Brazil Official Promises to Take Necessary Measures to Resume Beef Exports to U.S. -- Update
June 23 2017 - 2:19PM
Dow Jones News
By Jeffrey T. Lewis
SÃO PAULO -- Brazil's agriculture minister promised Friday to
take the measures necessary to reopen the U.S. market after the
U.S. Department of Agriculture suspended imports of Brazilian beef
over concerns about its safety.
The decision by the USDA, announced Thursday, came after Brazil
suspended beef exports to the U.S. from five Brazilian
slaughterhouses. Some of the beef from those abattoirs was found to
have abscesses caused by a vaccine against hoof-and-mouth disease.
Brazil's agriculture ministry said the abscesses aren't a health
risk.
Brazilian agriculture minister Blairo Maggi said he is ready to
travel to the U.S. to hold talks to re-establish exports. Mr. Maggi
said in a statement there has been "strong pressure" from U.S. beef
producers to block beef from Brazil, but added the Brazilian
government agrees with the U.S. position and intends to correct the
problems.
The ministry said it would introduce more rigorous inspections,
and will make changes to the hoof-and-mouth vaccine to try to avoid
the problem with abscesses, among other actions.
"We have to fight [to resume exports] because it's an important
market," Mr. Maggi said.
The USDA had no immediate response for comment Friday.
The USDA said Thursday that since the agency began analyzing all
meat shipments from the country in March inspectors have rejected
about 11% of Brazilian fresh beef products because of "public
health concerns, sanitary conditions, and animal health
issues."
The rate of rejection of beef shipments from the rest of the
world is only 1%, the USDA said.
Beef from Brazil, one of the world's biggest exporters of the
meat, came under increased scrutiny three months ago after the
Brazilian authorities unveiled a corruption probe targeting food
inspectors.
Brazil's biggest agricultural association, National
Confederation of Agriculture and Animal Husbandry, questioned the
USDA's reasons for the suspension, saying the issues pose no risk
to Americans' health.
"We hope the U.S. government will divulge the technical and
scientific justifications upon which they based the decision, which
can also be seen as a protectionist measure," the group said in a
statement.
The U.S. only allowed imports of fresh Brazilian beef to resume
last year after a 13-year ban, and is still a small market for the
South American country's cattlemen. The U.S. only bought 3% of
Brazilian beef exports in the first five months of this year,
according to exporters group Abiec.
The biggest potential problem for the Brazilian beef industry is
that other countries representing much bigger markets will also ban
imports, said Kevin Good, senior market analyst at Colorado-based
Cattlefax, a producer-owned organization that deals primarily with
analyzing beef and other animal protein markets.
"You could see more damage if there's a lack of confidence from
other export markets," said Mr. Good. "That's the risk, is there a
domino effect or not."
When the investigation of sanitary inspectors was announced in
March, China, the European Union and other countries issued
temporary bans or increased scrutiny on Brazilian meat shipments.
No countries have announced new bans since the USDA's announcement
Thursday.
Shares of Brazilian meatpackers JBS SA and Marfrig Global Foods
SA declined Friday.
JBS, the world's biggest animal protein producer, was down 1.6%
in early afternoon trading. Marfrig had fallen 0.6% at the same
time, while meatpacker Minerva SA's shares were up 0.6% after
falling 2.2% in early trading. Shares in U.S. meat producers rose
Friday, with Tyson Foods Inc. and Hormel Foods Corp. both up around
2%.
Write to Jeffrey T. Lewis at
jeffrey.lewis@wsj.com<mailto:jeffrey.lewis@wsj.com>
Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com
(END) Dow Jones Newswires
June 23, 2017 14:04 ET (18:04 GMT)
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