BRICS Shows The Future In Trade Relations

When the US led G7 plus the EU imposed the so called 'shock and awe' sanctions on Russia,it turned to its fellow members of BRICS for its trade,this helped it successfully navigate the storm and overcome the majority of the barriers to trade.When it was cut off from the SWIFT system it and the other BRICS members moved to trade in their own currencies.

So now while the trade war between the US and most countries of the world has temporarily stalled, it is gaining momentum with China. It is obvious that China will follow the lead set by Russia and utilise the BRICS to mitigate the trade conflict with the USA.

In response to the imposition of duties on Chinese imports to the US that exceeded 100%, China has taken its own measures, including increasing tariffs in some cases to over 99%, as well as tightening control measures for many types of products, including outright bans.
Consequently, the export of food products  from the US to China are going to drop dramitcally as they just are not profitable. This presents  a valuable opportunity for the BRICS members particularly the Russian agro-industrial complex to enter the Chinese market and secure an additional share of the world's largest consumer sector?
Now lets remember that during the previous trade war, which was less comprehensive during Donald Trump's first presidency, China's retaliation was primarily against American agricultural products. The rationale behind these measures was well-calculated: first, the share of direct losses from tariffs for agricultural producers is higher than the average for the rest of the economy. Secondly, the impact was felt most acutely by American farmers, who predominantly voted for Trump and the Republican party. In total, China's countermeasures led to a reduction in U.S. food exports to China by $25.7 billion.Now that may not sound a lot but its about the amount that Russia makes on an annual basis from its wheat exports.
The potential for further escalation remains a concern. The tariffs imposed in 2018–2019 were relatively moderate. The current measures are significantly more extensive. Initially, in March, China set a barrier of 10–15%, then in April, it added another 34%, and this week, another 50%. As a result, as Daria Snitko, Vice President and Head of the Analytical Department at Gazprombank, told Izvestia, duties will amount to 94% of the base level for soybeans, sorghum, pork, beef, fish, and some other products, and 99% for corn, wheat, and chicken meat. Such a high tariff level is likely to have a significant impact on foreign trade.
China imports and consumes a significant amount of American food products , primarily raw materials. In 2024, the supply food products from the United States to China reached $27 billion. This represents around 14% of all food exports from the United States, with Mexico and Canada ranking higher on this list. This dynamic will have a particularly significant impact on soybean producers, who are currently experiencing losses that are estimated at $5.7 billion (this estimate was made prior to the recent increase in Chinese tariffs to 99%).

Russia's involvement in this matter is negligible, as evidenced by its non-participation in the aforementioned trade wars. The US has not imposed tariffs on Russia, since trade between the countries is already low after the introduction of the huge number sanctions were imposed and is limited to products that the US cannot buy anywhere else like enriched uranium  and fertilisers.
There is a threat of a drop in oil prices due to the general weakening of the global economy, but this is an indirect effect. In most industries, Russian businesses are not yet organised or prepared to capitalise on any potential gaps in the market created by the stringent tariffs. One potential area of exception may be agricultural exports to China.
Russia's exports of food products have been increasing on an annual basis. In 2023, the growth rate was 34%. In 2024, exports also grew in most sectors. For instance, in February, China granted permission for three huge pig farms from Russia to enter its market for the first time ever. While the supply for the year was modest, at around 38,000 tons, which is negligible in the context of China's total pork consumption of around 60 million tons but it adds to the 500 thousand tons of pork products it currenty sends, so can be considered a positive development. Its worth noting that the Chinese market is huge for animal offal as the Chinese eat everything from the nose to the tail of ana animal. Pigs ears,tails,feet and intestines are extremely popular in the country. Where the saying goes' The only thing with wings they do not eat is an aeroplane and the only thing with four legs is a table.  
Now Russian grown Soybean supplies increased by almost 90%. Russia is the dominant supplier of sunflower and rapeseed oil to China, accounting for 60% of all supplies, a significant increase from its previous share of less than 10% five years ago.
Wheat, however, is a separate topic. The most significant component of Russian agricultural exports (52 million tons in the last agricultural year) has historically encountered significant challenges in penetrating the Chinese market. Until the 2010s, supplies were generally banned by the Chinese government due to the infection of Russian wheat with dwarf smut (a disease caused by a fungus).

Since 2015, however, the import of wheat from four regions of the Asian part of the country has been permitted. However, it was only on 24 February 2022 that grain from all over Russia was permitted to be supplied. However, a caveat was imposed: China was only willing to accept spring wheat (a type of grain that is predominant in Russia during the winter months). Despite this condition, exports to China experienced rapid growth, with a tripling of volumes in the period from January to November of the previous year.
It should be noted that the current circumstances may be subject to alteration should the ongoing tariff war not be halted. However, it is expected that some duties from China and the US will remain in force. Darya Snitko anticipates that Russian suppliers may be able to capitalise on the volumes made available by Chinese imports.
Russian exporters of pork, soybeans, fish, and corn have the opportunity to increase volumes at a competitive price. However, it is unrealistic to expect that Russian exports will completely replace the American goods that are currently leaving the market. It is likely that another  main beneficiary of this situation will be fellow BRICS member  Brazil, which will be able to significantly increase its exports to repla the capacity of the lost US supplies.

She added that changes in global trade should accelerate the processes of unifying requirements and allowing Russian products into new markets, but that this work does not fully depend on the market situation.

Since the launch of the programme to support the export of agricultural products from Russia, there have been many consultations on the admission of various products to the Chinese market, for example, permission to export pork was a natural success of bilateral negotiations and many years of work by various departments.
Denis Ternovsky, a leading researcher at the Center for Agro-Food Policy at the Institute of Applied Economic Research of the Presidential Academy, has noted that Russian agricultural exports to China, where they compete with American products, are primarily represented by crop products with limited processing depth.
The cost of exports is determined by two factors: physical volume, or the number of deliveries, and their price. It is not possible to significantly increase the physical volume of exports, as this is limited by agricultural production, which is very slow due to the long crop growing cycle. While certain foreign trade restrictions may alter the flow of commodities in the short term, they are unlikely to impact the overall size of these trade flows. However, in the medium and long term, the opening up of niche markets in China is expected to provide a significant incentive for the expansion of Russian agricultural production, according to industry experts.
Furthermore, Ternovsky notes that trade restrictions can influence pricing. For instance, the withdrawal of American producers from the Chinese market could potentially lead to price hikes for other importers, including those from Russia. Conversely, the imposition of extensive trade restrictions may precipitate the collapse of raw materials markets, consequently driving up prices for agricultural products.

The stringent conditions imposed on the supply of winter wheat to China align with the country's broader strategy of reducing its reliance on imports of this commodity. The easing of these conditions is more likely to be driven by the success of developing Russian-Chinese relations than an attempt to replace American wheat, the share of which in Chinese imports is small and declining.