China’s tariff-free quota for Brazilian beef could be exhausted as early as March next year, potentially doubling the period in which meatpackers face pressure from reduced access to their biggest export market, according to Roberto Perosa, president of Brazilian beef exporters’ association Abiec.
Brazilian processors could face as many as six difficult months in 2027 if exporters rush to fill the Chinese quota, compared with about three months this year, Perosa told reporters Thursday. China is Brazil’s largest beef buyer, and its absence has already squeezed margins and strained cash flow at some processors, he said.
China announced its safeguards on Dec. 30, 2025, with the measures taking effect Jan. 1, giving exporters no opportunity to bring shipments forward. This time, companies have months to prepare for the 2027 quota.
“This year, we already know about the quotas. Everyone is preparing to sell around October and November,” Perosa said.
Chinese demand remains uncertain, particularly because beef inventories in the country are high. Still, Perosa said exporters may accelerate sales to China.
“If things play out as we expect, the quota could be exhausted in March, or April at the latest, which would be very bad for the entire industry,” he said. “We would go from three months of pressure to six.”
Perosa was referring to July through September this year, the period between the exhaustion of the 2026 quota and the start of shipments aimed at filling the 2027 allocation.
The past few months have been “extremely difficult” for meatpackers, he said. Margins declined after China effectively left the market, while some companies have faced cash-flow pressure because they use advance payments from Chinese customers as working capital.
Brazilian beef needs to be shipped in November to reach China in January, meaning negotiations for 2027 are about to begin. Without government intervention in the allocation process, exporters could race to secure as much of the quota as possible. The 2026 quota was exhausted in June.
Competition could become even more intense if China approves additional Brazilian plants for exports following an inspection mission expected to begin this weekend. Chinese officials are also expected to visit facilities that were previously approved but later suspended.
Abiec wants Brazil’s government to allocate the country’s quota among exporters using criteria including each company’s market share and export performance. The association has advocated the proposal throughout 2026 but has yet to receive a decision from the government, Perosa said. Abiec members unanimously support the plan, he added.
“We are talking to the government about the quota issue to minimize the impact on the market, but this is a turbulent moment,” Perosa said, referring to Brazil’s elections.
Asked whether there was still enough time to introduce an allocation system for the 2027 quota, Perosa said a decision could be applied retroactively.
Brazil’s China beef quota is expected to increase by 22,000 metric tons next year from 1.1 million metric tons in 2026.
EU Return in 2027?
Brazilian beef shipments to the European Union, suspended since Sept. 3, are also unlikely to resume before 2027, according to Abiec.
“Resuming trade flows is an issue to be resolved in the first half of next year,” Perosa said.
Abiec’s first goal is to have Brazil restored to the EU’s list of countries authorized to export animal proteins. The bloc must first validate a protocol approved by Brazil’s Agriculture Ministry setting out how cattle raised without antimicrobials from birth will be monitored, as required by the EU.
Abiec then wants the EU to establish a transition period allowing Brazil to adapt to the bloc’s antimicrobial requirements.
Perosa said Brazil already has a proposal for such a transition but declined to provide details. Under the EU’s current requirements, he said, Brazil could take two years to regain eligibility to export beef — roughly the average period from an animal’s birth to slaughter.
Another hurdle is getting cattle ranchers to join the protocol, developed by the private sector through Abiec and the Brazilian Agriculture and Livestock Confederation, or CNA, with certification companies.
“We still have few cattle ranchers enrolled in the protocol, but we are working intensively with CNA to increase participation,” Perosa said.
The suspension of EU sales through the end of this year is expected to cost Brazil about $500 million, according to Perosa. Brazil sold about $1 billion of beef to Europe last year, with roughly half of that revenue generated in the final four months, traditionally the strongest period for shipments to the bloc.
US Quota Offers Partial Relief
A new US tariff-free import quota for beef, in effect since the beginning of September, will only partly offset the loss of the European market because US and European buyers demand different products, Perosa said.
US buyers primarily import trimmings and forequarter beef used to produce ground beef, while European customers buy higher-value forequarter cuts. Maintaining a balance among export destinations is therefore important for processors seeking to maximize carcass values, he said.
The new US tariff-free quota totals 300,000 metric tons, split into monthly allocations of 100,000 metric tons through November 2026.
About 22% of the September allocation had been filled as of Sept. 14, according to US Customs and Border Protection data compiled by the Brazilian Agriculture Ministry’s agricultural attaché in the US and cited by meat industry group Abrafrigo.
Brazilian beef exports to the US rose 25% in value to $2 billion from January through August, before the new quota took effect. Shipments by volume climbed 37% to 241,000 metric tons.
Brazil exported 2.2 million metric tons of beef across all markets during the same period, up 5% from a year earlier. Revenue jumped 22% to $12.8 billion.
This story was translated from the original Portuguese with the assistance of artificial intelligence and reviewed by The AgriBiz editorial staff.
