December 4, 2007

 

Brazil takes a step closer towards opening meat trade with China

 

 

Brazil, a top meat producer is taken a step closer towards widening the meat trade with China, the world's top pork consumer. 

 

Both countries signed a draft veterinary protocol last week at the High Level Food Safety Forum in Beijing, initializing the process which might see Brazil widening its meat exports to China.

 

Brazil has been looking to gain official access to China for years and now a realization of that objective is now within sight, said USMEF Senior North China Representative Donald Song.

 

Higher pork demand could also have spurred the Chinese government to give Brazilian exporters the approval they have long sought for.

 

Song added there were unconfirmed reports that AQSIQ, the China's veterinary agency, would send officials as early as this week to Brazil to finalise terms of the agreement and perhaps to inspect and approve plants.

 

To open up access for Brazil, China has taken the first step of reaching an agreement on general terms of supply of meat and poultry, on a species basis. The next step would involve certification teams which would inspect and approve facilities on a plant-by-plant basis.

 

Brazil currently has 24 poultry plants and three beef plants approved to export to China, according to the China Certification and Accreditation Administration Web site.

 

However, details of the meat trade has been sketchy at best: Although Brazilian authorities claim that it has exported 650 tonnes of beef to China, the three approved beef facilities have not been eligible to export to China until recently due to Brazil's foot-and-mouth disease outbreak, according to the USMEF.

 

On Sept. 30, AQSIQ announced that Brazil could resume exports of meat from cloven hoof animals from facilities in four states.

 

Still, even as Brazilian exports of poultry and beef to China remained at lackluster levels, trade with Hong Kong has been rising sharply.

 

Hong Kong is the second largest of Brazilian pork, accounting for an 18-percent share of exports in the first 10 months of this year totaling 85,385 tonnes.

 

Figures suggest that the shipments may have been rerouted to China. A direct link from Brazil to China would mean a major victory for Brazilian exporters, USMEF said.

 

With high pork prices in China currently, Chinese processors may consider Brazil's competitive pork prices to be a good fit for the country's raw material needs, USMEF said.

 

The higher demand for pork in China could be seen from the fact that in October, China's pork imports rose 120 percent to 383,189 tonnes. 

 

In September, US pork and pork variety meat exports to China rose 66 percent in volume to 76,772 tonnes and 81 percent in value to 108.9 million compared to the same time last year.

 

Besides gaining the Chinese market, Brazilian pork exporters may have something to cheer for from their biggest market - Russia, which accounts for more than half of the country's pork exports.

 

While Brazil's beef exports have risen consistently, its pork exports have been on a more erratic path due to periodic bans from Russia.

 

Although Brazil's pork exports to Russia in October were 37 percent below the record export volume of 2005, a pickup is expected soon as Russia recently signaled an increase in regional market access for Brazil. Exports have also been gaining momentum in the summer months this year.

 

Overall, Brazil's pork exports have increased 13 percent during the first 10 months of the year, led by a 42 percent increase in exports to Hong Kong. Still, this is 10 percent below the record volume exported in 2005.