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Russia bans Brazilian meat due to ractopamine

Russia says ractopamine was found in Brazilian exports of beef and pork; Brazilian lobby says it's not used in production of exported meat.

by Anatoly Medetsky and Gerson Freitas Jr.

Russia banned pork from Brazil at a time that imports from the Latin American country, the biggest foreign supplier of the meat, have been rising and as the Kremlin has sought to encourage its own farm industry.

The government barred Brazilian pork and beef imports from Dec. 1, saying testing had found the muscle growth stimulant ractopamine, which is prohibited in Russia. A Brazilian lobby for the industry said the feed additive isn’t used in production of the exported meat, which adheres to Russian rules.

Total imports of pork to Russia are rising for the first year in four and may reach 300,000 metric tons, according to Russia’s National Pig Farmers Union. Supplies from Brazil, which make up 90% of the shipments, are competing with local producers on price, the union said.

“Brazil was left alone as a major supplier,” Yury Kovalev, head of the union, said in Moscow. “They were reminded that we have certain requirements.”

Miratorg Agribusiness Holding and Ros Agro Plc are among Russian producers that stand to gain from import curbs. Miratorg’s President Viktor Linnik told the RBC newspaper last month that Brazil sells almost $1 billion of meat to Russia every year. As of Nov. 12, pork imports had risen about 13% from the same period a year earlier, the Agriculture Ministry said on its website, citing customs data.

Ban Impact

The ban “may apply some upward pressure on prices,” said Artur Galimov, an analyst at Otkritie Capital. “But in general, the market sees ongoing growth in local pork production and hence should be more resilient to a reduction in imports than before.”

Russia imported 230,395 tons of Brazilian pork this year through October, about 40% of the Latin American country’s total shipments, figures from Brazil’s Agriculture Ministry show. It also imported 131,083 tons of beef, about 11% of the total.

JBS SA, Brazil’s largest meat exporter, and BRF SA, its largest chicken and pork exporter, declined to comment on the ban. Brazil beef exporter Minerva SA will maintain shipments to Russia through units in Paraguay, Uruguay and Argentina, it said in a statement. Marfrig Global Foods SA said Russia makes up just 3% of its Brazil beef exports.

"The industry is confident about the characteristics of its product, and ensures that shipped pork production does not use ractopamine," the Brazilian Animal Protein Association lobby said in a statement.

Russia, the world’s biggest wheat exporter, is seeking to start sales of grain, vegetable oil and fish to Brazil, Russian Agriculture Minister Alexander Tkachev said last month when he met his counterpart  Blairo Maggi last month. Brazil sells more than it buys in the trade, he said. Brazil is seeking to expand sales of beef, pork and soybeans to Russia, Maggi said.

To contact the reporters on this story: Anatoly Medetsky in Moscow at [email protected]; Gerson Freitas Jr. in São Paulo at [email protected]

To contact the editors responsible for this story: Lynn Thomasson at [email protected]

Tony Barrett, Nicholas Larkin

© 2017 Bloomberg L.P

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