By Ana Mano

SAO PAULO (Reuters) -An association representing chemical companies in Brazil, where large U.S. firms like ExxonMobil and Dow Chemical operate, expressed “deep concern” regarding a U.S. executive order raising tariffs on Brazilian exports to 50%.

The Brazilian chemical sector is intrinsically tied with the United States, Abiquim said in a statement on Friday, describing a relationship marked by “integration” and “cross-investments.” 

“The impact will be significant on Brazilian chemical exports, compromising supply chains, jobs, and investments in Brazil and the U.S.,” Andre Cordeiro, head of Abiquim, said in the statement.

More than 20 chemical companies operating in Brazil are American-owned, Abiquim said.

Together with the American Chemistry Council (ACC), Abiquim said it submitted a joint statement to the governments of Brazil and the United States “requesting actions to prevent damage to the integration and resilience of chemical supply chains, focusing on trade facilitation measures and regulatory cooperation.” 

Brazil, which exported $2.4 billion of chemical products to the U.S. last year, runs a trade deficit of nearly $8 billion with the U.S. in this sector, according to trade data cited by Abiquim.

President Donald Trump’s executive order from July 30 affects about $1 billion in annual Brazilian chemical exports to the U.S., while exempting only five products, which represented $697 million in sales to the U.S. in 2024. 

In addition to direct exports, Abiquim said more pain will be inflicted on its companies as chemical products have applications in industries including food, furniture, textiles, leather goods, and rubber, some of which are dealing with U.S. order cancellations because of the new tariff.

Before the executive order was published, Abiquim said last week its own sector already faced contract cancellations linked to the threat of Trump’s tariffs.

(Reporting by Ana Mano; Editing by Andrea Ricci)