China Diversidade

China: 12-City Company Analysis
A custom report compiled by Euromonitor International for APEX
September 2009
Project Managers: James Chen and Zoe Zhou
+86 21 6372 6288

www.euromonitor.com
List of Contents and Tables
1. RESEARCH BACKGROUND .......................................................................................................... 4
1.1 Research Objectives................................................................................................................................................ 4
1.2 Research Methodology & Coverage ...................................................................................................................... 5
1.2.1 Eromonitor Approach & Project Methodology ........................................................................................... 5
Table 1 Total Number and Distribution of Trade Interviews ............................................................... 5
Table 2 Skeleton of the Quantitative Evaluating System for 52-City Ranking .................................... 6
1.2.2 Geographic Coverage ................................................................................................................................. 6
1.2.3 Criteria for Sectors and Companies Interviewed ........................................................................................ 7
1.3 Research Deliverables ............................................................................................................................................. 7
2. MANAGEMENT SUMMARY ............................................................................................................ 9
2.1 Overview of the Brazil-China Trade Relationship ............................................................................................... 9
2.2 Opportunities for Brazilian Companies ...............................................................................................................11
2.3 Challenges and Barriers ........................................................................................................................................12

Chart 1 China's Monthly Trade Growth (value ), Jan-Oct 07/08.....................................................13
Table 3 % of Foreign Suppliers by Country of Origin Owned by 300 Companies Interviewed ........15
Table 4 Brazilian Products Faced with Competing Import Orgin Counties/Areas in China ...............16
2.4 Key Recommendations ..........................................................................................................................................16
Chart 2 Key Marekt-entry Recommendations to Brazilian Exporters .................................................16
Table 5 Major Websties and Trade Sources for 300 Chinese Companies to Know about Brazil........20
3. BUSINESS RELATIONSHIP BETWEEN CHINA AND BRAZIL ...................................................22
3.1 Brazil-China Trade and Commercial Ties Overview .........................................................................................22
3.1.1 Overview of Brazil-China Trade................................................................................................................22
Table 6 Main Imported Oroducts from Brazil to China, 2007 ............................................................22
3.1.2 Market Drivers and Constraints of Brazil Exports to China ......................................................................22
3.2 Sectors Representing Better Opportunities by City ...........................................................................................23
3.3 Promising Cities for Brazilian Products by Sector .............................................................................................24
3.4 Potential Chinese Partners of Brazilian Suppliers .............................................................................................26
4. NEEDS AND WANTS OF CHINESE COMPANIES ......................................................................28
4.1 Sample Description ................................................................................................................................................28
Chart 3 Industry Membership and Sample Distribution ......................................................................28
Chart 4 Business Nature of Companies Interviewed ...........................................................................28
Chart 5 Business Ownership of Companies Interviewed ....................................................................28
Chart 6 % of Companies Having Experience with Brazilian Products across 12 Cities......................29
Chart 7 % of Companies Having Worked with Brazilian Companies across 12 Cities .......................29
4.2 Company Perception Level of Brazil ...................................................................................................................29
4.2.1 Company Perception on Brazilian Products...............................................................................................29
Chart 8 Average Scores of Comments on Brazilian Products .............................................................30
Chart 9 Regional Variations in Scores of Comments on Brazilian Products .......................................31
Table 7 Scores of Comments on Brazilian Products across 12 Cities ..................................................31
Chart 10 Comments on Brazilian Products across Key Sectors ..........................................................32
Table 8 Scores of Comments on Brazilian Products across Key Sectors ............................................33
4.2.2 Company Perception on Brazilian Suppliers .............................................................................................33
Chart 11 Average Scores of Comments on Brazilian Suppliers ..........................................................34
Chart 12 Regional Variations in Scores of Comments on Brazilian Suppliers....................................34
Table 9 Scores of Comments on Brazilian Suppliers across 12 Cities ................................................35
Chart 13 Sector Variations in Score of Comments on Brazilian Suppliers .........................................35
Table 10 Scores of Comments on Brazilian Suppliers across Key Sectors .........................................36
4.2.3 Previous Information about Brazil/Brazilian Products...............................................................................36
Chart 14 Major Information Channels for Chinese Companies to Know about Brazilian
Euromonitor International 2009. All rights reserved. Page ii

Products/Suppliers ...............................................................................................................................37
4.2.4 Company Expectations about Brazilian Products and Suppliers ................................................................37
Chart 15 Expectations about Brazilian Products .................................................................................37
4.3 Company Purchasing Criteria ..............................................................................................................................38
4.3.1 Top Purchasing Criteria .............................................................................................................................38
Chart 16 Importance of Purchasing Criteria ........................................................................................38
4.3.2 Major Criteria of Selecting Foreign Suppliers ...........................................................................................38
Chart 17 Average Scores of Importance on Criteria of Selecting Foreign Suppliers ..........................39
4.3.3 Current and Potential Foreign Suppliers ....................................................................................................39
Chart 18 Number of Foreign Suppliers Owned by Companies Interviewed .......................................39
Chart 19 Country Origin of Foreign Suppliers ....................................................................................40
Chart 20 Companies Willingness to Change Suppliers......................................................................40
Chart 20 Main Reasons Why Change Suppliers .................................................................................40
Chart 21 Main Reasons Why Do Not Change Suppliers .....................................................................41
Chart 22 Potential Sourcing Countries/regions ...................................................................................41
4.4 Openness to Brazil as a Commercial Partner ......................................................................................................42
4.4.1 Overall Comments on Willingness to Trade with Brazil ...........................................................................42
Chart 23 Openness to Brazil as a Traded Partner ................................................................................42
Chart 24 Main Reasons for Non-openess to Buy Brazilian Products or Source Brazilian
Suppliers. .....................................................................................................................................43
4.4.2 Comparative Openess to Brazil across 12 Cities and Sectors ....................................................................43
Table 11 Regional Variations in Openness to Brazil as a Commercial Partner ..................................44
Table 12 Openness to Brazil by Key Sector........................................................................................44
4.4.3 One-Way ANOVA Analysis ......................................................................................................................45
Table 13 ANOVA Analysis on Whether Previous Experience with Brazil Products would
Influence Future Openess to Brazil as a Trade Partner ........................................................................45
Table 14 Difference in Openess to Braizl between Companies Having v.s Not Having
Experience with Brazilain Products .....................................................................................................45
Table 15 ANOVA Analysis on Whether Previous Experience with Brazil Suppliers would
Influence Future Openess to Brazil as a Trade Partner ........................................................................46
Table 16 Diffeneren in Openess to Braizl between Companies Having v.s Not Having
Brazilain Suppliers ...............................................................................................................................46
5. APPENDIX .....................................................................................................................................47
Appendix 5.1 Quantitative 52-City Ranking as of Trade Opportunities to Brazilian Products ...........47
Appendix 5.2 Sectors Representing Better Opportunities to Brazilian Companies by City ................49
Appendix 5.3 Promissing Cities for Brazilian Products by Sector ......................................................50
Appendix 5.4 Potential Chinese Partners for Brazilian Exporters by Sector .......................................51
Appendix 5.5 Portrait of Potential Chinese Partners for Brazilian Companies ...................................53
Euromonitor International 2009. All rights reserved. Page iii

1. RESEARCH BACKGROUND
1.1 RESEARCH OBJECTIVES
The client, Apex-Brasil (the Brazilian Trade and Investment Promotion Agency), is a government organization
which aims to develop greater trade opportunities between Brazilian companies and the global business
community.
Apex-Brasil is now keen to develop expanded commercial ties with China by gaining a better understanding of
the needs of a total of 300 companies operating in 12 metropolitan areas (25 companies for each reviewed city)
across China.
As such, Apex-Brasil approached Euromonitor International to gain key information and insights about each
companys perception of Brazil as a trade and investment partner, to learn about the city and/or region where
they operate, and ultimately recommend which of these companies/cities/sectors represent greater development
opportunities for expanded business relationships with Brazil.
Apex-Brasils major research objectives can be summarised as follows:

12 city summary reports which identify and provide an in-depth profile of the companies operating in the
region, in addition to a robust analysis of the local city economy, logistical environment and local
consumption habits.
40 top-line city reviews for 40 additional Chinese cities.
One final report summary outlining Euromonitors recommendations and assessment of the companies
which offer Brazil the best opportunities for business cooperation and trade.
Euromonitor International 2009. All rights reserved. Page 4

1.2 RESEARCH METHODOLOGY & COVERAGE
1.2.1 Euromonitor Approach & Project Methodology
Globally, Euromonitor has engaged in more than 500 bespoke research projects, including the routine study of
the Chinese market. All research efforts for this program were undertaken by a total of 16 in-county analysts
native to the market, and thus bring not only language and cultural knowledge to the project but also an
understanding of how Chinese companies typically function and who the key information holders are.
The project was coordinated by project managers from Euromonitors Shanghai office, accompanied by the co-
management and support from Euromonitors Chicago office.
Secondary research
Syndicated intellignece
Euromonitor began with an assessment of as much publicly available, relevant background information as
possible to build an overall industry picture and general city profile through sources covering:
Governmental statistics resources, such as the China Statistics Yearbook, regional Statistical Bulletin,
China Customs Statistics, IMI Yearbook, Brazil exports data from Apex-Brasil, etc.
Trade associations and other semi-official sources, such as China National Textile and Apparel
Committee, China Chemicals Industry Association, and China Electronic Components Association.
Specialist trade press, i.e. Intertrade, China Textile Information Weekly, Electrical Industry, to name
a few.
Company research
As a useful supplement to the information derived from trade interviews and to better profile the company,
where relevant brief corporate intelligence would draw on sources such as annual reports and accounts
published by the major manufacturers and importers across the 12 cities reviewed.
In addition, the companies websites were used to collect basic company information, including the
product/brand portfolio, main overseas suppliers and partners, production capacity and tech certification, the
number and location of manufacturing plants, significant marketing events, etc.
Primary research
Trade Interviews
Euromonitor is keen on qualitative- and quantitative-based trade interviews which are not singly identified by
the numbers of surveys, but by the assessment of the quality of answers received and the intelligent and
transparent analysis of the information collected.
Euromonitor has conducted trade interviews with more than 300 Chinese companies as well as
economic and trade promotion committees to learn about the current and planned business
relationship between local companies and Brazil.
For city top-line analysis, trade interviews were also requested with local logistic companies and
forwarders to understand the typical freight cost and selection of the best transport system for
Brazilian products into the city.
Table 1 Total Number and Distribution of Trade Interviews

Target Organization No. of Interviews
Domestic manufacturers/importers 300
Logistic companies 17
Trade associations/press 3
Government organizations 14
Source: Euromonitor International
SPSS statistics analysis

Euromonitor input all the information collected from 300 company interviews into a database with SPSS format,
and thus provided Apex-Brasil with original and more quantitative intelligence to identify the target customer
base, covering the comments of Chinese companies about Brazilian products and suppliers, the main reasons for
non-trade with Brazil, what Chinese companies expected from Brazilian products and their concerns, openness
to Brazil as a trade partner, etc. Furthermore, noteworthy regional variations and different responses across
sectors were highlighted (see Section 4).
City ranking analysis

To offer an intuitive and complementary picture for identifying the promising cities that represent opportunities
for Brazilian exporters, Euromonitor ranked the 52 cities reviewed (see Appendix 5.1) backed on a 4-
dimentional (under 12 classified indicators) evaluating system.
According to the weights across indicators illustrated below, Euromonitor in-country analysts are able to use a
rating system to rank the 52 cities by each indicator, whereby generating a unitary score for each city. The lower
the score, the greater the trade opportunities are possible between this city and Brazil.
Table 2 Skeleton of the Quantitative Evaluating System for 52-City Ranking
Macro Economic Performance Industry fitness

20
30
35 35 15 15 50 50
Value production Value production Industry focus (Total city imports
Value Total
of primary of secondary between local from Brazil) / (total
GDP &
growth
value
imports industry, and industry, and important sectors & China imports via
the city by value)
& growth contribution to total contribution to total major Sino-Brazil
GDP GDP trading products
Logistic Initiatives Retailing and Consumption

30
20
33.3 33.3 33.3 33.3 33.3 33.3
Ports: Average freight cost Whether the city Retailing Consumption Personal
convenience in for best transport is a railway sales per expenditure disposable
transporting by system for Brazilian interchange capita per capita income (PDI)
maritime products into the city
Analysis and Validation

Throughout the project and upon the conclusion of the in-country research, reports and market conclusions are
checked and validated to ensure the highest quality possible. Analysts use all information to create an
independent evaluation of the market through triangulation and consensus building.
1.2.2 Geographic Coverage

The 12 target cities for in-depth analysis are:
Beijing (NC), Tianjin (M), Shanghai (M), Nanjing (PC), Hangzhou (PC), Guangzhou (PC), Xiamen,
Fuzhou (PC), Chengdu (PC), Wuhan (PC), Shenyang (PC) and Dalian, representative of the most important
cities in North, South, East, West, Mid and Northeast China respectively, with illustrious economic performance
and a considerable value of imports from Brazil.
The 40 additional cities for top-line review have the most important economies after the aforementioned 12
cities or were listed by Apex-Brasil, including:

Chongqing (M), Shijiazhuang (PC), Jinan (PC), Qingdao, Changchun (PC), Nanchang (PC), Harbin (PC),
Changsha (PC), Hohhot (PC), Baotou, Hefei (PC), Xuzhou, Wuxi, Dongguan, Suzhou, Kunming (PC),
Nanning (PC), Liuzhou (PC), Guiyang (PC), Foshan, Zhanjiang, Haikou (PC), Yantai, Tangshan,
Zhengzhou (PC), Yibin, Xian (PC), Taiyuan (PC), Yinchuan (PC), Lanzhou (PC), Xining (PC), Urumqi
(PC), Shaoxing, Ningbo, Nantong, Quanzhou, Wenzhou, Weifang, Macau (SAR) and Hong Kong (SAR)
Note: NC: National Capital; M: Municipality; PC: Provincial Capital; SAR: Special Administration Region
All the agreed-upon cities have been confirmed with Apex-Brasil since the very inception of the research.
1.2.3 Criteria for Sectors and Companies Interviewed

Sectors focused on in each city
Apex-Brasil opportunity matrix selection by district, and
Euromonitor selection of the most important sectors to the local economy
Company selection criteria
Reasonable distribution among the main sectors selected in each city
Companies with business concentration in major Sino-Brazil sectors are preferable
Include trading companies (import companies)
Solely foreign funded companies can be included as long as these companies represent less than 20%
of the total number of companies in each city; preference given to Chinese companies
Proportionally divided between companies that import for its own consumption and companies that
import to sell to others
Companies recommended by Apex-Brasil, as appropriate.
1.3 RESEARCH DELIVERABLES
Euromonitor will deliver the 12 city summary analysis, a compiled 40-city top-line review, as well as 1 final
report highlighting best-fit Chinese companies with greater trade opportunities with Brazil.
Each City Summary Report is divided into 3 sections entitled: Section I: 25 company analysis, Section II:

city top-line analysis and Sec : city highlights (as available)
For Company Analysis, 3 steps are hopefully involved in generating the company profile, this being said,
Step 1: Company perception level of Brazil: Includes experience with Brazilian products and/or partners,
previous information about Brazilian products, expectations about Brazil, willingness to purchase Brazilian
products, etc.
Step 2: Business & buying patterns profile of each company: The main points likely to be covered are business
type (importers, manufacturers, distributors, wholesales, retailers, etc.), purchaser contacts, business briefing
(key segments and products), typical buying cycle and average order quantity, key brands purchased, purchasing
decision criteria, foreign suppliers, quality/packaging/tech requirements for suppliers, distribution structure, and
major clients.
Step 3: Openness to Brazil as a commercial partner: This section addresses the companys willingness to receive
more information about Brazil, the willingness to purchase Brazilian products, the willingness to invest in Brazil,
and the condition for having a Brazilian company as a supplier/the conditions to invest in Brazil.
City Top-line Analysis aims to describe the local economy, logistics and consumption level.
City Highlights is the summary document that reconciles all findings derived from the primary company
interviews and the secondary research based city top-line analysis, to identify the most promising sectors and
companies, as well as provide market-entry recommendations for Brazilian exporters.
40-city Top-line Review is between 4-5 pages for each city profile, or a complete 198-page report focusing on
the local economy (main economic sectors, economic influence over surrounding cities, metropolitan area, etc),
logistics (road, rails and ports as available, city map, selection of the best transport system for Brazilian
products into the city, etc.) and consumption (consumer affluence, consumption patterns, major retailers, etc.)
analysis.

Final Report (this document) focuses on the key factors affecting the trade relationship between China
and Brazil, and offers market recommendations as to how it can better evolve in the foreseeable future. This
section is delivered in a qualitative format relying on integrated insights and analysis from all previous reports,
as well as other collateral market sense gained throughout the project.

2. MANAGEMENT SUMMARY
The section below summarizes the current industry picture pf Sino-Brazil business ties, gauges Chinese
companies perception and openness to Brazil, the cities, sectors and companies representing better trade
opportunities, and key recommendations for Apex-Brasil. This information derived from a 20-week research
program conducted by Euromonitor. Please note that more details and supporting information are located within
the body of this final report, as well as in the twelve12-city-level reports and one 40-city top-line review
analysis.
2.1 OVERVIEW OF THE BRAZIL-CHINA TRADE RELATIONSHIP

Thanks to the robust economic performance of both the two Golden BRIC counties, accompanying the
closer dialogue at state government level on cooperation across a broaden range of business, the trade between
Brazil and China has had pronounced, vigorous growth over the review period and represent enormous potential
in future.
According to sources from the Ministry of Commerce of China and Apex-Brasil-Brazil, Chinas
overall value trade with Brazil climbed to USD29.7 billion (RMB70.0 billion), up by 46.4% over
2006 value terms, of which the imports from Brazil accounted for round 61.6 , or USD18.3 billion

(RMB43.7 billion), and exports to Brazil amounted to 38.4 , or USD11.4 billion (RMB27.2 billion)
in 2007.

It is noteworthy that Brazilian exports to China are surging by 890 in value terms during 2001-2007,
and forecasted to enjoy more dynamic growth in future, with the total exports tripling to reach over
USD30 billion (RMB71.7 billion) by 2010, when China would overtake US as Brazils largest trade
partner (sources: Ministry of Commerce of China).

The majority (73.8 ) of Brazilian value exports to China deal with agricultural products and raw
materials, while the finished or semi-finished products only hold 8.1% and 18.1% value share,
respectively (see Section 3.1.1).
Underlying macro drivers for Brazilian products and companies entering into Chinese market include
Chinas growing demand for raw materials to feed the booming domestic manufacturing industry and
infrastructure construction, WTO initiatives, government tightening regulations on natural resource utilization,
increased consumer affluence and receptiveness to foreign goods (especially for food and beverages), the
levelling out of oil prices and other raw materials worldwide, and the consensus drawn between the two
countries about the importance of Sino-Brazil cooperation leading to more supportive trade and investment
policies (see Section 3.1.2).
Of all 12+40 cities reviewed within this research program, Shanghai, Hong Kong, Qingdao, Guangzhou,
Ningbo, Tianjin, Dalian, Beijing,, Nanjing, Hangzhou, Foshan, Wuhan, and Xiamen are identified to have
greater development opportunities for Brazilian products (see Appendix 5.1 and Section 3.2, 3.3), when
looking at either the citys overall economic performance, mainstay sectors related to Brazilian opportunity
industries, or local logistical convenience and consumption level.
Domestic cities like Beijing, Wuhan, Chengdu, Changchun, Shijiazhuang, post high fitness between
important local industries and major Brazilian export sectors, exhibiting considerable current usage
and demand for Brazilian products.
As costal cities without significant manufacturing presence themselves, Hong Kong, Ningbo, Dalian,
Xiamen, Shenzhen stand out in geographic convenience not only to cater local market but function
more as a transportation interchange serving nearby areas and inland China. These cities were also
identified as the ideal portal cities where Brazilian exporters could debut in the Chinese market.
Shanghai, Guangzhou, Tianjin, Nanjing and Qingdao enjoy the combined advantages of having both
industry focus and logistic superiorities, and are ranked in the first tier community of cities that have
the best development opportunities for Brazil as a trade partner.

Based on both the syndicated Customs Statistics and primary interviews with more than 300 companies,
approximately 15 sectors are recognized to maintain healthy growth or have stronger development potential for
trade between Brazil and China in future (see Section 3.2, 3.3).
Six mainstay sectors, including iron ore, soy, crude oil, pulp, tobacco leaf, and steel, dominate

Chinas total imports from Brazil, with a value share of approximately 80 in 2007; this figure has
increased by nearly 2 percentage points over the year before.
Sectors like leather (blue-wet), precious stones, chemicals (silicon in particular), stone blocks,
machinery and mechanical products also see imported Brazilian products amongst the 300 companies
reviewed, and most of them are willing to maintain and increase their purchase in future.
Chinese companies speak highly about the quality and regional flavour of Brazilian juice concentrates,
fruit juice, coffee beans, meats, etc, and believe Brazilian food would gain more popularity amongst
domestic consumers, offering great growth potential based on a small sales base currently present in
the Chinese market.
There are also regional variations relating to the promising sectors for Brazilian companies (see
Appendix 5.2).
By using trade interviews to understand the perception, needs and wants, as well as openness to Brazil,
about 117 out of the 300 companies contacted are interested in or more likely to develop further trade
relationships with Brazilian products or suppliers (see Section 3.4, Appendix 5.4, 5.5 for promising companies
by sector and city).

Nearly 44 of the 300 companies interviewed have purchased Brazilian products, and 36% of them
have been working with Brazilian partners.
In general, the companies interviewed are satisfied with Brazilian products in terms of stable quality,
competitive prices and on-time delivery, scored at 4.15, 3.50 and 3.86, respectively (out of a rating system
of 1-5 point scale, 1 representing least satisfied and 5 representing most satisfied), however, it is
noteworthy that a few of the correspondents complained about the recent price increases of imported
Brazilian products (typically represented by coffee beans, wood, leather, and granite blocks), and believe it
may cripple the competitiveness of Brazilian products, especially compared to those from Asian and
African countries.
Chinese companies offer a mid-upper evaluation on contract fulfilment (4.09) and commercial
creditability (4.06) of their Brazilian partners, while the efficiency (3.51), after-sales service (3.28)
and price stability are not as satisfactory, and called for improvement according to some company sources.
More than 70% of interviewed companies have known about Brazilian products or manufacturers
before, and their main information channels are B2B websites, recommendations from industry peers and
trade fairs.
About 67% of interviewed companies are willing to purchase Brazilian products, while the main
restrictions for those remaining who are not open to Brazil include (1) the lack of basic information about
Brazilian products, (2) well-catered needs by existing suppliers, (3) concerns over long-distance
distribution and high transportation costs for imports from Brazil.
235 companies interviewed have foreign suppliers, and more than 73 companies interviewed claim
they plan to change current suppliers, and another 63 are maintaining cooperation with existing suppliers
but are open to sourcing more and new foreign partners (this was especially stressed by many foodstuff
companies surveyed).
Product quality is prioritized; price terms, reputation and overall capital/production capacity are also
key to most companies when select a foreign supplier.
The average openness to Brazil scored a 3.12 (out of a 1-5 point scale, with 1 representing the least
willing and 5 representing most willing to be open to Brazil as a commercial partner); amongst the 300
companies interviewed, they show the most willingness to get information about Brazil (4.13), rather
than purchase Brazilian products (3.42) or cooperate with Brazilian suppliers (3.15); invest in
Brazil (1.76) is a distant fourth.
Only around 20-30 companies represent interest to invest in Brazil, meaning they have the plan to
establish a sales office or manufacturing plant in the country.

The main reasons preventing domestic companies from investing in Brazil not only lie in their limited
capital capacity or not aligning with the companys current stage of market globalization, but in part as a
result of anxiousness about local public security, transportation infrastructure and investment environment
(such as unstable exchange rate, low administrative efficiency, etc) . In addition, given that overseas
investment is a major corporate decision, some branch companies interviewed have no final decision
regarding it (N.B: typically, most Beijing-headquartered, large-scale, group corporations are government-
linked, which need the decision of higher authorities to approve overseas investment projects)
Statistical analysis (using the One-Way ANOVA approach) indicates that the companies having
previous trade relationship with Brazil would represent stronger, with statistical significance, willingness
to purchase Brazilian products or cooperate with Brazilian suppliers in the future, as compared to those
without such commercial experience.
2.2 OPPORTUNITIES FOR BRAZILIAN COMPANIES

Imports of Brazilian products benefit from Chinas robust macro economy and expanding domestic
demand.
China has maintained double-digit GDP growth for the past few years, and pronounced steady, accelerating
year-on-year growth of 11.4% in 2007 over 2006 compared with 10.7% over the year-long period before.
Despite the national economy being influenced by the epidemic of the global financial crisis, and trade exports
in particular are expected to be hampered, China is still expected to remain strong. Domestic demand will fuel
the GDP, which was growing at 8.5-10% annually in 2008, and China will recover from the recession earlier
than the rest of world, to restore the GDP growth at over 10% by around 2010.
In addition, with a huge population base of more than 1.3 billion, China is increasingly committed to
industrialization and urbanization, which has considerably driven the new upsurge of infrastructure construction
and the growing affluence for consumer goods nationwide. In early November 2008, the Chinese government
launched a package of fiscal and monetary policies, valued at RMB4 trillion, to encourage domestic investment
and demand.
Chinas robust economic performance as well as expansionary policies to cope with the economic crisis offers
an opportunity for Brazilian exporting products, which see a heavier concentration of construction and raw food
materials to China.
Chinese companies generally positive perception of Brazilian products, and openness to learn more
about Brazil
Most of the interviewed companies that registered a trade relationship with Brazil speak highly of Brazilian
products and suppliers in terms of quality and contract fulfilment, whereby representing a strong willingness to
consolidate cooperation. The major constraint that keeps domestic enterprises from buying Brazilian products is
their general lack of awareness about the advantages as well as characteristics of Brazilian products, typically
represented by some of the interviewed foodstuff and beverage companies.
More importantly, statistics indicate around 200 (equivalent to 66%) of the total 300 companies surveyed are
willing to purchase Brazilian products, despite many of them having yet to approach any Brazilian partners.
Additionally, a higher percentage, 90-95%, of interviewed companies are willing to get more information about
Brazil. They are keen to know details about Brazilian products related to their key business, as well as the
overall economic and financial environment, local transportation system, trade policies and market entry
standards in Brazil.
Trade opportunities are identified when the information gap between Chinese and Brazilian enterprise is bridged.
For example, Dalian Tyre Factory Ltd, which imports large quantities of rubber from Malaysia, Thailand and
Indonesia, had never heard of Brazilian rubber. Meanwhile, many companies in Chengdu (the capital of Sichuan
Province, inland China) are importing via trade agents in coastal cities, and they show great interest in
cooperating with Brazilian suppliers directly.
Brazilian sectors prevail by virtue of price competitiveness and moderate-upper quality
Though faced with cost drivers out of long-distance transportation, many Chinese companies prefer to purchase
from Brazil due to the competitive price and general good quality, especially sectors such as wood, leather,
chemicals, and soybean oil.
According to interview sources, the total value of imports of chemicals in Guangzhou are quite large, and many
local companies have become aware of and show interest in Brazilian products, which are regarded to enjoy

greater price advantages as compared with those from neighbouring Southeast Asian countries like Malaysia,
Thailand, Burma, Vietnam, etc (this is the Guangzhou companies traditional import origin area, however the
product prices from this area have recently been rising).
Chinas tightening regulations on domestic resource utilization and lower import barriers may
propel the purchase of raw materials from Brazil.
Due to the states increasing commitment as well as tightening industry policy to protect natural resources,
Chinese manufacturers are faced with a domestic supply crunch of raw materials such as timber, paper pulp, and
stone blocks, and consequently have to use substitutes or source outbound, offering trade opportunities for
Brazilian products.
According to the sources from Wuhan Maxleaf Paper Group, the top-performing producer of notebooks and
exercise books in China, a lot of domestic paper manufacturers have switched to straw pulp as the replacement
for wood pulp, and made more purchases of quality wood pulp from foreign countries.
In addition, some interviewed companies mentioned that prior to 2007, the import quota of cotton was not
sufficient for many Chinese textile enterprises because the imported products were cheaper than domestic cotton.
However, from 2008 onwards, imported low-end cotton does not enjoy a tariff preference due to the new trade
policy in China, resulting in the surplus of the import quota. Therefore, if Brazil can supply mid-to-high-end
cotton, it may have notable development opportunities.
Last but not the least, in order to meet WTO requirements, the Chinese government is relaxing import tariffs
(e.g. a drop from 12% to 6% for imported frozen meats in mid-2008), which is in favour of Brazilian exports of
certain sectors in China.
Supply crunch from competing export countries offer market blank and trade opportunities
Interview sources indicated that Brazil, surpassing the USA in 1990s, has became the number one tobacco leaf
exporting country in the world, well-known for its high quality, rich varieties, reasonable pricing and stable
supply. With the drop of tobacco leaf production in 2000 out of the anti-smoking movement in the US and the
domestic turmoil in Zimbabwe (both countries used be to the major tobacco leaf exporters), Brazil would seize a
greater chance to increase its tobacco leaf export to China as well as the rest of world.
Domestic cities witness dynamic cooperation and value import of Brazilian products.
By virtue of strong economic performance, advantageous geographic location and prominent consumer
affluence, domestic cities such as Shanghai, Hong Kong, Guangzhou, Qingdao, Ningbo, Tianjin, and Nanjing
have registered prosperous trade with Brazil, and are expected to enjoy greater market appeal to Brazilian
products in future.
According to Apex-Brasil sources, Qingdao, Shanghai, Nanjing, Shanghai, Ningbo, Dalian, Shijiazhuang,
Tianjin, Hangzhou, Nanning and Huangpu rank as the top 10 cities in mainland China which hosts the largest
Brazilian exports in 2007, with a combined value of USD14.8 billion (RMB35.4 billion), accounting for 80.5%
to total Chinese imports from Brazil.
Sectors representing better development opportunities

With either a larger current value trade, or greater potential for future cooperation, sectors representing better
opportunities for Brazilian companies are identified as mineral products, soy, pulp, petroleum oil, tobacco leaf,
leather, meat, chemicals, orange concentrates, juice, coffee bean, meat, wood, stones and precious stones.
Amongst all 117 companies which are targeted to offer opportunities for Brazilian exporters, nearly 55 show
particular interest in Brazilian mineral and chemical raw materials, around 16 would like to know more about
timber from Brazil, and 16 companies look forward to importing various Brazilian-flavored food and beverage.
2.3 CHALLENGES AND BARRIERS

China's slowed-down trade growth embroiled by the global financial crisis
Though China is widely acknowledged as one of the most robust economies to withstand the worsening global
financial crisis, statistics indicate Chinas trade growth for both imports and exports have been dramatically
dropped during the 10 months reviewed, and even suffered a plunge since October 2008.
Trade sources also reveal that during January to July in 2008, around 59 import origin countries recorded the
negative growth of value exports to China, compared to within the corresponding period in 2007.

Chart 1 China's Monthly Trade Growth (value ), Jan-Oct 07/08
45%
40.0%
40%
35.1%
33.7%
35% 31.0%
30.6%
30% 27.6% 28.1%
26.3% 26.9%
23.1% Import
25% 26.7% 21.5%
Export
24.6% 19.2%
20% 21.8%
21.1% 21.3%
15% 17.6%
15.6%
10%
5% 6.5%
0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
It foresees the overall declining economic situation worldwide would likely distort the growth of trade between
Brazil and China as the major constraint at a fundamental level to drag more Brazilian products entering
Chinese market in the near future.
Price hikes and fluctuations of Brazilian products sway Chinese companies purchase willingness
According to the sources of the State Ministry of Commerce, Chinas foreign trade growth is in part hindered by
the worldwide raw material inflation (seeing Brazilian major exports to China are mostly mineral and food raw
materials), and such findings are also proved by the primary company interviews. This being said, a few number
of correspondents complained about the recent hikes of imported Brazilian products, typically referring to the
granite block, timber, precious stone, and pulp sectors. As a result, some of the Chinese companies have
reduced imports from Brazil or switched to Asian or African-based suppliers.
It is noteworthy that although many companies comment positively on the good quality of Brazilian products,
they share the feeling that some Brazilian products are loosing ground to other import origin areas in price
competitiveness. For example, the interviewed Xiamen Yungde Ornament Co has just decreased its order for
Brazilian timber, and made more purchases from Africa since 2007. Similarly, Beijing-based China Light
Industrial Material Co., Ltd stopped imports of Brazilian palm wax and turned to domestic suppliers instead,
because the price of Brazilian products fluctuate significantly (sometimes up to a 300% variation in short
period), bringing about much difficulty to companys cost control. Also, industry experts pointed out that the
current unit price of Brazilian pulp has surged to USD780-810 (RMB1864-1936) per ton, up by around 86%
over 5 years ago.
Lastly, continued appreciation of Brazil currency against the US dollars is also deemed part of the constraint to
weaken the competitiveness of Brazilian exports.
Eagerness for instant profit-seeking and rigidness on price terms may harm the long run cooperation
relationship
As mentioned by some domestic companies which specialize in the pulp, chemical and iron ore sectors,
Brazilian suppliers sometimes are deemed too eager for instant benefit by means of price manipulation, while
ignoring the cultivation of a stable and long term cooperation with Chinese partners.
According to CLIMC (China National Light Industrial Materials Co), the mega state-owned company with
annual sales revenue of RMB3 billion and 60%, or RMB 1.8 billion being accounted by pulp and paper articles
in 2007, the world most expensive and cheapest Brazilian pulp are both sold to China, with increasingly higher
price (out of the contracted terms) when the demand is booming, or at very low price for clearing the unsold
stock since the market is down.
Some interviewees (e.g. Jiangsu Skyrun Corporation) felt antipathy toward Brazilian companies over-defence
on pricing, leaving little room for negotiation with Chinese partners, which is not aligned with the accustomed

business manner in China (a relationship and negotiation based pattern), and they may quit the partnership
if Brazilian companies stick to the practice.
Lack of mutual readiness between Brazilian and Chinese companies for trade initiatives
Looking at the main reasons for non-openness to Brazil, the majority of correspondents attributed their concern
about lack of basic information about Brazilian products, let alone cooperating with Brazilian manufacturers.
Similarly, for many medium and small companies interviewed who are willing to buy Brazilian products, they
prefer to make purchases via domestic trade agents which have more expertise in quality control and the import
formalities of Brazilian products, rather than run the commercial risks by themselves due to limited awareness
about Brazil. However, certain negative impacts may arise out of such trade pattern, not only referring to the
increased purchase cost for final buyers, but to information asymmetry. For example, primary research indicates
some paper manufacturers in Xiamen (e.g. Xiamen C&D Paper & Pulp Co., Ltd) give up sourcing Brazilian
pulp when they failed to get the relevant product information from large local traders.
On the other hand, Brazilian companies are also weak in knowledge on how to better enter the Chinese market
via effective distribution channels and marketing strategies, and they are sometimes regarded to not be in a
position to offer tailor-made products or good service to cater to the Chinese market.
Concerns over long-distance distribution
Largely due to the long-distance distribution, the increased freight expenditure and turn-around period trigger
Chinese companies to have concerns about the overall purchase cost and on-time delivery for imports from
Brazil, especially comparing to those from nearby Asian areas. Also, the geographic remoteness raises barrier
for on-site business investigation or negotiation in person.
Fujian Province, as one of Chinas major production bases for construction stone, has developed significant
manufacturing presence and clustered a number of stone block professors, who complained that high freight cost
prevented them from importing more Brazilian stone materials despite their better quality. Instead, the local
companies are currently making more purchases from India and Turkey. Similar situations occurred to some
domestic chemical providers as well.
It is noteworthy that some Chinese companies are accepting a typical 40-day delivery time, well understanding
the long distance between Brazil and China. However, they were frustrated by delays caused by other reasons
such as short supply, or as mentioned by Xiamen Stone Enterprise, the company met with the belated delivery
of imported Brazilian granite for several recent orders. It is mainly because the Brazilian government requested
all heavy duty trucks be replaced by dual-fuel (ethanol and oil) trucks starting in July 2008, thus local
transportation was significantly dampened as a huge number of originally used trucks had to be discarded and
there was a supply crunch of the new type trucks.
Language barrier and low commercial efficiency
The language barrier and time lag acts as a minor but tangible barrier for some Chinese companies to approach
Brazilian suppliers.
In addition, low business efficiency and poor post-delivery service (e.g. equipment maintenance, recall of sub-
quality products) are generally regarded as the core areas that need to be improved in future.
Chinas rooted trade relationship with the Occident and Asian countries, while Brazil is a relatively
burgeoning trade partner
China has commanded a long history of trade with Europe, North America and surrounding Asian countries,
while the Sino-Brazil business relationship is comparatively in the initial stage.
Of all 300 companies interviewed, around 79% have foreign suppliers, and a lot of them are from the US,
Germany, and Japan where domestic companies are able to buy premium machinery and electrical products;
meanwhile for imports of raw materials such as rubber, woods, and stones Southeast Asia countries (e.g.
Thailand, Malaysia, Indonesia) are more appealing to Chinese buyers by virtue of lower prices.

Table 3 % of Foreign Suppliers by Country of Origin Owned by 300 Companies Interviewed
Country of Origin Country of Origin

US 43.4% Other European countries 31.5%
Brazil 35.3% Japan 29.8%
Other American countries 23.4% South Korea 16.2%
Germany 27.7% Other Asian countries 31.9%
Italy 9.8% Australia 10.2%
France 8.9% African countries 10.6%
Russia 8.1%
In addition, 54.7% of companies surveyed do not want to change suppliers mainly because of the developed,
stable cooperation between them; nearly one-third are not open to Brazil as a major sourcing area for new
suppliers.
Relatively monotonous variety of Brazilian products
According to company sources, Brazilian products enjoy good quality but are relatively flat in varieties or new
launches, typically represented by sectors like coffee beans, vegetable oil, propolis, etc (with the exception of
Brazilian granite blocks, as commented by many domestic manufacturers, which see strong varieties and wide
colour offerings).
Brazilian manufacturers are commented as not being good at custom production or processing to cater the
specific needs of Chinese companies, and some interviewees even mentioned they would likely replace the
current Brazilian partners when they come to source new suppliers that are more flexible to feed their bespoke
production demand.
Threats brought by other import origin counties/area

Company interviews found that certain imported Brazilian products are less competitive or increasingly loosing
ground to other import origin countries or areas.
Tabulated below are a few of the Chinese imported Brazilian sectors faced with threats from rest of the world.

Table 4 Brazilian Products Faced with Competing Import Orgin Counties/Areas in Chinese market
Major competing
Sectors Comments (strengths & weakness)
countries/areas
Brazilian products are lacking advanced technology & world renowned brands. No
remarkable price competitiveness compared to domestic suppliers, and some products
do not apply to Chinese market well (e.g. gold metal detectors).
Mechanical and electrical Germany, Japan, US, German and Japanese products enjoy premium quality and high precision, while Korean
products (e.g. auto parts) South Korea manufacturers standout by their cost-performance ratio.
Chinese companies have witnessed long-history trade cooperation with suppliers from
US, Europe, Japan and Korea, who represent more readiness to the Chinese market and
offer better after-sale tech service.
Recent price hikes of Brazilian products trigger the heavier import concentration from
African countries.
Particularly along with the on-going Sino-Africa Cooperation Forum during the review
Timber African countries
period, the trade relationship between China (especially for western China) and African
countries is growing dynamically, indicating the policy initiatives as significant market
boosters, especially within the energy sources.
Long term cooperation with these countries as the traditional import origin. Rubber raw
Southeast Asia
Rubber materials from Southeast Asia are more competitive in price with convenient
(Thailand, etc.) transportation.
Italian products have good quality at lower price. Additionally, coffee beans from
Coffee beans Italy Columbia, Jamaica, and Ethiopia also take notable share in Chinese market attributable
to high quality and specialty flavour.
The majority of Chinese companies do not know about Brazilian chemical raw
Chemicals Japan , South Korea materials, though they are in mid-upper quality with reasonable price.
Stone block India Indian products are more competitive in price, thanks in part to low transportation cost.
The oil and protein contents of Brazilian soybeans are high; hence it is acceptable for
Soybeans Argentina Brazilian soybeans to be higher in price. However, when the demand is weak, domestic
companies prefer to import more Argentine soybeans as a result of lower price.
2.4 KEY RECOMMENDATIONS

Chart 2 Key Marekt-entry Recommendations to Brazilian Exporters
Quality
Positioning
Pricing
Packaging Infrastructure development
Sectors of better Product Efficient customs
Government Industry support measures
initiatives Improved public security
trade opportunities
Promising cities
Better transportation Distribution
Brazilian products &
system Exporters
Marketing & Increased exposure & introduction to
promotion Chinese companies
Business efficiency Major information channel to leverage
Documents & formalities Practice
Trade
Information appealing to Chinese companies
Price negotiation Cooperation with local distributors
Payment & settlement Establishment of branch offices in key China
Transporting market
Post-delivery

Product
Quality: Despite Brazilian products are generally commented as being good quality, dometic companies expect
Brazilian suppliers to further stress on quality control and the standardization for each batch of delivery.
According to interview sources, taking BTA Automation Ltd as an example, the company has one Brazilian
supplier (SMAR) for electronic instruments, and it found certain models of the imported products are not of
stable quality. Similarly, Xiamen Universe International Trade started to purchase Brazilian agate stones in
2005 with a total value import of USD88,500 (RMB211,515) during the first half of 2008. However the
company several times found a mixture of B-class quality products in the A-class batch delivered. In addition,
the variety of Brazilian agate stones is regarded a bit dull.
Brazil is also expected to enhance the tech level of its machinery and mechanical products, electrical and
electronics, to comply with more international technological standards and industrial standards in China (e.g.
GB series), and further expand the sales performance within Chinas auto parts and aricrafts building market.
Lastly, the study indicated a lot of Chinese manufactueres, especially for those large-scale or state-owned
enterprises, priortize quality rather than price as their major purchasing criterion.
Positioning: In general, imported Brazilian products, for non-natural resources sectors in particular, do not
stand out in price competitiveness. Seeing the long distance distribution and high freight as the inherent cost
drivers that cannot be alleviated in the short run, Brazilian exporters may postion at medium or high-end
segments, especially for meat, juice, precious stones, blue wet leather, and C&T ingredients sectors which enjoy
unique Brazilain characteristics and command increasing popularity in Chinese market.
In addition, China sees segmented consumer affluence and diversified needs across different tier ctities;
therefore Brazilian suppliers need to be sure to target the correct city market. For example, Shanghai, as the
most developed and openest metropolis in China, records rapid consumption growth of Brazilian coffee beans
over the reviewed period, while it falls into flat sales in Dalian, largely due to high price.
Pricing: (1) As mentioned above, some Chinese companies intend to reduce their purchase of Brazilian
products as a result of changing prices. For some Brazilian flagship sectors like minerals, pulp, coffee beans,
etc., the quotes from Brazil are generally regarded to be higher than other countries, therefore prohibiting many
domestic manufactures willing to approach Brazil but are price sensitive.
It is expected to bolster Chinese imports of Brazilian coffee beans, stones, pulp, and iron ore if the Brazilian
exporters are able to offer more stable prices with discount packages as appropriate.
(2) Brazilian suppliers, for pulp exporters in particular, are suggested to adopt a more flexible pricing system
instead of sticking to high price or closing the door for negotiation.
As per interview sources, Russian exporters may be a good example to track, whose pulp products are usually
priced reasonably to feed the market demand no matter when it is in prime or in recession. They are spoken of
highly and the performance to maintain a healthy price system when the market is going down; that is to say,
Russian suppliers do not dump stocks at very low prices to cause losses for previous buyers who purchased high.
Packaging: Not only do suppliers need to provide long-distance transportation with no damage to the
outlook and quality of the goods, but take into consideration the typical length and width of Chinas
transportation vehicles to lift the full load rate when the cargoes are delivered from ports to the inland area.
For certain sectors, special pack format or associated documents are required. For example, when importing
medicines, it is requested to deliver the hard copies of the Drug Import Registration Certificate, the Import
Drugs Approval Notice, the Import Drugs Inspection Report, or the Import Drugs Customs Form with an
official seal. For wooden tray pack solutions, a fumigation certificate is always requested.
Promissing sectors to target: The research program identified around 15 sectors representing better
development opportunities for Brazilian suppliers (see Appendix 5.3). Also, Euromonitor recommended the
most promising sectors by the 12 reviewed city as well (see Appendix 5.2).
Trade practice
In general, Brazilian suppliers are regarded highly on contract fulfilment and creditability by Chinese partners.
However they are expected to further improve the trade practices below to achieve greater success in China.

Business efficiency: Commercial efficiency is most frequently mentioned by domestic companies as where
Brazilian suppliers can improve. That is to say, Brazil needs to have prompt and active responses to e-mail or
calls from Chinese companies regarding inquiries or other trade affairs. On this point of issue, Brazilian
suppliers may learn some practices from European and American companies, who are keen on CR (customer
relationship) management and business efficiency, which is stressed as part of the cost-cut.
In addition, given the language barrier acts as a major constraint, Brazil may need train more foreign talents
with prominent English or even Chinese proficiency to better facilitate the communication.
Documents and formalities: Brazilian exporters, especially for newcomers, are expected to better build
trade documents complying with the requirement of CCIQ (China's Commodity Inspection & Quarantine) and
customs, and check with Chinese companies in advance where possible.
In addition, according to company sources, the Brazil Visa application usually takes a long time, affecting
normal business exchanges. For example, the Beijing-based China Light Building Material has been importing
timber from Brazil and records frequent visits to Brazil for business investigations, but the company has to wait
for over one month after submission of the application materials to the Brazilian Consulate, in spite of the
business visa application should have taken shorter time, as some countries offer visa waivers for business visits
or business visa applications only take. The interviewee thinks the Brazilian visa application is supposed to be
made easier for business visitors.
Price negotiation : Partly due to the difference in business culture, Chinese companies are accustomed to close
negotiation and stress on relationship with trade partners. Therefore they do not accormadate the stiff price
terms and uncompromising attitude by some Brazilian suppliers.
As such, it is believed to solicit more trade leads if Brazilian companies are getting flexible in pricing and
payment. For example, Guangzhou Yonghan Xinglong Import & Export Co. started importing Brazilian coating
additives in 2004, and the company did aspire after a more elastic payment mode (i.e. payment in 60 days after
delivery) from Brazilian suppliers.
Payment & settlement: Primary research indicates a lot of Brazilian exporters (including some big names
for mineral metallurgical products) do not accept the L/C issued by Bank of China, Chinas largest commercial
bank, when dealing with foreign exchange business. Instead, they only require the L/C from world well-known
banks such as HSBC, which would significantly increase the commercial cost and prohibit the initiatives from
many Chinese medium-small scaled importers.
Transport: Domestic large-scale companies, especially those in the tobacco, pulp, and soybean industries,
do not attach much importance on delivery turn-around period as their purchases are mostly on a regular basis in
large quantity. However fast turnover is key to small-medium enterprises and for trade agencies in particular.
Besides, a few companies interviewed claim that certain Brazilian ports have the problem of weight shortage.
For example, according to Chinatex Corporation, one of the largest traders of cotton and soybeans in China,
shortage of weight is quite common for shipment from Brazilian ports, especially Paranagua Port, at 200-300
tons per cargo vessel of imported soybean in average, equivalent to a rise of USD30 (RMB72) per ton in unit
price.
Post-delivery: Under most circumstances, Chinese buyers do not call for a lot of after-sales service for
Brazilian product, not only due to its good quality but the attribute of the most imports being raw materials.
However, some domestic companies (in leather, stones and machinery industries, etc) are not satisfied with
Brazilian exporters slackness or disregarding the post-delivery quality issues by not providing tech support and
product maintenance.
Also, though different across sectors, the interviewed manufacturers for machinery and mechanical products
represent more concern over after-sales service as one of the uppermost selecting criteria.
Distribution
Most promising cities: Shanghai, Guangzhou, Tianjin, Nanjing and Qingdao take the lead. The five
cities make up considerable trade presence with Brazil at present, and enjoy illustrious economic, logistic,
consumption performance and openness to Brazilian products and suppliers. Hong Kong is another core base
for imported Brazilian products thanks to its special role in intrepid trade.
Meanwhile, Beijing, Dalian, Ningbo, Hangzhou, Wuhan, Shenzhen, Xiamen, Chengdu, followed by
Shenyang and Fuzhou are also viewed favorably for growth potential, buoyed by either high fitness between

local important industries and major Sino-Brazil trading sectors, or stand out in geographic convenience not
only to cater local market but more as a transportation hub to serve inland China
Additionally, Euromonitor identify the most promising cities by major sector to support Brazilian companies
market-entry decision (see Appendix 5.3).
Better transportation system: Maritime transportation dominates the distribution mode of imported
Brazilian products, as it is the most economical method, despite the long turn-around period.
According to trade interviews, products are seldom delivered by airplane, with the exception of emergent orders
or precious cargoes, such as jewellery stones, precision instruments, etc.
For inland transportation, the average cost of shipping by truck is higher than by railway for heavy cargo per
20GP, while water plus truck intermodal transportation is around 10-20% cheaper than railway plus truck
portfolio.
(Note: The best transportation system for each reviewed city is briefed within the city logistic portion under
Sec2 city top-line analysis in each city summary report)
Marketing and promotional activities

Trade interviews indicate Chinese companies are keen on suppliers reputation, creditability, brand
awareness, as well as the sales and share within the local market when make the selection. Also, sometimes they
would like to collect the clients feedback on the supplier for reference.
Large-scale companies prefer to cooperate with industry big names, whose prominent capital and production
capacities are believed to bring about premium products with stable supply and good contract fulfilment.
Meanwhile, a lot of Chinese medium-small companies do not put high premium on the name recognition of
foreign partners, as long as they are able to provide quality products at contracted delivery terms. Hence,
Brazilian companies may see higher chance of success should they source Chinese partners that are of equal
scale or strength.
A lot of interviewees suggest Brazilian exporters increase exposure and introductions amongst Chinese
companies via more promotional activities, just like the Xiamen-Brazil Trade and Economic Cooperation
Seminiar co-hosted by CCPIT Xiamen Branch and Apex-Brasil in mid-August 2008, where many local
companies consider the meeting as a major, and even the exclusive, channel to learn about Brazilian competitive
industries and flagship products. For example, Xiamen Feimeitai Trade Co., Ltd. represented an interest to
purchase mechanical products from Brazil right after the meeting.
In addition, as quoted from some correspondents, such forums are ideally initiated by the government or
associated organizations, which would command authority and have the greatest reach amongst domestic
companies, and more convincing than a cold call. Also, it is suggested to pay more attention to Macao as an
information port in China (or the venue to hold such meeting), as Macao is also a Portuguese-speaking territory,
and actually some enterprises interviewed obtained information about Brazilian suppliers via Macao.
The internet (including B2B e-commerce platforms, search engines, trade websites, etc), trade exhibitions and
seminiars, and recommendation from industry peers are the major information channels for Chinese companies
to learn about foreign products and suppliers.
Brazilian companies should reveal themselves and publish more products details via internet or by means of
trade fairs, which are familiar and prevailing channels amongst domestic companies.

Table 5 Major Websties and Trade Sources for 300 Chinese Companies to Know about Brazil
Sectors
Alibaba.com, HC360.com, Globalsources.com.cn,www.b2b168.com, china.chemnet.com,
Website www.texnet.com.cn, www.socotton.com, www.jx.cn,
www.mofcom.gov.cn, www.ccct.org.cn, www.grain.org.cn, etc
Domestic: The China Export Commodities Fair (Canton Fair), Xiamen International Stone
Fair, CIFIT (China International Fair for Investment &Trade), Hong Kong Leather Fair,
Guangzhou Leather Fair, China Fine Products of Grain and Oil Exhibition, Hong Kong
Jewellery Fair, China International Textile, Apparel and Fabric Exhibition
Trade fairs International: Vitoria Stone Fair (Brazil), International Machinery and Industrial Supplies
Trade Fair (Brazil), Outdoor Furniture Fair and International Sports Fair (Cologne,
Germany), Camping and Garden Lifestyle International Garden Trade Fair, National
Hardware Show and Lawn & Garden World (US), EXPOLUX (Brazil), International
Trade Fair for Products, Equipment, Services and Technology for Hospitals, Health Clinics
and Laboratories, CPHI Worldwide, etc.
Trade magazines <Electrical Industry>, <Electromechanical Engineering>, etc.
The majority of the 300 companies interviewed are willing to lean more about Brazil, though the information
requests are primarily limited to the specific industries or products they deal with.
As such, Brazilian companies are expected to provide more product information in terms of quality and tech
parameters, varieties, industry standards and certifications along with price and delivery terms, to focus on the
strengths and uniqueness of their products.
Meanwhile, for Chinese enterprises who have acquired a general picture about Brazilian products are more
interested to learn the local consumption behaviour, infrastructure development, overall economic and financial
environment, and trade policies to support their market strategy to expand business network or invest in Brazil.
For example, Sichuan Huiyuan Mining & Mineral has invested in Tanzanian, Vietnam and Laos for the
exploitation and production of precious metals, and the company is planning to make inroads into the Brazilian
market; yet prior to the investment, it aspires after a clear picture of the throughputs of the main Brazilian sea
ports and the best transporting roadmap from the inland mining area to costal cities.
Noticing the fact that many Chinese manufacturers, especially for those located in inland area, are still apt to
import through distributors and trade agents in coastal cities, while at the same time, most Brazilian companies
are not keen on the demand and trend of Chinese market, or familiar with the complicated trade procedures, it
suggests, for both Brazilian newcomers or veterans, cooperation (or balance the cooperation) with large regional
distributors to leverage their market experience as well as client resources to broaden sales channels and product
reach within the vast territory market.
Brazilian companies should consider setting up more sales offices or branches in China, because interviews
indicate Chinese importers also stress on convenient communication and in-person negotiation when selecting a
foreign supplier, and they are likely hindered to approach Brazil (as a relatively new import origin country)
when find out the Brazilian suppliers do not have office presence in China. As well, the establishment of a
Chinese branch is believed to facilitate more business inquiries, and provide better after-sale service to Chinese
clients.
Looking at regional variations, Brazilian suppliers of precious stones (e.g. agate, diamonds) and construction
stone materials (e.g. granite block) are recommended to set up branches in Guangzhou, Xiamen, Fuzhou, etc.,
while oils, tobacco, soy bean providers should develop representative offices in Beijing, pulp manufacturers to
extend their performance in Shandong Province, and aircraft and auto parts producers to establish branches in
Chengdu, Shenyang, Wuhan.
Policy initiatives
Logistic infrustructure in Brazil need to be improved. Some Chinese companies (e.g. Guangzhou Welon
(China) Ltd) mentioned the transportation network in Brazil is not well developed or balanced across regions,
and the inland transportation fee is very expensive. Therefore, these companies care about geographic location

when selecting Brazilian suppliers, preferring those near the wharfs or port cities that have the advantage of a
cost cut for transportation. Meanwhile, some Chinese companies that plan to set up manufacturing plants in
Brazil also slow down their investment prior to finding a better transportation system for their products to reach
the port cities.
More efficient customs work. A few of the companies interviewed come to claim that Brazil still raises
relatively high trade entry-barrier and complicated attestation system for some Chinese products, typically
represented by medical instruments. Also, customs is not very efficient to work with.
For example, according to the sources of Wuhan Yage Optic and Electronic Technique, the company once tried
to take part in the Sao Paolo Medical Device Exhibition (HOSPITALAR). However the Brazilian Customs
would command high tariffs on the exhibits (at several times as much as the product is worth), though Yage
holds the ATA certificate (ATA is a worldwide acknowledged certificate for exhibits, and the holders are
supposed to enjoy tariff free for their exhibits to attend the exhibitions). In addition, Brazilian Customs usually
takes around 9-months to examine the imported medical devices. Yage spent a lot of time and money on
participating in the exhibition but gave up eventually.
Industry support from the government. According to most correspondents interviewed, they are quite
open and believe it is helpful to get more information about Brazil via Apex-Brasil or other Brazilian
government organizations or NGO.
For example, Guangzhou Recca Refrigerantes Ltda and Guangzhou Y & K Food (the interviewed food and soft
drinks manufacturers) are not only interested in purchasing Brazilian products or maintaining the cooperation
with Brazilian partners, but called for more support from the Brazilian government and official units, such as
Apex-Brasil, to jointly launch PR activities and promote their sales of Brazilian specialties in China.
However, some interviewed companies mention that Brazil is one of the most heavily taxed countries in South
America and the taxation system in Brazil is rather complicated. It is suggested the Brazilian government to
further change the existing heavy tax on import and export trade and relax the entry barrier for foreign
investment. Meanwhile, a few correspondents witnessed and applauded some improvement in recent years. This
being said, the Brazilian government has introduced many new preferential policies, so Chinese enterprises
investing in Brazil can enjoy the tax preferential measures from the federal, state and the municipal government,
such as providing infrastructure facilities (like land, workshops, electricity and water) at discounted prices and
using low-interest loans.
Not palatable public security draws back the investment willingness. Around 30 of the 300 companies
interviewed expressed the intention to invest in Brazil. However many of them are not satisfied with the local
security after an on-site investigation.
To name a few, Xiamen Yungde Ornament Co., Ltd has once sketched out a plan to invest the wood industry in
Brazil. However this venture was postponed after Yungdes senior management visited Brazil, finding the local
public security environment to not be satisfactory. In another example, the interviewee of Wuhan HongHao
Machinery Trading had been in Sao Paulo for a couple of years, and she thought the security in Sao Paulo may
be an issue for the companys investment in Brazil.
However, the fact is Brazil has been considerably improving its public security and investment environment.
The government posted bans on guns nationwide, and initiated a crime prevention program costing around USD
3 billion since 2007. To date, Brazil has registered the inflow of FDI worth USD34.6 billion (RMB82.7 billion),
taking the top spot across all Latin American countries.
As such, it suggests the Brazilian government or associated official agents create more opportunities to
introduce the latest in-county situation to Chinese enterprises and lift their concerns.

3. BUSINESS RELATIONSHIP BETWEEN CHINA AND
BRAZIL
3.1 BRAZIL-CHINA TRADE AND COMMERCIAL TIES OVERVIEW

3.1.1 Overview of Brazil-China Trade
Brazil exports to China hit a record high of USD13.8 billion (RMB33.0 billion) in 2007
With Brazilian raw material exports at record levels and Chinas ever-increasing production of manufactured
goods, it is little wonder that the trade between these two countries is on a rapid expansion path. According to
Chinese Customs, trade value between the two countries achieved USD29.7 billion (RMB71.0 billion) in 2007,
46.4% up from the previous year. As per the trade data provided by Apex-Brasil-Brazil, Brazilian exports to
China reached USD13.8 billion (RMB33.0 billion) in 2007. It is worth noting that the Brazilian exports mostly
focus on the fields of farm produce and raw materials, which hold 73.8% of total, while manufactured and semi-
manufactured products only hold 8.1% and 18.1%, respectively (source: Apex-Brasil-Brazil). Brazils exports to
China are increasingly focusing on a few sectors. In 2007, six Brazilian sectors including iron ore, soy, crude
oil, pulp, tobacco leaf and columbium held 79.55% of total Brazil exports to China by value term, increasing
from 77.75% a year earlier. (Source: Ministry of Industry & Trade Development of Brazil)
Table 6 Main Imported Oroducts from Brazil to China, 2007
Year-on-year growth Import volume

Sectors Import value (USD100 million)
(%) (Tons)
Non-agglomerated iron ore 31.19 45.6 9605
Soy 28.32 16.4 1007
Crude oil 8.39 0.5 218
Agglomerated iron ore 5.91 21.2 897
Paper pulp 3.85 10.8 84
Bean oil 3.1 174.2 42
Tobacco 2.69 247.2 5
Ferro columbium 2.06 110.7 1
Non-forged refined copper 1.99 No export data in 2006 3
Blue and wet cattle leather 1.25 10.5 4
Total China imports from Brazil 107.49 27.9% N/A
Source: Ministry of Industry & Trade Development of Brazil
Brazilian exports to China registered a CAGR of 35.7% during 2001-2007

From 2001 to 2007, the Brazilian exports to China increased by 890%, which means a CAGR of 36.7% during
the past 7 years. Currently, China is the third largest trade partner of Brazil, after the US and Argentina. Both
China and Brazil are very positive about the future development of the bilateral trade. According to the China
Agenda published by the Brazilian government in July 2008, the Brazilian government planned to triple the
Brazilian exports to China within 3 years. China is expected to become Brazils largest trade partner.
3.1.2 Market Drivers and Constraints of Brazil Exports to China

Chinas fast growing economy and expanding domestic demands are favourable to Brazilian exports
According to China National Bureau of Statistics, the growth rate of Chinas GDP has maintained over 10% for
five successive years until 2007. The fast growth of the Chinese economy generated great demands on industrial
products. Besides, due to the increase of over 1.3 billion potential consumers and their rapidly growing
disposable income, China has become a huge marketplace for various kinds of consumer goods.

To deal with the current global financial crisis, China has taken some flexible and prudent macro-economic
policies to boost domestic demands. In November 2008, The Chinese government announced that a stimulus
package estimated at RMB4 trillion (about USD570 billion) would be spent over the next two years to finance
programs in 10 major areas, such as low-income housing, rural infrastructure, water, electricity, transportation,
environment, technological innovation and rebuilding from several disasters, most notably the May 12, 2008
earthquake. The government has already lowered interest rates three times in the second half of 2008, increased
export rebates, cut property transaction taxes, and switched to a relatively loose monetary policy to stimulate
the investment. A booming demand on related raw materials and products driven by the Chinese government
will definitely generate more business opportunities for Brazil.
However, the decline of Chinese exports caused by the global financial crisis might be a constraint for Brazilian
exports to China, because part of the decreased exports need to be absorbed by the domestic market. But it is
good to see that the Chinese government is taking export-oriented policies (e.g. the increased export rebates),
and targeting at emerging markets, such as Russia, India, Latin America, etc.
Proactive and practical activitics of the Brazilian government further enhances the Sino-Brazil trade
links
The Brazilian government has been encouraging Sino-Brazil trade for many years. Four years after Brazilian
President Lula visited China in 2004 with a large number of business people aiming at boosting exports to China;
he came to China again in August 2008. Brazil-Guangzhou Enterprises Commission was founded in 2006. In
2007, 19 enterprises from St. Paul of Brazil came to China and talked with enterprises in Guangzhou City. All
these activities have enhanced the business tie between the two countries.
Chinas natural resources protection laws led to the rising imports from Brazil
China has enacted and promulgated many special laws on environmental protection as well as natural resources
protection, which lead to the increasing imports of natural resources. In 1998, China imposed a ban on all
logging along the Yellow River and Yangtze River following the summers devastating floods. After that, the
imports on wood related products including timber and pulps have kept rising. In additional, China has
strengthened the supervision on stone quarrying, and many quarries in China have been forbidden to exploit
resources. The action drives up the imports on foreign stone material. Some local governments also published
rules to protect natural resources. For example, Xiamen government announced to reward those companies with
big imports on bulk commodities including stone materials, woods, pulp, etc.
Brazils export benefits from Chinas tariff reduction policies.

To comply with China's commitments on tariff reduction upon its entry into the World Trade Organization
(WTO) in 2001, Chinas overall level of import tariffs has been lowered to 9.8% in 2007 from 15.3% in 2001,
with the import tariff of farm produce at 15.2% and that of industrial products at 8.9%. In 2008, China started
to impose or raise export duties on products including wood pulp, coke, alloy steel, steel billets, and some
finished steel products, while levying lower temporary import duties on more than 600 kinds of products
including crude oil, coal, key equipment and component parts to trim the trade surplus and optimise economic
structure.
3.2 SECTORS REPRESENTING BETTER OPPORTUNITIES BY CITY

Based on syndicated sources and the import data from both Apex-Brasil and the regional customs across the 12
reviewed cities, promising sectors to Brazil were identified, which represent either large current value trade or
greater growth potential.
Meanwhile, as an important complementary picture, Euromonitor leveraged the 300-company interviews
(primary research) to augment the syndicated findings, and recommend several niche sectors which are not
demonstrated by the macro import statistics, but do enjoy notable openness and appeal amongst local companies
interviewed (see Appendix 5.2).
For example, trade statistics indicate sectors like mineral products, tobacco leaf, metallurgical products,
machinery and mechanical appliances usually rank the top places in value imports across the Brazilian products
purchased by the city, while interview sources help find out certain segments where companies show great
interest and would like to approach Brazil as a trade partner, such as the precious stones and juice in
Guangzhou , coffee in Shanghai, edible vegetables and live plants in Chengdu, agriculture products in Wuhan
and Beijing, to name a few.

3.3 PROMISING CITIES FOR BRAZILIAN PRODUCTS BY SECTOR
Similarly, looking at Chinas current imports from Brazil, demands of the Chinese market, domestic supply
within related sectors, as well as the 300 company interviews, Euromonitor identified the sectors that are
expected to have more business opportunities for Brazilian suppliers. Besides, a list of promising cities for each
sector is also provided in Appendix 5.3, based on the city imports from Brazil as well as each citys demands.
Below are the brief introductions for some of the selected sectors.
Petroleum crude oil

The sizzling economy, soaring investment growth in the heavy industrial sector, and cars crowding urban streets
have driven up China's demand for petroleum oil. China's net import of crude oil was 159.28 million tons in
2007, up 14.7 percent compared with 2006. The consumption of crude oil, representing the sum of net imports
plus domestic output, rose 7.3 percent to 346 million tons in 2007. The gap of 46% of China's crude oil
consumption has to be closed by import. In the following years, the growth of domestic oil output will still keep
stable, but lag far behind the rising domestic demand.
Qingdao, Ningbo, Shanghai, Dalian, Hangzhou and Nanjing are six cities with larger consumption of Brazils
crude oil currently, while Hong Kong, Zhanjiang, Haikou, Tianjin, Urumqi, Xiamen and Guangzhou are cities
with greater potential due to their high consumption of crude oil.
It is worth noting that Asia's largest oil refiner, China Petrochemical Corp. (Sinopec), started production at its
new Qingdao refinery in June 2008. The refinery is designed with a processing capacity of 10 million tonnes per
year, supplying the region of northern China. By October, the plant had refined 3.74 million tons of crude oil,
most of which is from Middle Eastern countries.
Mineral products
China imports almost half of the iron ore in the international market, making it the country with the highest iron
ore consumption in the world. Industry sources noted that Chinas booming economy is expected to consume
more than half of the worlds key resources within a decade, as China already accounted for 47 percent of all
iron ore consumption, 32 percent of aluminum and 25 percent of copper in 2007. The figures within the next
couple of years would move to 58 percent of all iron ore, 45 percent of aluminum and a third of all copper.
However, a sharp slowdown of China happened in 2008 influenced by the global financial crisis. But it is
believed that the demand would rebound during 2009 as the fundamentals of Chinese economic growth remain
solid. A stimulus package of USD600 billion (RMB1.4 trillion) was announced by China on November 2008 to
fund major infrastructure developments, which could reignite Chinese steel demand in the following years.
Before 2007, many steel companies had changed to the use of low-grade iron ore with lower price due to the
low cost of coke and the supply shortage of iron ore. However, with the sharply rising price of coke, the
economic efficiency of using high-grade iron ore has become more obvious. This trend is leading the change of
the demand structure of iron ore, and making the high-grade iron ore provided by CVRD of Brazil more and
more popular.
Hebei, Shandong, Liaoning, Shanxi, Jiangsu, Shanghai, Hubei and Henan are eight provinces that have
developed metallurgy industries with large pig iron production.
Paper & pulp

China is currently the second largest country in paper products consumption, only after the US. In 2007, China
imported 8.472 million tons of pulp (valued USD5.55 billion, RMB13.3 billion), which is the third largest sector
of China in import value only after petroleum and steel products. It is estimated that with the annual
consumption of 100 million tons, China will take over the US to become the country with the highest
consumption of paper products by 2010.
In 2007, the Integrated Scheme of Energy-saving and Emission-reducing of China prescribed that 6,500,000
tons of production capacity in paper industry should be shut down during the period of the eleventh 5-year plan
(2006-2010) of China. With this policy, 1562 small-scale pulp producers were closed during the first three
quarters of 2007, and the production size of pulp decreased 15% compared with the same period of 2006. Given
that China has been imposing a zero import tax on pulp for six successive years, the demand gap caused by the
decreased domestic production of pulp was naturally narrowed by imports. With the rising living standard of

Chinese people and the upgrading and diversification of paper products in China, the demand of pulp for high
quality paper products is expected to increase greatly.
Chinas paper mills are mostly concentrated in cities around Yangze River Delta and Pearl River Delta.
Soybean
China has the largest soybean consumption globally, and the soybean import volume of the country reached
37.82 million tons in crop year of 2007-2008, an increase of 9.09 million tons or 31.6% from the previous year.
Chinas demand on soybeans is expected to increase, especially for those used for animal feed and edible oil.
The oil yield ratio of domestic soybeans is only 17%-18%, whereas that of imported soybeans is approximately
22%. During the last five years, 91% of the imported soybeans are of a high oil yield ratio.
To reduce the cost of soybean imports and curb the price increases of grain in the domestic market, on October
1, 2007 China slashed import duty on soybeans from 3% to 1%.
Tobacco
As the global largest market for cigarettes with approximately 350 million consumers, China produces more
cigarettes than any other country producing 30% and consuming a third of the worlds cigarettes. As the
number of smokers in this part of the world continues to rise, China and Asia have become the most sought-after
markets for tobacco. To develop new products, China has to import tobacco leaf to launch new cigarette
products every year.
There are about 12 provinces in China producing tobacco and the largest one is Yunnan Province. In this
province, tobacco represents the major agricultural product, and the tax from the tobacco production is more
than 70% of all taxes collected in Yunnan province.
Tobacco is run by the Chinese government, which strictly controls cigarette production and distribution. Instead
of producing tobacco to meet the market demand, cigarette makers have to follow government regulations on
which brands of tobacco to produce and how much they should produce. The right of purchasing imported
tobacco leaf is controlled by the Beijing-based headquarter of China Tobacco Co.
Leather
With the rising of consumption level of Chinese people and the emerging premium trend in China, the demand
of leather products is also increasing. Due to the limited domestic leather supply and stable quality of imported
leather, China leather import has increased substantially. Despite of the relatively small import value, Chinas
imports of hides/skins/leather and fur-skins increased by around 15%, and that from Brazil increased by over
40% in 2007. It is estimated that by 2030s Asia, especially China, will take over Europe and become the global
leather production & trade centre. In additional, the fast growing exports of leather products (e.g. footwear,
leather apparels, bags, sofa, etc.) of China also has boosted the imports of leather.
Metal & metal products

China is the global largest country in using nonferrous metal. With the fast development of industrialization, the
gap between the rising demand and domestic supply of nonferrous metal is bigger and bigger, and China relies
more and more on the international supply of nonferrous. The storage and guarantee time of the top four
nonferrous metals of China (i.e. copper, aluminium, lead, and zinc) as well as many other nonferrous metals are
all very limited. Guarantee years of the most nonferrous metals in China are within 10 to 20 years. New
nonferrous metals explored are far from enough to cover the decrease of the storage. Therefore, the demand of
nonferrous metals of China is expected to increase greatly.
Commuter aircrafts
China is expected to keep the fast growth of economy and passengers throughput in long term. The development
of commuter airlines obviously lags behind that of the whole airline industry in China. Besides, China planned
to build 97 new airports by 2020, which will greatly boost the development of China aviation and the demand of
commuter aircrafts as well. In addition, commuter aircrafts have the advantages of low oil consumption and low
carbon emission, which can meet the energy-saving regulations of China.
Sichuan Airline has already bought five E145 aircrafts, China Eastern Airline Jiangsu branch and Wuhan
Airline also have bought or booked E145 aircrafts, and Hainan Airline has booked 50 E190 aircrafts from Brazil.
Brazilian Airline estimated that the demand of commuter aircrafts in China will reach 590 in the next few years.

Meat
In the following years, China would need to import more pork to offset a domestic shortage. By September 2008,
Brazils largest meat processor Sadia has established the representative office in Shanghai to push its meat
export to China. Research showed several big catering companies including Yum! Restaurants China and
Haucaller showed interest in Brazils poultry meat and beef, respectively. To restrain the price hike of pork
since late 2007, the import tax of frozen pork was decreased from 12% to 6% on June 1, 2008. According to
Chinese Customs, the China value import of pork in the first half of 2008 reached USD320 million (RMB764.8
million), increased by 15.4 times compared with the previous year. Besides, the high pork price also has
encouraged consumers to eat more poultry meat.
Juice
Partly due to the rising health trend, juice and nectar are more and more popular in China with a stable growth
rate of over 10% for many years. Given the low consumption level of juice in China, the market is expected to
growth much further in the next five years. According to the interview, Brazilian orange juice (concentrates) has
good reputation among Chinese companies. China juice imports from Brazil increased by over 50% in 2007,
more than two times of the growth rate of total China juice imports.
Chemical products
Chemical product is another sector of which China has increased import from Brazil greatly. In 2007, the
growth rate of China value import of chemical products from Brazil recorded almost 60%. The growth rate of
the total Chinese value imports of chemical products also reached around 25% in 2007, which indicates a fast
rising demand of imported chemical products in China. Currently, the ratio of import dependence of China on
organic chemical materials is around 20%, while that of the three major synthetic materials (synthetic plastic,
rubber and fibre) is more than 30%. Although the demand of inorganic salt, chemical fertilizer and pesticide can
be met by domestic supply, fine chemical intermediates still rely on import.
Stone materials
In recent years, stone import to China has maintained a rising trend. Imported stone materials are greatly
demanded in both interior and exterior renovations. Additionally, stone materials used in China tend to be
upgraded to meet the rising requirements of users. Besides, China has cut down the import tariff of marble,
granite and sandstone blocks to encourage the import of stone materials and hence reduce the exploitation of
domestic stone resources. Fujian, Guangdong and Shandong are three production bases for China stone industry.
Wood
According to the interviews, Brazilian wood is one of the few Brazilian products well known by Chinese
companies. Around 10 companies interviewed purchased Brazilian wood before. Although the real estate
industry in China is cooling down recently, it is believed that the strong potential market will recover in near
future and imported wood will still have a promising market in China. Besides, the Chinese government is
trying to enhance the protection of wood resources, which may also encourage the importation of wood.
3.4 POTENTIAL CHINESE PARTNERS OF BRAZILIAN SUPPLIERS

Potential Chinese companies are identified not only based on their records and assessment on previous
experience with Brazilian products or suppliers, but stress on openness to Brazil as a trade partner, combined
with their current or future needs for sourcing foreign suppliers, despite the companies interviewed likely having
yet to purchase any Brazilian product (see Appendix 5.4).
For example, Guangzhou-based Recca Refrigerantes Ltda (GZ21) is counted as a private company specializing
in Brazilian soft drinks such as Guaran, Aa, Cupua, Acerola, Caj, and Guojapa. It not only purchased fruit
extracts from Brazil, but cooperated in production techniques and branding with Brazilian partners. The
company came to claim persistent and increased market commitment to introducing Brazilian flavored soft
drinks in future, and offered a full score of 5 points in terms of openness to Brazil.
Another example is Yundang Industry and Trade Development Co., Ltd (XM08), a company expert in trade of
chemical and pharmaceutical raw materials and textile. Yundang has yet to make any purchase from Brazil, and
it maintained cooperation with eight foreign suppliers, from South Korea, Japan, India and Australia. However

the company is keen to get more information about ores, marble blocks, soybean, etc in Brazil, and shows
interest in buying Brazilian fine chemicals.
For in-depth profile for each potential Chinese company selected, please refer to the 25-company analysis
located in 12 city reports on CC (Company Code) index (see Appendix 5.5).

4. NEEDS AND WANTS OF CHINESE COMPANIES
4.1 SAMPLE DESCRIPTION
Among 300 interviewed companies in 12 cities, 77.6% are involved in Sino-Brazil trading related sectors, and
76.3% are headquarters.
The whole research covers various industries, which are illustrated in Chart 3.
Chart 3 Industry Membership and Sample Distribution
Source: Euromonitor International, 300-company interviews
Manufacturers account for 46.2% of the companies interviewed, and nearly 56.7% of the interviewed companies
are private.
Chart 4 Business Nature of Companies Interviewed
Chart 5 Business Ownership of Companies Interviewed

Among 300 interviewed companies in 12 cities, 131 companies (43.7%) have previous experiences with
Brazilian products and 108 companies (36.0%) have worked with Brazilian companies.
Based on the research, compared with other industries, more companies in footwear, wood, metallurgical
products, paper, and precious stones have experience with Brazilian products.
Compared with other cities, Beijing, Xiamen, and Nanjing record higher ratio of interviewed companies that
have purchased Brazilian products before and worked with Brazilian companies.
Chart 6 % of Companies Having Experience with Brazilian Products across 12 Cities
80% 76. 0% 76. 0% 72. 0%

70%
60% 52. 0% 52. 0% 56. 0%
50% 44. 0% 44. 0%
40%
30%
20% 12. 0% 12. 0% 12. 0% 16. 0%
10%
0%
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Chart 7 % of Companies Having Worked with Brazilian Companies across 12 Cities
80. 00%
68. 0%
70. 00%
60. 00% 56. 0% 56. 0%
50. 00%
40. 00% 36. 0% 36. 0% 36. 0%
32. 0%
28. 0%
30. 00% 24. 0% 24. 0%
20. 00% 12. 0%
10. 00% 4. 0%
0. 00%
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4.2 COMPANY PERCEPTION LEVEL OF BRAZIL

4.2.1 Company Perception on Brazilian Products
Company comments on Brazilian products by average
In general, the interviewed companies have given relatively higher comments on Brazilian products in terms of
stable quality and prompt delivery, rather than product variety, competitive prices, advanced
technology or after-sale service.

Chart 8 Average Scores of Comments on Brazilian Products
Note: Rating system of 1-5 point scale, with 1 representing least favorable and 5 representing most favorable comments on
Brazilian products
In general, companies interviewed speak highly of stable quality and prompt delivery for purchased
Brazilian products. However, there are some sectors with quality issues hindering the trade. According to
interviews, Beijings Chinatex Corporation complained that weight shortage often occurs when it was working
with Brazilian soy suppliers, and because of the abnormal red colour of the received Brazilian soy bran, the
company stopped purchasing from Brazil since 2006. Tianjin Huixin plans to source new soy suppliers because
of the weight shortage of Brazilian soy purchased. In addition, Fujian Shunda Sport Goods Co (OEM for
Reebok and Adidas) ceased importing Brazilian cattle leather for unstable quality since 2007. Besides, some
companies also mentioned that the moisture content of Brazilian timber is higher than their requirements. Some
Brazilian suppliers in agate material and timber mixed unqualified products with high quality ones when
delivering goods.
Regarding prompt delivery, most Brazilian products purchased by the interviewed companies were delivered
timely. The main reasons for occasional postponed deliveries include strikes, bad weather (e.g. typhoon), and
insufficient output capacity of Brazilian manufacturers.
For competitive price, a large number of companies interviewed mentioned that prices of most imported
Brazilian products (typically represented by coffee beans, woods, tobacco leaf, textile, leather, granite blocks,
etc) are increasingly less competitive compared with those from other sourcing areas such as Asian and African
countries. For example, the granite block from Brazil is increasingly less attractive than those from India, and
Xiamen has purchased more from India in recent years. Furthermore, quite a few correspondents indicated that
the price competitiveness of Brazilian products is also influenced by the continuing appreciation of Brazil Real.,
as well as some Brazilian companies eagerness for instant benefits. However, for those products that are not
greatly demanded by the Chinese market, such as Brazilian Hematite, the prices offered by Brazilian suppliers
are quite competitive.
Most companies in some industries (e.g. machinery and mechanic, electronics) have given negative comments
about Brazilian mechanical products in terms of technology level. They insist that Brazilian mechanical
products, precision instruments, and even home appliances are not possible to compete with same products from
Europe, the US, Japan and South Korea. For example, BTA Automation Ltd in Beijing stopped importing
Brazilian SMART instruments, and has turned to purchase products from UK ABB. Shanghai Liancheng Group,
an equipment manufacturer without foreign suppliers, indicated that the domestic products have better cost
performance than foreign ones.
Since most Brazilian exports are resource products, most of time after-sales service is regarded as inessential or
unnecessary by Chinese buyers. However, quite a few companies interviewed pointed out that it is quite difficult
to get reasonable compensation when the Brazilian suppliers breach contract.

Regional comments on Brazilian products
Among the 12 reviewed cities, Wuhan, Nanjing and Fuzhou achieved the highest scores with regard to
commentary about Brazilian products
Chart 9 Regional Variations in Scores of Comments on Brazilian Products
Brazilian products
Dalian sees obvious lower scores in competitive price compared with other cities, mainly due to the unfavorable
comments from a few companies who purchased different raw materials from Brazil, including agate materials,
coffee beans, ferrocolumbium, iron ores, denim, and Guarana.
Companies in Wuhan have given high comments on Brazilian products in terms of technology and after-sale
service. This is probably because the purchased Brazilian products by Wuhan companies interviewed are mainly
instruments and parts, which, unlike raw materials, allow Brazilian suppliers to apply high technology and offer
good after-sale service.
Table 7 Scores of Comments on Brazilian Products across 12 Cities
Stable Competitive Prompt Product Advanced After-sale Average

City
quality price delivery Variety technology service score
Beijing 4.5 3.3 3.9 3.2 3.4 3.4 3.6
Shanghai 4.0 3.0 3.0 3.7 3.0 3.3 3.3
Guangzhou 3.9 3.9 3.2 3.6 2.6 3.0 3.4
Chengdu 4.7 3.3 4.3 3.0 3.0 2.3 3.4
Wuhan 3.7 3.7 4.3 3.3 4.3 4.3 3.9
Shenyang 4.0 2.7 4.0 4.0 3.7 3.3 3.6
Dalian 4.4 2.4 4.5 3.3 2.5 1.9 3.2
Tianjin 4.2 4.0 4.2 3.1 2.9 2.2 3.4
Fuzhou 4.2 4.1 4.6 3.6 2.6 2.9 3.7
Xiamen 3.6 3.3 3.0 3.6 3.1 3.1 3.3
Nanjing 4.1 3.7 3.8 3.6 3.6 3.5 3.7
Hangzhou 4.4 3.6 4.4 2.6 1.9 2.3 3.2
Brazilian products

Comments on Brazilian products across sectors
Basically, average comments on Brazilian products by companies in different sectors did not vary a lot, given
all scores ranging from 3.2 to 4.0. Among all sectors, metallugical products, textiles, precision instruments,
paper and articles, chemical products, machinery and mechanical appliances, and rubber and articles achieved
relatively higher scores with regard to average commentary about Brazilian products.
Chart 10 Comments on Brazilian Products across Key Sectors
4. 5
4. 0
4. 0 3. 7 3. 7
3. 7 3. 6 3. 6
3. 4 3. 5 3. 4 3. 5
3. 5 3. 3 3. 2
3. 0
2. 5
2. 0
1. 5
1. 0
0. 5
0. 0
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Brazilian products
In general, companies in rubber industry feel that Brazilian products are competitive in price, while companies
in some industries, such as paper, wood, plastics and precious stones, are not satisfied with the price level of
Brazilian products.
According to the interviews, some companies who have purchased Brazilian products also reflected that
Brazilian products are monotonic, and Brazilian suppliers are not willing to customize their products to meet
clients demands or provide products with wide variety.

Table 8 Scores of Comments on Brazilian Products across Key Sectors
Stable Competitive Prompt Product Advanced After-sale Average

Sectors
quality price delivery Variety technology service score
Textiles 4.1 3.5 4.0 3.8 3.2 3.3 3.7
Precision instruments 4.6 3.6 3.6 3.1 3.6 3.7 3.7
Footwear 3.7 3.6 3.4 3.7 2.7 2.5 3.3
Chemicals 4.1 3.6 3.8 3.7 3.0 3.4 3.6
Machinery &
4.0 3.4 3.4 3.6 3.6 3.5 3.6
mechanical products
Paper & articles 4.3 3.3 3.7 3.8 3.6 3.5 3.7
Woods & cork 4.4 3.3 4.1 3.6 2.5 2.6 3.4
Rubber & articles 4.4 4.3 4.0 3.1 2.4 2.9 3.5
Metallurgical
4.5 3.9 4.1 4.1 3.6 3.6 4.0
products
Plastic & plastic
3.3 3.3 4.3 3.0 2.7 2.3 3.2
products
Precious stones 4.0 3.3 3.7 3.7 3.0 2.8 3.4
Others 4.2 3.5 3.8 3.4 3.1 3.2 3.5
Brazilian products
4.2.2 Company perception on Brazilian suppliers

Company comments on Brazilian suppliers by average
Most interviewed companies offered favourable comments about Brazilian suppliers, especially for contract
fulfillment and commercial creditability. However, efficiency and after-sales service were considered
not very satisfactory to some correspondents, in light of their experience with Brazilian partners.
Low efficiency of Brazilian companies was mentioned frequently by the interviewed companies across 12 cities,
because Brazilian companies only accept letter of credit issued by UK-based banks, such as HSBC, not Chinese
banks. This brings about great inconvenience to small- and medium-sized enterprises in China, and has a
negative effect on the potential cooperation between Chinese and Brazilian enterprises.
Besides, according to the interivews, the fact that CVRD broke the long-term agreement with Chinese
companies by increasing the price of iron ore in September 2008 influenced Brazilian companies creditibility
among some Chinese companies in relevant industries, although the overall scores of contract fulfillment and
creditability are high.
As mentioned, many companies have given unfavourable comments on their Brazilian suppliers in terms of
after-sale because most of Brazilian imported are raw materials. However, there are still some Brazilian
manufacturers performing outstanding in after-sale service. For example, Hangzhou Huajin was very happy with
its Brazilian pulp supplier, Aracruz Celulose SA, who often visits Huajin in Hangzhou for an exchange on the
product quality and pulp ingredient formula for newsprint.

Chart 11 Average Scores of Comments on Brazilian Suppliers
Brazilian suppliers
Regional comments on Brazilian suppliers
Among the reviewed cities, companies in Chengdu, Dalian and Fuzhou have offered higher comments on
Brazilian suppliers they worked with.
Companies in Nanjing, which have given high comments on Brazilian products, have given relatively lower
comments on Brazilian suppliers. The possible reason could be that companies in Nanjing have purchased many
unique Brazilian products (e.g. propoils, cosmetic ingredient, orange oils, rose oils, calfskin, palm wax, etc.),
which might have lowered their criteria of selecting suppliers. Although these companies are happy with the
Brazilian products they purchased, they are not very satisfied with the Brazilian suppliers they are working with.
For example, Jiangsu Sainty of Nanjing believes that Brazilian orange oils and rose oils it have purchased have
advantages in quality globally. However, according to the interview, the company actually is not satisfied with
the product variety of its Brazilian supply, and hopes that Brazilian companies could enhance their R&D ability
and try to meet clients needs in new product development.
Chart 12 Regional Variations in Scores of Comments on Brazilian Suppliers
Brazilian suppliers
Looking at specific comments on Brazilian suppliers across the 12 cities, contract fulfilment and creditability of
Brazilian suppliers is generally commented good, with scores ranging from 3.7 to 5.0, while average scores of
efficiency are generally low.

Table 9 Scores of Comments on Brazilian Suppliers across 12 Cities
Contract Capital/production After-sale Average

Cities Creditability Efficiency
fulfillment capacity service score
Beijing 4.1 3.7 3.7 4.0 3.1 3.7
Shanghai 4.1 4.0 3.0 3.8 3.5 3.7
Guangzhou 4.2 4.5 3.3 3.5 3.3 3.7
Chengdu 4.7 4.3 3.7 4.0 5.0 4.3
Wuhan 4.1 4.0 3.8 3.7 4.0 3.9
Shenyang 3.8 3.7 3.2 3.3 3.2 3.4
Dalian 4.8 4.8 4.6 4.2 2.8 4.2
Tianjin 4.4 4.4 3.6 3.6 3.2 3.8
Fuzhou 5.0 5.0 3.0 4.0 3.0 4.0
Xiamen 3.7 4.0 3.1 3.9 3.2 3.6
Nanjing 4.0 3.8 3.4 3.7 3.5 3.7
Hangzhou 3.9 4.1 3.9 3.8 2.7 3.7
Note: Rating system of 1-5 point scale, with 1 representing least favorable and 5 representing most favorable comment on
Brazilian suppliers
Comments on Brazilian suppliers across sectors
Brazilian companies have better reputation among companies in paper and articles, metallurgical products, and
rubber and articles, compared with those in other industries.
Chart 13 Sector Variations in Score of Comments on Brazilian Suppliers
Brazilian suppliers

Table 10 Scores of Comments on Brazilian Suppliers across Key Sectors
Contract Capital/produc After-sale

Sector Creditability Efficiency Average score
fulfillment tion capacity service
Textile 3.9 4.1 3.5 3.8 3.4 3.7
Precision
4.2 4.1 3.6 3.6 3.2 3.7
Instruments
Footwear 4.1 4.4 3.7 3.6 2.9 3.7
Chemicals 4.2 4.2 3.5 3.8 3.4 3.8
Machinery &
mechanical 3.7 3.8 3.2 3.5 3.1 3.5
products
Paper & articles 4.2 4.3 3.8 4.4 3.5 4.0
Woods & cork 3.5 3.6 3.3 3.8 2.8 3.4
Rubber & articles 4.3 4.8 3.8 3.8 3.3 4.0
Metallurgical
4.4 4.3 3.4 4.0 3.7 4.0
products
Plastic & plastic
4.3 3.7 3.7 4.0 3.0 3.7
products
Precious stones 4.2 4.1 3.3 3.8 3.1 3.7
Others 4.2 4.1 3.6 3.9 3.5 3.9
Brazilian suppliers
4.2.3 Previous information about Brazil/Brazilian products

More than 70% of the interviewed companies have acquired information about Brazilian products or suppliers,
while 21% companies never heard Brazilian products and suppliers.
The top three frequently used information channels for Brazilian products and suppliers are B2B e-commerce
websites, recommendations from industry peers, and exhibitions/trade fairs. B2B e-commerce websites mainly
refer to Alibaba (www.alibaba.com), Huicong website (www.hc360.com), and websites of Brazilian
manufacturers/suppliers.
Unfortunately, information about Brazilian products and suppliers from government institutions / trade
associations and advertisments in trade presses and magazines were not widely available for Chinese companies,
while most Chinese companies consider these channels more reliable and authoritative than internet.

Chart 14 Major Information Channels for Chinese Companies to Know about Brazilian Products/Suppliers
33.5%
Website / Internet
33.5%
Personnel recommendation
32.6%
Exhibitions
19.5%
Proactive visits by Brazilian companies
10.4%
Others
8.6%
Ad. in trade press, magazines
8.1%
Gov. institutions/trade associations
0% 5% 10% 15% 20% 25% 30% 35% 40%
4.2.4 Company Expectations about Brazilian Products and Suppliers

52.3% of interviewed companies hope Brazilian products to be of stable quality and 45.5% wish to get
competitive price.
Chart 15 Expectations about Brazilian Products
Stable quality 50.9%

44.1%
Competitive prices
17.7%
Others
15.9%
Recommendation of Brazilian suppliers
11.4%
Product Variety
8.6%
Efficient communication
6.8%
after-sale service
4.1%
Localization
3.6%
Advanced technology
Representative offices of Brazilian suppliers 1.4%
0% 10% 20% 30% 40% 50% 60%
Note: multiple choice were allowed for interviewees

Many trading companies indicated that they usually purchase products according to market demands. If the
product type and quality is acceptable for the market, cost would be a key factor influencing their decision
making. Some companies complained that the prices of Brazilian products fluctuate greatly and frequently.
They hope that the prices of the Brazilian market will be more stable.
Given that 21% interviewed companies had never heard about Brazilian products and a higher percentage is
expected among companies not interviewed, many companies would like to get more information about
Brazilian suppliers and their products.
Moreover, some companies also hope that Brazilian suppliers could enhance their product variety, launch more
new products, and localize their products to meet the demands of the Chinese market.

Chinese companies are also eager to get support from Brazilian suppliers in terms of technology and after-sale
service. When there is any problem with goods received, they hope that Brazilian suppliers could offer
reasonable solutions.
As per the issue regarding inefficiency, some companies wish that language problem could be solved to improve
the communication between the two countries, and that Brazilian suppliers could response promptly when
Chinese companies send queries to them.
In addition, some companies suggested that Brazilian suppliers should strengthen their marketing activities to
introduce more products to both Chinese companies and consumers, as well as to support Chinese companies in
sales and marketing.
During the interviews, some suggestions to Brazilian government were also mentioned, such as shortening the
time for issuing visas, especially business visas, encouraging Brazilian companies and banks to accept L/C from
Chinese banks, strengthen the propaganda of Brazilian products in China, and improve Brazilian public security
environment. In addition, Brazilian government is also expected to provide a fair investment environment and
hopefully offer pereferential policies for the investments from Chinese companies.
4.3 COMPANY PURCHASING CRITERIA

4.3.1 Top Purchasing Criteria
Good quality is regarded as the top purchasing criteria by most companies, followed by competitive price and
on-time delivery. Other top purchasing criteria include companies famousness, advanced technology, after-sale
service, and easy communication. Usually, when product quality is acceptable, most companies always seek for
a balance between quality and cost. It is worth to note that some trading companies dealing with machinery
products consider after-sale service as a very important factor.
Chart 16 Importance of Purchasing Criteria

5
4.5
4
3.5
3
Score
2.5
2
1.5
1
0.5
0
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Note: Rating system of 1-5 point scale, with 1 representing least important and 5 representing most important criteria to make
purchase
4.3.2 Major Criteria of Selecting Foreign Suppliers

A majority of interviewed companies regard product quality & variety and prices as very important when
selecting foreign suppliers. Capital/production capacity is also important for most companies, while only part of
companies think after-sale service is a must for suppliers.

According to interviews, besides the above-mentioned factors, some companies are very cautious when
selecting foreign suppliers and attach great importance to companys reputation and credit, because it is costy
and time consuming to deal with overseas trade conflicts. Moreover, operation history and experiences,
factorys equipments (advanced or not), and successful cases are also influential factors for selecting foreign
suppliers.
Chart 17 Average Scores of Importance on Criteria of Selecting Foreign Suppliers
Note: Rating system of 1-5 point scale, with 1 representing least important and 5 representing most important selecting criteria
4.3.3 Current and Potential Foreign Suppliers

Existing foreign suppliers
78.3% of the interviewed companies have foreign suppliers, more than 22.3% of which own more than 10
foreign suppliers. Certain large scaled enterprises (e.g. Bao Steel, Zhenghua Port Machinery) report 100 or more
suppliers worldwide.
Chart 18 Number of Foreign Suppliers Owned by Companies Interviewed
Most foreign suppliers of the interviewed companies are from America, Europe and Asia. Besides Brazil, the
US, Germany and Japan were mentioned most frequently by interviewees when asked about their foreign
suppliers locations.

Chart 19 Country Origin of Foreign Suppliers
Potential foreign suppliers
24.3% of the interviewed companies mentioned they planned to change current suppliers, 54.7% reported they
had no plan to change suppliers, or look for new partners, while 21.0% indicated they would not like to change
current suppliers but were open to source more and new suppliers.
Chart 20 Companies Willingness to Change Suppliers
Compani es pl anni ng t o change

24. 3% cur r ent suppl i er s
Compani es unwi l l i ng t o change

cur r ent suppl i er s but wi l l i ng t o
54. 7% sour ce new ones
Compani es unwi l l i ng t o change
21. 0% cur r ent suppl i er s or sour ce new
ones
The main purposes for some companies to change suppliers and look for new suppliers are to find more
competent suppliers, to find new suppliers who can offer lower prices (including lower freight cost), and to
replace current unqualified suppliers. Besides, most import and export companies are always looking for new
products that can fit the market needs, and eager to get support from new suppliers.
Chart 20 Main Reasons Why Change Suppliers

Most companies without any plan to change suppliers have established long-term and stable partnership with
existing suppliers and are satisfied with them. According to the interviews, many companies believe that
suppliers with long-term relationships can offer them good prices and services, and stable supply. High cost for
changing suppliers also restrains some companies from sourcing new supplier. Additionally, the lack of
information about potential suppliers is also another reason.
Chart 21 Main Reasons Why Do Not Change Suppliers
Note: multiple choices were allowed

When asked about potential sourcing regions, most companies prefer suppliers from Europe, America and Asia.
The US is ranked top among all sourcing countries. Since the interviewed companies were selected on the
condition that they have the potential of purchasing Brazilian products, Brazil was ranked second as potential
sourcing country. Some companies prefer Asian countries because of the lower freight cost compared with other
regions. Many companies that import raw materials in large quantity also mentioned that they may consider
suppliers from Brazil.
Chart 22 Potential Sourcing Countries/regions
Source:Euromonitor International, 300-company interviews
A number of food companies interviewed showed interest on food products with Brazilian characteristics,
including fruits, snacks and meat, although they do not have plan of changing suppliers in short term.

4.4 OPENNESS TO BRAZIL AS A COMMERCIAL PARTNER
4.4.1 Overall Comments on Willingness to Trade with Brazil
Most of the 300 companies surveyed are willing to get more information about Brazil, and 49.3% and 43.0% of
them, respectively, showed fairly or greatly interest to buy Brazilian products and source Brazilian suppliers
(see Chart 23).
Major information appealing to Chinese companies include: Brazilian manufacturing presence in the relevant
sectors, detailed information about product quality, tech parameters, varieties that Brazilian suppliers could offer
as well as the associated industry standards and certifications, the features and uniqueness of Brazilian products.
In addition, for Chinese enterprises that have learned big picture about Brazil and reported the relationship with
Brazilian suppliers, they are also keen on the overall economic and financial environment, local infrastructure
development and consumption patterns, government trade policies and market-entry standards in Brazil.
Chart 23 Openness to Brazil as a Traded Partner

Total score 4.13 3.42 1.76 3.15
3.3%
100%
4.7%
90% 24.3% 18.7%
16.3%
80% 41.3%
70% 16.0% 24.3%
25.0%
60%
50%
22.7%
40% 34.7%
26.0%
30% 59.7%
20% 22.3%
20.0% 17.7%
10%
3.3% 7.0% 12.0%
0% 0.7%
To get more information To purchase Brazilian To invest in Brazil To source Brazilian suppliers
about Brazil products
Not a bit Less Moderate Fairly Greatly
Note: rating system of 1-5 point scale, with 1 representing least (not a bit) willingness and 5 representing most (greatly)
willingnee to Brazil as a commercial partner.
Total Score= (Score i % of companies holding the willingness i ), e.g. to get infomration about Brazil,
4.13=10.7%+23.3%+320.0%+434.7%+541.3%
Of all 300 companies, average openness to Brazilian products is scored at 3.42 out of 5, very close to that score
of openness to source Brazilian suppliers (3.15). However, the main constraints that keep Chinese companies
from cooperating with Brazil include:
(1) The lack of basic readiness for Brazilian products.
(2) Solid relationships developed with current suppliers, with no plan to source new one.
(3) Brazilian products are not very competitive in price, and even certain sectors see continued price hikes and
fluctuation.
(4) Concerns over high freight cost and long turn-around period largely out of the remote distribution.
(5) For some high-tech sectors, typically represented by machinery and electrical appliances, Brazilian suppliers
are not able to provide high quality.

Chart 24 Main Reasons for Non-openess to Buy Brazilian Products or Source Brazilian Suppliers
Lack of information about Brazil 54.5%
Solid relationship w ith current suppliers 28.4%
Less competitive price 19.3%
Long-distance distribution 17.0%
Unstable product quality 6.8%
Low business efficiency 2.3%
Policy & economy influence 1.1%
Others 19.3%
0% 10% 20% 30% 40% 50% 60%
Regarding investment in Brazil, only around 10% have the plan to establish a sales office, source distributors or
set up manufacturing plants in Brazil, while those who are not open to make investment in Brazil are largely out
of the following reasons:
(1) Companys limited capital capacity for globalization or not in line with current stage of the market
expansion strategy.
(2) Faced with highly consolidated market. For example, the mining, soybean, tobacco leaf sectors in Brazil are
monopolized by international traders or Brazilian tycoons, and thus offer faint hope for Chinese companies
penetration.
(3) Preference to invest in surrounding East and South Asian countries, where it would not see significant
language barrier or time lag problem, with more convenient transportation.
(4) Public security in Brazil is not satisfactory.
(5) Concerns about the transportation infrastructure and investment environment (e.g. labour law, unstable
exchange rate, low business efficiency)
(6) The overseas investment is a big corporate decision, and some branch companies interviewed have no final
decision on that.
4.4.2 Comparative Openess to Brazil across 12 Cities and Sectors

Statistics based on 300 company interviews indicates that companies from Southern costal cities like Fuzhou,
Xiamen, Guangzhou, and inland metropolis Chengdu exhibit relatively higher openness to Brazil, which is
believed in part attributable to the several niche segments representing strong trade potential in these cities, such
as the juice and snacks in Guangzhou, block stones in Xiamen, precious stones in Guangzhou and Fuzhou,
agricultural products and mining sectors in Chengdu.
According to interview sources, a number of companies in Chengdu are making imports via trade agents located
in costal cities, yet they are interested to talk to Brazilian suppliers directly. Also, it is noteworthy several
Chengdu-based mining and mineral manufacturers (e.g. Sichuan Xinghongyuan, Sichuan Huiyuan, Chengdu
Diao, Sichuan Yadong Cement) are enthusiastic about investing in Brazilian mineral fields and exploration of
nonferrous metal in Brazil.
Possible reasons for general flat openness amongst companies in Beijing and Shanghai, where considerable
value imports of Brazilian products are recorded, is due to the major products they trade with Brazil are
traditional and large quantity sectors, meanwhile the local Chinese buyers are content with the status quo,
without prominent new market momentum.

Table 11 Regional Variations in Openness to Brazil as a Commercial Partner
To get information To purchase To invest To source Brazilian
City Average
about Brazil Brazilian products in Brazil suppliers
Beijing 3.8 3.4 1.8 3.2 3.1
Shanghai 3.5 2.5 1.4 2.4 2.5
Guangzhou 4.5 4.0 1.6 3.9 3.5
Chengdu 4.4 3.7 2.4 3.8 3.6
Wuhan 4.4 2.7 2.2 2.4 2.9
Shenyang 3.8 3.2 2.3 3.1 3.1
Dalian 4.2 3.4 1.7 3.4 3.2
Tianjin 4.1 3.3 1.0 2.7 2.8
Fuzhou 4.9 3.3 2.1 2.8 3.3
Xiamen 3.8 4.1 2.1 3.7 3.4
Nanjing 4.4 4.0 1.2 3.9 3.4
Hangzhou 3.8 3.5 1.3 2.7 2.8
Source: Euromonitor International: 300 company interviews
Across sectors, companies specialized in textiles and footwear, chemicals, pulp, woods, rubber,
metallurgical products, and food and beverage (under others) show more willingness to source Brazil products
and suppliers.
Table 12 Openness to Brazil by Key Sector

To get information To purchase To invest To source Average
Sector
about Brazil Brazilian products in Brazil Brazilian suppliers score
Textile 4.3 3.9 1.4 3.7 3.3
Precision
4.3 3.1 1.8 2.9 3.0
Instruments
Footwear 4.1 3.7 1.6 3.7 3.3
Chemicals 4.2 3.8 1.5 3.9 3.3
Machinery &
3.9 2.9 1.7 2.8 2.8
mechanical products
Paper & articles 4.0 3.9 1.5 3.9 3.3
Woods & cork 4.3 3.8 1.5 3.4 3.2
Rubber & articles 4.2 3.9 1.4 3.3 3.2
Metallurgical
4.5 3.8 1.6 3.6 3.4
products
Plastic & plastic
4.2 3.2 1.6 3.1 3.0
products
Precious stones 4.1 4.0 1.9 3.6 3.4
Others 4.2 3.8 1.9 3.5 3.4

4.4.3 One-Way ANOVA Analysis
Correlation between companys previous experience with Brazilian products/supplier and its openness to
Brazil
Based on those companies who have previous experience with Brazilian products, One-Way ANOVA
analysis indicates:
Whether a company recorded purchase experience with Brazilian products would evidently (with
statistical significance) influence its future openness to Brazil as a trade partner.
This being said, companies that have experiences with Brazilian products post stronger willingness to
purchase Brazilian products and source Brazilian supplies, comparative to those without such experience
Table 13 ANOVA Analysis on Whether Previous Experience with Brazil Products would Influence Future
Openess to Brazil as a Trade Partner
ANOVA
Sum of
Squares df Mean Square F Sig.
Willingness to get more Between Groups 2.922 1 2.922 3.647 .057
information about Brazil Within Groups 237.981 297 .801
Total 240.903 298
Willingness to pur chase Between Groups 128.448 1 128.448 115.500 .000
Brazilian products Within Groups 330.294 297 1.112
Total 458.742 298
Willingness to invest in Between Groups 5.077 1 5.077 4.253 .040
Brazil Within Groups 354.535 297 1.194
Total 359.612 298
Willingness to sour ce Between Groups 50.820 1 50.820 32.529 .000
Brazilian suppliers Within Groups 463.996 297 1.562
Total 514.816 298
Note: The decimals circled in red is the hypothesis testing result. The hypothesis is proved true when such figure is smaller
than 0.05
Table 14 Difference in Openess to Braizl between Companies Having v.s Not Having Experience with Brazilain
Products
Company Group To get information To purchase To invest in To source Brazilian

about Brazil Brazilian products Brazil suppliers
Having previous experience
4.23 4.16 1.62 3.61
with Brazilian products
Not having previous experience
4.03 2.84 1.88 2.78
with Brazilian products
Similarly, for companies that have a trade relationship with Brazilian suppliers, One-Way ANOVA analysis
indicates:
Those companies who have had business ties with Brazilian suppliers are evidently (with statistical
significance) more willing to purchase Brazilian products and source Brazilian supplies in the future.

Table 15 ANOVA Analysis on Whether Previous Experience with Brazil Suppliers would Influence Future
Openess to Brazil as a Trade Partner
ANOVA
Sum of
Squar es df Mean Square F Sig.
Willingn ess to get mor e Between Groups .238 1 .238 .299 .585
infor mation about Brazil Within Groups 234.900 295 .796
Total 235.138 296
Willingn ess to pur chase Between Groups 25.718 1 25.718 17.865 .000
Brazilian products Within Groups 424.672 295 1.440
Total 450.391 296
Willingn ess to inv est in Between Groups .013 1 .013 .011 .917
Brazil Within Groups 358.418 295 1.215
Total
358.431 296
Willingness to sour ce Between Groups 37.330 1 37.330 23.519 .000

Brazilian suppliers Within Groups 468.232 295 1.587
Total 505.562 296
Note: The decimals circled in red is the hypothesis testing result. The hypothesis is proved true when such figure is smaller
than 0.05
Table 16 Diffeneren in Openess to Braizl between Companies Having v.s Not Having Brazilain Suppliers
Company Group To get information To purchase To invest in To source Brazilian

about Brazil Brazilian products Brazil suppliers
Having Brazilian suppliers 4.17 3.81 1.78 3.62
Not having Brazilian suppliers 4.11 3.20 1.77 2.89
Source:Euromonitor International, 300-company interviews

5. APPENDIX
Appendix 5.1 Quantitative 52-City Ranking as of Trade Opportunities to Brazilian Products
Retailing & Total Score

Ranking City Macro Economic Business Fitness Logistic
Consumption (weighted)
1 Shanghai 5.95 3.00 1.33 5.67 3.62
2 Hong Kong 11.35 3.00 1.33 1.33 3.84
3 Guangzhou 6.65 7.00 1.33 4.67 4.76
4 Ningbo 12.05 4.50 1.67 8.67 5.99
5 Qingdao 10.20 3.50 1.67 14.67 6.52
6 Tianjin 8.90 5.50 1.33 19.00 7.63
7 Dalian 13.45 4.00 1.67 18.33 8.06
8 Hangzhou 11.05 7.00 11.33 10.33 9.87
9 Beijing 6.70 12.00 8.00 14.33 10.21
10 Foshan 15.90 19.00 1.67 9.67 11.44
11 Xiamen 30.80 9.50 1.67 9.67 11.44
12 Nanjing 20.70 3.50 12.00 15.67 11.92
13 Suzhou 7.80 19.50 10.33 8.67 12.24
14 Dongguan 16.30 19.00 8.00 6.67 12.69
15 Wuxi 13.35 19.50 8.33 12.33 13.49
16 Yantai 15.60 20.00 1.67 19.33 13.49
17 Fuzhou 23.00 12.50 1.67 23.33 13.52
18 Macau 34.00 21.5 2.00 1.67 14.18
19 Wenzhou 29.55 19.00 1.67 14.00 14.91
20 Jinan 17.05 18.50 8.67 17.67 15.09
21 Tangshan 19.80 19.00 1.67 26.33 15.43
22 Quanzhou 26.60 20.00 1.67 20.33 15.89
23 Shaoxing 25.10 20.50 8.33 12.33 16.14
24 Shenyang 21.40 14.50 12.00 22.00 16.63
25 Wuhan 19.30 6.50 18.33 27.0 16.71
26 Nantong 23.80 19.00 1.67 30.33 17.30
27 Changsha 28.50 10.00 12.67 26.67 17.83
28 Chongqing 13.70 10.00 17.67 37.33 18.51
29 Changchun 23.35 15.00 11.00 35.00 19.47
30 Shijiazhuang 27.05 5.50 16.00 38.33 19.53
31 Chengdu 16.50 16.00 19.33 29.0 19.70
32 Zhengzhou 29.35 11.50 12.33 34.00 19.82
33 Taiyuan 35.30 11.50 13.00 28.00 20.01
34 Zhanjiang 36.45 8.00 1.67 50.33 20.26
35 Weifang 27.40 20.00 8.67 34.00 20.88
36 Hefei 35.45 8.00 15.00 36.00 21.19
37 Nanning 36.65 6.50 8.67 48.00 21.48
38 Haikou 45.20 14.00 1.67 40.00 21.74
39 Harbin 25.40 15.50 15.00 40.00 22.23
40 Nanchang 37.65 11.00 17.67 35.33 23.20
41 Xuzhou 33.90 20.50 11.00 37.33 23.70

42 Baotou 41.85 21.00 15.67 23.00 23.97
43 Kunming 31.90 17.00 12.67 44.00 24.08
44 Xian 32.80 17.00 16.33 40.67 24.69
45 Guiyang 45.95 15.00 13.00 40.33 25.66
46 Liuzhou 43.05 19.50 11.00 44.00 26.56
47 Huhhot 44.35 18.50 15.67 38.67 26.85
48 Yinchuan 48.20 16.00 16.33 41.33 27.61
49 Xining 43.55 18.50 13.00 49.67 28.09
50 Urumqi 47.10 18.50 19.00 39.67 28.60
51 Lanzhou 48.00 18.00 17.33 46.67 29.53
52 Yibin 45.25 20.50 18.00 51.33 30.87
Note: Total Score (weighted)= (Score i Weight i )
e.g. Shanghai City, 3.62=5.9520%+3.0030%+1.3330%+5.6720%

The smaller score achieved, the greater trade opportunities would see between this city and Brazil

Appendix 5.2 Sectors Representing Better Opportunities to Brazilian Companies by City
Promising sectors
Promising sectors
City derived from import statistics provided by Apex-
identified by 300 company interviews
Brasil and the regional customs
Machinery and mechanical products, tobacco leaf,
Metallurgical products, machinery and mechanical
paper pulp, aircrafts and auto parts, rubber &
products, paper pulp, oil and derivatives, soybean (as
articles, precision instruments, electrical products,
Beijing well as other agricultural products), woods, tobacco leaf,
non-iron metal, food (coffee bean, meats), personal
chemicals, auto parts, food (juice concentrates, coffee
hygiene & cosmetic, milk products, footwear, tools,
bean, meats), etc.
cutlery, spoons & forks, metallurgical products
Mineral products, plastics & plastic products, Irion ore, machinery and mechanical products, rubber &
tobacco leaf, woods, machinery and mechanical articles, aircrafts & auto parts, leather, tobacco leaf,
Shanghai
products, petroleum oil, metallurgical products, soy, chemical products, food (coffee, meats, paste and edible
leather, auto parts, inks, glues and enzymes preparations), woods, precision optical instruments etc.
Mineral products, chemical products, leather & Chemical products, precious stones, food (fruit juice &
Guangzhou hides, textile, footwear, tobacco leaf, poultry meat, soft drinks, wine, snacks, coffee bean), leather & hides,
rubber & articles, juice, paper, petroleum oil textile (linen), woods, paste & edible preparations etc.
Machinery and mechanical products, aircrafts and Woods, hides & leather, food & agriculture products,
Chengdu auto parts, rubber & articles, food (juice, coffee machinery and mechanical products, metallurgical
bean, meat), personal hygiene & cosmetics products, medical devices, etc.
Mineral products, machinery and mechanical Machinery and mechanical products, auto parts, iron ore,
Wuhan appliance, auto parts, rubber & articles, paper & woods, rubber & articles, paper pulp, cotton as well as
articles, crude oil, precious stones other tropical agriculture products, etc.
Rubber & articles, pulp, machinery & electrical products,
Non-iron metal, auto parts, electrical and electronics,
Shenyang coffee bean, pharmaceutical products, chemicals, auto
textile, steel, fertilizer, plastic material
parts, timber, plastic materials, minerals, fruit, etc.
Mineral products, soy, metallurgical products, oil &
Food additives & flavours, precious stones, marbles,
derivatives, machinery & mechanical products,
Dalian textiles, auto parts, shoes materials, agricultural products
chemical products, woods, leather, chemical
(fruits), meats, rubber, ores, etc.
products,
Mineral products, soy, leather, timber, paper pulp, , Pulp, timber, minerals & ores, plant oils, black gallstone,
Hangzhou
oil & derivates, chemical products kaolin, food natural materials, C&T, medical & dye, etc.
Ores, woods, soy bean, auto parts, foods, precious stone,
Fuzhou Soy, mineral products, hides & leather, woods
plastics, white sugar, plastic raw materials, rubber, etc.
Mineral products, soy, metallurgical products,
tobacco leaf, machinery & mechanical products, Leather, soy bean, ores, precious stone, auto parts, foods
Tianjin
auto parts, non-ferrous metal, pastas & edible raw materials, etc.
preparations, rubber & articles, textile
Soy, mineral products, leather, chemical products, Stone material (granite), cattle leather, precious stones
Xiamen coffee, stone materials, rubber & articles, precious (agate), inks, rubber and articles, glass and glassware,
stones, aircrafts and auto parts, cleaning products chemical products, aircrafts and auto parts, etc.
Soy, mineral products, metallurgical products, pulp, Timber, chemical products, personal care products, juice,
Nanjing machinery & mechanical products, chemicals, foods pulp, glycerin, health products, leather, plant oil, boron,
(meat, coffee, dairy), leather, auto parts, textiles auto parts, wool, electromechanical equipments, etc.

Appendix 5.3 Promissing Cities for Brazilian Products by Sector
Sectors Potential Cities

Qingdao, Dalian, Shanghai, Shijiazhuang, Ningbo, Hangzhou, Wuhan, Tianjin,
Mineral products
Nanjing, Hefei, Nanning, Guangzhou, Lanzhou, Zhanjiang, Changsha
Nanjing, Qingdao, Nanning, Tianjin, Shijiazhuang, Ningbo, Dalian, Xiamen,
Soy products
Hangzhou
Qingdao, Ningbo, Shanghai, Dalian, Hangzhou, Nanjing; Hong Kong,
Petroleum oil
Zhanjiang, Haikou, Tianjin, Urumqi, Xiamen and Guangzhou
Tobacco leaf Beijing, Shanghai
Shanghai, Nanjing, Qingdao, Nanchang, Guangzhou, Beijing, Hong Kong,
Paper & pulp
Tianjin
Hong Kong, Shanghai, Guangzhou, Hangzhou, Nanjing, Qingdao, Xiamen,
Leather
Tianjin, Fuzhou, Nanning
Hong Kong, Lanzhou, Shanghai, Ningbo, Taiyuan, Beijing, Tianjin, Harbin,
Non-iron metal
Shenyang
Metallurgical products Tianjin, Shanghai, Qingdao, Hong Kong, Dalian, Beijing, Harbin
Ningbo, Shanghai, Nanjing, Hong Kong, Hangzhou, Qingdao, Guangzhou,

Chemicals
Xiamen, Nanchang, Tianjin
Hong Kong, Guangzhou, Nanjing, Shanghai, Qingdao, Dalian, Tianjin, Macao,
Meat
Beijing, Xiamen, Hangzhou
Concentrated orange juice Guangzhou, Shanghai, Beijing, Hangzhou, Tianjin, Nanjing
Chengdu, Harbin, Nanjing, Wuhan, Haikou, Beijing, Dalian, Guangzhou,

Aircrafts & parts
Harbin, Kunming, Hong Kong, Macau, Shanghai, Xiamen
Qingdao, Shanghai, Hong Kong, Nanjing, Guangzhou, Tianjin, Dalian, Xiamen,
Rubber & article thereof
Beijing, Ningbo, Guiyang, Hangzhou, Fuzhou, Hefei
Stone materials Xiamen, Quanzhou, Shenzhen, Lanzhou
Shanghai, Hong Kong, Tianjin, Guangzhou, Dalian, Hangzhou, Qingdao,
Woods
Ningbo, Xiamen
Others (e.g. juice, coffee, personal care
products, agricultural products, plastic Beijing, Shanghai, Guangzhou, Chengdu, Wuhan, Shenyang, Dalian, Hangzhou,
materials, auto parts, precious stones, Fuzhou, Tianjin, Xiamen, Nanjing
glassware, precision instruments etc.)

Appendix 5.4 Potential Chinese Partners for Brazilian Exporters by Sector
Sector Company names

Tobacco leaves China National Tobacco Imp & Exp Corp; Shanghai Tobacco Import & Export Corporation
Beijing Cross-Century Science & Technology; Guangzhou Chuangbo Chemical Co., Ltd; Guangzhou
Chemical raw Senye Chemical Imp & Exp Co., Ltd; Guangzhou Maxtex Import and Export Co., Ltd; Spec-Chem
materials Industry; Double Coin Holdings; Shenyang Huaning Shoes; Fuzhou Fuyan Footwear; Fujian Zhenyun
Plastics Industry; Liaoning Chengda Industrial; Dalian Tyre Factory; Xiamen C&D Inc.
Baosteel Group Corporation; Xiamen C & D Inc; Xiamen Yundang Industry and Trade; Sichuan
Huiyuan Mining and Mineral Inc; Sichuan Yadong Cement Co., Ltd; Tianjin Xiantong Material &
Mineral Trade;Zhejiang Metals and Materials; Shaoxing Binbin Timber Industry; Hangzhou Huasheng Paper;
products Fuzhou Tansun Imp & Exp; Fujian Xinhai Steel; Fujian Rongjiang Imp & Exp; Dalian Red Horse
Century International; Dalian Sunline International Trade; Dalian Dongzhan Group; Jiangsu Overseas
Group; Shenyang Wu Ai Group.
Nanjing Green-Jewel Trading; Jiangsu Machinery Import & Export; Han-well Brand Marketing
Management; Nanjing Rich Native Animal Products; Beijing Xiandushi Coffee Co., Ltd; Beijing
Huiyuan Beverage and Food Group Co., Ltd; Shenyang Wu Ai Group; Shenyang Huayue Foreign
Food and
Economic and Trade; Guangzhou Pure Taste Imp & Exp Co., Ltd; Guangzhou Y & K Food Co., Ltd;
beverage
Recca Refrigerantes Ltda; Chengdu Yingmalong Canned Food; Chengdu Uni-president Food Co., Ltd;
Tianjin ZhenRuGuo Food Industry; Dalian Sunline International Trade; Zhejiang Chun'an County
Foreign Trade; Fuzhou BuildDirect.
Carpenter Tan Handicrafts Co., Ltd; Wuhan Eleca Electronics Co., Ltd; Hubei Cen-tronic; Fuzhou
Kaishijie Wood; Nanjing Minglin Wood Industry; Nanjing Textile Import/Export; Jiangsu Machinery
Import & Export; High Hope Intl Group Jiangsu Knitwear & Home Textiles Imp. & Exp; Shenyang
Woods
Wu Ai Group; China Light Building Material Import & Export Corporation; Beijing Yonghui Wood
Working Co., Ltd; Beijing New Building Materials (Group) Co., Ltd; Hubei Allied Homeware Co.,
Ltd; Xiamen Yungde Ornament; Kingmate (Xiamen); Shaoxing Binbin Timber Industry.
Maxleaf Paper Group Co., Ltd; Shenyang Stainless Paper Industry; Hangzhou Hanggang Foreign
Paper pulp Economic Relations and Trade; Xiamen C&D Paper &Pulp Co., Ltd; Jiangsu Overseas Group; Nanjing
Textile Import/Export; Hangzhou Huajin Import & Export.
Soy (including COFCO; China Textile Resources Corporation ;Fujian Kanghong; Tianjin Longwit Grains and Oils
oil and bran) Industrial; Tianjin Huixin Soybean Science & Technology; Xiamen C & D Inc.
Wuhan Kyowa Synchronizer Ring Corp; Wuhan Hai Sing Tech International Co., Ltd; Shenyang
Metals Cement Machinery; Shenyang Sanyo Building Machinery; Fuzhou Build Direct; Jiangsu Overseas
Group; Hubei Cen-tronic
Shanghai Lermonda Shoes Co., Ltd; Guangzhou Penny Shoes Co., Ltd; Chengdu Duomeiduo Shoes;
Leather Dalian Auskin Footwear; Tianjin Baoxinda Case & Bag Factory; Yamei Xiamen Leather Products Co.,
Ltd; Jiamei Group Xiamen Import & Export Co; Jiangsu Animal By-Products Import & Export
Shenyang Sino Vehicle Parts; Shenyang Northeast Machine and Industry; Shenyang Huayue Foreign
Auto parts Economic and Trade; Dalian Auto Tech;
High Hope Intl Group Jiangsu Knitwear & Home Textiles Imp. & Exp; Fuzhou Build Direct;
Hangzhou Liyuan Fragrance Tech; Zhejiang Chun'an County Foreign Trade; Xiamen Yundang Industry
and Trade; Fujian Chahua Household Plastics; Jiangsu Sainty; Nanjing Rich Native Animal Products;
Nanjing Textile Import/Export; Jiangsu Machinery Import & Export;
Chemical
High Hope Intl Group Jiangsu Knitwear & Home Textiles Imp. & Exp; Jiangsu Overseas Group;
products
Chengdu Reliance Electric Co., Ltd; Liaoning Chengda Industrial; Liaoning Pharmaceutical Foreign
Trade; Guangzhou Chemical Import and Export. Corp; Wuhan Hai Sing Tech International Co., Ltd;
Sichuan Huiyuan Optical Communication ; Chengdu Hujiang Medical Instruments; Dalian Wenda;
Xiamen Shenglihang Trade Co., Ltd; Hangzhou Mingyang Technology; Qingchun Jewllery; Fuzhou
Precious stone Banaxiu Brazilian Natural Gem; Fuzhou Duopas Apparel; Tianjin Hongyan Mining; Guangzhou Deli
Jewellery Co., Ltd
Xiamen Orient Wanli Stone Co., Ltd; CATICXM; Xiamen Stone Enterprise Co., Ltd; Xiamen Yundang
Granite blocks
Industry and Trade; Dalian Zhongqiaozhizun Marble;

Guangzhou Welon (China) Ltd; Dalian WO_LONG Trading; Chengdu Reliance Electric Co., Ltd;
Textiles
Guangzhou Chemical Import and Export. Corp ;Wuhan Yudahua Group Co., Ltd;
Machinery and
mechanic Dalian Auto Tech; Shenyang Blower Works (Group) Import & Export;
appliance and Shenyang Sanyo Building Machinery; Chengdu Reliance Electric Co., Ltd;
parts
Precision Chengdu Hujiang Medical Instruments; Fortune Medical Supplies Co., Ltd; Liaoning Pharmaceutical
instruments Foreign Trade; Hubei Cen-tronic.
Others Xiamen Meitoushan Metal Products Co., Ltd; Shenyang Huayue Foreign Economic and Trade;
(electronics, Chengdu Kunshan Honghe Modern Agriculture; Chengdu Reliance Electric Co., Ltd; Guangzhou
glassware, etc.) Chemical Import and Export. Corp; Fujian Rongjiang Imp & Exp; Ekai Electric Group Co., Ltd.

Appendix 5.5 Portrait of Potential Chinese Partners for Brazilian Companies
Experience Experience Experience Openness to BRA
Code Company name Related sector (s) Business nature with BRA with BRA with foreign (out of 1-5 scale Interested sector(s)
products suppliers suppliers rating system)
China National Tobacco Imp & Exp Manufacturer,
BJ15 Tobacco 3.5 Tobacco leaves
Corp. imp/exporter
Beijing Cross-Century Science &
BJ22 Chemical products (Wax) Manufacturer 4.25 Palm wax
Technology Co., Ltd.
Timber, plastic products,
China Light Building Material Import
BJ23 construction material, steel Imp/exporter 4 Woods
& Export Corporation
products, etc
Beijing New Building Materials Manufacturer,
BJ24 Construction material (OSB) 3.75 Woods (OSB)
(Group) Co., Ltd. imp/exporter
Oils & fats, food and Manufacturer, Soy(soybean and
BJ25 COFCO 3.75
beverage, soybeans, etc imp/exporter, wholesaler soybean oil)
Beijing Huiyuan Beverage and Food Manufacturer/Importer & Concentrated orange
BJ03 Fruits & juices 2.75
Group Co., Ltd exporter juice
Textile, agricultural and Manufacturer,
BJ14 China Textile Resources Corporation sideline products (e.g. edible exporter/importer, 3.25 Soybean meals
oil) wholesaler
BJ08 Beijing Xiandushi Coffee Co., Ltd. Coffee beans Manufacturer, importer 3.75 Coffee bean
BJ12 Beijing Yonghui Wood Working Woods Importer, distributor 3.5 Woods
Manufacturer,
SH15 Baosteel Group Corporation Steel and steel products 3.25 Mineral products
imp/exporter
Shanghai Tobacco Import & Export
SH25 Tobacco Imp/exporter 3.25 Tobacco leaves
Corporation
Shanghai Zhenhua Port Machinery Port related machinery & Good willingness to
SH02 Manufacturer, exporter 3
Co., Ltd. mechanical appliances invest only
SH04 Shanghai Lermonda Shoes Footwear (shoes) Manufacturer 2.75 Leather
Shanghai Liancheng (Group) Co., Machinery & mechanical Manufacturer , Good willingness to
SH24 3
Ltd. products, electrical wholesaler invest only

appliances
Electronics, machinery &
Manufacturer,
SH14 Ekai Electric Group Co., Ltd. mechanical appliances, 3.25 Electronics parts
imp/Exporter
precision instruments
Manufacturer, Imp/
SH07 Double Coin Holdings Ltd. Rubber & articles (tires) 1.75 Rubber
exporter
Manufacturer, importer/
GZ21 Recca Refrigerantes Ltda. Guangzhou Beverages 5 Fruit extracts
exporter
Chemicals, glassware,
Guangzhou Chemical Import and
GZ02 Chemical products Importer/exporter 4.25 Textile & dyeing
Export. Corp
products
Sports wear and sporting Manufacturer, importer
GZ04 Guangzhou Welon (China) Ltd 3.25 Textile products
supplies and & exporter
Foods and food ingredients
GZ05 Guangzhou Y & K Food Co., Ltd Manufacturer/Importer 4 Coffee bean
(coffee bean)
Guangzhou Tahitian Noni Juice Co., Manufacturer, Good willingness to
GZ13 Beverages 3
Ltd. Importer/exporter invest only
Precious
GZ01 Deli Jewellery Co., Ltd Jewellery Manufacturer, exporter 3.5
stone(SAPPHIRE)
Guangzhou Chuangbo Chemical Co., Manufacturer, importer

GZ15 Chemical products (Wax) 4 Palm wax
Ltd and exporter
Guangzhou Senye Chemical Imp & Fine chemical raw

GZ16 Fine chemicals Importer and exporter 4
Exp Co., Ltd materials
Manufacturer,
GZ14 Guangzhou Penny Shoes Co., Ltd Footwear (shoes) 4 Wet blue leather
importer/exporter
Guangzhou Maxtex Import and
GZ24 Latex, synthetic rubber Importer and exporter 3.75 Rubber
Export Co., Ltd.
Guangzhou Pure Taste Imp & Exp Importer, wholesaler &
GZ22 Food & beverage 4.25 Food
Co., Ltd. retailer
CD13 Carpenter Tan Handicrafts Co., Ltd Woods articles Manufacturer/distributor 4 Wood
Sichuan Huiyuan Mining and Mineral Manufacturer, exporter
CD12 Metallurgical products 4 Mineral products
Inc & importer

Electrical equipments,
Nylon, plastic and
CD08 Chengdu Reliance Electric Co., Ltd supplies and electronic Manufacturer 3.75
electric equipment
components
Chengdu Kunshan Honghe Modern Manufacturer, importer Agricultural
CD14 Agriculture products 3.75
Agriculture & exporter products(seeds)
CD18 Chengdu Uni-president Food Foods Manufacturer/retailer 4 Ground coffee
Manufacturer, exporter
CD10 Chengdu Duomeiduo Shoes Footwear (shoes) 3.5 Leathers and furs
and importer
Foods (canned agricultural Manufacturer, exporter Food(canned fruit and

CD01 Chengdu Yingmalong Canned Food 3.5
products) & importer vegetable)
Electronic and electrical Photoelectric
Sichuan Huiyuan Optical Manufacturer, exporter
CD25 products, communication 3 products(optical fibers
Communication and importer
equipments and cables)
CD24 Sichuan Yadong Cement Co., Ltd Cement Manufacturer 3 Mineral products
Chengdu Hujiang Medical Medical equipments and

CD21 Medical instruments Distributor 3.5
Instruments rubber products
Wuhan Kyowa Synchronizer Ring Machinery and mechanical Manufacturer, Metal product (steel
WH01 2.75
Corp. products exporter/importer rings)
Exporter/importer,
WH10 Wuhan Eleca Electronics Co., Ltd Musical instruments 4 Wood
manufacturer
Electronics and electrical laboratory instruments.
WH13 Hubei Cen-tronic products, mechanical Exporter/importer 2.75 Woods, aluminum
instruments powder
Manufacturer,
WH03 Maxleaf Paper Group Co., Ltd Paper and Paper article 3 Paper pulp
Exporter/importer
Manufacturer,
WH12 Fortune Medical Supplies Co., Ltd Surgical appliances 3.75 Medical instrument
exporter/importer
Wuhan Hai Sing Tech International Manufacturer, Metal product and
WH15 Mechanical products 3.25
Co., Ltd. exporter/importer chemical products
Manufacturer,
WH24 Hubei Allied Homeware Co., Ltd Furniture and furnishing 3.25 Woods
Exporter/importer

Wuhan Tianyu Information Industry Smart card and smart card Manufacturer, Good willingness to
WH09 3
Co., Ltd. operating system exporter/importer invest only
Manufacturer,
WH19 Wuhan Yudahua Group Co., Ltd Textiles 3 Cotton
exporter/importer
Manufacturer &
SY02 Shenyang Huaning Shoes Galoshes products 3.75 Rubber
wholesaler
SY04 Shenyang Cement Machinery Cement machinery products Manufacturer 4.25 Steel
SY05 Shenyang Stainless Paper Industry Paper products Manufacturer 3.75 Pulp
Steel, motor & crane

SY07 Shenyang Sanyo Building Machinery Crane products Manufacturer & exporter 3
related parts
Coffee bean, auto
Shenyang Huayue Foreign Economic Apparel, textiles, case bags,
SY08 Importer & exporter 3.75 accessories and
and Trade furniture materials
electronic products
Pharmaceutical, medical
Liaoning Pharmaceutical Foreign Pharmaceutical products,
SY12 Importer & exporter 4 devices and chemical
Trade and medical devices
products
Manufacturer, importer
SY13 Shenyang Sino Vehicle Parts Auto parts 3.25 Auto parts
& exporter
Shenyang Blower Works (Group) Turbo-machinery,
SY14 Importer & exporter 4 Motor, filter and pipeline
Import & Export compressor, and pump.
Plastic raw materials,
Plastic raw materials &
SY15 Liaoning Chengda Industrial apparels, and chemical Importer & exporter 3.25
chemical fertilizers
fertilizers
Textile, garment, bag, toy,
handicraft, small Distributor, importer &
SY16 Shenyang Wu Ai Group 4.5 Wood, mineral, fruit, etc.
commodities and other exporter
products
Shenyang Northeast Machine and Machinery equipment and
SY19 Importer & exporter 3 Auto parts
Industry parts
DL02 Dalian Wenda Food additives, chemicals 4.25 Food additives & flavors
& exporter

DL05 Qingchun Jewllery Agate, crystal and emerald Manufacturer 4 Jewellery raw materials
DL06 Dalian Dongzhan Group Mineral products 4.25 Iron ore
& exporter
DL07 Dalian Zhongqiaozhizun Marble Marble products Manufacturer 4 Stone (marble)
Textiles, garments, and

DL08 Dalian WO_LONG Trading Importer 4 Textiles
accessories
Machinery & mechanical Auto processing
DL10 Dalian Auto Tech Manufacturer 3.5
appliances equipments
DL11 Dalian Auskin Footwear Footwear Manufacturer & exporter 4.5 Shoe materials
Chemicals, mechanical
Ores, agricultural
DL14 Dalian Sunline International Trade equipments, metallurgy Exporter & importer 3
products and fruits
products, rare ore/metal
DL19 Dalian Tyre Factory Tyre Manufacturer & exporter 3.5 Natural rubber
Dalian Red Horse Century Iron ore, Iron & steel

DL21 Exporter & importer 4 Ores
International products
bio-chemical products, natural materials for
Zhejiang Chun'an County Foreign
HZ03 medical appliances, Exporter & importer 4.5 food, cosmetics, medical
Trade
instruments & meters and dye
Hangzhou Hanggang Foreign
HZ06 Pulp Exporter & importer 3.5 Pulp
Economic Relations and Trade
HZ07 Hangzhou Huasheng Paper Paper Manufacturer 3.5 Kaolin dry powder
Metal products, oil products, Manufacturer, exporter
HZ16 Zhejiang Metals and Materials 3.5 Ores
hotel, and textiles & importer
Manufacturer,
HZ17 Shaoxing Binbin Timber Industry Flooring wholesaler, retailer, 4 Timber & mineral
exporter/importer
Essential oil and relevant Manufacturer &
HZ19 Hangzhou Liyuan Fragrance Tech 2.5 Plant oils
products wholesaler

Brazilian black gallstone and
HZ22 Hangzhou Mingyang Technology Manufacturer 2.75 Black gallstone
relevant jewellery
Wood pulp, waste paper,

HZ25 Hangzhou Huajin Import & Export Exporter & importer 4 Broad-leaved wood pulp
plastics
Precious stones & metals,

FZ02 Fuzhou Tansun Imp & Exp Importer & exporter 5 Ores
white sugar, etc.
FZ03 Fuzhou Kaishijie Wood Wood products Manufacturer 4 Wood

FZ05 Fujian Kanghong Soy related products Manufacturer 4 Soy bean
Auto parts, steel & iron
FZ09 Fuzhou BuildDirect Building materials Importer & exporter 4
products, food
Fuzhou Banaxiu Brazilian Natural
FZ10 Precious stones Manufacturer 4 Precious stone
Gem
FZ11 Fujian Chahua Household Plastics Household plastic products Manufacturer 3.5 Plastic
FZ12 Fuzhou Duopas Apparel Apparel Manufacturer 5 Precious stone

FZ14 Fujian Xinhai Steel Metallurgical products Manufacturer 4 Ores
Porcelain, footwear &
FZ17 Fujian Rongjiang Imp & Exp headgear, machinery, metal Importer & exporter 3.5 Ores & white sugar
& hardware and others
FZ18 Fujian Zhenyun Plastics Industry Plastic and plastic products Importer & exporter 3.25 Plastic raw materials
FZ20 Fuzhou Fuyan Footwear Footwear Manufacturer 4 Rubber
Hardware, furnace burden,
TJ06 Tianjin Xiantong Material & Trade ore, chemical products & 3.5 Ore powder
& exporter
textiles
Non-metallic mineral
products, chemical raw Precious stone &
TJ11 Tianjin Hongyan Mining Manufacturer 4
materials, healthcare tourmaline
jewellery
Tianjin Longwit Grains and Oils
TJ13 soybean oil, palm oil Manufacturer 4 Soy bean oil
Industrial

Tianjin Huixin Soybean Science & Soybean oil, soybean meal
TJ14 Manufacturer 3.75 Soy bean
Technology and healthcare food.
Tianjin Baoxinda Case & Bag Genuine leather and non-

TJ16 Manufacturer 3 Leather products
Factory genuine leather products
Flavor essence, fruit and

TJ17 Tianjin ZhenRuGuo Food Industry vegetable power and Manufacturer 3 Fruit concentrates
condiments
Rare minerals, Metallurgical
XM07 Xiamen Orient Wanli Stone Importer 3.5 Granite blocks
products
Chemical products, granite,
steel, minerals, medical
XM02 CATICXM Importer/exporter 3.75 Granite blocks
devices, shoes and apparel,
paper products, etc
Stone raw material and stone
XM10 Xiamen Stone Enterprise Co., Ltd. Manufacturer, exporter 2.5 Granite blocks
articles
XM01 Yamei Xiamen Leather Products Leather products Manufacturer/exporter 3 Leather
Jiamei Group Xiamen Import & Leather products, textile and

XM11 Manufacturer/exporter 3.5 Leather(wet blue)
Export Co apparel, plastic products, etc
XM24 Xiamen Shenglihang Trading. Agate/crystal stones Importer/exporter 3.25 Agate/crystal stones
XM25 Xiamen C&D Paper &Pulp Paper & pulp Importer/exporter 3.5 Pulp
Metallurgical products,
Manufacturer/Importer Mineral products and
XM12 Xiamen ITG chemical products, textile 4.75
and exporter steel products
and apparel, pulp, food, etc.
XM16 Xiamen Meitoushan Metal Products Metal products Manufacturer/exporter 3 Glassware
Woods articles (wooden

XM20 Xiamen Yungde Ornament Manufacturer/Exporter 4.25 Timber
floor), ornaments
Optical PC lenses, chemical
XM14 Kingmate (Xiamen) Importer/exporter 5 Timber
products, etc
Chemical and Mineral products and
XM08 Yundang Industry & Trade. Importer/exporter 3.5
pharmaceutical raw materials chemical raw materials

Manganese ore, soybean,
Barley, wheat, ores, palm oil,
XM17 Xiamen C & D Inc. Importer/exporter 5 crude soybean oil and
rubber, fish powder;
rubber
Wood, chemical products,
Manufacturer, importer Wood, chemical products
NJ02 Nanjing Textile Import/Export personal care products, juice, 3.75
& exporter and paper pulp
and pulp
Wood, personal hygiene
NJ03 Jiangsu Machinery Import & Export Wood & glycerin 4 &cosmetics, beverage,
& exporter
chemicals
Orange and lemon Juice,
Orange and lemon Oil,
NJ04 Nanjing Rich Native Animal Products Fruit juice Manufacturer & retailer 4
cherry juice and cherry
powder
NJ05 Nanjing Green-Jewel Trading Health products Wholesaler 4.5 Bee glue
Manufacturer, importer Chemical material,

NJ07 Spec-Chem Industry Chemicals 4
& exporter rubber
Jiangsu Animal By-Products Import Manufacturer, importer
NJ10 Leather 4 Leather
& Export & exporter
Han-well Brand Marketing Wholesaler, importer &
NJ11 Health products 3.5 Bee glue
Management exporter
NJ14 Jiangsu Sainty Plant oil & boron 3.75 Orange and rose Oil
& exporter
NJ19 Nanjing Minglin Wood Industry Timber Manufacturer & exporter 3.5 Wood(board)
Jiangsu Knitwear & Home Textiles Wood, chemical, auto part, Manufacturer, importer Wood, chemical, auto
NJ23 3.5
Imp. & Exp. etc. & exporter parts
Timber, steel, chemicals, Iron ore, woods, paper

NJ25 Jiangsu Overseas Group wool, pulp, 3.5 pulp, chemical products
& exporter
electromechanical products and metals

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China: 12-City Company Analysis

A custom report compiled by Euromonitor International for APEX

Project Managers: James Chen and Zoe Zhou

+86 21 6372 6288

Euromonitor International 2009. All rights reserved. Page ii

Euromonitor International 2009. All rights reserved. Page iii

Apex-Brasils major research objectives can be summarised as follows:

Euromonitor International 2009. All rights reserved. Page 4

Table 1 Total Number and Distribution of Trade Interviews

SPSS statistics analysis

Euromonitor International 2009. All rights reserved. Page 5

City ranking analysis

Table 2 Skeleton of the Quantitative Evaluating System for 52-City Ranking

Macro Economic Performance Industry fitness

Logistic Initiatives Retailing and Consumption

Source: Euromonitor International

Analysis and Validation

1.2.2 Geographic Coverage

Euromonitor International 2009. All rights reserved. Page 6

1.2.3 Criteria for Sectors and Companies Interviewed

1.3 RESEARCH DELIVERABLES

Euromonitor International 2009. All rights reserved. Page 7

Euromonitor International 2009. All rights reserved. Page 8

2.1 OVERVIEW OF THE BRAZIL-CHINA TRADE RELATIONSHIP

Euromonitor International 2009. All rights reserved. Page 9

Euromonitor International 2009. All rights reserved. Page 10

2.2 OPPORTUNITIES FOR BRAZILIAN COMPANIES

Euromonitor International 2009. All rights reserved. Page 11

Sectors representing better development opportunities

2.3 CHALLENGES AND BARRIERS

Euromonitor International 2009. All rights reserved. Page 12

Source: Euromonitor International

Euromonitor International 2009. All rights reserved. Page 13

Euromonitor International 2009. All rights reserved. Page 14

Country of Origin Country of Origin

Source: Euromonitor International

Threats brought by other import origin counties/area

Euromonitor International 2009. All rights reserved. Page 15

2.4 KEY RECOMMENDATIONS

Euromonitor International 2009. All rights reserved. Page 16

Euromonitor International 2009. All rights reserved. Page 17

Euromonitor International 2009. All rights reserved. Page 18

Marketing and promotional activities

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Euromonitor International 2009. All rights reserved. Page 21

3.1 BRAZIL-CHINA TRADE AND COMMERCIAL TIES OVERVIEW

Table 6 Main Imported Oroducts from Brazil to China, 2007

Year-on-year growth Import volume

Brazilian exports to China registered a CAGR of 35.7% during 2001-2007

3.1.2 Market Drivers and Constraints of Brazil Exports to China

Euromonitor International 2009. All rights reserved. Page 22

Brazils export benefits from Chinas tariff reduction policies.

3.2 SECTORS REPRESENTING BETTER OPPORTUNITIES BY CITY

Euromonitor International 2009. All rights reserved. Page 23

Petroleum crude oil

Paper & pulp

Euromonitor International 2009. All rights reserved. Page 24