Britain’s decision to leave the Europe Union buffeted markets, spurred panic on global trading floors and prompted U.K. Prime Minister David Cameron to resign. But for Brazil’s meat industry, the Brexit vote sounded like opportunity knocking.
As a net-importer of food, the U.K. will probably have to adopt more flexible rules and be more opened to imports from other nations amid tighter supplies from the European bloc, according to Minerva SA, Brazil’s second-biggest beef exporter. An industry group also said it expects Britain to take a more flexible approach to meat shipments from the South American nation, which has faced EU restrictions.
“Brussels has put several rules to protect agricultural producers from competition,” Fernando Galletti de Queiroz, the chief executive officer of Minerva, said in a telephone interview, referring to the EU capital. “Any departure from the bloc creates an opportunity for other nations’ suppliers.”
The departure from the EU should also curb investments in the U.K.’s food sector, potentially making the nation even more dependent on imports, Queiroz said.
Brazil’s beef sales to the EU reached $802.3 million last year, making it the second-largest market for the nation’s exporters, according to data from industry group Abiec. The U.K., the second-biggest importer of Brazilian industrialized beef, accounted for about 20 percent of sales to the region.
Having direct access to the U.K. may eventually favor Brazil’s beef exports as the nation’s shipments to the EU are restricted by trade restrictions that include taxes, quotas and sanitary barriers, said Fernando Sampaio, executive director at Abiec.
“I believe the U.K. will be more liberal compared to the EU,” Sampaio said. “But it’s impossible to say how exports will behave because we still don’t know how access market rules will change.”