Mexico set to clear more Brazilian meatpacking plants for shipments, official says

By Kylie Madry

MEXICO CITY, Aug 28 (Reuters) - Mexican authorities will kick off audits of 14 Brazilian meatpacking plants next month to clear them to send exports to Mexico, Luis Rua, secretary of trade at Brazil's agriculture ministry, told Reuters.

WHY IT'S IMPORTANT

In August, Mexico overtook the U.S. as the No. 2 buyer of Brazil's beef as U.S. tariffs on Brazilian goods took effect. Brazil is the world's top beef exporter.

KEY QUOTE

"There will be an audit in September, Mexico's sanitary agency will go to Brazil and hopefully soon these 14 (meatpacking plants) will be approved," Rua told Reuters on the sidelines of an event in Mexico City.

ADDITIONAL CONTEXT

The news was first reported by Brazilian outlet Estadao. According to the report, the plants belong to meatpacking majors such as Marfrig MRFG3.SA, JBS JBSS3.SA and BRF BRFS3.SA.

Analysts said that the U.S. tariffs are set to reshape the beef trade, speculating that beef could be sent through Mexico or other countries before ending up in the U.S.

Mexico Economy Minister Marcelo Ebrard told Reuters that "it was not the plan" for the increased beef shipments from Brazil to make their way to the U.S.

BY THE NUMBERS

The plants' approval would be in addition to the 35 plants already cleared to export to Mexico, Rua explained.

THE RESPONSE

Mexico's agriculture ministry, which operates the sanitary agency, did not immediately respond to a request for comment.