São Paulo, Brazil -- 15 September 2020 – A senior-level dialogue facilitated by the Tropical Forest Alliance has advanced the transition by Brazil and China towards the forest-positive sustainable production and trade of beef between the two nations sourced from Brazil’s Cerrado and Amazon regions. Nearly 90 senior-level representatives of key actors involved in the production and commercialization of beef took part, from both nations, in the 27 August dialogue. This included exporting and importing companies, financing banks, non-governmental organizations and government officials.
The bilateral dialogue revealed alignment, by both nations as well as among participating sectors, on the need to combat illegal deforestation and track the entire beef supply chain, in order to bring Brazilian livestock management up to modern standards and to ensure that Brazilian beef meets legal and health/safety requirements and consumer expectations – factors that are increasingly essential to maintain and increase beef exports to the Chinese market.
The Tropical Forest Alliance works to catalyse innovative private-public solutions and collective action to advance the world’s transition to deforestation-free commodities such as beef, soy, palm oil, cocoa and paper/pulp. As part of this forest-positive collective action strategy, senior-level dialogues are facilitated between suppliers and buyers. The dialogues include intense collaboration among participants, with the aim to advance environmental conservation and economic development through new sustainable business opportunities.
Brazil beef exports to China have increased tenfold in the past twenty years, despite the fact that beef represents only 8.9% of meat consumed in China, as per the OECD. Brazil currently has a 35% market share of China beef imports, and in the first four months of 2020, Brazil boosted exports to China by 111% to 202,000 tons, with US$ 1.1 billion in sales to the country, as reported by Brazil’s beef industry.
“Agribusiness represents 20% of Brazil’s GDP, almost half of exports and 20% of jobs. Livestock, in turn, accounts for 8.5% of the country’s GDP, with mainland China and Hong Kong representing 34% of the total volume of Brazilian beef exports,” said Marcos Jank, researcher, professor and coordinator of Insper Agro Global.
"But we still have challenges,” he added, “we need to improve efficiencies throughout the supply chain, address perceptions that question the sustainability of our processes, internationalize our associations and companies, and develop a long-term strategic vision."
A Ministry of Commerce of China representative shared that Chinese consumption patterns are changing. Chinese consumers, he said, are increasingly preparing food at home, making them more selective about the health and safety quality of the meat they buy and consume, and its sustainability. This, he added, has been acerbated by the Covid-19 pandemic.
“The dialogue realized two significant outcomes,” said Fabíola Zerbini, Tropical Forest Alliance Regional Director for Latin America. “Firstly, consensus was reached on, a key issue – implementation of environmental regulations, notably Brazil’s Forest Code, needs to align with both land use policies and beef safety/health policies, to ensure the legal security and product health/safety that the consumer market is demanding, especially post Covid-19.
“Secondly, the investment dynamic is shifting. Investors are now looking for opportunities for modernization. Linking healthy/safe meat with land use policies creates the conditions needed for a carbon market and for a system of payment for environmental services. This scenario is increasingly valued by international investors, will bring credibility to Brazilian beef, and, as a consequence, will build trust with Chinese buyers. Representatives from both nations made this clear.”
“This dialogue also demonstrated,” Zerbini added, “that the future of trade relations between Brazil and China looks positive, but we must also bring this discussion to Europe, America and the national market – along with the understanding that deforestation must be contained or it will become a path of no return, and negatively impact the ability to expand food production.”