The role of distance on international commerce: the impact on Sino-Brazilian beef trade

Abstract

Purpose The purpose of this paper is to identify Brazilian and Chinese cultural, managerial and negotiation factors that can influence the beef trade between the two countries. Design/methodology/approach First, a matrix based on reliable secondary sources was established created upon indicators of economic, financial, policy, administrative, cultural, demographic, knowledge, global connectedness and geographic distance between the two countries. This was combined with primary data from interviews conducted with two key stakeholders of the supply chain, namely, the Brazilian agricultural attaché to China, and the director of Apex-Brasil. The results were analysed in a qualitative descriptive manner. Findings Cultural and political distances between Brazil and China are the most profound origins of challenges in negotiations on both the private and public level. Research limitations/implications The interviews were limited in number and to the Brazilian portion of agents involved in the beef trade (diplomats and APEX representative). The low number of interviews might be a limiting factor of the investigation. However, the interviewees’ key position in the supply chain and data triangulation with secondary sources equilibrates the results’ trustworthiness. Social implications China and Brazil are becoming important players in the international market. Brazil has become a leader in the production and export of agricultural commodities. Brazil is the first producer or the second exporter of coffee, soybean, ethanol, poultry, sugar and beef. In 2009, China became Brazil’s top partner in trade (Xi, 2016). In 2015, Brazil exported $35.6bn to and imported $30.7bn from China. In the foreseeable future China will continue to be the most dynamic economy worldwide. This trade dynamic can be a source of opportunities for Chinese and Brazilian enterprises. Originality/value Information collected and conclusions drawn from the research are unique in scientific and management literature related to this specific topic, and can be of great value for stakeholders, traders and diplomats in the Sino-Brazilian trade.

International market information and agricultural commodity price dynamics

“…Although exporters have increased their capability, a number of port rejections may arise hindering inventory sharing (Yoshida, 2017). In spite of these, cultural and political distances between trading partners are still the most profound challenges in trade (Knoll et al, 2018). Nonetheless, the importance of international market information on domestic commodity price dynamics, especially for making decisions on commodity inventory level and marketing has been demonstrated in this study.…”

“…Although exporters have increased their capability, a number of port rejections may arise hindering inventory sharing (Yoshida, 2017). In spite of these, cultural and political distances between trading partners are still the most profound challenges in trade (Knoll et al. , 2018).…”

Determinants and Potential of Agri-Food Trade Using the Stochastic Frontier Gravity Model: Empirical Evidence From Nigeria

“…Larger countries are expected to engage in more bilateral trade (Shahriar et al, 2019b). The farther apart countries are from each other, the less they are expected to trade, due to higher transportation costs associated with longer distance (Knoll et al, 2018; Liu et al, 2020).…”