If you import coffee, orange juice, beef, or specialty metals from Brazil, your landed cost may have just jumped 50% overnight — or, if your product is on the right list, not at all. On July 30, a new Executive Order under the International Emergency Economic Powers Act (IEEPA) added a 40% tariff on Brazilian goods on top of an existing 10% reciprocal tariff, bringing the total additional duty to 50% above the normal MFN rate starting at 12:01 a.m. EDT on August 6. The difference between a product that is in and a product that is out comes down to a single annex, a carve-out for goods already hit by Section 232, and how your shipment was admitted to a Foreign Trade Zone.
For a small roaster buying 20 bags of green coffee a month, a taqueria chain sourcing Brazilian beef trim, or a machine shop buying pig iron and silicon metal, that annex is not a footnote. It decides whether you need to reprice your menu, renegotiate a purchase order, or simply confirm with your broker that your HTS code is on the exclusion list. Here's how to read the order, where the exclusions actually are, and how to get your books to reflect the new reality without overstating inventory or missing a drawback.
What Just Changed and When It Hits
The order is straightforward in structure but layered in execution:
The math: 40% + 10% = 50% above MFN. The 10% reciprocal tariff on most countries has been in place since early 2025. The July 30 action adds another 40% specifically for Brazil, citing Brazilian government trade policies. The result is a total of 50% in additional duties stacked on top of whatever normal Column 1 (MFN) rate your product already paid. A product that was duty-free before now pays 50%. A product that was 3% before now pays 53%.
Effective time: 12:01 a.m. EDT on August 6, entered for consumption or withdrawn from warehouse for consumption. The trigger is entry, not sail date. Goods entered on August 5 are under the old rate. The same container entered on August 6 is not — unless it qualifies for a transit exception.
Transit exception: loaded before August 6 and entered by October 5. If your goods were loaded onto the vessel at origin (lading on a through bill) before 12:01 a.m. EDT on August 6 and they are entered for consumption before 12:01 a.m. EDT on October 5, they are exempt from the new 40% addition. Keep the bill of lading date and the entry summary together. Brokers are asking for both documents before they will claim the exception.
Statutory exceptions under 50 U.S.C. 1702(b). The order restates the standard IEEPA limits: personal communications that do not transfer anything of value, humanitarian donations of food, clothing, and medicine, informational materials (publications, films, photographs, artwork), and personal travel baggage. These are narrow and rarely apply to commercial import entries, but they are in the text.
FTZ handling matters. Goods entering a Foreign Trade Zone after August 6 must be admitted under privileged foreign status unless they would qualify for domestic status, in which case the new tariff does not apply. In practice, that means you cannot admit Brazil-origin goods into an FTZ as non-privileged and wait for a policy reversal to avoid the rate. If you use an FTZ, tell your operator on August 6 that Brazil entries are privileged foreign unless you have a domestic-status qualifying transformation.
Duty drawback is still allowed. Significantly, the order does not suspend drawback. If you import Brazilian inputs, pay the 50% additional duty, and then export a finished product or destroy goods under drawback rules, you can still claim drawback on the duties paid, subject to normal time limits and documentation.
Adjustments are built in. The order says tariffs may increase if Brazil retaliates or decrease if Brazil addresses the concerns cited. It also has a standard severability clause. Do not build a pricing model that assumes 50% is permanent.
Which Products Are Actually Excluded (and Which Are Not)
This is where most small importers will either save a lot of money or make a costly assumption. There are two different exclusion buckets, and they are not the same.
Annex I: Products that do not get the new 40%
The Executive Order includes an Annex I list of about 690-odd tariff lines that are not subject to the additional Brazil 40%. You need the annex with your broker to check your specific 8- or 10-digit HTS, but the headline categories that are out include:
- Silicon metal and pig iron
- Civil aircraft, aircraft engines, and certain aircraft parts (think Embraer supply chain)
- Brazil nuts
- Orange juice (single-strength and concentrate, 2009.11 and 2009.12) and certain other processed citrus
- Select energy products (including certain crude and fuel categories) and selected wood pulp and paper goods
For a specialty food importer, the distinction is sharp: orange juice and Brazil nuts are out, so a container of not-from-concentrate orange juice from São Paulo entered on August 20 would not pay the extra 40% (it still pays the existing 10% reciprocal and normal MFN). Green coffee (0901.11/0901.12), however, is not on Annex I. If you roast Brazilian specialty coffee, that cost increase lands in full.
Beef is the same story. Most fresh, chilled, and frozen beef cuts from Brazil (0201, 0202) are not on Annex I and are therefore subject to the full additional duty. If you buy Brazilian beef trim for a restaurant group, your per-pound landed cost just moved.
Section 232 Carve-Out: Products already paying their own tariffs
A separate exclusion says goods already covered by Section 232 tariffs are not double-hit by this Brazil order:
- Steel and steel derivatives (Section 232, currently 50%)
- Aluminum and aluminum derivatives (Section 232)
- Autos and auto parts (Section 232)
- Copper and copper derivatives (starting August 1 under a parallel Section 232 action)
If you import Brazilian steel slab or aluminum extrusions, you are already paying the Section 232 rate on those entries. The order excludes them from the Brazil IEEPA addition so you are not paying 50% plus another 50%. That is not a free pass — you are still paying the Section 232 duty — but it prevents a 100% stack. Keep your entry paperwork clear on which authority is being assessed. CBP will expect the correct case number and HTS chapter 99 subheading for the specific exclusion you claim.
A common mistake is assuming steel is now duty-free from Brazil because it is excluded from the Brazil order. It is not. A hot-rolled coil from Brazil entered on August 10 still pays the Section 232 steel duty. The exclusion merely keeps it from paying both.
Why Your Bookkeeping Can't Wait for the Broker's Statement
Brokers collect and remit duties, but your books determine your margin, your inventory value, and your tax deduction timing. Getting the tariff into the ledger correctly on the right date matters as much as getting the rate right.
Consider a roaster with a standing purchase order for $40,000 of green coffee (CIF value) from Minas Gerais, loaded August 3, entered August 12. Under the transit rule, that shipment is exempt from the new 40%. The roaster's next PO, loaded August 9 for the same value and entered August 18, is not. The first shipment's landed cost is roughly $40,000 plus freight, insurance, existing 10% reciprocal, and harbor fees. The second shipment's landed cost is roughly $40,000 plus the same plus an additional $16,000 in new duties (40% of CIF, plus 10% reciprocal on top of MFN). That $16,000 is not a small variance to true up at quarter end. It is a 40% cost increase that needs to be in inventory or in cost of goods sold immediately, depending on when you take title.
If you wait for the monthly broker statement to post the duty, your inventory is overstated or understated for weeks, your menu pricing stays stale, and your gross margin report for August tells a story that never happened.
A Practical Checklist for Small Importers
Use this as a one-week sprint with your broker, your 3PL, and your bookkeeper.
1. Audit every open PO with Brazil as country of origin
Create a simple sheet: PO number, supplier, product description, 8-digit HTS, CIF value, estimated loaded-on-board date, estimated entry date, Annex I or Section 232 status, and projected additional duty. Sort by entry date, not order date. Anything entering on or after August 6 is in scope unless it has a privilege.
Your bookkeeper should tag these POs in your accounting system so you can later trace which inventory lots carry the additional duty.
2. Confirm every HTS against Annex I and Section 232 with your broker in writing
Do not self-classify exclusions from a news summary. Send your broker the list: "0901.11.00 — green coffee, not roasted, not decaffeinated — Annex I? Section 232?" Get the answer back per HTS, in an email you can keep. For mixed shipments, remember exclusions are line-item specific. A container with three HTS lines — orange juice (excluded via Annex I), green coffee (not excluded), and steel fittings (excluded via Section 232) — will have one line at 10% plus MFN, one line at 50% plus MFN, and one line at the Section 232 rate. Your entry summary will show different Chapter 99 numbers per line.
3. Lock the transit exception paperwork now
For any shipment loaded before August 6 that you hope to enter by October 5, collect: copy of through bill of lading showing on-board date, commercial invoice, packing list, and entry summary draft. Put them in a single folder per shipment. If Customs asks for proof two months from now, you will not be hunting through email.
4. Decide your FTZ admissions posture before the next admission
If you operate or use a Foreign Trade Zone, confirm with your zone operator: all Brazil-origin admissions after August 6 are privileged foreign status unless the goods will undergo a qualifying domestic-status transformation. Update your zone admission template so the operator does not need to ask you each time.
5. Rebuild landed cost per SKU before you reprice customers
Add a temporary tariff surcharge line to your landed-cost build for Brazil-origin SKUs. For a SKU that was $10.00 CIF with $0.30 freight and $0.17 insurance:
- Pre-August 6 landed base: $10.47 plus 10% reciprocal ($1.047) plus any MFN and fees
- Post-August 6 landed, not excluded: $10.47 plus 50% additional ($5.235) plus the same base duties and fees
That is a 40% step increase in added duty alone. Your gross margin model should show both scenarios so you can see where a price increase, a pack-size change, a blend substitution, or a supplier switch to Colombia, Ethiopia, or Central America actually restores margin.
6. Accrue the duty liability on the right day
For goods where you take title at loading (FOB origin), the tariff liability still accrues at entry, not at purchase order or at sailing. That creates a mismatch: you owe the supplier now, you owe CBP later. In your ledger, keep the PO value in a prepaid or in-transit inventory account, and create a separate tariff payable or landed-cost accrual that is only posted when CBP entry occurs.
A plain-text pattern that works well for auditability:
2026-08-12 * "Green coffee - Brazil PO-1045" - entered Aug 12
Assets:Inventory:Coffee:InTransit 40,000.00 USD
Liabilities:AP:Supplier:Brazil -40,000.00 USD
2026-08-12 * "CBP entry 999-0123456-1 - additional Brazil IEEPA"
Expenses:COGS:Tariffs:BrazilIEEPA 16,000.00 USD
Liabilities:AP:Broker:CBP -16,000.00 USD
; HTS 0901.11.00, CIF 40,000, 40% additional, entry Aug 12, not Annex IIf the goods are still in warehouse and not yet expensed, capitalize the tariff into inventory instead of COGS, using an Assets:Inventory:Coffee account, so your per-kilo inventory value reflects the true cost. The entry is the same except you debit Assets:Inventory rather than Expenses:COGS until you roast and sell.
7. Track drawback as a receivable, not a hope
If you re-export finished goods that used Brazilian inputs, set up a drawback claim tracker the day you pay the duty. Each export that qualifies should generate a receivable for the recoverable duty amount, with supporting manufacturing records, export bills, and entry numbers. Drawback can take months, but a receivable in your books reminds you to file and prevents the money from disappearing into a general expense.
8. Keep your backup for 5 years, not 5 weeks
CBP can audit entry classifications and exclusion claims well after the fact. Keep the Annex I printout with your HTS circled, the broker's written confirmation per HTS, the bill of lading, the entry summary (CBP Form 7501), and the FTZ admission records together, per entry number. A small importer who can produce that packet in one PDF will have a very different audit than one who has to reconstruct it from three inboxes.
How to Talk to Customers and Suppliers Without Overpromising
The order explicitly says rates can move in either direction. Do not write a customer letter that says 50% is forever, and do not write a supplier that you are permanently switching origin. A steadier script: "The U.S. has added a 40% duty on most Brazilian goods as of August 6 on top of the existing 10%, for a total of 50% above MFN. Orange juice, Brazil nuts, and pig iron are excluded under Annex I, and steel and aluminum are excluded from this addition because they already pay Section 232 duties. Coffee and beef are not excluded and are therefore at the full rate unless they were loaded before August 6 and entered by October 5. We are reviewing our open POs and will adjust pricing once we confirm entry dates and classifications with our broker."
That language is accurate, narrow, and leaves you room to adjust if the annex changes or if Brazil and the U.S. negotiate a carve-out.
Simplify Your Financial Management
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