Brazil and U.K. create joint committee on agriculture

On February 11, Minister of Agriculture and  Food Supplies, Tereza Cristina, and U.K. Secretary of the Environment, Food and Rural Affairs, George Eustice, signed a Memorandum of Understanding to create the Brazil/U.K. Joint Committee on Agriculture (CCA). Following this signature, the authorities of the two countries will make efforts to ensure the continuity of bilateral consultations on issues related to trade in agricultural goods and to establish a forum for debates related to the interests of both countries, including potential trade arrangements for the future.

The CCA will consist of meetings between the participants held alternatively in each country (or virtually, when necessary) and between public agencies in Brazil and the United Kingdom and relevant agricultural and animal health institutions.

Other CCA objectives include facilitating discussions and collaboration on agricultural issues between the two countries, including, but not limited to, issues such as agricultural and food trade and access to markets; regulations and technical certifications relevant to agricultural materials; food safety and food safety measures; agricultural production sustainability; research and innovation in ​​agriculture and supply; and international sanitary and phytosanitary standards.

Cristina also emphasized that the committee’s objective is to reduce bureaucracy and speed up interactions between the two countries. “We understand that at the beginning, the United Kingdom will continue to adopt many of the European parameters, including sanitary and phytosanitary. But we expect that over time, without abandoning its high standards, the United Kingdom’s technical standards will become more aligned with international rules, and closer to science-based approaches”, highlighted Cristina.

Zac Goldsmit, U.K. Minister of the Pacific and the Environment, also signed the memorandum.

Bilateral trade

Brazilian agribusiness exports to the United Kingdom grew 5% in value in the 2019/2020 comparison, rising from US$ 1.031 billion to US$ 1.087 billion.

The main agricultural products exported in 2020 were: soybeans – US $ 220.9 million; poultry (chicken and turkey) – US$ 204.4 million; fruits such as melons, grapes, watermelons, guavas, and mangoes – US $ 138.66 million; food preparations and preserves of bovine origin – US$ 96.1 million; coffee – US$ 96 million; sugar – US $ 57.4 million; and ethyl alcohol – US $ 27.4 million.

The main products imported by Brazil from the United Kingdom last year were whiskey, which reached US$ 55.7 million, and gin, which reached US$ 8.7 million. Together, these drinks represented 60% of British agribusiness exports to Brazil, valued at US$ 107.8 million.

According to the explanation of the agricultural attaché in London, Augusto Billi, the year 2020 was quite atypical, partially due to the Covid-19 pandemic which altered consumption habits and supply chains, and also due to the Brexit transition experienced by the United Kingdom on 12/31/20.

 

“The UK economy suffered a sharp drop of about 20% in March and April, recovering slowly, but without reaching the previous levels of economic activity”, adds Augusto Billi.

Despite all the difficulties of the year 2020, Brazilian agribusiness managed to grow 5% in the British market. Growth expectations are favorable for 2021.

The UK imports more than 50% of the food it consumes, and around 70% of the products come from the EU. Despite the Trade and Cooperation Agreement signed between the United Kingdom and the European Union in December 2020, the simple fact of the mutual imposition of sanitary and phytosanitary checks at the borders favors the competitiveness of Brazilian products.

“A positive fact post-Brexit that favored Brazil was the decision of the United Kingdom to deregulate some fruits, and these no longer require phytosanitary certification”, stresses Billi.

“Also, the creation of the Autonomous Tariff Quota, with zero tariffs for up to 260,000 tons of raw cane sugar, increases the positive outlook for the sector. It is estimated that Brazil should occupy a large part of this quota ”, he concludes.

 

The graph below shows cargo handling between Brazil and the U.K. since 2017:

Cargo Handling between Brazil and the U.K. | Jan 2017 – Dez 2020 | WTMT

Text Source: DataLiner (To request a DataLiner demo, click here)

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