What are the Impacts of Reopened Beef Trade Between the US and Brazil?
In the past week, the US and Brazil have agreed to reopen their markets to trade in fresh and frozen beef products.
The US Department of Agriculture said Brazil's action reflects the US's negligible risk classification for bovine spongiform encephalopathy (BSE) disease and aligns Brazil's regulations with international animal health guidelines.
"The Brazilian market offers excellent long-term potential for US beef exporters. The US looks forward to providing Brazil's 200-million-plus consumers, and growing middle class, with high-quality American beef and beef products," US Agriculture Secretary Tom Vilsack said.
Brazil’s agriculture ministry said the conclusion of the negotiations is important for Brazil, not only because of the US’s buying potential, but also because the US is a reference to other importers of fresh beef.
Shipments are expected to start in 90 days after the completion of administrative procedures by the health authorities of both countries - read more.
However, looking at the volumes that Brazil may be able to export to the US under current trade rules, CME market analysts Steve Meyer and Len Steiner said that in the near future, imports of fresh Brazilian beef should not have huge effects on the US’s domestic beef industry.
“We would expect the majority of imported fresh beef from Brazil to be in the category of 90 per cent lean beef, very similar to the product we currently import from Australia,” they said. “The value of the Real could make Brazilian beef rather more competitive than Australian product, for US importers.” - Read more.
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