‘Farmers cannot look at Brazilian beef on EU shelves when we are told beefmust be more sustainable’

Ukraine war to rekindle Mercosur talks

Farmers protesting over the Mercosur Deal outside Leinster House, Dublin, in 2019. Picture: Gareth Chaney Collins

EU representatives have approached Brazil’s government, seeking to rekindle negotiations on the stalled 2019 EU-Mercosur trade agreement.

The renewed contact comes amid rapid changes in global supply chains due to the pandemic and the Ukraine war, which have increased Brazil’s influence as an agricultural producer.

The Ukraine war has pushed Europe to strengthen international alliances and supply chains, hence the EU’s renewed appetite to sign a Mercosur Free Trade Agreement (FTA).

In 2019, Mercosur members agreed to sign an FTA with the EU, after 20 years of negotiations. But the FTA was not ratified by the Council of Europe, due to concerns about its environmental impact.

As Amazon forests blazed in the autumn of 2019, personal and political relations sharply deteriorated between France’s president Macron and Brazil’s far-right leader, Jair Bolsonaro, which further cooled trading relationships.

Deforestation increased further in 2020 and 2021.

Several EU countries, MEPs, and environmental activists have voiced disquiet about the environmental impact of the proposed deal.

Irish and French farmers in particular are opposed to a deal that they argue will open the floodgates to imports of Brazilian beef.

Conversely, other powerful EU lobby groups, such as car manufacturers and big industrial enterprises, are pushing the EU hard to expand access to 260m South American consumers.

The Southern Common Market (in Spanish, Mercosur) is the fifth largest economic bloc globally. It was established in 1991 and has four member countries: Argentina, Brazil, Paraguay, and Uruguay.

Any change to Mercosur economic policy requires the consensus of the other members.

Therefore, Brazil’s presidential elections, starting on October 2, could be crucial. Former left-wing president, Luiz Inácio Lula da Silva, has indicated his willingness to resuscitate trade ties with the EU, if elected.

Lula (as he is known in Brazil) has been comfortably ahead in public opinion polls, but his lead has steadily narrowed, as the Bolsonaro-led government recently unleashed stimulus measures including cash stipends for the poor and tax cuts on goods such as petrol.

On October 2, if one candidate receives more than 50% of the vote, they win outright. Otherwise, the top two candidates enter a run-off on the last Sunday in October.

Lula is committed to combating deforestation but would insist on renegotiating parts of the 2019 FTA accord with the EU. In particular, he wants to extract more concessions from the EU for development of Brazilian industry. But EU negotiators don't want to reopen talks, preferring instead "an additional instrument to accompany the agreement."

Since Bolsonaro’s election win in 2018, Brazil’s environmental protection agencies have been weakened, and the country has experienced devastating wildfires and a surge in Amazon deforestation, which reached levels in 2021 not seen since 2006.

But this year has even higher deforestation rates, 10% more than last year.

Bolsonaro has also tried to dismantle FUNAI, the state agency to protect and promote the rights of indigenous peoples in Brazil.

Bolsonaro’s election campaign is supported by the agricultural and energy lobbies, where he has a strong base.

In contrast, Lula, as a social democrat with a trade union background, campaigns on tax reform to distribute wealth more evenly, increase public spending, protect the Amazon, and improve environmental legislation.

"With Bolsonaro in government, there cannot be any Mercosur agreement, that is crystal clear," said German MEP Anna Cavazzini, who recently led a Greens/EFA mission to Brazil to evaluate the threat to the Amazon region from illegal gold mining and logging.

Here, IFA Livestock Chairman Brendan Golden recently reiterated farmers' fears that trade deals such as Mercosur would undermine the EU market for Irish suckler and beef farmers. The FTA as it stands provides preferential EU market access to almost 100,000 tonnes of beef from Mercosur members. IFA also notes that the carbon footprint of Brazilian beef is estimated to be 80 kg per kg beef, compared to 19 kg for Irish beef, and the EU average of 22.1 kg.

Irish Cattle and Sheep Farmers Association beef chair Edmund Graham said, “We need absolute clarity from the government that farmers will not have to look at Brazilian beef on EU shelves at a time when we are told that beef must be more sustainable.” Sinn Féin Agriculture spokesman Matt Carthy recently called on the Irish government to end EU-Mercosur trade negotiations, pointing out that the Brazilian meat industry is unveiling plans to significantly increase its cattle herd to meet projected export demand, if Mercosur goes ahead.

Conversely, the European Commission has highlighted supposed benefits of the deal for European farmers and food businesses, such as better access to a large new market of 260m people. The Commission said the anticipated 100,000 tonnes of beef imported to the EU (after five years of the trade deal) represents only 1.2% of total European beef consumption, and all imported agri-foods must comply with the EU’s stringent food safety standards (no hormone beef or non-authorised GMO products).

While the Irish farming sector is unlikely to be sympathetic to Bolsonaro’s populist and right-wing policies, it may still welcome a Bolsonaro presidential election success, given that it would likely scupper any possibility of ratification of the EU-Mercosur FTA.