Economy
China investigates Mercosur meat imports, creating uncertainty for trade
Fears of potential Chinese beef-importing restrictions persist in Mercosur member states Brazil, Argentina and Uruguay.
By Analía Rojas |
BUENOS AIRES -- Argentina, Brazil and Uruguay, the leading beef exporters of the Mercosur bloc, entered 2025 on edge as China -- one of their largest markets -- announced a sweeping investigation of the impact of imported beef on its domestic industry.
The probe has raised concerns among producers in a sector heavily reliant on Chinese demand.
On December 27, China's Ministry of Commerce announced an investigation of imported beef, targeting major suppliers like Brazil, Argentina and Australia. Beijing initiated the probe at the request of hard-pressed Chinese beef producers.
Beef prices in China have been on a steady downward trend in recent years, a reflection of excess supply and dwindling demand as the world's second-largest economy faces a slowdown, according to AFP.
The investigation impacts a total of 22 companies, including four from Argentina, four from Brazil and three from Uruguay, alongside exporters from Chile, Costa Rica, the United States, Australia, New Zealand, Ireland and France.
For Mercosur's meat-exporting giants, the move raises concerns over potential restrictions in one of their most crucial markets.
Unease
Brazil, the world's largest beef exporter, announced in late December that it will refrain from taking "any preliminary measures" following China's decision.
Brasilia intends to prove in coming months that Brazilian meat exports do not harm China's domestic industry, the Brazilian Foreign Ministry said in late December. It described them instead as a valuable complement to Chinese production.
The investigation has already sent ripples through Brazil's market. Shares of major meat producers, including Marfrig Global Foods, JBS and Minerva, have suffered successive declines in the Ibovespa index since the start of the year, reflecting concerns over potential restrictions in their most important export market.
Meanwhile, Argentina's Ministry of Economy and Secretariat of Agriculture voiced its apprehension in a late-December statement. It is "closely monitoring and analyzing the details" of China's investigation of imported beef, it said.
While the commercial flow remains unaffected for now, the inquiry has also raised unease within the Argentine beef industry.
"The first steps are just being taken, but there is concern even though the dynamics of shipments to that destination have not been affected so far," said Martín Costantini, CEO of Frigorífico Rioplatense, in an interview with Infocampo on January 9.
For its part, Uruguay's Ministry of Livestock, Agriculture and Fisheries has expressed skepticism over China's investigation of imported beef, pointing out contradictions between the allegations and recent Chinese approvals for meat imports.
Livestock, Agriculture and Fisheries Minister Fernando Mattos rejected accusations by Chinese livestock associations. "Uruguay is not the cause of the problems they have highlighted," he said December 30.
Even though China remains Uruguay's largest market for meat exports, Uruguayan shipments have significantly declined. In 2024, Uruguay's market share in China dropped to 6%, down from 15% during record years like 2022.
Chinese promise
Statistics from the Brazilian, Argentine and Uruguayan governments show the size of Chinese demand for Mercosur beef.
In 2023, Brazil shipped $6 billion worth of beef to China, solidifying its market leadership. Argentina followed with $2.1 billion worth, a significant share of its agricultural trade. Uruguay contributed $710 million worth.
Beijing has assured exporters that trade will remain unaffected during the eight-month investigation, pledging to maintain the existing 12% ad valorem tariff on beef imports.
However, this assurance has done little to ease concerns in the meat sectors of Brazil, Argentina and Uruguay, where fears of potential restrictions loom large.