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Russia and Brazil seek food deal worth billions

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Oscar Rousseau

By Oscar Rousseau+

20-Apr-2017

Russia's Evgeny Gromyko (left) with Brazil's Blairo Maggi (right)
Russia's Evgeny Gromyko (left) with Brazil's Blairo Maggi (right)

Brazil’s rotten meat scandal seems not to have made Russia’s stomach turn, as the two countries seek to double the value of bilateral agri-food trade. 

Brazil and Russia hope they can double turnover from two-way trade through an enhanced food deal for meat, fish and dairy, which could be worth $10bn by 2022.

Agri-food trade between the two nations is worth $5bn today.

Brazil’s Blairo Maggi, Minister of Agriculture, Livestock and Supply (MAPA), and Russia’s Deputy Agriculture Minister Evgeny Gromyko met this week at a twin-nation summit to discuss a deal.

Maggi put forward Brazil’s position to Russia: it wants to expand market access for beef, pork, poultry and dairy as soon as possible. In return, Russia wants to start shipping large volumes of fish, predominantly cod, to Brazil.

Only three Russian fish firms are currently allowed to export fish to Brazil, although Russia wants to see 108 companies licensed to sell fish to Brazil within the next five years.

Corruption and collusion

Brazil appears happy to oblige, as it is eager to bolster food trade with Russia.

Russia was one of a few countries to leap to the defence of Brazil following the rotten meat scandal – a corruption crisis experts have warned could cost the Brazilian meat industry nearly $5bn in fines and sanctions.

With such hefty sums hovering over Brazil’s prized meat industry, demand to increase trade with far-flung allies is high on the country’s political agenda.

Along with Brazil, India, and China, Russia makes up the quartet of BRIC nations, which some years ago experts believed would power a wave of market-led economic growth. However, recessions in both Brazil and Russia have seen the two countries pushed aside.

Now, they are looking to each other for a food trade boom.

There are no political or economic objections for us to increase bilateral trade [with Russia],” said Maggi during a cabinet meeting on 19 April.

Meanwhile, Brazil’s Luis Rangel, MAPA Secretary of Agricultural Protection, who handles food safety for imports and exports, visited Russia in February this year to endorse Russian meat plants. Rangel did not find any serious problems during the visit and, this week, said a deal to increase meat trade was “at an advanced stage”.

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