June 9, 2004

China Soy Ban To Have Limited Impact On Brazil Exports
 
Brazilian soybean exports will not drop significantly in the 2004-05 season (February-January) because of China's decision to temporarily ban imports from seven companies, said Agriculture Minister Roberto Rodrigues, according to the local business daily Valor Economico Tuesday.
 
China is Brazil's main soybean client, importing 6.1 million metric tons in 2003, but Chinese authorities barred Brazilian exports from a number of companies in May after fungicide-tainted seeds were discovered in three cargoes.
 
Rodrigues said the government would release a decree this week setting out rules on cargo contamination, which he hoped would lead to the prompt lifting of the bans.
 
Cargoes were rejected at Chinese ports despite registering extremely low levels of fungicide contamination, leading to speculation that the move was an attempt to stem supply.
 
However, the Brazilian government has chosen not to impose a zero tolerance policy on fungicide contamination, instead adopting the international threshold of three seeds per kilogram, said Rodrigues.
 
The international threshold is likely to be adopted following heavy lobbying from exporters, who argued that zero tolerance would make it too risky to ship.
 
Exports to China have virtually stopped since the contamination issue was raised.