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Brazil tries to rescue meat industry from scandal

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tiamin rice

Brazilian Agriculture Minister Blairo Maggi (R) and technicians of the ministry make an inspection visit to the JBS-Friboi chicken processing plant in Lapa, Parana State, Brazil on March 21, 2017. Brazil, the world’s biggest beef and poultry exporter, has been hit by stomach-churning allegations of corrupt practices in its meat industry. Police have halted exports by 21 meat processers suspected of bribing inspectors to issue them bogus health certificates for rotten meat. / AFP PHOTO / RODRIGO FONSECA

Brazil’s government fought Wednesday to save the country’s meat industry from getting burned in a corruption scandal that has prompted several countries to pull Brazilian beef and chicken from the menu.

Agriculture Minister Blairo Maggi did not mince his words.

“What we are suffering now is a blow, a punch to the stomach,” he told the Senate.

“We have to recover, to reorganize our forces, to travel around the world and to show that what happened here was that a few people did wrong but that the system or the industry was not at fault.”

Maggi warned that Brazil’s chances are dwindling for realizing ambitions to raise market share in the worldwide food trade to 10 percent from the current seven percent.

“It’s so bad that when I see this seven percent I start to think that it will be a job to maintain it. I can’t imagine getting to 10 percent. It’s a shock,” he said.

Brazilian meat exports were worth $63 million a day until last week’s announcement by police of “Operation Weak Flesh,” which revealed that some meatpackers had paid crooked inspectors to pass off rotten and adulterated meat as safe.

That figure plummeted to about $74,000 on Tuesday, the foreign trade ministry said.

– Few bad apples –
Brazil’s government appealed Wednesday to the World Trade Organization’s (WTO) 163 other members not to impose “arbitrary” bans on the country’s more than $13 billion meat export industry.

But damage has already been done, with two of the biggest markets, China and Hong Kong, having suspended all imports of beef and chicken.

Other important markets, notably the European Union, have stopped any imports from the 21 businesses under investigation.

Japan, Brazil’s third-biggest market for chicken with $720 million in sales, imposed a similar limited ban, while Mexico has stopped imports of chicken produced by the 21 companies under scrutiny.

In its letter to the WTO, Brazil pressed its message that a few bad apples are at fault for the scandal and that the Brazilian food industry itself is in good health.

It pointed out that of 11,000 employees at the agriculture ministry, 2,300 work as inspectors on animal products and “only 33 individuals are being investigated for improper conduct.”

Underlining Brazil’s leading position as an exporter of animal products to 150 countries, the letter insisted that the agriculture ministry “is widely recognized for its rigorous and robust inspection service.”

Markets analyst Andrei Perfeito told AFP that Brazil’s fear is that competitors will try to gain ground while this cloud hangs over Brazilian products.

“It’s a very competitive market. The (agriculture) ministry has a huge job ahead of it,” he said.

The scandal also broke right ahead of negotiations to seek a free-trade accord between the European Union and several South American countries including Brazil.

France and other European countries are wary about opening up the EU meat market to countries in the South American Mercosur bloc, which includes Argentina, Brazil, Paraguay and Uruguay.

Panama on Wednesday became the latest country to act over the scandal.

Its Food Safety Authority said in a statement it had ordered Brazilian meat to be removed from supermarket shelves until Brazilian health officials could certify it was fit for consumption.

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