Trade: Brazil’s ‘FMD-free’ aspirations won’t significantly change market access

Jon Condon, 04/04/2013


Brazil has set a target to be declared Foot & Mouth Disease-free by late 2014, but even if successful, the move is unlikely to have any great impact on global beef trade flows.

That’s because the declaration would be achieved only with vaccination for the disease, analysts say.

In a statement issued over Easter, Brazil’s Ministry of Agriculture suggested the country would be ‘FMD-free’ by the end of next year, but curiously failed to make the crucial distinction, in trade access terms, between FMD freedom with, or without vaccination.

In its recent statement Brazil’s Agriculture Ministry said it planned to be ‘internationally recognised’ as FMD-free next year, saying it had spent A$34 million on tackling and preventing the disease in eight states where FMD is still endemic in the country’s northeast in past two years, with significant progress made.

It predicted that these areas would be nationally recognised as ‘FMD-free’ by May this year, with the whole of Brazil “likely to be recognised as FMD-free by the World Animal Health Organisation (OIE) by the end of 2014.”

Currently, 89pc of the national herd of cattle and buffalo, or 185 million head, are located in zones free of FMD (with vaccination), representing 60pc of the land-mass. The inclusion of the additional states in the country’s northeast would add another 22 million head, taking the proportion of animals in FMD-free (with vaccination) zones to 99pc, the Ministry claimed.

Veterinary authorities were currently carrying out sampling in north-eastern cattle herds to demonstrate they were free of the disease.

“Since the second half of 2012, 17,000 farms have been monitored with 71,000 animals sampled. The study is expected to finish in early May.”

The Ministry said it had been working for years for the country to have the ‘largest herd in the world free of the disease’, but it made no distinction over the use or non-use of vaccination in market access terms.

“With these advances, several markets still inaccessible to Brazilian beef will surely be opened," the statement said.


Big distinction between ‘with’ and ‘without’ vaccination in FMD status


MLA general manager trade and economic services, Dr Peter BarnardMeat & Livestock Australia’s general manager Trade and Economic Services, Dr Peter Barnard, yesterday confirmed that any FMD-freedom gained by Brazil would only come with vaccination, which made a ‘huge difference’ in terms of potential market access.

Currently Brazil is unable to service Australia’s largest and most lucrative export markets including Japan, South Korea, Taiwan and the US with fresh/frozen beef because of FMD, and that would not change even if Brazil was granted FMD ‘freedom with vaccination’ status by the OIE.

Currently the only Brazilian state with FMD-freedom (without vaccination) is Santa Catarina, which is an insignificant beef producer, by Brazilian standards, but a more significant producer of pork.

“Most of the rest of the Brazilian states apart from those in the country’s northeast are free with vaccination, but authorities are collecting data now to present to an OIE meeting next year, to try to get the remaining states declared free, with vaccination,” Dr Barnard said.

He confirmed yesterday that even if it was successful in achieving national FMD freedom, with vaccination, it was unlikely to represent any significant change in trade access for Brazil.

“It would not be much of a shift in trade access, if any,” Dr Barnard said.

Currently Brazil can access markets like Russia, the EU, and China, where it competes directly with Australian product.

“Brazil is making progress on the issue of FMD control – there is no doubt about that – but it still has a way to go to achieve even national freedom, with vaccination,” Dr Barnard said.

“But having said that, an important development in recent years has been an erosion in the difference in price for beef from FMD-free, and FMD-affected countries. Twenty years ago, there was an enormous gulf in price between the FMD-free world (North Asia, North America and Australia) and the FMD-endemic world.”

But that price difference had now narrowed considerably, Dr Barnard said. The main reason was probably the changing economic circumstances and higher standards of living in developing countries, where FMD was more likely to be present.

“In a lot of countries that Australia now sells beef into, including Russia, the EU, the Middle East and parts of southern Asia, we are already competing against Brazilian product anyway,” he said.

“Another point is that Brazil itself has a very large and reasonably strong domestic market, and with economic growth at 3.5 to 4pc a year, its own economy is chugging along nicely, and there is growing domestic beef demand from the expanding middle class.”

Dr Barnard said beef supplying countries like Australia, for a whole variety of reasons (not just FMD status) had a wholesome quality image that was of great value in international markets.

“But as time marches on, and if the world continues to develop the way it has recently, FMD status will probably continue to become less critical in beef trade,” he said.    


US cattlemen wary of Brazil's disease control commitment

The only Brazilian state designated by the OIE with FMD-freedom (without vaccination), Santa Catarina,  was due to receive OIE approval to export pork to the US last month, but the prospect aroused strident criticism from US beef lobby groups, like R-Calf.

“Our only means of preventing the introduction of FMD into the US from raw Brazilian pork will be immediate notification by Brazil in the event of another FMD outbreak in that country,” said Max Thornsberry, chairman of R-Calf’s Animal Health Committee.

He noted the fact that Brazil had taken two years before notifying the US in December last year that it had detected a cow with BSE that had died in 2010.

“That clearly demonstrates that developing countries like Brazil are not in the same league as the US in preventing, detecting and reporting dangerous livestock diseases,” Mr Thornsberry said.

“The US faces a real risk of introducing FMD from Brazil and the USDA must start to realise that its system of relying on foreign countries to prevent disease spread and introduction is badly broken,” he said. 




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