April 15, 2019 / 8:36 PM / a year ago

UPDATE 1-US wheat delegation in Brazil to gauge import demand under quota

(Adds comments from Abitrigo head, context on wheat trade)

By Marcelo Teixeira

SAO PAULO, April 15 (Reuters) - A delegation representing the United States wheat industry is visiting Brazil this week to talk to millers and food industries to gauge potential for higher import demand once a tariff-free quota is implemented, a local wheat group told Reuters on Monday.

Rubens Barbosa, president of Brazil’s wheat milling association Abitrigo, said he met the head of U.S. Wheat Associates, Vincent Peterson, and the chief executive of the Kansas Wheat Commission, Justin Gilpin, on Monday to discuss the U.S.-Brazil wheat trade.

The U.S. delegation, which also included wheat producers and a trader from U.S. company The Andersons, is looking at opportunities to expand business in Brazil, one of the world’s leading wheat importers, under a Brazilian import quota of 750,000 tonnes.

“They know Brazil will continue to import significant amounts of wheat in coming years, and they want to increase their share of that market,” Barbosa said.

Brazil’s President Jair Bolsonaro announced the tariff-free quota during his visit to the United States last month. It will also apply to other suppliers such as Russia.

Barbosa said that Abitrigo supports the import quota as it will give the industry access to more suppliers at lower prices. No date has been set yet for its implementation, but government is working on the regulation, he added.

Barbosa said the United States currently sells around 8 percent of the wheat Brazil imports.

Brazilian mills buy around 6 million tonnes of wheat per year, an amount that varies depending on the local crop output. Most of the imported wheat comes from Argentina, which benefits from a zero import tariff as a member of the Mercosur trade bloc. (Reporting by Marcelo Teixeira Editing by Chizu Nomiyama and Susan Thomas)

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