“My favorite word is: duties”. So, a few days ago, the former American president and new candidate for the White House Donald Trump made it clear that the trade war against the China, in the event of his victory, it would be further tightened, with taxes on Dragon products and priority given to domestic companies, which however would consequently be disadvantaged in exports to Asia, to compensate for the hostile measures. Who would benefit from such a scenario? Probably not Europe, which would align itself with the Atlantic line as it is already doing for example on electric cars Made in China. AllLatin america, which already benefits (especially the Mexico) of nearshoring, on the other hand, definitely yes.
Soybeans, Brazilian Gold and Exports to China
In fact, under the Trump presidency, exports of US agri-food products to China, the largest market in terms of demand, had suffered a setback. The example of soy, one of the agricultural commodities most in demand by Beijing: in 2016, before the tycoon took office as president, the United States sold to the Asian giant 36,1 million tons of soybeansIn 2018, when the trade conflict intensified during the Trump presidency, the figure fell to 8,2 million, less than a quarter of what it had been two years earlier.
Who took advantage of it, even back then? South America and especially Brazil, which in fact returned in 2022 to being China's first trading partner and which today is the world's leading producer of as many as 10 raw materials for food use: in no particular order, soy, sugar, coffee, beef, corn, soy flour, chicken meat, tobacco, cellulose and orange juice.
In 2016, Brazil exported more soybeans to Beijing than the US, but only slightly, 38,6 million tons, while two years later the figure almost doubled to 74,5 million tons. In practice, during the years of Trump's first experience in the White House, Brazil came to export almost ten times more soy than the United States, and it still benefits from it today, with the North Americans never regaining that market, not even with Joe Biden.
Corn and beef
Even more striking, in some ways, is the case of doing more: in 2021, at the beginning of Biden's term, China imported almost 19 million tons of the grain from the United States, and almost zero from Brazil. In 2023, the proportion was effectively reversed: imports from the United States collapsed to 5,7 million tons, exploding at 16,1 million tons those from the South American giant. There were also unforeseen events, such as climate change that damaged many crops in the US (in truth, drought hit South America hard too) and African swine fever, which made Beijing dependent on proteins from abroad.
In 2016, Brazil exported 736 thousand tons of beef towards China, and the figure for North Americans was only slightly lower. In 2023, however, Portuguese speakers reached a historic record at 2,3 million tons of beef sold to the Dragon, in the face of sustainable agriculture, one might add, with the United States stuck at 1,1 million, despite the increase in demand from the East. Also because in the meantime the productivity of star-spangled cattle farms had fallen to 1950 levels.
Here's Why Brazil Is Rooting for Trump
Overall, American Agribusiness has nevertheless held up, growing overall from 140 billion dollars exported in 2016 to 174 billion last year, with a deficit of 21 billion in the sector's trade balance. In the same period, however, Brazil has doubled its exports from 85 billion to 167 billion dollars, causing the agri-food trade balance to soar into a positive territory by as much as 150 billion. A more than valid reason to "root" for Trump, considering that the entire Latin American continent and not only Brazil is rich in raw materials, food but also energy and "critical": think of Argentina which was already the world's leading exporter of soya, Chile and Bolivia which possess the very precious lithium, gold, and oil itself. After all, many countries have now chosen to privilege the axis with China, to the point that an agreement between Mercosur and Beijing is now considered more convenient and more urgent than the stalled one with the European Union.
