China relaxes rule on weeds in Brazilian soybeans, and cargoes must be released

Soybean harvest in Piauí. Disclosure Chinese authorities agreed to relax rules regarding the presence of weeds in soybean shipments imported from Brazil. The information is contained in a document from the Agricultural Defense Secretariat (SDA), of the Ministry of Agriculture, published this Friday (20) in the federal government’s Electronic Information System (SEI). In recent days, the Asian country has returned around 20 Brazilian ships loaded with soybeans because they contain weeds banned in China. 🗒️ Do you have any reporting suggestions? Send to g1 In the document, the SDA explains that, in a meeting with Chinese authorities, the Brazilian government explained “that it is not possible to attest to the absolute absence of weed seeds in soybeans, given the production characteristics.” The text adds that “the Chinese authorities understood and accepted that the zero tolerance criterion will not be adopted” in cargo leaving Brazil. Given this scenario, the Brazilian government determined the certification of ships even when there is the presence of weeds identified in laboratory reports. Despite the flexibility, there is still no official numerical limit defined for weed tolerance. According to the document, the acceptable percentage will be discussed in the future in bilateral negotiations between representatives of the two countries. Until then, the assessment will continue to be based on risk analysis and mitigation measures, according to the product’s destination. What happened In recent days, China returned soybean cargo sent by Brazil that did not comply with the country’s health rules, while Cargill – one of the largest grain exporters – canceled shipments to its Asian partner on the 12th of this month. The main destination for Brazilian soybeans, China accounts for around 80% of the product’s exports. Around 20 Brazilian ships were recently returned by China for containing soybeans mixed with weeds banned in the Asian country. Given the situation, representatives from the Ministry of Agriculture are expected to travel to China next week to discuss the issue. On Tuesday (17), Brazil’s Minister of Agriculture, Carlos Fávaro, said at a press conference that the quality of Brazilian soybeans “is unquestionable”, but that the Chinese concerns are legitimate. He also stated that he will propose to China the creation of a specific health protocol for soybean trade. When the pressure began Although the case has gained repercussion in recent days, the situation is not new, says Raphael Bulascoschi, soybean market analyst at StoneX Brasil. “The problem started at the end of last year, when the GACC, the body responsible for inspection in China, informed the Brazilian government that shipments were arriving with an excess of prohibited seeds and foreign materials”, says Bulascoschi. “Recently, China once again demanded harsher pressure from the Ministry of Agriculture, which led the government to adopt a ‘zero tolerance stance’ to avoid diplomatic tensions and to issue phytosanitary certificates more rigorously,” he adds. In practice, he says, the Ministry started to carry out more frequent inspections and stopped issuing certificates for shipments that do not meet the requirements. “Without this certificate, companies are prevented from delivering cargo to China and receiving payment”, he explains. Now, with China’s flexibility, the cargo must be released. Interruption of Cargill According to Bulascoschi, it was in this context that Cargill decided to interrupt exports to China. g1 contacted the company, which informed that its representative entities — the National Association of Cereal Exporters (Anec) and the Brazilian Association of Vegetable Oil Industries (Abiove) — would publish a joint note. However, the entities have not provided explanations. In the joint note, published on Thursday (12), they only said that they “closely” follow the “recent developments” in soybean exports. Impact on exports Analysts at Hedgepoint Global Markets assess that the case is a one-off and should not affect the volume of soybeans exported to China. “The queue of ships in Brazilian ports remains strong, with around 17 million tons of soybeans, 10 million of which are destined for China”, says Thais Italiani, Market Intelligence manager. “So far, there is no record of significant delays in the departure of ships, which indicates that these are specific adjustments in the cargo inspection process,” he added. Luiz Fernando Gutierrez Roque, Market Intelligence coordinator for Grains and Oilseeds at Hedgepoint Global Markets, states that 20 ships with soybean cargo represent between 1.2 million and 1.5 million tons. “It’s little compared to the 112 million tons that Brazil should export in total this year”, he concludes. How the war in the Middle East can increase food prices in Brazil

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