Collaboration between Brazil and Mexico is key to reducing the burden of US orange juice tariffs on both nations, says GlobalData

The US has imposed 10 % tariffs on Brazilian orange juice exports, while the majority of Mexican orange juice exports are likely to be USMCA compliant and therefore tariff-exempt.

This scenario creates opportunities and threats for orange juice exporters in both countries. On the one hand, burdened with a 10 % tariff, Brazilian exporters’ share of the US orange juice market could be under threat from tariff-free Mexican exporters.

On the other hand, if demand for Mexican orange juice soars among US importers as a result of US tariffs making Brazilian orange juice exports more expensive, then a greater percentage of total Mexican orange juice production could be redirected away from the domestic market and into the US. This would reduce Mexico’s domestic supply, which could result in increased prices for domestic orange juice consumers, says GlobalData, a leading data and analytics company.

Rory Gopsill, Senior Consumer Analyst at GlobalData, comments: “Avoiding price inflation is likely to be a priority for the Mexican Government as well as domestic orange juice brands and retailers, because Mexican consumers are already under financial pressure.”

According to GlobalData’s Q1 2025 Global Consumer survey, 56 % of Mexican consumers are extremely or quite concerned about their personal financial situation, and 60 % are extremely or quite concerned about the impact of the cost-of-living crisis on their financial situation. Moreover, 47 % of Mexicans are switching to cheaper brand alternatives to deal with rising prices, and 38 % are switching to cheaper retailers. Mexican orange juice brands and the retailers selling them will be wary of increasing prices for these reasons.

However, greater collaboration between Brazil and Mexico could result in controlling the balance of trade between the two countries’ US orange juice exports, and partially avoid the US tariffs.

Annually, the US consumes a greater volume of juice than any other country in the world. In 2024, the US consumed 5.3 billion litres of juice, considerably more than the runner-up, China, which consumed 1.4 billion litres in the same year, according to GlobalData’s Segment Insights Database, accessed May 2025. Figures from the Observatory of Economic Complexity, accessed May 2025, confirmed that the US exported $633 million worth of fruit juice in 2023 and imported $3.44 billion in the same year. As these figures demonstrate, the US is heavily reliant on fruit juice imports to meet domestic demand, especially orange juice, which is the most consumed fruit juice in the US, according to the USDA.

Brazil is the largest exporter of orange juice to the US, sourcing 75 % ($570 million) of the US’ non-frozen/spirited/fermented orange juice in 2023, and 44 % ($203 million) of the US’ frozen non-fermented/spirited orange juice in 2023. For Mexico, these figures were 16 % and 49 % respectively, making it the second largest exporter of orange juice to the US, according to The Observatory of Economic Complexity, accessed May 2025.

A potential solution to the challenges confronting both Brazil’s and Mexico’s orange juice exports to the US could be for Brazil to sell more orange juice to Mexican producers, who could then use it to produce juice blends that are exported to US markets. This is because, according to Fresh Plaza (2025), 60 % of juice blends can originate from third countries and still be USMCA compliant.

A product is more likely to be USMCA compliant if it is manufactured in the US, Mexico, or Canada, and made of materials sourced in these three countries. Mexico devoted more hectares to orange cultivation than any other country (except for India, Brazil, and China) in 2024, according to GlobalData’s Crop Area Production and Yield database. It would make sense for Mexican manufacturers to convert home grown oranges into orange juice for domestic consumption to maximise supply chain and administrative efficiencies.

Gopsill adds: “Brazilian exporters could mitigate losses in their share of the US import market by increasing the volumes of orange juice they sell to Mexican producers. Simultaneously, Mexican producers could use the Brazilian oranges to produce USMCA compliant orange juice and sell it to the US without burning through domestic orange juice supplies and increasing domestic orange juice prices, which would be a positive result for both nations.”