Blairo Maggi says China can produce its own meat — but still needs Brazil to feed the animals

By Brazil Stock Guide – China may be able to produce nearly all the meat it consumes. The harder part is feeding the animals.

That is the equation in which Blairo Maggi, Brazil’s former agriculture minister and one of the country’s best-known agribusiness executives, sees a key constraint on China’s drive for food self-sufficiency — and a structural advantage that Brazil will be difficult to replace.

Speaking at the Bradesco BBI Agro Summit in São Paulo on Thursday, an event bringing together business leaders, executives, investors and other senior figures from Brazil’s agribusiness sector, Maggi said China may be able to reduce imports of pork and poultry because domestic production already meets most of its needs.

But producing more animal protein at home will still require huge volumes of plant protein, particularly soybeans.

“To produce animal protein, they will need plant protein. And that is where Brazil fits into this equation,” Maggi said.

The alternative would be for China to significantly expand domestic soybean acreage, displacing land currently used for other crops.

For Maggi, that is a difficult equation to justify when soybeans are readily available on the international market.

“Do they have the conditions to do that today? No, they don’t,” he said.

China’s push for food security, Maggi added, should not be viewed purely through an economic lens. For a country of China’s scale, food is also a matter of social and political stability.

His reasoning is straightforward: when food becomes scarce, the risk of tension and conflict increases. Beijing will therefore continue seeking to reduce vulnerabilities even when importing is economically more efficient.

Maggi, however, does not see China’s dependence on imported agricultural commodities as a permanent guarantee for Brazil.

He described Brazil’s heavy reliance on China as a “yellow flag” and said the country must continue opening new markets — a process he considers difficult both when securing access and when trying to preserve it over time.

That is where his analysis takes a broader turn.

For Maggi, perhaps the biggest risk facing Brazilian agribusiness over the next decade is not its ability to plant more, harvest more or adopt new technology. It is what happens outside the farm gate.

“The future is being shaped in forums that we, as farmers and businesspeople, often do not attend,” he said.

According to Maggi, new requirements often begin in relatively narrow technical discussions and, years later, emerge as sanitary, environmental or trade rules capable of restricting exports.

Brazil, in his view, needs to be present before those rules are finalized.

“We will be part of the future if we meet the rules and requirements of the future, whether they are sanitary, environmental or commercial.”

The concern is particularly relevant coming from someone who has spent decades looking at the agricultural value chain from both sides of the farm gate.

Maggi is a shareholder in Amaggi, one of Brazil’s largest agribusiness companies and the country’s largest fully Brazilian-owned group operating across the soybean, corn and cotton value chains.

The company is active in grain production and trading, logistics, exports, energy, agricultural inputs, financial services and biodiesel, with a commercial presence that includes China.

That integration helps explain why Maggi’s view of competitiveness extends well beyond farm productivity.

He recalled a Brazil that, when he was a child, was still receiving U.S. powdered milk through aid programs. Roughly six decades later, the country has become one of the world’s leading food exporters.

The transformation, he said, was driven by education, agronomy schools, technology and public policies that allowed the sector to advance.

But he added a warning.

“What got us here is not what will take us forward.”

Money has become more expensive

One of those challenges is credit.

Maggi estimates that official government-backed credit lines now account for only about 20% to 30% of the financing needs of Brazilian agribusiness. The remainder comes from private banks, trading companies and capital-market instruments developed over the past few decades.

In his view, money is available. The problem is its cost. Beyond high interest rates, Maggi highlighted the impact that financial distress and defaults by farmers and companies have on the cost of funding for the entire sector.

He was particularly critical of cases in which business owners take on large debts, accumulate personal assets and then seek to shift part of the losses onto creditors when things go wrong.

“A person borrows money in the market, buys an apartment in Balneário Camboriú, buys an airplane […] then runs into trouble and wants everyone else to share the loss,” he said.

For Maggi, that behavior ultimately gets priced into credit for every other farmer.

The reliability of collateral is also part of the equation.

The less predictable it is for lenders to recover money after a default, he argued, the higher the risk premium they are likely to demand — particularly foreign investors.

From soybeans to diesel

The same logic of reducing vulnerabilities appears in Maggi’s discussion of fertilizers and energy.

Brazil has potash reserves, he said, but remains heavily dependent on imports because turning those deposits into commercial projects continues to face regulatory, environmental and Indigenous-related obstacles.

He specifically cited deposits in the Amazon region that could supply Brazil’s Center-West agricultural belt and benefit from logistics along the Amazon River.

The problem is longstanding.

“In practice, it became much easier to import than to produce,” he said.

But Maggi sees biofuels as an opportunity to address two vulnerabilities at the same time.

The more biodiesel and ethanol Brazil produces, he argued, the less dependent it becomes on imported fuels.

At the same time, the country creates an additional domestic market for soybeans and corn — effectively providing a buffer if external demand, including Chinese demand, grows more slowly in the future.

That strategy is already visible at Amaggi.

The company produces biodiesel from soybean oil and has been using B100, or pure biodiesel, in agricultural machinery, trucks and vessels.

In July, Amaggi also completed the acquisition of a 40% stake in FS, one of Brazil’s largest corn ethanol producers, in a transaction that included a $100 million capital injection.

Maggi said some of the company’s operations already run on 100% biodiesel, even though he estimates its cost to be around 3% to 4% higher than conventional diesel.

For him, there is another value in that calculation.

“It is independence.”

Corn ethanol closes another loop.

Turning corn into fuel creates additional demand for Brazilian agricultural production while also generating DDGS, a protein-rich co-product used in animal feed.

In that sense, part of Brazil’s response to a potential shift in China’s purchasing pattern may lie within Brazil itself: converting more grain into fuel, animal protein and higher-value products rather than relying primarily on exporting the commodity.

Confidence inside the farm gate

Despite his warnings, Maggi remains optimistic about one essential part of the equation: the Brazilian farmer.

He sees an increasingly younger generation of producers and what he describes as an unusual willingness to adopt new technologies.

Artificial intelligence, apps, management systems and monitoring tools are already changing the way farmers track costs and make decisions, he said.

“We are much more precise today than we were in the past,” Maggi said. “This generation is extremely eager to adopt new technology. They are very good at it.”

That is why, when Maggi looks 10 years ahead, he appears less concerned about what happens inside the farm than about everything surrounding it.

Farmers will continue pursuing productivity gains. Technology will continue to advance. China will continue needing to feed an enormous population and a vast livestock industry.

China is thinking about its food security.

For Blairo Maggi, Brazil needs to think with the same degree of foresight.

The bigger questions lie elsewhere: how expensive capital will be, where fertilizers will come from, which markets will remain open and which sanitary, environmental and trade rules will shape global commerce.

Brazilian soybeans continue to occupy a position in that system that will be difficult to replace.

But Maggi’s central message is precisely that Brazil should not treat an advantage built over decades as if it were permanent.