1. Bilateral trade between China and Brazil hit a record high in the first half of 2026, fueled by a surge in Chinese electric vehicle exports and robust Brazilian shipments of crude oil and beef. Brazil's exports to China jumped 22% to $58.3 billion, while imports from China rose 8% to $38.5 billion, generating a $19.8 billion surplus for Brazil. China solidified its position as Brazil's largest trade partner, capturing 31.6% of its total exports, far surpassing the U.S. share of 9.4%, and supplying 27% of Brazil's total imports. [para. 1][para. 2][para. 3][para. 4][para. 5]
2. This deepening economic relationship occurs amid growing friction between the Trump administration and the Lula government, highlighted by new U.S. tariffs. However, the CEBC downplayed the direct impact on the record Sino-Brazilian trade, citing differing export structures. Brazil exports raw materials (soybeans, crude, iron ore, beef) to China and manufactured goods (crude oil, aircraft, steel) to the U.S., meaning the two markets do not naturally substitute each other. [para. 6][para. 7][para. 8][para. 9]
3. The surge in Chinese exports was largely driven by new-energy vehicles. They accounted for 15% of Brazil's imports from China and 88% of its overall EV imports, with total EV exports reaching $5.35 billion. Exports of fully electric vehicles surged nearly fourfold to roughly $2 billion, and plug-in hybrids doubled. This was partly a rush to beat upcoming Brazilian tariff hikes of up to 35%. With the duties in place and companies like BYD setting up local production, export volumes are expected to stabilize. [para. 10][para. 11][para. 12][para. 13][para. 14][para. 15][para. 16]
4. Brazil phased in higher auto tariffs, implementing a $463 million zero-tariff quota to encourage local production. After the initial quota expired, tariffs of 25% on fully electric, 28% on plug-in hybrid, and 30% on traditional hybrid vehicles applied. The base tariff is set to rise to 35% starting July 2026. BYD, having faced pushback from established automakers over its tariff request, denied applying for a renewed quota but stressed its $1.07 billion investment in Bahia. [para. 17][para. 18][para. 19][para. 20][para. 21][para. 22][para. 23]
5. Geopolitical volatility, including the U.S.-Israel-Iran conflict and the Strait of Hormuz blockade, drove Brazilian crude exports to China to a record $15.1 billion. Cariello believes this positions Brazil for a new full-year record. China absorbed 54% of Brazil's crude, with monthly records set in March, April, and June. Rising prices positioned Brazil as a reliable alternative to Middle Eastern suppliers. Robust energy demand also came from India and Singapore. [para. 24][para. 25][para. 26][para. 27][para. 28]
6. Brazilian beef exports to China surged 50% year over year to a record $4.8 billion. However, China implemented a safeguard measure with a 1.1 million-ton quota for Brazil subject to a 12% tariff; any excess faces a 55% levy. With the quota already breached, a slowdown in shipments is expected. Meanwhile, poultry exports recovered after a bird flu ban, reaching $772 million, up 43% year over year. [para. 29][para. 30][para. 33][para. 34]
7. Soybean exports to China rose 7% to $20.2 billion, while iron ore shipments increased 9.4% to $9.2 billion. China remains the dominant buyer for both commodities. [para. 35]
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