Export flows are rerouting
Brazil redirected trade in the first quarter: exports to the U.S. fell 18.7% while shipments to China rose 21.7%, illustrating how exporters pivot away from markets hit by U.S. tariffs. Economists note neighbours like Canada and Mexico have proved relatively resilient, and the U.S.-Mexico-China manufacturing triangle remains tightly integrated — meaning protectionism is changing trade partners, not ending supply links (riotimesonline.com) (rbc.com) (theglobalist.com).
Brazil’s exporters just gave a real-time answer to tariffs: in the first quarter of 2026, shipments to the United States fell 18.7%, while exports to China jumped 21.7%. In March alone, exports to the United States were down 9.1% and exports to China were up 17.8%. (riotimesonline.com) This was not a one-month wobble. The drop in Brazilian exports to the United States was the eighth straight monthly decline after President Donald Trump imposed a 50% surcharge on Brazilian goods in mid-2025. (riotimesonline.com) The trade balances show how sharply the map changed. Brazil ran a $5.98 billion first-quarter surplus with China and a $1.39 billion first-quarter deficit with the United States. (riotimesonline.com) That does not mean trade is disappearing. It means sellers are looking for a different buyer, the way a soybean farmer reroutes trucks from one port to another when one customer suddenly raises the toll. (riotimesonline.com) Canada offers a second clue. Royal Bank of Canada economists wrote on April 8 that tariffs in 2025 covered more than 70% of total United States imports at their peak, yet “global trade mostly carried on” outside North America even as the shock hit specific sectors and regions hard. (rbc.com) Canada itself did not collapse under that pressure. Royal Bank of Canada said Canada’s gross domestic product and unemployment rate were broadly steady in 2025, even though industries tied closely to the United States took concentrated damage. (rbc.com) Mexico shows the same pattern from another angle. The Globalist reported on April 8 that Mexican manufacturing wages are roughly 40% lower than Chinese manufacturing wages and 88% lower than wages in the United States, which helps explain why factories keep clustering there instead of moving everything back across the border. (theglobalist.com) China is still inside that North American factory system. The Globalist says there are now more than 200 Chinese manufacturing and infrastructure investments in Mexico, and the Dallas Federal Reserve has described Mexico’s strategy as one that must deal with both the United States and China at the same time. (theglobalist.com) (dallasfed.org) The International Monetary Fund found in a 2025 working paper that lower United States imports from China were accompanied by higher imports from Mexico and other Asian partners rather than a clean break from overseas supply chains. (imf.org) So the picture is not “tariffs end globalization.” The picture is Brazil selling more to China, Canada absorbing uneven damage, and Mexico stitching together a production line where Chinese inputs, Mexican assembly, and United States consumers are still linked by the same chain, just with different labels on the boxes. (riotimesonline.com) (rbc.com) (theglobalist.com) (imf.org)
