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Brazilian tallow exporters are increasingly focused on strengthening their domestic market and exploring new global routes as trade tensions with the United States escalate. This was a key theme discussed by industry leaders Francisco Braido, commercial director at Braido Group, and Carlos Martella, commercial director at Fasa by Darling Ingredients, during the 'Outlook and perspectives for Brazilian tallow exports' panel at the Fastmarkets Biofuels & Feedstocks South America 2026 conference.
The sector faces significant challenges, particularly given that the US has historically absorbed approximately 98% of Brazil’s tallow exports. Recent measures, including last year's tariff increase and a new 37.5% tariff burden imposed on Brazilian tallow and other products destined for the US, have created substantial uncertainty. Martella highlighted that the past 11 months have necessitated adaptability, diversification, and the evaluation of alternative markets. These new avenues, including Brazil's own domestic market, present 'different standards and requirements that we had not all been concerned about before,' he noted.
Braido emphasized the company's proactive approach, stating they 'took advantage of the moment to structure and understand what makes the most logistical and economic sense.' He underscored the importance of certification and traceability throughout the entire supply chain, clarifying that their strategic plan for alternative routes targets the medium term, not an immediate reshuffling of existing flows. Braido projects stable demand for feedstock, both domestically and externally, until 2029, with potential for a 'jump' thereafter.
Despite the current difficulties in pricing Brazilian tallow in the US, Martella acknowledged that 'at current levels, the US remains attractive, especially because of the flexibility in the technical specification' of the demanded product. He pointed out a limitation in Brazil, where 'not everyone is able to work with tallow at 10% or 15% FFA.' Nonetheless, Martella anticipates that domestic demand for tallow in Brazil will 'gain traction and recover from now until the end of the year.' Braido added that Brazilian suppliers should always pursue the best conditions for their business, regardless of the destination – be it the local market, the US, or Europe.
Braido also noted that rising fuel prices, exacerbated by the ongoing conflict between the US and Iran, currently mean that even with the 37.5% tariff, the arbitrage for Brazilian tallow into the US remains viable. This contrasts with last year, when a 50% tariff under the Trump Administration saw a 'strong domestic market here was the salvation of tallow producers.' Martella added that the sector was 'lucky' in 2025 as the implementation of the B15 mandate (requiring a 15% biodiesel blend in diesel) coincided with the tariff increase, providing an absorption mechanism.
However, Martella cautioned that the domestic market is currently navigating a 'very challenging moment,' with technical specifications acting as a 'limiting factor for consumption growth.' He expressed optimism for a 'slight improvement toward the end of the year,' which could unlock significant local opportunities as actions are being taken to address these issues. Braido affirmed that Brazil's biodiesel sector generally possesses the capacity to absorb tallow supply, distinguishing it from other external markets that share Brazil's limitations regarding higher FFA materials, unlike the US which holds a technological advantage in this area.
Looking ahead, the European market shows promise as a more consistent future consumer of Brazilian tallow, primarily due to its 'more stable' biofuels regulations and policies compared to the US. Europe’s 'protectionist' stance towards virgin vegetable oils could also benefit imported feedstocks like Chinese UCO and South American or Oceanian tallow in the renewables sector. Braido, however, stressed that the Brazil-Europe route is a recent development over the past year and not yet technically viable for the scale of shipments typically sent to the US.
Asian markets, including Singapore and China, also present potential, though they currently face technical and logistical restrictions, Martella observed. Braido highlighted China's testing of aviation fuels, suggesting that if it adopts US-like technologies, it could fundamentally 'trigger a global reshaping of trade flows in the feedstock market.' Braido concluded that while these developments offer 'good news stories for the medium and long term,' the immediate focus remains squarely 'on the Brazilian domestic market and its development.'
The Fastmarkets Biofuels & Feedstocks South America 2026 conference, scheduled for Monday, August 10, in São Paulo, Brazil, is set to gather key stakeholders and market participants across agricultural commodity value chains. Its panels will delve into the effects of global geopolitical and trade shifts on South American markets for vegetable oils, meals, fats, and grains. Fastmarkets provides critical pricing information across the complex biofuels and feedstocks marketplace, covering biodiesel, glycerin, Renewable Identification Numbers (RINs), California’s Low-Carbon Fuel Standard (LCFS) credits, and related European certificate markets. Source: Fastmarkets