How Brazil Became the World’s Largest Beef Exporter

Brazil is the world’s largest beef exporter, accounting for about 20 percent of the global market share in 2020. The country exported 2.6 million metric tons of beef and veal, worth 9.3 billion U.S. dollars, to more than 150 countries. Brazil’s beef industry has grown rapidly in the past decades, thanks to its abundant natural resources, favorable climate, low production costs, and strong domestic and international demand. However, Brazil’s beef sector also faces many challenges, such as environmental impacts, animal welfare issues, trade barriers, and quality standards. This article will explore how Brazil became the world’s largest beef exporter, what are the main drivers and constraints of its beef industry, and what are the future prospects and opportunities for Brazilian beef in the global market.

Brazil’s Beef Industry: A Historical Overview

Brazil has a long tradition of cattle raising, dating back to the colonial period when Portuguese settlers introduced cattle to the country. Cattle were mainly used for transportation, leather, and dairy products, while beef consumption was low and mostly restricted to the coastal areas. In the 19th century, Brazil started to export salted beef to Europe and Africa, but the quality was poor and the market was limited. In the 20th century, Brazil’s beef industry underwent several transformations, influenced by political, economic, social, and technological factors.

The first half of the 20th century

In the first half of the 20th century, Brazil’s beef industry was characterized by low productivity, high mortality rates, poor sanitary conditions, and lack of infrastructure and technical assistance. The government implemented several policies to improve the situation, such as creating public institutions for animal health and research, subsidizing credit and inputs for cattle farmers, and promoting regional development programs. However, these policies were often ineffective or inconsistent, and failed to address the structural problems of the sector.

The second half of the 20th century

In the second half of the 20th century, Brazil’s beef industry experienced a significant expansion and modernization, driven by several factors. First, the government adopted a more market-oriented approach, liberalizing trade and prices, reducing subsidies and taxes, and encouraging private investment and innovation. Second, the domestic demand for beef increased substantially, due to population growth, urbanization, income rise, and dietary changes. Third, the international demand for beef also grew rapidly, especially from developing countries in Asia and Africa. Fourth, Brazil developed a competitive advantage in beef production, based on its natural endowments of land, water, and climate, as well as its low-cost labor force and feed sources. Fifth, Brazil improved its animal health status, eradicating foot-and-mouth disease (FMD) from most of its territory and gaining access to more markets. Sixth, Brazil diversified its beef products and markets, offering different types of cuts, grades, and qualities to suit different consumer preferences and needs.

As a result of these factors, Brazil’s beef production increased from 1.7 million metric tons in 1961 to 10.3 million metric tons in 2020, making it the second-largest beef producer in the world after the United States. Brazil’s beef exports also increased from 21 thousand metric tons in 1961 to 2.6 million metric tons in 2020,
making it the largest beef exporter in the world ahead of Australia.

Brazil’s Beef Industry: Current Situation and Future Outlook

Brazil’s beef industry is currently facing a complex and dynamic scenario, marked by both opportunities and challenges. On the one hand, Brazil has a strong potential to increase its beef production and exports, due to its abundant natural resources, favorable climate, low production costs, and strong domestic and international demand. According to some projections, Brazil could produce up to 16 million metric tons of beef by 2030, and export up to 4 million metric tons to more than 200 countries. On the other hand, Brazil also faces many challenges that could limit its growth and competitiveness, such as environmental impacts, animal welfare issues, trade barriers, and quality standards.

First challenge

One of the main challenges that Brazil’s beef industry faces is its environmental impact. The expansion of cattle ranching has been associated with deforestation, land degradation, biodiversity loss, greenhouse gas emissions, and water pollution. According to some estimates, cattle ranching is responsible for about 80 percent of deforestation in the Amazon region, and for about 10 percent of global greenhouse gas emissions from agriculture. Brazil has been criticized by environmental organizations, consumers, and trading partners for its lack of effective policies and enforcement to prevent and control the environmental damage caused by cattle ranching. Brazil has also been pressured to adopt more sustainable practices and standards to reduce its environmental footprint and improve its image in the global market.

Second challenge

Another challenge that Brazil’s beef industry faces is its animal welfare issue. The welfare of cattle is an important concern for many consumers, especially in developed countries, who demand higher standards of animal health, hygiene, and well-being. Brazil’s beef industry has been accused of violating some of these standards, such as using hormones, antibiotics, and other additives to enhance the growth and performance of cattle, or subjecting cattle to stressful and inhumane conditions during transportation and slaughter. Brazil has also been challenged to comply with the sanitary requirements and regulations of some of its main markets, such as the European Union, which impose strict rules on animal health, traceability, and food safety. Brazil has been working to improve its animal welfare practices and standards, by investing in research, technology, education, and certification programs, but it still faces some gaps and difficulties to meet the expectations and demands of some consumers and trading partners.

Third challenge

A third challenge that Brazil’s beef industry faces is its trade barrier issue. The international trade of beef is subject to various tariffs, quotas, subsidies, and non-tariff barriers, such as sanitary and phytosanitary measures, technical regulations, and labeling requirements. These barriers can affect the competitiveness, accessibility, and profitability of Brazil’s beef exports in different markets. Brazil has been involved in several trade disputes and negotiations with some of its main trading partners, such as the United States, the European Union, China, and Russia, over various issues related to beef trade, such as FMD status, hormone use, traceability, quality, and origin. Brazil has also been seeking to expand and diversify its beef markets, by signing free trade agreements, bilateral protocols, and preferential arrangements with other countries and regions, such as Japan, South Korea, Indonesia, and the Middle East.

Fourth challenge

A fourth challenge that Brazil’s beef industry faces is its quality standard issue. The quality of beef is a key factor that influences the consumer preference, satisfaction, and loyalty, as well as the price, reputation, and competitiveness of the product in the global market. The quality of beef depends on various attributes, such as tenderness, juiciness, flavor, color, fat content, marbling, and hygiene. These attributes are affected by various factors, such as breed, age, sex, feed, health, management, transportation, slaughter, processing, packaging, storage, and distribution of cattle and beef. Brazil’s beef industry has been improving its quality standards and practices over the years, by adopting more efficient and modern technologies and techniques throughout the production chain. However, Brazil still faces some challenges to achieve and maintain consistent and high-quality standards for its beef products, especially for the premium segments of the market that demand more sophisticated and differentiated products.

Brazil is the world’s largest beef exporter, with a strong potential to increase its production and exports in the future. However, Brazil also faces many challenges that could limit its growth and competitiveness, such as environmental impacts, animal welfare issues, trade barriers, and quality standards. Brazil needs to address these challenges by adopting more sustainable, humane, fair, and quality-oriented practices and standards for its beef industry, in order to meet the expectations and demands of its consumers and trading partners, and to enhance its image and reputation in the global market.

The Global Beef Export Market in 2022

The global beef export market is expected to grow in 2022, as demand for high-quality protein increases in many regions of the world. According to the USDA, the top five exporters of beef in 2022 will be Brazil, Australia, the United States, India and Argentina. These countries will account for more than 70 percent of the total beef exports worldwide.

Brazil: The Largest Beef Exporter

Brazil is forecast to be the largest exporter of beef and veal in the world in 2022, with an export volume of 2.6 million metric tons. Brazil has a competitive advantage in the beef industry, as it has abundant land and water resources, low production costs and a large cattle herd. Brazil also has access to many markets, especially China and the United States, which are the leading destinations for its beef exports. Brazil’s beef industry has faced some challenges, such as environmental concerns, animal health issues and trade barriers, but it has also made efforts to improve its quality standards, traceability systems and sustainability practices.

Australia: The Second-Largest Beef Exporter

Australia is projected to be the second-largest exporter of beef and veal in the world in 2022, with an export volume of 1.7 million metric tons. Australia is a major supplier of grass-fed beef, which is preferred by many consumers for its health and environmental benefits. Australia also has a reputation for producing safe and high-quality beef, which meets the requirements of many importing countries. Australia’s main markets for its beef exports are Japan, China, South Korea and the United States. Australia’s beef industry has been affected by droughts, floods, fires and COVID-19 in recent years, but it has also shown resilience and recovery.

The United States: The Third-Largest Beef Exporter

The United States is expected to be the third-largest exporter of beef and veal in the world in 2022, with an export volume of 1.5 million metric tons. The United States is a leading producer of grain-fed beef, which is valued for its tenderness and marbling. The United States also has a strong domestic demand for beef, which supports its export competitiveness. The United States’ main markets for its beef exports are Japan, South Korea, Mexico and Canada. The United States’ beef industry has faced some challenges, such as labor shortages, transportation disruptions and trade disputes, but it has also benefited from favorable exchange rates, consumer preferences and trade agreements.

India: The Fourth-Largest Beef Exporter

India is forecast to be the fourth-largest exporter of beef and veal in the world in 2022, with an export volume of 1.4 million metric tons. India’s beef exports consist mainly of buffalo meat (carabeef), which is cheaper than bovine beef and has a lower environmental impact. India’s main markets for its beef exports are Vietnam, Malaysia, Indonesia and Egypt. India’s beef industry has faced some challenges, such as religious restrictions, political tensions and animal welfare issues, but it has also capitalized on its low-cost advantage and growing demand in emerging markets.

Argentina: The Fifth-Largest Beef Exporter

Argentina is projected to be the fifth-largest exporter of beef and veal in the world in 2022, with an export volume of 0.9 million metric tons. Argentina is known for producing high-quality grass-fed beef, which is appreciated by many consumers for its flavor and nutrition. Argentina also has a long tradition and culture of beef consumption and production, which gives it a competitive edge in the global market. Argentina’s main markets for its beef exports are China, Chile, Israel and Brazil. Argentina’s beef industry has faced some challenges, such as economic instability, inflation and export quotas, but it has also diversified its products, markets and strategies.

References:

https://data.worldbank.org/indicator/BX.GSR.GNFS.CD?most_recent_value_desc=true

https://knoema.com//atlas/Taiwan-Province-of-China/topics/Foreign-Trade/Export/Exports-of-goods-and-services

https://www.statista.com/chart/19122/biggest-exporters-of-beef/
https://www.statista.com/statistics/917207/top-exporters-of-beef-global/
https://beef2live.com/story-world-beef-exports-ranking-countries-0-106903
https://www.ers.usda.gov/amber-waves/2019/july/brazil-once-again-becomes-the-world-s-largest-beef-exporter/

https://www.statista.com/chart/19122/biggest-exporters-of-beef/

https://www.statista.com/statistics/917207/top-exporters-of-beef-global/

https://beef2live.com/story-world-beef-exports-ranking-countries-0-106903

https://www.ers.usda.gov/amber-waves/2019/july/brazil-once-again-becomes-the-world-s-largest-beef-exporter/