The Brazil-China Nexus in Agrofood: What Is at Stake in the Future of the Animal Protein Sector

Abstract

For over a decade China has supplanted Europe as the principal stimulus for the production and export of soy from Brazil, overwhelmingly in the form of whole beans rather than meal. Medium-term projections, whether from the United States Department of Agriculture (USDA) or Brazil’s Ministry of Agriculture, Livestock and Supply (MAPA), suggest that this dynamic will continue, while China’s Ministry of Agriculture and Rural Affairs (MARA) forecasts are somewhat more modest. In this article, a range of new factors are taken into account, which point to a more uncertain future. These include: Brazil’s alignment in the US-China trade war and the tensions this is creating both diplomatically and within the soy sector itself; the measures China is adopting to diversify its agricultural commodity supply bases; China’s increasing commitment to global climate goals; the impact of food innovation and consumer trends on global meat consumption; and the policies China is putting into place to increase domestic capacity. All these factors, it is argued, may call into question the current dynamism of the Brazil-China soy nexus over the medium term, with the unintended consequence of easing of the pressure on Brazil’s fragile Cerrados and Amazon ecosystems.