Concerns are rising among paper suppliers worldwide due to President Donald Trump’s trade war, which may lead to a serious shortage of toilet paper in US supermarkets.
Suzano SA, the largest pulp exporter globally, has reported disruptions in shipments of essential raw materials for toilet paper and hygiene products due to US tariffs.
The Brazilian company, known for its bleached hardwood pulp used by various American manufacturers, experienced a 20% drop in exports to the US in April compared to the previous year.
“We had to pass the increased costs onto US buyers in response to the tariffs,” said Joanne Alberto de Abreu, CEO of Suzano, in an interview with Bloomberg News.
The company, based in Sao Paulo, cautioned that ongoing trade barriers could worsen supply chain issues and drive up prices.
Currently, Brazil faces a 10% tariff on exports from the US, similar to most trading partners, apart from China.
This warning is particularly poignant as memories of the 2020 toilet paper shortage, spurred by panic buying during the pandemic, are still fresh for many consumers.
Even though store shelves seem to be stocked for now, analysts indicate that it wouldn’t take much for instability in the paper supply chain to resurface, especially if consumers start hoarding in anticipation of more trade issues.
Suzano’s stock took a hit as shares fell 4.3% during trading in Sao Paulo, indicating investor concern over rising tariffs.
Suzano’s executives highlighted how the uncertainty around tariffs is disrupting contract negotiations and pricing strategies. “All pulp buyers and sellers are struggling with price prediction due to these tariffs,” said Leonardo Grimaldi, the company’s executive vice president.
It’s not only Suzano expressing concerns; several other global suppliers have also highlighted potential supply bottlenecks for essential items if the tariff disputes escalate.
This situation illustrates a larger trend, where trade disputes, typically centered around high-tech and luxury goods, now threaten basic products that are crucial for daily life.
Brazil, as one of the leading pulp producers, has become central to the latest trade conflict.
As the US increases various import duties under Trump’s trade policies, Brazilian exporters are hurriedly trying to maintain their market share while dealing with rising costs.
Suzano, which played a significant role in supplying toilet paper during the pandemic, is adapting but warns that ongoing tariff pressures could lead to a chain reaction impacting American consumers—specifically in their bathrooms.
“Pulp is more than just a commodity,” Abreu remarked. “It’s fundamental to many essential products we use daily.”
Last month, Apollo Global Management cautioned that US store shelves could face shortages within weeks due to the unexpected tariffs on Chinese goods, potentially driving the economy into a recession by summer.
Tortenslok, Apollo’s chief economist, outlined how disruptions in supply chains can lead to product shortages, affecting retail and causing layoffs in both trucking and retail sectors.
The timeline suggested by Slok predicts that Trump’s tariffs will halt shipments from China by mid-May, lead to empty store shelves by the end of May, reduce sales, and ultimately result in layoffs, pushing the US into a recession by summer 2025.
While some analysts believe that current inventory could mitigate immediate impacts, Slok foresees a “Covid-like shortage” as goods from China dwindle and the economy grinds to a halt.
This news has reached the White House for comment.
