Reuters assesses Brazil's trade risks ahead of presidential runoff

Brazil's presidential election could reshape talks with the United States over tariffs and critical minerals, experts interviewed by Reuters say. Flavio Bolsonaro and Luiz Inacio Lula da Silva face a runoff on October 25.

Bolsonaro received approximately 47% in the first round, while incumbent President Lula secured about 45%. In an October 9 Reuters analysis, experts examined the candidates' contrasting approaches to Washington. Their assessments describe possible scenarios rather than decisions already taken.

Brazil must balance relations with China and the United States, its largest and second-largest trading partners. Brasilia and Washington established a working group in September to address tariffs and a broader trade framework. US access to Brazil's critical minerals and rare earths has emerged as a contentious issue.

Former Brazilian ambassador to the United States Rubens Barbosa suggested that Washington might prefer to await a Bolsonaro presidency rather than make concessions to Lula. Peterson Institute for International Economics fellow Monica de Bolle believes a right-wing Congress could increase pressure on Lula over natural resources even if he wins re-election.

Lula emphasises sovereignty, multilateral cooperation and relations with the Global South, including BRICS. He opposes outside intervention in Brazilian politics. Bolsonaro, by contrast, seeks closer relations with Donald Trump's administration.

Experts say those ties could facilitate US negotiations while raising the risk of concessions over strategic resources. Brazilian Association of Institutional and Governmental Relations president Jean Castro believes Bolsonaro would need to demonstrate independence to prevent his approach being viewed as subordination to Washington.

The disagreement also concerns organised crime. Bolsonaro supported US designation of major Brazilian criminal groups as Foreign Terrorist Organizations. Lula rejected that approach as intervention and favours a national response supported by international cooperation.