Brazil has retaliated against U.S. cotton subsidies by increasing tariffs on 102 items imported from the U.S.
Brazil won its case against U.S. cotton subsidies at the World Trade Organization last year, and is now entitled to retaliate with measures that will cost U.S. exporters up to $830 million a year.
Items on the retaliation list mostly include luxury goods such as cosmetics and leisure boats, as well as clothes, textiles and automobiles.
Among agricultural products to suffer tariff increases will be wheat, powdered milk and fruit. For most items tariff rates will be doubled, and in the case of clothes and textiles they will be as high as 100 percent.
The McDonalds fast food chain will also be affected as import tariff on sauces and condiments will be increased.
Imposing higher import tariffs was the solution presented to Brazil by the WTO after the U.S. refused to change its cotton subsidy program. However, negotiations are taking place to come up with an alternative solution, which could include a reduction in U.S. tariffs on Brazilian meat, orange juice and ethanol.
The tariff increases will take effect in 30 days.