Russia food ban offers big opportunity for Brazil
Russia's ban on many western food products presents a massive opportunity for meat and grain exports from agricultural powerhouse Brazil and a smaller one for its Latin American neighbors.
Around 90 new meat plants in Brazil were immediately approved to export beef, chicken and pork to Russia and the South American nation is already working to increase its exports of corn and soybeans sales to Russian buyers, Brazil's secretary of agricultural policy, Seneri Paludo, said on Thursday.
Brazil's enthusiasm for Russia comes as Moscow's relations with the rest of the West are at Cold War-era lows. Russia banned all imports of U.S. food products and certain goods from the European Union, Australia, Canada and Norway after President Vladimir Putin ordered retaliation for sanctions against Moscow over the Ukraine crisis.
In a further snub to Washington, U.S. intelligence contractor Edward Snowden was granted a three-year residence permit in Russia, his lawyer said on Thursday. Brazil's relations with Washington also cooled after revelations last year that the United States spied on President Dilma Rousseff's personal e-mails.
Russia's government met with various Latin American embassies on Wednesday to discuss the possibility of looking for more food providers in the wake of the its ban on many western products, the head of Chile's Direcon trade body said on Thursday.
As the world's top exporter of beef, chicken and soybeans, and one of the only countries in the world with land available to ramp up agricultural production, Brazil is a clear winner from the embargo. But smaller countries like Argentina and Chile could benefit, too.
"Russia has huge potential as a consumer of agricultural commodities," Paludo told journalists in Brasilia, comparing the "window" opened by the embargo to the "revolution" that Brazil's exports experienced when China's commodities market opened a decade ago.
Brazil's beef association Abiec said 58 of the 90 plants were for beef - 27 for fresh meat, and 31 for processed. Brazilian food companies, like chicken exporter BRF SA and meat packer JBS SA, stand to benefit. The companies did not immediately respond to requests for comment.
JBS has businesses in the United States and Mexico as well as Brazil but it does not sell U.S. beef to Russia. Beef products topped Brazil's exports to Russia in the first six months of the year, Brazilian trade data showed. Brazil ships the vast majority of its soybeans to China and sent just 352,849 tonnes of soy to Russia between January and June. The president of Brazil's animal protein association ABPA said on Wednesday Brazil could cover U.S. chicken exports to Russia and would increase exports by 150,000 tonnes per year, though increasing pork exports would be harder.Hong Kong replaced Russia as the top buyer of Brazilian beef in 2013 but beef association Abiec said exports to Russia "were certain to rise" in the second half of the year.
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