Brazil welcomes renewal of Mexico anti-inflation package as local exporters benefit

The Brazilian ministry of agriculture welcomed Mexico’s renewal, for another year, of measures against inflation that exempt certain food products from import taxes, a boon to Brazilian exporters.

The list of products benefiting from the measures include poultry meat, pork, beef, corn, rice and eggs, the ministry said.

In 2023, Mexico became Brazil’s fifth-biggest trading partner, behind China, the United States, Argentina and the European Union, according to the ministry.

The trade boost came largely from the implementation of a Mexican anti-inflationary package in May 2022, which facilitated the entry of Brazilian products into the Mexican market.

The measures also helped Mexico surpass Chile and Paraguay as the second main destination for Brazilian agricultural exports in Latin America, the ministry said.

Citing trade data between January and November 2023, the government said Brazilian agricultural exports to Mexico reached around $2.26 billion.

Brazil is currently the second-biggest supplier of poultry meat to the Mexican market, the ministry said. Recently, it started sending pork shipments to that country.

Before the anti-inflation measures, import tariffs were 16% for Brazilian pork and up to 75% for chicken meat, according to ABPA, a Brazilian lobby representing food processors like BRF SA and JBS SA.

The chart below shows Brazil’s top exports to Mexico from January to October 2023. The data is from DataLiner.

Top Exports to Mexico | 2023 | WTMT

Source: DataLiner (click here to request a demo)

With the measures, trading picked up, but the accelerated growth of Brazilian meat imports spurred a reaction from Mexican lobbies, which sought relief in the courts to suspend pork imports from Brazil.

The agriculture ministry did not immediately reply on the current status of the pork ban. ABPA said the ban stands.

After the import suspension was enforced, the Brazilian agriculture ministry said $60 million worth of Brazilian pork products had been shipped and awaited authorization to enter Mexico.

(Reporting by Ana Mano; Editing by Mark Porter)

Source: Reuters via Yahoo Finance 

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