Sanitation concerns arise after police sting; some countries vow to suspend their imports

By Paul Kiernan

RIO DE JANEIRO -- Brazilian authorities tried to contain the fallout from a police sting that has raised questions about the safety of the nation's meat industry, as governments around the world moved to suspend imports due to sanitary concerns.

China, the biggest buyer of Brazilian meat, along with South Korea, the European Union, Egypt and Chile took steps to temporarily ban imports from either Brazil or specific companies accused by Brazilian federal police Friday of bribing sanitary officials for health certificates, while the U.S. and other countries said they would increase inspections. Among the dozens of companies targeted are some of the world's biggest producers and exporters of chicken and beef, including JBS SA and BRF SA.

Both companies have denied selling bad meat or bribing officials.

Brazil's leaders fear that police allegations that meatpackers peddled rotten, salmonella-infested products could tarnish one of the country's most vibrant industries just as the economy is fighting to recover from its deepest recession on record. Brazil is the world's second-largest producer of chicken and beef, trailing only the U.S., and meat products are among its top exports.

Consumers here and abroad grew concerned as the allegations made international news. "We've been cheated if all of this is true," said Patricio Buccioni, a 68-year-old taxi driver in Santiago who often buys Brazilian beef at the supermarket. Asked whether he will continue to do so in the future, Mr. Buccioni said, "I'm going to be more careful."

The investigation, dubbed "Weak Flesh," left Brazilian authorities walking a fine line as they sought to calm consumers and trade partners without appearing dismissive of the police's findings. The operation is the latest in a string of high-profile corruption investigations that have shaken Brazil and weakened confidence in the government.

"Agribusiness for us in Brazil is an extremely important thing, and it must not be devalued by a small nucleus," President Michel Temer said Monday in a speech at the American Chamber of Commerce in São Paulo. "We export to more than 150 countries, and obviously, to reach this number, we worked for a long time."

Mr. Temer has been huddling with regulators, meat producers and foreign officials to discuss theinvestigation and reassure them that Brazilian meat is safe. After back-to-back meetings Sunday, the president treated 19 ambassadors and eight foreign trade officials to dinner at Steak Bull, a plush, all-you-can-eat grill near the presidential palace.

In a Twitter video featuring uplifting music and scenes of green pastures, Agriculture Minister Blairo Maggi, himself the owner of huge tracts of farmland in Brazil's interior, said that "the vast majority" of government workers are trustworthy and that only 21 of the country's 4,837 meat plants are under investigation.

Talking to reporters on Sunday, Mr. Maggi criticized the federal police for not clarifying some information with the ministry before releasing it to the public. For instance, police highlighted the use of meat from pigs' heads in sausages, a practice Mr. Maggi said is in fact legal in Brazil.

And some meat-loving Brazilians shrugged off the concerns.

"Yesterday, I had a barbecue with my family and friends," said José Molina, a 57-year-old advertising worker, while preparing for a meat-heavy lunch at a São Paulo steakhouse. "I think there's exaggeration and that the situation will go back to normal soon."

But governments in several of Brazil's largest export markets expressed worry, and industry officials were bracing for further restrictions. Brazil's nightmare scenario would be if foreign governments made the temporary suspensions announced Monday into more permanent bans, which could take years to overturn.

"I wish, I expect, I pray that it doesn't happen," Mr. Maggi said in a press conference Monday after China announced the suspension of Brazilian imports.

China informed the Brazilian Agriculture Ministry on Monday that it will ban meat imports from the South American country until Brazil's government explains the situation. Mr. Maggi was scheduled to hold a videoconferencewith Chinese authorities on Monday night to "provide clarification," the Brazilian ministry said. China imported nearly $2 billion of meat products from Brazil last year.

Enrico Brivio, spokesman for public health and food safety at the European Commission, said Monday during a news briefing that the bloc is moving to suspend imports from "any of the establishments implicated in the fraud."

"We've asked our member states to remain vigilant and increase...controls on meats coming from Brazil," Mr. Brivio said, referring to "documentary and physical checks."

The Agriculture Ministry of Chile, one of Brazil's top-10 export markets, said on Twitter that it had suspended imports of Brazilian beef until it receives further details.

South Korea's Ministry of Food and Drug Safety said it wouldn't allow chicken already imported by BRF to be sold or to circulate in the country.

Egypt temporarily suspended imports of poultry and other meat from Brazil pending a response from the Brazilian Embassy in Cairo to questions sent by the local authorities, Agriculture Ministry spokesperson Hamed Abduldayem said.

U.S. authorities are now doing more examinations of "raw beef trimmings and ready-to-eat product" from Brazil for possible pathogens, according to the USDA.

BRF said Monday that it hasn't been officially notified by foreign or domestic authorities of any suspension by countries where it does business.

Industry officials sought to play down the scandal by calling the police's conclusions into question. Antonio Jorge Camardelli, head of beef exporters' group ABIEC, said in a news conference Monday the police based some of their allegations on technical mistakes, asserting an "unnecessary crisis" had resulted.

While too soon to know the full impact, Neil Shearing, chief emerging markets economist at Capital Economics, said that the scandal could"plausibly derail the country's economic recovery" if it continues to grow.

"It goes without saying that this is the last thing that Brazil's economy needed," Mr. Shearing said.

--Emre Peker,

Jeffrey T. Lewis

, Luciana Magalhães,

Samantha Pearson

, Lucy Craymer and Ryan Dube contributed to this article.

Write to Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

March 21, 2017 02:47 ET (06:47 GMT)

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