(DTN)--Brazil, home of the world's largest commercial cattle herd, aims to lead the global beef export market, wooing health conscious consumers with grass-fed, disease-free meat, reported Reuters.

Currently the world's No. 3 exporter of beef, Brazil aims to pass the United States and Australia, the No. 2 and No. 1 exporters, respectively, by 2005.

Beef export leaders say the country's staggering capacity to produce cattle on top of a voracious internal market are the perfect mix for leading the world beef industry.

"Brazil, home to more than 165 million head of cattle, is hedged against most downturns in the world beef industry as 90% of its output is consumed domestically," said the president of the Brazilian Association of Beef Exporters (ABIEC), Edivar Vilela de Queiroz.

But Queiroz, speaking to reporters late Monday, April 8, at Sao Paulo's posh Barbacoa churrasqueiria, or meat joint, also said beef exports had more than doubled since 1997 and jumped almost 39% annually in 2001 to 632,000 tonnes.

He was speaking at the start of a "Brazilian Beef" tour for foreign journalists.

"We don't expect this kind of growth this year because of outside market factors, but in the medium term Brazil's capacity to expand its production of animal protein is immense," said Queiroz, who expected modest growth this year.

Brazil's real currency depreciated roughly 16% against the dollar last year, making the country's farm exports highly attractive. But the local unit stabilized recently.

Large regional beef industries in Argentina and Uruguay were shut out of many world markets like Europe as they struggled to rein in a foot-and-mouth epidemic among their prized herds.

But Brazil is unlikely to lose the gains it made last year with the reemergence of its South American neighbors on the world beef market, said Samuel Ribeiro Giordano, professor at the University of Sao Paulo's Agribusiness Program.

"The rule of trade is if you don't occupy a position in a market, a third party will," said Giordano, referring to Brazil's gains last year as it was relatively unscathed because of its vaccination program against the fast spreading disease.

The country's grass-fed beef has also profited from Europeans' concerns over bovine spongiform encephalopathy (BSE), that has plagued the Continental herd.

The bulk of Brazil's chilled or frozen beef exports are shipped to Europe where butcher shops from Lisbon to Milan have begun to showcase Brazilian cuts to clients wary of BSE.

The Brazilian herd has one of the lowest world risk ratings for the brain-wasting disease because it is grass fed, consuming no bone or animal remains which are believed to be the vector of spreading BSE among cattle.

Brazil, about the size of the continental United States, has enormous pastures to feed its cattle and meet its beef export goal.

"Brazil has 19% of the world's arable land and only uses 10% of it," said Giordano. "Brazil has the equivalent area of France and Germany in undeveloped, sustainable, arable land. And that is assuming we leave the Amazon Basin untouched."

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