Donald Trump announced a 20% tariff on all cargo passing through the Strait of Hormuz, dubbing the US the "guardian" of the route. The announcement pushed oil above $80 a barrel, one of the biggest daily increases since the start of the US-Iran war. Less than 24 hours later, the American president backtracked: the tariff would be replaced by trade and investment agreements with Gulf countries, after pressure from allies. The change was announced hours before the tariff was to take effect.
Even so, the most significant impact on Brazil isn't at the gas station, it's in the granary—the retreat doesn't erase the precedent: a stroke of the pen can tax a strategic strait overnight.
Nearly 25% of the world's oil and even larger portions of fertilizers pass through the Hormuz Channel: 40% of urea, 30% of ammonia, and 25% of phosphates exported globally. Brazil imports more than 80% of the fertilizers it consumes, an essential input for the soybean harvest that begins in September. A surcharge of 20% would increase the cost of agriculture, with a cascading effect on food prices.
This isn't abstract geopolitics: it's about the cost of freight, of supplies, and ultimately, the cost of food on a Brazilian's plate.
The first path is diplomatic: to coordinate with India, China, and the Europeans a joint position at the WTO against the legality of a unilateral tariff on an international strait. Alone, Brazil has little bargaining power; as a bloc, collective pressure has changed American policies before—it was pressure from Gulf allies that brought down the tariff in less than a day.
The second approach is to diversify routes and suppliers, a move that agricultural exporters are already testing by redirecting shipments via Turkey. There is also the preventative route: anticipating shipments in the face of any new sign of tension in the strait, instead of waiting for a possible surcharge.
Companies in the agricultural and chemical industries, however, have more immediate tools: anticipating purchases and inventories before a price increase takes hold; currency and commodity hedging; and renegotiating freight rates by sharing the risk with international suppliers.
Hormuz is more than 13,000 km from Brazil. But it became clear this week that a toll on a strategic strait can, within hours, become a threat of higher supermarket prices—even if reversed the next day.
Dr. Andrea Aquino
President of the Maritime and Port Law Commission of the OAB/CE (Brazilian Bar Association, Ceará chapter)
