BUENOS AIRES/SAO PAULO, Oct 28 (Reuters) - Brazil's soybean industry fears the European Union's new anti-deforestation regulations (EUDR) could curb soymeal exports to the bloc, creating an opening for rival supplier Argentina, which says it is better placed to comply with the incoming rules.
Brazil is the EU's largest supplier of soybean meal for animal feed, accounting for about half of the bloc's imports last year, according to data from the European Feed Manufacturers' Federation (FEFAC). Brazil exported
a record 23.3 million metric tons of soymeal in 2025.
Starting December 30, the EUDR will require importers to prove their products are not linked to deforested land, with significant penalties for non-compliance.
In Brazil, extensive farmland across central and northeastern states has been developed in cleared ecosystems in recent decades, whereas Argentina's most important farmlands are spread across the vast Pampas plains, where farmers have been producing for over a century.
The EUDR is raising alarm in Brazil's agriculture sector, with FEFAC warning that traceability requirements under the rules could shut out up to 4 million tons of soymeal, roughly 17% of total exports.
According to FEFAC's latest report on how anti-deforestation rules may impact supply chains, Brazil was assigned a "medium" risk rating, with the west-central state of Mato Grosso and others facing "structural and logistical hurdles" that could restrict the expansion of fully EUDR-compliant supply chains.
Dante Romano, research manager at Rosario-based grains broker Max Agro, explained that farmers in central Brazil are more than 2,000 kilometres away from sea ports and often have to change between trucks, barges and trains to get their grains to export terminals, making supply chains difficult to trace.
Argentina's prime soy-producing lands are no more than 350 kilometres away from the Rosario port hub, making traceability considerably easier, and cheaper.
For Buffon, the landmark legislation unfairly targets Brazil. He said environmental restoration efforts were underway in some regions even as new cropland was being developed.
"Brazil's environmental problems are much smaller than the size of our agriculture," the Aprosoja president said.
The EUDR will come into effect just days before Luiz Inacio Lula da Silva inaugurates a new term as president of Brazil, after beating right-wing candidate Flavio Bolsonaro, who had said he would free production from "environmental hurdles" and let farmers do "whatever they wished" on their lands.
'ARGENTINA IS READY'
Further south, Argentina's powerful soybean crushing industry is positioning itself to benefit from any disruption faced by Brazilian exporters in meeting the EU's tougher rules.
"We can easily fill that gap," said Gustavo Idigoras, president of Argentina's CIARA-CEC grains exporters and crushers chamber, referring to potential export losses in Brazil, which he estimated at 5 million to 6 million tons.
"Argentina is ready," Idigoras said, pointing to the country's VISEC traceability system, which tracks soybeans and beef from production through to export and is fully operational.
In its latest risk assessment, FEFAC assigned Argentina a "low" risk rating for EUDR-related supply disruptions, projecting that nearly all of the country's soymeal crop in the first half of 2027 would meet requirements.
Romano said Argentina could capitalize on any shortfalls in Brazilian shipments. At the same time, he said, Brazil may seek to expand sales to alternative markets as Argentine exporters divert more volumes to meet European demand.
Argentina is the world's largest soymeal exporter, shipping about 27 million metric tons last year, roughly a quarter of which went to Southeast Asia.
The adjustments come at a sensitive moment in relations between the EU and Mercosur, after the bloc and the South American trade group reached a provisional free-trade agreement in May following decades of negotiations.
Argentina and Brazil are both members of Mercosur along with Uruguay and Paraguay, another key supplier of soybeans to Argentina's crushing industry.
Paraguay's CAPPRO grains crushing chamber said the country has "favorable structural conditions" to meet European requirements. In its Region Oriental, where most soybeans are grown, legislation passed in 2004 prohibits deforestation for agricultural use.
Like Argentina, Paraguay received a low risk rating from FEFAC.
(Reporting by Maximilian Heath in Buenos Aires and Oliver Griffin in Sao Paulo, additional reporting by Daniela Desantis in Asuncion; Edited by Lucinda Elliott and Nia Williams)
