Brazil Eyes Threats to its Ag Trade

South American Crop Watch

Brazilians concerned about a freeze-out from the East

Published on: July 29, 2013

Brazilians, already quite sensitive to temperature drops, are filling their Facebook pages with pictures of their dogs huddling under blankets to stay warm as a rare cold front passes through areas that haven't seen ice in years. Whether an effect of a changing global climate, or just a fluke in the otherwise predictable winter weather patterns, farmers down there these days are wearing coats in the office, outside and even at home, in places as close to the Equator as Mato Grosso.

And they're also concerned about a freeze-out from the East. After all, China currently buys some 70% of all the soybeans produced in Brazil's top soybean state of Mato Grosso. The Brazilians are looking at what's happening around them, and seeing that their dominance in China is not set in stone.

The Brazilians are finding out there are indeed other suppliers for ag goods, and they can't simply rest on their laurels. As Brazilian diplomat Marcos Caramuru de Paiva points out, the country has only nine beef exporting slaughterhouses licensed to ship to China, while tiny New Zealand boasts 26. China canceled several loads of Brazilian soybeans early this year after precarious port conditions resulted in ships waiting in line to get loaded—for up to 45 days.

If that weren't enough, Brazil is worried about a USA-EU free trade agreement, and a China-US and Canada trans-pacific agreement. Maybe that's why the country's National Agriculture Confederation last year opened an office in Beijing.

That's the thing about the weather: every once in a while you get a serious cold snap, even in the tropics. And so the Brazilians are looking at the radar carefully, and seeing the possibility of some turbulent weather ahead. Now's the time for them to get ready.