From Tariffs to Potash: The Geopolitical Forces Redrawing Brazil’s Agricultural Future
29 December 2025 Brazil is at the center of global agricultural trade shifts, including new U.S. tariffs and China’s growing influence on geopolitical risks surrounding critical inputs like potash. To understand how these forces are reshaping Brazil’s ag sector, domestic fertilizer strategy, and long-term food security, AgriBusiness Global (ABG) spoke with Matt Simpson, CEO of Brazil Potash.
In this conversation, Simpson discusses the ripple effects of the 50% U.S. tariff on Brazilian exports, the country’s accelerating trade alignment with China, and Brazil’s push to reduce fertilizer imports.
ABG: With the U.S. implementation of a 50% tariff on a range of Brazilian agricultural products, even though fertilizer wasn’t included, what kind of shockwaves are you seeing across Brazil’s ag sector?
Matt Simpson: It has caused a massive shift in how Brazil’s government is responding to economic pressures.
Earlier in 2025, the focus was almost entirely on environmental commitments — especially with Brazil hosting COP30. The message was about reducing illegal deforestation, ensuring ethical sourcing of soybeans, and enforcing land-use rules.
But since the tariffs were announced, priorities have expanded. The government is now talking seriously about how to support farmers and businesses hit by the tariffs. They’re discussing a support package of roughly 40 billion reais — around $7-8 billion USD — targeted at affected sectors like coffee and cattle.
Some large companies, like JBS, have diversified operations in the U.S., but smaller producers are much more exposed. Globally, commodity prices have jumped, adding yet another layer of volatility.
ABG: With the tariffs in place, are you seeing Brazil accelerate its trade realignment toward China?
MS: Absolutely. Brazil has been the No. 1 exporter of agricultural products to China for years, while the U.S. has typically ranked around third.
But since these tariffs, we’ve seen a dramatic shift. Brazil has stepped in to fill the soybean demand almost immediately.
Brazil is uniquely positioned to expand its role in global agriculture thanks to its vast reserves of arable land, the world’s largest supply of fresh water, and a climate that supports up to three cropping cycles per year.
So yes, the tariffs have accelerated Brazil’s pivot toward China — because Brazil can replace U.S. volumes at scale.
ABG: There’s been a lot of attention on countries that continue trading with Russia. Is Brazil at risk of sanctions from NATO or others?
MS: Not that I’m aware of, at least not directly. People talk a lot about oil purchases, and we’ve seen India get hit with additional penalties, but the real geopolitical risk isn’t oil — it’s fertilizer.
Globally, potash production is dominated by just a handful of countries. Canada remains the largest supplier, followed closely by Russia and Belarus. Together, these three nations control roughly 80% of the world’s total potash supply, creating one of the most concentrated fertilizer supply chains anywhere in agriculture.
Countries like the U.S. import 95% of their potash. Brazil imports 98%. In both cases, Canada is first, but Russia and Belarus are the next major suppliers. If potash were ever sanctioned, the impact on both Brazilian and American farmers would be devastating, and the world simply cannot ramp up Canadian capacity fast enough to fill that gap.
This is why projects like Brazil Potash are so important: They create a fourth major source of potash in a geopolitically stable region.
ABG: Brazil announced a major plan to reduce fertilizer imports after the Ukraine invasion. How is that strategy progressing?
MS: The turning point came in 2021–2022. When the U.S. sanctioned Belarus in mid-2021, potash prices jumped from about $300 to $600 per ton. After Russia invaded Ukraine, prices doubled again to roughly $1,200. Within weeks, Brazil released its National Fertilizer Plan — an ambitious strategy to cut the country’s fertilizer import dependence from 85% to 45% by 2050.
Since then, the government has begun reshaping the sector on multiple fronts. It eliminated the interstate tax on fertilizers — previously an 8.4% cost burden — and introduced new import tariffs that are gradually rising from zero to 4% over four years. The government is also investing heavily in farmer education, sending teams of economists across the country to train growers on optimal nutrient management. And, with potash now designated a critical mineral, Brazil is offering stronger support for domestic production, including financing discussions for projects like ours.
Brazil imports about $26 billion USD in fertilizer each year — four to six times more than most countries. Reducing that dependency is no longer just an economic goal; it’s a national priority.
ABG: Speaking of domestic production, what’s the latest on the Autazes Potash Project and your construction timeline?
MS: We’ve already begun early site work: vegetation clearing and land leveling.
On the commercial side, we recently signed a second offtake agreement with KeyTrade, a major Swiss trader. A third agreement is expected soon.
Infrastructure is also advancing.
We signed a memorandum of understanding with Vittor to build a 100-mile power line, a $200 million investment they will finance, operate, and transfer back to us after 25 years.
Discussions are underway with partners for similar arrangements for our port, steam plant, and backup power facilities.
We’re also working with Brazil’s government on import tax exemptions for equipment.
To put it simply: Yes, the project is moving — and moving quickly.
ABG: Brazil is also pursuing multiple domestic fertilizer projects. How do those fit into the broader strategy?
MS: Yes, the government has identified several projects to diversify supply. I can’t speak to the status of all of them, but I can say this Brazil needs multiple new fertilizer sources — not just one — if it wants to meaningfully reduce import dependence. Our basin alone is large enough for multigenerational development. We’re starting with 2.4 million tons, but with time, we could double, triple, even quadruple output.
That level of scale is essential to reducing reliance on politically sensitive suppliers.
ABG: Any final thoughts on how Brazil should navigate the current geopolitical and trade environment?
MS: This isn’t just about supplying potash to Brazil. It’s about giving the world a fourth stable source of supply.
Whether it’s tariffs, sanctions, port strikes, or rail disruptions, farmers need certainty. Strengthening potash production in Brazil benefits not only Brazilian growers, but potentially North American farmers as well. This is about resilience in a vulnerable global system.
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