UPDATE 1-Brazil wants compensation, may retaliate against EU steel duties

Brazil has asked the European Union for compensation after it imposed import tariffs on steel from major producing countries earlier this month, the Brazilian government said in a statement on Monday. The government has also notified the World Trade Organization that it may adopt its own countermeasures to "rebalance" trade following the EU's actions, according to a joint statement from the foreign, economy and agriculture ministries.

Brazil is seeking 180 million euros ($203.6 million) in compensation, a government source with knowledge of the matter told Reuters. If the EU denies compensation, that could open the way for Brazil to place or increase tariffs on European products, including powdered milk, said the source, who was not authorized to speak publicly and asked not to be named.

On Feb. 1, the EU announced limits on steel imports in response to U.S. President Donald Trump's metals tariffs. The tariffs establish limits and quotas for major exporting countries including China, India, Russia and many others. "The Brazilian government remains open to dialogue with the European Union in order to seek the best way to address these issues," the statement said.

"It also reiterates its willingness to continue defending the interests of Brazilian producers and exporters with every effort." ($1 = 0.8843 euros) (Reporting by Anthony Boadle and Jake Spring; Editing by Tom Brown and Dan Grebler)