Animal health authorities in Brazil have been told in no uncertain terms that the EU will impose a total ban on imports of beef by the end of the year unless standards of welfare, traceability and residue testing match those of Europe.
An EU veterinary mission to Brazil in March reported that, while some progress has been made since a previous inspection, there are still several concerns, especially on animal health and the control and use of vaccines.
A ban on imports from three regions in Brazil has been in place since October 2005, largely as a result of a major outbreak of foot-and-mouth disease. The three areas, Mato Grosso do Sul, Paraná and São Paulo, accounted for 60% of Brazilian exports of beef.
The expectation was that the ban would result in a major decline in trade with the EU, But this has not been borne out in practice, with a fall of just over 5% in 2006.
This in turn has raised serious concerns over the movement of both live cattle and carcasses between provinces in this vast country.
Last year Brazil exported 333,000 tons of beef to the EU. In the first two months of this year the UK imported 4,951 tons from Brazil, which suggests that over a full year months the total will be about 30,000 tons.
Brazil has been pressing for the ban on exports from the three areas to be lifted. However, sources at the International Meat Traders Association say the Brazilian ambassador in Brussels has been warned that unless the situation is remedied a total ban will be imposed.
This would have major implications for the rural economy in Brazil, a country that has the fastest expanding beef industry in the world.
Imports of beef from most developing countries to the EU are subject to tariffs, but the World Trade Organization is keen to see these phased out over several years. Such a policy would be highly detrimental to EU producers, a fact highlighted earlier this week by John Bryan, the chairman of the Irish Farmers' Association's livestock committee.
He said: "The European Commission can no longer ignore the failure of Brazil to meet our standards in Europe and should not delay decisions [on a export ban] any longer."
Yesterday the Brazilian Embassy in London refused to comment other than to say that it was hopeful of a satisfactory outcome to discussions with Brussels.
Several other countries in South America have been subject to export bans by the EU in recent years, almost invariably on animal health grounds. However, according to figures from HM Revenue and Customs, in the first two months of this year the UK imported 1,894 tons from Argentina and Uruguay.
Over the same period the UK exported 9,669 tons of beef, mostly to mainland Europe.