Brazil avoids regulating the China quota in 2026 and deepens tensions in the chain

The Brazilian government will not move forward in 2026 with a control scheme over the beef export quota to China, a decision that exposes the sharp differences between producers and industry, according to Pecuaria. The issue was not included in the last Gecex meeting and, for now, is not on the agenda.

From the producers’ side, the Confederation of Agriculture and Livestock (CNA) spoke out against it, warning that regulation could hurt cattle prices, favor large packers, and generate regional distortions. There is also concern over the lack of transparency in the use of the quotas, with the risk that plants may argue a supposed exhaustion to push values downward.

The industry, by contrast, is pushing the measure. Abiec argues that a system of allocation and monitoring would make it possible to organize the market, stabilize prices, and avoid abrupt falls in external quotations. It also warns that the absence of control could lead to disorderly competition and financial problems for companies, especially in the second half of the year, when feedlot cattle supply increases.

The background is the rapid use of the Chinese quota: in the first two months of the year, more than one-third of the annual total assigned to Brazil had already been shipped. In this context, packers fear an early exhaustion of the quota and subsequent downward pressure on international prices.

Beyond producers’ objections, a transparent quota management scheme could help smooth the price cycle throughout the year, avoiding a concentrated use in the first half and a possible sharp adjustment in the second, when Chinese demand loses weight in the market.

Given the lack of consensus, the government has chosen not to intervene in the short term, although it leaves open the possibility of resuming the discussion in 2027 if there are impacts on the domestic market. Meanwhile, the industry is evaluating alternatives such as access to financing lines under the Brasil Soberano Plan to mitigate possible losses.