Orange juice prices could rise by 20% to 25%, according to Johanna Foods, a small US business suing the White House over threatened tariffs against Brazil.
In a letter to President Luis Inacio Lula da Silva on July 9, President Donald Trump said that from August 1st he would apply 50% tariffs to all imports from Brazil.
Trump said high tariff rates are needed because of the “how Brazil treated former President Bolsonaro.”
Brazilian prosecutors argue that Bolsonaro is part of a plan that includes a plan to assassinate the current president of the country who defeated him in the last election, and is Supreme Federal Court Judge Alexandre des Moraise. Bolsonaro denied any misconduct.
Trump also said Brazil censored US-based social media platforms and runs an “unsustainable trade deficit” with the US.
However, data from the US trade representative office shows that the US has a surplus in commodity trade with Brazil. Last year it was over $7 billion.
Johanna Foods says it supplies nearly 75% of all private labels to orange juice to US customers, but says that the president has no power to collect this tariff, as these debates do not constitute an economic emergency.
“The Brazilian letter does not refer to a legal or legal authority in which Brazilian tariffs can be imposed by the President,” wrote the company’s lawyer Mark Caplin in a filing.
“The Brazilian letter does not constitute an appropriate enforcement lawsuit, and does not refer to or incorporate or incorporate an executive order, or modify or modify existing executive orders, rather than an executive order,” the lawyer continued.
The company says some of its customers include Walmart, Aldi, Wegman’s, Safeway and Albertsons.
Johanna Foods CEO Robert Facchina said the obligation would be an estimated $68 million hit, exceeding the profits of a year since it was founded in 1995.
“Brazilian tariffs will likely lead to a significant price increase in major American breakfast dishes,” the lawsuit reads.
“These are from the ingredients of concentrated orange juice imported from Brazil, in sufficient quantities or quality to meet the plaintiff’s production needs and are not reasonably available from any supplier in the US.”
Prices for orange juice have already risen nationwide. Last year, the average price of 16 ounces of orange juice rose 23 cents (over 5%) to $4.49, according to the Bureau of Labor Statistics.
Orange Juice Futures, a global benchmark that tracks products, has also jumped recently. Last month they rose nearly 40%, with most of that increase following Trump’s threat.
The Brazilian Supreme Court ruled last month that social media companies can be held responsible for content posted on the platform. Elon Musk’s social media site X was temporarily banned in Brazil last year after masks rejected a court request to ban some accounts.
Facchina says the layoffs of union manufacturing employees, management staff and declining production capacity in Flemington, New Jersey and Spokane, Washington, are almost certain if these tariffs are enforced. Johanna Foods employs around 700 people in Washington and New Jersey.
Brazil was the 18th largest source of imports of US goods last year, with over $42 billion in imports in the country, according to data from the US International Trade Commission.
In its legal application, we ask the International Trade Court to declare that the International Emergency Economic Force Act does not grant Trump any legal authority to impose tariffs on Brazil and that it does not identify any national emergency or “an extraordinary and extraordinary threats” required by the President to impose tariffs.
In response to the lawsuit, a White House spokesman said the administration would “use legally and fairly the tariff power granted to administrative agencies by the Constitution and Congress to level the arenas for American workers and protect national security.”
