In this file:
· Brazil hopes to expand chicken and pork sales to EU bases on the deal with Mercosur
· Mercosur/EU trade agreement very positive for the Brazilian meat industry
Brazil hopes to expand chicken and pork sales to EU bases on the deal with Mercosur
July 8th 2019
A historic trade deal between the European Union and Mercosur last week is lifting expectations for Europe’s next mission to evaluate Brazilian chicken plants, an industry group said on Friday.
Ricardo Santin, vice president of Brazil chicken and pork association ABPA, said in a telephone interview that the EU mission, tentatively scheduled for November, is part of a regular schedule of facility inspections.
The mission will look into what Santin called corrective measures to improve Brazilian inspections after the Europeans banned imports from 20 plants due to issues detected in 2018.
He said the measures, presented by Agriculture Minister Tereza Cristina Dias to European officials recently, include cutting state inspectors out of key decisions to create “a more vertical” process free of political interference.
“It is early to say if Europe will suspend the embargo on the plants,” Santin said. But he said that was a clear possibility after last week’s accord, which shows Europe’s “recognition of the seriousness of Mercosur institutions.”
Regarding the breakthrough trade deal after two decades of negotiations, Santin pointed to technical details that still need to be worked out.
For example, the deal would allow 180,000 tons of duty-free carcass weight equivalent (CWE) of poultry exports from Mercosur. However, the CWE criteria, typically used for cuts including bones, makes little sense for boneless cuts, according to Santin, who suggested the current terms should be tweaked.
The EU has agreed to reduce barriers on 82% of agricultural imports from Mercosur over a transition period. Each country in the two trade blocs must approve the terms of the treaty before full implementation.
Santin said the agreement boosts the importance of the European market to Brazilian chicken exports, which have been declining in relation to Asia. According to ABPA estimates, it may generate additional revenues of US$ 400 million to US$ 500 million per year.
The deal also bolsters the prospect of Brazil resuming pork exports to the EU...
Mercosur/EU trade agreement very positive for the Brazilian meat industry
July 9th 2019
A trade deal between the European Union and South America’s Mercosur bloc of countries could facilitate other agreements and open up new markets for Brazil’s massive beef-packing industry, a trade group said.
Speaking one week after Brussels and Brasília announced an agreement to reduce barriers on industrial and farm products, Antônio Camardelli, head of Brazil’s Abiec beef association, said the deal could pave the way to negotiating access to new markets or expanding trade with existing partners.
“A deal of this magnitude is like an invitation card for speaking with other countries and trade blocs,” Camardelli admitted. He mentioned Indonesia and Thailand as prospective new markets for Brazil, the world’s biggest beef exporter with sales of around US$ 7 billion last year.
Though Europe is not Brazil’s largest buyer, it is the country’s best-paying customer for some prime beef cuts, Camardelli said.
Camardelli said the deal boosts the prospects for more Brazilian beef sales to the EU, as it commands a 42.5% share of the new 99,000-tonne annual quota for beef exports to EU member countries that will be assigned to Mercosur. Tax on the new quota will be 7.5%. The annual quota is for Argentina, Uruguay and Paraguay as well as Brazil.
The new trade terms, once implemented, would also reduce to zero from 20% a levy on beef imports into the EU under the so-called Hilton quota. That quota allows Brazil and Argentina to each export up to 10,000 tons of beef, and 29,500 tons of prime beef cuts, to the EU per year.
With the exception of the Hilton terms, the EU-Mercosur deal does not change any other EU tariffs, Camardelli said, referring to the levies ranging from 12.8% to 20% that Brazil pays to sell beef into the EU under other existing quotas still in place.
But Camardelli expects the deal will...