Mercosur’s 150,000 tonne beef bid in EU talks

By Stephen Cadogan

South American negotiators want preferential access to EU markets for 150,000 tonnes per year of their beef, according to market analysts at Rabobank, the global agri-bank.

The analysts say allowing 99,000 tonnes of beef into the EU at a lower tariff level has already been tabled, as part of the long-running Mercosur-EU trade talks.

The 150,000 tonnes access demanded by the Mercosur side compares with total EU beef imports in recent years of between 204,000 tonnes and 270,000 tonnes, and Brazil, Argentina, and Uruguay — three of the Mercosur countries — are already the EU’s main suppliers, together accounting for 63% of total EU imports. Brazil alone accounted for 107,000 tonnes in 2017.

As a result of the high Mercousr beef access demand, beef negotiations in the trade talks are at a standoff.

European Commissioner for Trade Cecilia Malmstrom.

Meanwhile, Uruguay has raised concerns over EU dairy demands in the talks. These disagreements may further prolong the trade talks, which already run the risk of being postponed in March due to the impending Brazilian national elections.

However, European Commissioner for Trade Cecilia Malmstrom said this week the EU remained very close to reaching a trade agreement with the Mercosur countries (Argentina, Brazil, Paraguay, Uruguay and Venezuela).

She confirmed the prospect of elections in Brazil was increasing the pressure on negotiators.

The talks resumed last week and continue this week, in Asuncion, the Paraguayan capital. Ms Malmström said there are remaining difficulties over the EU’s car exports, as well as agricultural issues to resolve.

Meanwhile, Irish beef exporters continue their search for alternative beef export markets in preparation for the Brexit and Mercosur threats, and the ABP Food Group last week announced a major breakthrough, an exclusive three-year supply agreement with the Wowprime Corporation’s Asian restaurant chain, to supply beef to its hundreds of restaurants in China.

The agreement is estimated to be valued at €50 million, but is contingent on Irish beef gaining access to the Chinese market.

ABP and Wowprime have also agreed to extend the arrangement to include ABP’s UK operations, in the event of the UK gaining market access to China.

Agriculture Minister Michael Creed recently said, “We understand that Ireland is now in the final stages of the market access process with China. However, despite this significant progress, the pace of the opening of the market access will be largely determined by the Chinese authorities and not by my Department.”

Some UK beef industry sources expect China to drop its British beef import ban within the next six months.

Meanwhile, chilled beef access has been granted for Argentina in China — the fourth country behind Australia, the US, and New Zealand to be granted such access.

And the first live cattle exports from northern Australia to China arrived in January, and this trade may become more permanent.

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