(Bloomberg) -- Brazil is in talks to gain Chinese approval for more meat plants to export to the Asian nation, according to Agriculture Minister Carlos Favaro.
Negotiations are currently under way to obtain clearance for another 10 to 15 beef, chicken and pork facilities, Favaro said in an interview at Bloomberg New Economy at B20 in Sao Paulo on Tuesday. An announcement could come as early as next month, during the Group of 20 meeting in Brazil, he added.
The talks come just as Favaro said Brazil should join China’s Belt and Road Initiative to counter protectionist measures from the US and European Union. The idea has divided President Luiz Inacio Lula da Silva’s government as it seeks to attract new investment to Latin America’s largest economy.
China is the biggest market for Brazilian beef, chicken and pork, and having more plants approved for export would be a boon for the likes of JBS SA, the top meat supplier, and its rivals Minerva SA, Marfrig Global Foods SA and BRF SA. The Asian nation, the world’s largest commodities buyer, accounts for about 14% of Brazil’s chicken exports and nearly half of beef shipments.
JBS slid as much as 1.5% in early trading in Sao Paulo, with Marfrig, BRF and Minerva also down.
“The sanitary process for approval is under way,” Favaro said, adding he was also working on opening the Chinese market to new products including sorghum, grapes, sesame seeds and pork byproducts such as feet and ears.
The last time China cleared Brazilian meat plants for export was in March, when 38 facilities were approved.
Brazil has expanded its share in global meat trade over the past few years as competitors including the US are faced with supply constraints. The South American nation should account for 36% of all chicken exports and 28% of all beef shipments this year, according to US Department of Agriculture data.
The idea of joining the Belt and Road Initiative, China’s flagship global trade and infrastructure program has sparked debate within the leftist Lula’s government. Some ministers argue it’s necessary to attract massive new investments, while others fear the partnership could dent existing relations with the US and EU.
But Favaro argued it could be done without “creating disputes with anyone.”
DISCLAIMER: New Economy at B20 is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News.
--With assistance from Gerson Freitas Jr..
(Updates with share move in fifth paragraph)
©2024 Bloomberg L.P.
