SAO PAULO, July 9 (Reuters) - Brazilian planemaker

Embraer ( ERJ ) is competing to supply Moroccan airline Royal

Air Maroc with its aircraft, a source familiar with the

negotiations told Reuters on Wednesday.

The African carrier is looking to expand and renew its

fleet in three size categories, and Embraer ( ERJ ) is fighting to tie

up an order in the smallest, the source said.

Earlier on Wednesday, local newspaper Folha de S.Paulo

reported that Royal Air Maroc was in talks with several

suppliers, including Embraer ( ERJ ), to purchase up to 200 aircraft.

Embraer's ( ERJ )

second-generation E2 jet family

is being considered by the airline, Folha reported, citing

the carrier's CEO.

The E2 line fits just below Boeing and Airbus's

best-selling 150-seat-plus market.

Embraer ( ERJ ) declined a request for comment, while Royal Air

Maroc did not immediately respond.

Shares in Embraer ( ERJ ) rose as much as 2% on the news, though

they flipped, closing down 3.6%, after U.S. President Donald

Trump announced he was

slapping exports from Brazil

with a 50% tariffs. The U.S. is Embraer's ( ERJ ) No. 1 market.

Reuters reported in June that Morocco's flagship airline

was also

nearing deals with both Boeing and Airbus

to renew its fleet, which is almost entirely comprised of Boeing

aircraft.

Royal Air Maroc plans to order dozens of Boeing jets,

while also placing a smaller order for 20 A220 jets from Airbus,

industry sources told Reuters.