Mercosur and Canada report progress in trade talks

Negotiations between Mercosur and Canada advanced on five chapters during a round of talks held in Toronto, lifting hopes for an agreement that could expand the bloc’s agricultural exports and facilitate imports of farm inputs.

The progress covered issues such as tariffs, rules of origin, sanitary and phytosanitary measures, trade facilitation and access to inputs. For Brazilian agribusiness, sanitary discussions are especially relevant because they define market access conditions for products such as meat, grains and fruit in Canada.

Canada is a high-income market and a major consumer of animal protein, grains and processed foods. An agreement could reduce tariffs on products such as beef, chicken, soybeans and derivatives exported by Mercosur.

Tariffs on beef and chicken still represent barriers for Brazilian exporters. Reducing or eliminating those duties would increase the competitiveness of Brazilian products against suppliers such as the United States and Australia.

The agreement could also benefit imports of agricultural inputs. Canada is an important supplier of potassium fertilizers, and lower trade barriers could help reduce production costs in Brazil.

Negotiations between Mercosur and Canada began in 2018 and have continued to advance gradually. Although there is still no deadline for concluding the agreement, recent rounds point to greater technical alignment between the parties.

For Brazil, the main benefits would be concentrated in exports of animal protein, soybeans, sugar and ethanol, as well as more competitive access to fertilizers and other agricultural inputs.

Source: Spacemoney

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