This Culinary Paradise Has Cornered Half of Brazil’s Beef Offal Exports
Foodthink Says
How can one trace whether beef comes from a deforested ranch? Are businesses and consumers fully aware of the social and environmental impact of these products? What environmental cost is hidden in ordinary people’s daily consumption? These are precisely the questions this report sets out to answer.
*This article was jointly published by “Repórter Brasil” and Hong Kong Free Press, and was first published on 31 March 2024. The original editor was Tom Grundy. Foodthink has been authorised to translate and republish this article. Click the “link” to read the original report.
At first glance, a handful of unremarkable office spaces in Hong Kong would seem to have nothing to do with the world’s largest tropical rainforest. Yet according to supply-chain data provided by the non-profit organisation Repórter Brasil to Hong Kong Free Press (HKFP), at least four Hong Kong-based businesses have imported beef products from a rancher whom Brazilian police have called “the Amazon’s worst destroyer of the rainforest”.
The World Wide Fund for Nature (WWF) states that “in almost every country in the Amazon region, livestock farming is the number-one driver of deforestation.” Roughly 17% of the Amazon rainforest has been converted to other land uses – forests cleared to make way for pastureland and roads that funnel Brazilian beef to global markets.
Rancher Bruno Heller has profited from the illegal clearing of Amazon forest. The Heller family’s farm was fined US$5 million for illegal deforestation, and Heller himself has been charged by the Brazilian Federal Police with clearing 6,500 hectares of forest cover – nearly five times the area of Lamma Island in Hong Kong.
I. Traceable, but Sustainable?
In late January 2024, a CFS spokesperson told this newspaper that these processing plants “must comply with food-safety requirements for imported products, such as the products being fit for human consumption and meeting regulations in both the exporting country and Hong Kong.”
Asked whether the sustainability of imported agricultural products was considered, the CFS replied the following month: “Hygiene conditions, humane slaughter, meat handling, processing, production, storage and transport should also be subject to oversight.” No further detail was given about the assessment process.
“At present, there are very few requirements in Brazil’s international trade concerning the social and environmental impact of products,” Marina Guyot, public-policy manager at the non-profit organisation Imaflora, told this newspaper by telephone from Brazil in February 2024.
To prevent the import of products linked to deforestation, the EU adopted a regulation in 2023 aimed at “reducing the EU’s impact on global deforestation and forest degradation.” The regulation targets commodities such as beef, soy and palm oil exported to the EU from areas deforested after 31 December 2020, and is set to take effect by the end of 2024.
Although the policy has been widely welcomed, it is unlikely to significantly reduce demand for Brazilian exports, as much of Brazil’s output is shipped to Asia. “European countries account for only 5% of Brazil’s total exports, and an even smaller share of total production,” Guyot said.
In contrast, Hong Kong has an enormous appetite for Brazilian beef. Despite its tiny land area and a population of just 7.5 million – nowhere near the EU’s 448 million – Hong Kong is the single largest buyer of Brazilian beef offal.
According to Brazilian trade data, in 2022 Hong Kong imported US$253.65 million worth of frozen beef offal from Brazil, accounting for 48% of Brazil’s total exports of such products.
II. Ambiguous Origins
In late November 2023, this newspaper visited these companies but learned very little. Galaila International occupied a dilapidated 1980s office building in Central, while Loyalty Union Asia looked out over Hong Kong’s main container terminal from an industrial building. Only these two had signage leading to an operating entity.
Harvest Charm’s registered address was an ordinary office building in Sheung Wan, and Uni Shining’s was an industrial unit in Tuen Mun. Neither location showed any sign of the companies’ presence. Uni Shining’s office appeared to have been taken over by a wedding florist.
Records at the Hong Kong Companies Registry offered little further insight into these companies’ activities. Of the four, only Galaila International had a website, which appeared to belong to a leather supplier. The remaining three had no websites, social media presence or brand identity.
Requests for comment sent to all four companies went unanswered. An employee at Galaila International said over the phone that she would pass this newspaper’s contact details to her supervisor, but no further word came thereafter. A letter addressed to Uni Shining International Trading was returned with the notation “unclaimed”.
Greenpeace found that nearly one-third of Hong Kong’s beef came from ranches in deforested areas of the Amazon rainforest, and called on major supermarkets to stop selling “deforestation-linked meat products” (deforestation meat).
Major supermarkets including AEON, Yata and City’Super responded to Greenpeace by saying they did not sell, or rarely sold, Brazilian beef. ParknShop subsequently said it would switch suppliers once its existing (Brazilian) meat stocks had sold out.
“After years of advocacy … it’s truly disheartening that these meat products are still available in Hong Kong,” Tom Ng of Greenpeace’s Hong Kong office told this newspaper in late January 2024.
“Hong Kong is one of the largest importers of deforestation-linked meat. We have been calling on businesses to stop importing it – or at least to stop importing products that have already been identified as problematic,” Ng said.
In February 2024, Wellcome was the only supermarket in this newspaper’s field survey that sold Brazilian beef. In early March, DFI Retail Group, Wellcome’s parent company, replied by email to relevant enquiries, stating: “Wellcome’s sourcing complies with local regulations, and the group is committed to sustainability.”
The group added that it was “aware of the growing discussion around environmental issues” and was “seriously reviewing its supplier network”.
A subsequent online search revealed that ParknShop also sells Brazilian beef products. This newspaper has contacted the supermarket chain for a response.
According to the Census and Statistics Department, Hong Kong imported 316.7 million kilograms of Brazilian meat products in 2023, of which 34.9 million kilograms were categorised as “beef” and 8 million kilograms as “meat and edible offal”.
In February 2024, asked why Hong Kong’s demand for Brazilian beef offal was so high, Louis Chan, deputy director of research at the Hong Kong Trade Development Council, told the Repórter Brasil reporter that Hong Kong “is renowned worldwide for its open and free trade regime … which makes it an ideal hub for international commodity trading.”
In an email, Chan wrote: “Without a doubt, Brazilian beef offal … enjoys a strong market in Asia. Offal can be consumed directly or processed for use in the food industry, the pet food sector, and the production of feed needed for local agriculture and livestock.”
He also cited Hong Kong’s per capita meat consumption. A 2018 study by the Department of Earth Sciences at the University of Hong Kong found that Hong Kong’s per capita meat consumption stood at 664 grams per day – “equivalent to two 10-ounce steaks,” Chan added.
Not all Brazilian beef imported into Hong Kong stays in the city, however. Citing government figures, Chan noted that US$342 million worth of Brazilian beef offal was re-exported from Hong Kong, with 50.3% destined for Vietnam, 29.9% for Taiwan and 15.4% for South Korea.
III. Final Destination: Mainland China?
“Hong Kong not only consumes Brazilian beef, it also serves as the entry point for imported products destined for China … but this process is not adequately tracked,” she said.
In December 2023, Alcides Torres of Scot Consultoria, one of the largest consultancy firms in Brazil’s meat industry, expressed a similar view in an interview with Repórter Brasil: “Some of the products exported to Hong Kong may be transhipped to mainland China.”
According to data from the World Bank’s World Integrated Trade Solution (WITS), in 2022 China’s beef offal imports came mainly from Uruguay, the United States and New Zealand. Brazil was not among them, as Brazilian products in this category have yet to be approved by the General Administration of Customs of China.
The CFS stipulates that meat products re-exported from Hong Kong to mainland China or Macao “must carry an official health certificate issued by the country of origin, clearly stating mainland China/Macao as the final destination of the consignment”. Macao is the third-largest re-export market for Hong Kong’s Brazilian beef and beef offal; mainland China does not appear on the list.
Smuggling activities peaked in 2022. That year, Hong Kong police seized 403 tonnes of smuggled frozen meat worth approximately HK$61 million and arrested 46 people. According to media reports at the time, among the seized meat products was Brazilian beef offal.
Data provided to this newspaper by the police showed that seizures of this kind declined in 2023, with only 52 tonnes of suspected smuggled frozen meat recovered in four cases, valued at HK$11 million.
IV. Sustainability: Pressure from the Demand Side
In February 2024, Lei Yu-ting, a researcher at Greenpeace’s East Asia office, told the Repórter Brasil reporter by email that awareness among Hong Kong consumers of whether meat products are sustainable “is rising slowly, but not enough to change consumption patterns or industry supply chains,” he added.
Mr Lei (name transliterated) also noted: “When Hong Kong consumers consider whether meat products are sustainable and traceable, they are more concerned with meat quality and food safety. It is difficult for consumers to judge whether the meat they eat is linked to land degradation and deforestation in countries such as Brazil.”
Tom Ng of Greenpeace Hong Kong added that while public pressure is important, policy change is even more essential. “Supply-chain transparency and traceability are critical, and all parties need to work together on this,” he said. He believes that governments, schools, non-governmental organisations and the media should also actively carry out public education on the link between meat consumption and deforestation.
“I don’t know whether government or corporate policy could directly ban products like these,” Ng continued, “but that is precisely the outcome we would hope to see.”
At the Brazilian NGO Imaflora, Guyot and her colleagues are working towards exactly that goal. The organisation has partnered with Brazil’s Federal Prosecutor’s Office to develop a monitoring system called “Beef on Track”, aimed at building supply chains free of “socio-environmental violations”, including deforestation on indigenous lands and forced labour.
Of the 158 slaughterhouses in the Brazilian Amazon, 110 have signed the “Beef on Track” agreement, which requires slaughterhouses to ensure that their direct suppliers comply with human rights and sustainability standards. Given the complex upstream and downstream relationships in the beef cattle industry, the system is far from perfect, as it only monitors the conduct of suppliers that sell directly to slaughterhouses. But it is, at least, a start.
Between 2018 and 2023, 163 Beef – the slaughterhouse on which the Repórter Brasil reporter and this newspaper focused their investigation – purchased cattle more than 20 times from farms linked to Heller and his family, and sold beef offal to the four Hong Kong companies. 163 Beef has not signed the “Beef on Track” agreement and did not respond to requests for comment.
Heller, through a defence lawyer shared by him and his daughter, issued a statement saying that “since the 1970s, their family has held the family property in rural Pará peacefully and without interference.”
The statement added: “The facts involved in the ongoing investigation are strictly confidential.” It remains unclear which specific investigation he was referring to.
“We are committed to … promoting green trade between China and Brazil, including Hong Kong, of course,” Guyot said. “If mainland China and Hong Kong were also to sign the Beef on Track agreement, it would greatly incentivise Brazilian meat companies and the industry to sign up.”
Translation: qiqi
Proofreading: Ze’en