Brazil is considering granting an import quota of 750,000 tonnes of U.S. wheat per year without tariffs in exchange for other trade concessions, according to a Brazilian official with knowledge of the negotiations ahead of President Jair Bolsonaro’s visit to Washington.
That is about 10 percent of Brazilian annual wheat imports and is part of a two-decades-old commitment to import 750,000 tonnes of wheat a year free of tariffs that Brazil made during the World Trade Organization Uruguay Round of talks on agriculture but never adopted.
Bolsonaro is scheduled to arrive in Washington on Sunday and meet with U.S. President Donald Trump at the White House on Tuesday.
Farm state senators have asked that wheat sales be on the agenda, in a letter to Trump. They estimate such a quota would increase U.S. wheat sales by between $75 million and $120 million a year.
Brazil buys most of its imported wheat from Argentina, and some for Uruguay and Paraguay, without paying tariffs because they are all members of the Mercosur South American customs’ union. Imports from other countries pay a 10 percent tariff.
The Brazilian official, who asked not to be named so he could speak freely, said the wheat quota could be sealed during a meeting between Brazil’s Agriculture Minister Teresa Cristina Dias and U.S. Secretary of Agriculture Sonny Perdue on Tuesday.
In return, the Brazilian government is hoping to see movement toward the reopening of the U.S. market to fresh beef imports from Brazil that were shut down after a meat-packing industry scandal involving bribed inspectors.
Brazil is also seeking U.S. market access for its exports of limes that are facing phytosanitary certification hurdles.
The world’s largest sugar producer also wants tariff-free access to the U.S. market. But Washington is not expected to budge on that issue until Brazil lifts a tariff it slapped on ethanol imports when they exceed 150 million liters in a quarter.
That is a major demand by U.S. biofuels producers who are the main suppliers of ethanol imported by Brazil.
