Brazil, fresh from a "major victory" in a trade dispute with the US over orange juice, is preparing to fight the European Union over poultry sales curbs alleged to discriminate against foreign producers.
Brazil is "getting ready" to take to the World Trade Organization complaints that EU laws restricting what may be counted as fresh poultry meat discriminate against exporters to the region.
The complaint, reported by anonymous trade sources to US Department of Agriculture officials in Brasilia, would be the latest in a series of WTO actions bought by Brazil.
The South American country two weeks ago claimed victory in a dispute over anti-dumping duties imposed on juice shipments to the US, which buys some $2bn of the product a year from Brazil.
Last year, Brazil won compensation from Washington over US cotton subsidies.
Against the EU, Brazilian pressure through the WTO helped force the shake-up of Europe's sugar regime which has curbed the region's exports and freed up imports.
Fresh, or not?
The poultry case centres on the definition of what poultry counts as "fresh" – with rules introduced last May preventing this label being applied to meat that has previously been frozen.
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Brazil broiler export destinations, 2010 and (year-on-year change)
1: Saudi Arabia, 550,969 tonnes, (+11.0%)
2: Japan, 386,476 tonnes, (+26%)
3: Hong Kong, 331,466 tonnes, (-23%)
4: EU, 281,878 tonnes, (-9.6%)
5: UAE, 208,333 tonnes, (-1.7%)
Source: USDA attache report |
Brazil, the world's largest poultry exporter, claims the rules discriminate against suppliers from outside the European Union, which typically ship chicken to the region frozen rather than fresh.
The rules were opposed within the EU too, notably by the UK, which said they would prohibit what it termed a safe and lucrative practice of using frozen meat for the preparation of, for example, barbecue foods.
Brazil's broiler meat exports to the EU fell by 9.6% to 282,000 tonnes last year, demoting the region to fourth place among buyers, behind Saudi Arabia, Japan and Hong Kong.
'Sabre rattling'
However, Brazil has, to date, not informed the EU of their intention to take their complaints to the EU, a European Commission source told Agrimoney.com.
"These things are always put out to consultation first," the source said, adding that the talk of complaint may amount to "sabre rattling" in preparation for such a process.
Brazil, whose broiler exports rose 5.6% last year to a record 3.63m tonnes, is involved in a series of campaigns to improve shipments, including plans to; increase to 44, from 25, the number of plants certified to export to China; seal a sanitary agreement on exports to Malaysia; and use this year to promote sales to Africa.
"Brazilian exports are concerned with the political situation in the Middle East," the USDA officials said.
"Exporters are particularly concerned with terms of payments, import logistics and the increase in the cost of insurance."