Where’s the beef? China’s meat ban leaves Brazilian officials puzzled

Brazilian authorities are increasingly concerned about China’s ban on Brazilian beef, which has lasted for more than a month and threatens to decimate exports worth around $ 4 billion a year.

Brasilia voluntarily suspended protein shipments to China – its largest market – in early September after confirming two cases of “atypical” mad cow disease at separate meat factories across the country.

Many expected Beijing to resume imports quickly after no further signs of the disease were detected in Brazil. The suspension, however, lasted for nearly six weeks, fueling growing consternation among Brazilian officials and its large meat packers.

“Brazil has been completely transparent with Chinese health authorities. We responded promptly to all requests for information that were sent to us. In addition, we have requested a technical meeting, which has not yet been scheduled by the Chinese authorities, who claim to analyze the information we have transmitted, ”said an official from the Brazilian Ministry of Agriculture.

“We cannot set a date for the resumption of beef exports to China because the decision is not ours.”

Brazil is the world’s largest beef exporter and its meat packers, including JBS and Marfrig, have benefited greatly from the booming protein market in China.

Between January and July of this year, beef shipments from Brazil to China reached 490,000 tonnes and generated sales of US $ 2.5 billion, an increase of 8.6% and 13.8%, respectively. , compared to the same period last year, according to data from the Brazilian Association of the Meat Export Industry.

An executive at a large meat-packing company said he was “surprised the suspension has lasted so long and expects a solution soon but without guarantee.”

Ireland will be monitoring the situation closely as China has yet to lift its ban on Irish beef imports following a case of ‘atypical’ mad cow disease last year. Beijing also announced a ban on British beef sourced from cattle under 30 months of age from September 29 after a case was discovered in Somerset last month.

China’s ban on British beef is a blow to British farmers, who hoped to restart beef exports to the country, said the Agriculture and Horticultural Development Council, a British agricultural advisory body. . China had yet to start buying British beef despite lifting its long-standing ban on British beef in 2018 and signing a memorandum of understanding the following year to boost imports.

The cases are considered “atypical” because they “occur spontaneously and sporadically and are not related to the ingestion of contaminated food”, according to the Brazilian Ministry of Agriculture, adding that there was “no risk to human and animal health “.

In recent years, China has shown increased sensitivity to food safety issues, especially with regard to imports. Last year, Beijing suspended imports from a number of Brazilian meat processing plants over fears that outbreaks of Covid-19 at the facilities could risk re-importing the virus into the country.

An Australian meat and cattle consultant said China could maintain the latest ban on Brazilian beef while turning a blind eye to imports indirectly from Vietnam and Hong Kong: “China needs the meat, but it needs to also save face. The gray channel is one of the only options.

Some Brazilian analysts believe the ban is a way for China to gain a trade advantage.

“This delay in the recovery can be a negotiating tactic aimed at improving prices and gaining bargaining power. It sounds like something more commercial because in terms of health issues there is nothing to discuss, ”said Hyberville Neto of Scot Consultoria, a consultancy on the meat and cattle industry.

In China, importers said a longer-term suspension of Brazilian beef would have a huge impact given the scale of shipments, but most expected trade to restart soon.

“Brazilian beef represents up to a third of our business. We are replacing it with increasing imports from other northern European countries and Kazakhstan, ”said an official from the Chengdu Haiyunda Trading Company, which has halted imports of Brazilian beef since the suspension.

Chenjun Pan, Chinese agricultural sector expert at Rabobank, said she expected shipments to resume “within a year.”

“At the moment in China, the pork supply is very sufficient, it could solve the problem [of protein shortages and substituting Brazilian beef]. Beef is not the staple animal protein, so for the Chinese government it is not the strategic supply of animal protein. “

The stalemate also left in limbo the fate of around 100,000 tonnes of Brazilian beef, certified sanitary before the trade was suspended but shipped afterwards. Beijing seems to refuse entry of the product.

“I have the impression that the product in transit is either stuck at transshipment ports or idling off the coast of China,” said a Brazilian meat packaging industry executive.

The Australian industry consultant said the shipment would likely pass through Vietnam or Hong Kong, but could not be redirected elsewhere.

“The option to go back to Brazil will not happen because this market is oversaturated with beef and it cannot go to the United States or other markets due to poor specifications, lack of health certificates and of Chinese labeling. “

Additional reporting by Michael Pooler and Carolina Pulice in São Paulo Paulo and Emma Zhou in Beijing

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