MercoPress. South Atlantic News Agency

Third month of Chinese ban on Brazilian beef; speculations as to commercial or technological motives

Last October beef sales dropped to 82,180 tons compared to 162.880 a year ago, according to Secex, Brazil's foreign trade secretariat

Brazil's beef exports plummeted during October as a consequence of the ban on purchases from its main client, China. Last October sales dropped to 82,180 tons compared to 162.880 a year ago, according to Secex, Brazil's foreign trade secretariat.

It's two months now since, on September 4, Brazil following a protocol agreed with China suspended shipments after two cases of “mad cow” were reported, one in Minas Gerais and the other in Matto Grosso.

Nevertheless Brazil set a beef export record during September while abattoirs and ranchers remained confident the suspension was going to be short-lived, particularly since the OIE (Animal health world organization) said that the two isolated cases of old cows were asymptomatic, and did not represent a risk for the Brazilian herd.

But reality turned sour, the containers shipped during September, before suspension were blocked by Beijing authorities and shipments remain stranded at Chinese ports awaiting authorization for entry or the green light to proceed to another destination.

Some analysts speculate that the beef suspension, now in its third month, is a Beijing strategy to lower Brazilian prices which were rapidly climbing. Secex has somehow confirmed the intention since protein prices remain 21,7% above last year, and a ton of beef reached US$ 5,166 in October.

Meantime the price of fat cattle in the Brazilian market since the suspension started has fallen almost 15%.

Other analysts speculate the situation could be the result of the launching of the bidding process this week for Brazil's 5G network which is expected to reach some nine billion dollars.

A long dispute with the United States over allegations that the Huawei 5G network is part of a Chinese global spying ring, led to many US allies to drop the Chinese option. Brazil under pressure from the US opted for two networks, a general one open to all society and consumers, and a second exclusive and restricted to government and links with congress, armed forces, state and city governments.

China can compete for the neutral 5G net but is banned from doing so with the more specific referred to government and its structure.