The recent trade agreements between China and Brazil, signed during Xi Jinping’s visit for the G20 Summit, outline new phytosanitary and sanitary requirements for Brazilian agricultural exports to China. Approved products include fresh grapes, sesame seeds, sorghum, fishmeal, fish oil, and other fish-derived proteins. These exports could generate up to US$500 million annually, strengthening agricultural trade between the two nations.
Bilateral Agricultural Trade
China has been Brazil’s largest trading partner since 2009. In 2023, bilateral trade reached US$181.53 billion, a 6.1% increase year-on-year. Agricultural exports played a key role, reaching US$60.24 billion, with soybeans, meat, sugar, corn, and coffee beans as dominant commodities. Brazil supplied 70% of China’s soybean imports and 47% of its corn imports. China, in turn, provides Brazil with essential agricultural inputs like fertilizers and pesticides.
Opportunities and Challenges
The new agreements offer Brazil an opportunity to diversify beyond soybeans and meat. China, the world’s largest importer of sesame, purchases 36.2% of global sesame imports. Brazil, currently the seventh-largest exporter, is increasing production to meet demand. Fishmeal exports also present growth potential, as China’s annual imports total US$2.9 billion, while Brazil’s share remains low at 0.79%.
However, scaling up production remains a challenge. China imported US$1.83 billion worth of sorghum in 2023, yet Brazil’s market share is minimal compared to the U.S. and Australia. Infrastructure constraints, lower yields, and limited export capacity could hinder Brazil’s ability to compete in these markets.
Implications for the B2B Food Industry
For businesses, these developments open new growth opportunities. Companies in agricultural production, food processing, and logistics can benefit from increasing Chinese demand. China’s growing middle-class population and evolving dietary habits create a promising market for Brazilian exports.
However, risks such as price fluctuations, climate change, and supply chain disruptions remain. Brazil’s coffee sector experienced major losses in 2021 due to frost and drought, underscoring the need for diversification to mitigate economic vulnerabilities.
Brazil’s agricultural expansion into sesame, fishmeal, and sorghum could reduce reliance on soybeans and meat. However, overcoming production and infrastructure challenges is crucial. By leveraging new trade agreements and enhancing output, Brazil can strengthen its role as a key supplier to China while ensuring a more resilient agricultural export strategy.
