EU agri-food trade with the BRICSs: The case of Brazil

International trade between countries can be categorised as inter-industry or intra-industry. Intra-industry trade, particularly of vertically differentiated products, has expanded significantly since the 1960s, especially in Europe. However, Fontagné et al. (2006) note that inter-industry trade has made something of a comeback since 2000, due to the increasing participation of emerging economies in world trade. Accordingly, this paper asks whether such a change is evident in the bilateral agri-food trade between the EU and Brazil which is the largest of all exporters of agri-food products to the EU. Trade types are categorised in the paper following Fontagné and Freundenberg (1997). Results suggest that whilst the majority of agri-food trade between Brazil and the EU is of an inter-industry nature, its relative importance has not increased, although there is evidence that inter-industry trade of other primary products has become more important, which accords with the observation of Fontagné et al. (2006). A better understanding of the changing nature and pattern of trade should inform on-going international negotiations between the EU and Brazil.