During his electoral campaign, Trump, who was elected on Nov. 5, suggested numerous tariff increases, including 10 to 20 percent across-the-board increases and a further 60 to 100 percent hike for imports from China.
Trade Partnership Worldwide, in a survey carried out for the US’ National Retail Federation (NRF), examined the low end and high end of the tariff proposals. Under scenario A, tariffs on all imports would be 10 percent and 70 percent for Chinese goods. Under scenario B, tariffs on all imports would be 20 percent, rising to 120 percent for Chinese products.
The analysis estimates that overall US footwear imports would fall by 28.7 percent under scenario A and by 40.1 percent under scenario B, with shipments from China declining by 76.5 percent and 89.2 percent, respectively.
Brazilian footwear shipments to the US only represent about 1 percent of overall American shoe imports, but the North American powerhouse is the Latin American country’s largest export market by value.
In 2024, total Brazilian exports amounted to 97.45 million pairs, down by 17.7 percent, and $976 million, down by 16.4 percent. Meanwhile, shipments to the US declined by 3.3 percent in value to 10.28 million pairs and by 4.8 percent to $216.3 million in value, according to data released by Abicalçados, the Brazilian association of footwear manufacturers.
Haroldo Ferreira, the President of Abicalçados, is cautiously optimistic about Trump’s arrival in office, even though he admits that the situation is unclear and could actually lead to growing pressure on Brazilian exports worldwide.
“What Trump will do is unknown because, if he raises duties, this could be beneficial but it could also be detrimental. The trade war between China and the United States could favour us just as it did during the pandemic when Chinese borders were closed,” he said. Thanks to lockdown policies introduced in China following the outbreak of the Covid-19 pandemic at the end of 2019, Brazilian footwear manufacturers had benefited from the subsequent disruption in trade flows and higher freight costs out of Asia. But from 2023, Brazil faced renewed Chinese competition as the Asian behemoth reopened its economy and freight prices normalized, making Asian manufacturers more competitive in terms of prices.
“In the event of an increase in duties towards the US, the Chinese could decide to export their products to other countries, affecting Brazilian exports to those countries. The Brazilian footwear industry is preparing for both scenarios,” Ferreira added.
Brazil is currently also facing pressure from Asian manufacturers at home, resulting in a surge in the country’s footwear imports. These rose by 26.3 percent in volume to 35.8 million pairs and by 7.9 percent in value to $477.72 million last year.
In 2024, Chinese footwear exports to Brazil totaled 9.8 million pairs, up by 4 percent, but fell by 16 percent in value to $40.2 million as the average price was cut by 19 percent to $4.06. Abicalçados described this as “an indication of prices artificially below those practiced on the market,” so-called dumping.
“There is a shift in production within Asia in search of lower labor costs. And, in the case of exports to Brazil, also to circumvent the anti-dumping tariff applied against Chinese footwear (currently at $10.22 per pair, in addition to the import tariff),” Ferreira explained.
Footwear exports from Cambodia, India, Myanmar and Bangladesh to Brazil rose by 56 percent in 2024 to a combined 2.5 million pairs. Ferreira noted that the Brazilian government has agreed to investigate the situation.
Brazilian companies see a window of opportunity in a US-China trade war
After attending Expo Riva Schuh & Gardabags, the trade show for mass-produced shoes held in the Italian town of Riva del Garda from Jan. 11 to 14, Henrique Galhego, Export Manager for the Brazilian shoemaker Bischoff Group, pointed out that Trump’s election has raised concerns among buyers regarding their Asian suppliers due to the potential US tariff increases. “At this trade show, some companies have already started looking to Brazil as a country offering quality products at competitive prices,” he commented.
The Brazilian footwear giant Grendene, which generated 27.0 percent of the country’s shoe exports in the third quarter of 2024, sees the new Trump administration as a big opportunity. The group has invested $50 million over the past two years in the country to expand its Melissa and other brands, according to Henrique Barth, the company’s Marketing Director.
Alex Klein Engelmann, Head of International Business at Pegada, a Brazilian footwear company that sells through 16,000 doors in 60 countries, believes that the incoming administration “may open up new opportunities to access the US market.”
Read the complete article at our sister publication Shoe Intelligence
