil of 25% for unfair trade practices. The USTR also has imposed a 12.5% tariff on Brazil for use of forced labor. In the Annex, pig iron has not been included in the exempted raw materials along with so many other metallics. Comments are due by July 1 and a USTR meeting is scheduled for July 6.
Tariff woes?
Can Brazilian pig iron continue to supply the US market with tariff at this level? A 25% tariff finding will increase prices by an additional $125/mt based on today’s prevailing price. Add another $62.50/mt if the 12.5% goes through on top.
SMU contacted a US-based trader on this question.
He said, “I think a 12.5% is doable, but no higher.”
The trader added he heard the Brazilian sales channels are already pursuing more European business as a result of this threat
We also contacted an executive director of a large channel in Brazil who told SMU he does not think tariffs on pig iron will go back to zero.
“It’s more likely to be 12.5%,” he said. No deals have been done lately. Buyers are waiting to see happens, he added.
Another Brazilian-based trader spoke with SMU and claimed, “Producers are resilient!”
They are completing their existing orders which will carry them through July. They will hope to be able to negotiate orders thereafter. He also indicated talks are ongoing with European buyers but for smaller quantities than the US usually buys.
