Brazil And China’s Strong Ag Relationship: Opportunity Or Overdependence?

As global markets react to trade tensions between the U.S. and China, another bilateral relationship has gained attention: Brazil and China. Over the past two decades, China has become Brazil's largest agricultural trading partner, accounting for one-third of the value of Brazil's total agricultural exports. With the latest tariff escalations, Brazil is expected to strengthen its trade ties with China (see Farmdoc video, April 9, 2025). However, this deepening relationship raises questions about long-term risks for Brazil having relied heavily on Chinese trade, particularly considering forecasts for slower Chinese economic growth in the coming years. This article examines the role of Chinese demand in driving the expansion of Brazil's agricultural sector in the last 20 years. It also discusses the implications of growing export concentration from a market diversification and risk exposure perspective.

China's Growing Share of Brazil's Export Market

China became Brazil's largest agricultural trading partner in 2013, 12 years after China joined the World Trade Organization (WTO). China now surpasses the European Union and the United States as Brazil's largest trading partner. Over the past two decades, China's share of Brazilian agricultural exports increased from just 7% in 2005 to 30% in 2024, according to the Foreign Trade Secretariat (Secex). During the same period, the European Union's share declined from 30% to 14%, while the United States' share fell from 14% to 7% (see Figure 1).

China is currently the leading importer of several major Brazilian agricultural and forestry products, accounting for 73% of Brazil's soybean exports, 49% of cellulose (a plant-based material widely used in paper), 46% of beef, 33% of cotton, 29% of sugar, 19% of pork, and 11% of poultry in 2024, according to Secex data. Over the past two decades, Brazil's total exports grew at a compound annual growth rate (CAGR) of 6%, while exports to China grew significantly faster, with a CAGR of 15% (Markestrat, 2025). This reflects a strong connection between Brazilian exports and China's economic growth.

In addition to boosting Brazilian exports, China's rapid economic growth has contributed to the appreciation of farmland in Brazil. Cropland prices in Brazil have risen significantly over the past decade, driven by high commodity prices caused in part by strong Chinese demand and a favorable exchange rate for Brazilian exporters. The most significant increases in land values have occurred in grain-producing regions, in the center-west and south of Brazil, particularly those areas specializing in soybean production - the leading agricultural export to China (see Farmdoc Daily, April 28, 2023).