China promises Brazil quick solution to beef embargo

RIO DE JANEIRO, BRAZIL – China, Brazil’s largest trading partner and the leading destination of Brazilian beef exports, should soon overcome the crisis generated by the embargo imposed on imports of the protein from the country, which has generated millions of dollars in losses for producers.

According to the Brazilian Foreign Ministry, the commitment was made by China’s Minister of Foreign Business, Wang Yi, in a telephone conversation held this Thursday with the Brazilian Minister of Foreign Affairs, Carlos França.

“The ministers discussed the opening and diversification of markets, including the resumption of Brazilian beef exports. The Chinese foreign minister believes that the matter will be resolved quickly,” the Brazilian Foreign Ministry reported in a message posted on its Twitter account.

According to the Foreign Ministry, a bilateral meeting between the two countries was scheduled for Thursday to discuss the matter.

China suspended beef imports from Brazil in early September, exactly 47 days ago, after the Brazilian Ministry of Agriculture confirmed the registration of two atypical cases of the so-called mad cow disease, one in the state of Mato Grosso – which has the largest herd in the country – and another in the form of Minas Gerais.

As the Brazilian and international health authorities clarified that these were atypical cases, i.e., arising spontaneously and not due to transmission between animals, and therefore do not pose a health risk, the Brazilian government was confident that China would quickly lift the embargo normalize shipments.

However, the Asian country has not pronounced itself on the matter or made any demand without explaining the reasons.

According to Brazilian business leaders, Beijing’s delay in reactivating trade retaliation to critical statements against the Chinese government by some Brazilian authorities, including President Jair Bolsonaro, insinuated that China had created the Covid-19 virus as a trading strategy.

The delay has generated enormous losses for Brazilian cattle farmers because Brazil is the world’s largest producer and exporter of beef, and China is its primary customer.

With the delay in shipments, producers have reduced slaughtering and face difficulties in keeping frozen the cuts already made. In contrast, beef prices in wholesale markets have suffered a sharp fall, a trend unfortunately not yet reflected in the domestic retail trade, where prices have skyrocketed this year.

The Brazilian Foreign Ministry reminded in its message on Twitter this Thursday that China has been Brazil’s largest trading partner since 2009 and one of the country’s primary sources of foreign investment.

It also reported that trade between the two countries grew by 34% in the first nine months of this year compared to the same period last year, up to $105 billion, with a surplus for Brazil that reached $37 billion through September.

Despite the Chinese embargo, Brazil exported a record volume of 187,000 tons of beef in September, with a growth of 30% over the same month last year, according to data from the Foreign Trade Secretariat of the Ministry of Economics.

The country exported a record 2.02 million tons of beef in 2020, increasing 8% compared to 2019, which yielded revenue of $8.4 billion, 11 % higher than the previous year.

China was the destination of 58.6% of this volume exported in 2020, with 1.18 million tons, and the origin of 60.7% of Brazilian revenues from beef shipments, with $5.1 billion.