EU-Mercosur deal favors Brazil’s meat exports

According to the Brazilian Beef Exporters Association (ABIEC), the trade agreement between the European Union and Mercosur may facilitate new trade agreements with other economic blocs or countries such as Indonesia and Thailand.

Brazil is the largest exporter of beef in the world, with sales of about US$7bn last year.

Although Europe is not the biggest buyer in Brazil, they pay the most, since they prefer noble cuts.

For ABIEC, the free trade agreement increases the prospects of selling Brazilian beef to the European Union. The country holds 42.5% of the new annual quota of 99,000 tons of beef. The tax on the new quota will be of 7.5%.

The new terms of trade, once implemented, will also reduce the tax on EU beef imports from 20% to zero under the so-called Hilton quota. This quota allows Brazil and Argentina to export up to 10,000 tons of beef and 29,500 tons of premium beef to the EU each year.

Exports of chicken meat

Meanwhile, Brazilian exports of chicken meat (considering all products, in natura and specialized) grew 64% in June compared to the same period last year, totaling 386.2 thousand tons according to the Animal Protein Association (ABPA).

In revenue, there was a 76.6% increase, totaling US$639.6m in June of this year, against US$362.2m in June 2018.

In the semester, the export sector performance reached a high of 11.4%, with 2,045m tons exported in 2019, against 1,836m tons made last year.

In revenue, the highest reached was of 14.9%. In the first six months of this year, US$3.406bn were made in sales, against US$2.64bn in 2018.

“There was a rise in purchases from almost all major importers, which generated a positive current of exports. The international context of high demand for protein is felt in the most diverse markets”, stated Francisco Turra, president of ABPA.

China, the main destination for Brazilian exports, increased its purchases by 22.6% between January and June of this year in comparison with the same period last year, totaling 257.9 thousand tons.

The European Union increased its purchases by 21%, reaching 129,9 thousand tons in the first semester. The United Arab Emirates increased its purchases by 35.7%, reaching 192 thousand tons in the same period.

“Arab markets have been maintaining a good import flow of products, with strong sales growth to the United Arab Emirates,” said ABPA’s executive director Ricardo Santin.

The following chart, based on data from the DataLiner, shows Brazilian meat and poultry exports to the European Union from January 2015 to May 2019.

The following DataLiner graph shows Brazilian meat and poultry exports to the European Union from January 2015 to May 2019:

Sources: Mercopress and ABPA

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