The European Commission has taken a decisive step forward by approving the long-debated EU-Mercosur and EU-Mexico trade agreements, bringing the possibility of the world’s largest free trade area closer to reality.
While the deal promises major opportunities for European wine exporters, it has triggered deep divisions within the broader agricultural sector, particularly in Italy.
For wine producers, the agreement is a milestone. The European Committee of Wine Companies (CEEV), which represents key players such as Italy’s UIV (Unione Italiana Vini) and Federvini, welcomed the Commission’s move. “At a time of growing geopolitical and economic challenges, it is more important than ever for the EU to secure and diversify its trade relations with reliable partners,” said CEEV president Marzia Varvaglione, calling on the European Parliament and the Council to ratify the agreement without delay.
The numbers reflect the sector’s optimism: EU wine exports reached €16 billion last year, with the U.S. still its top destination. Yet, diversification is seen as critical. Current trade with Latin America is relatively modest—Brazil accounts for just over EUR 200 million, and Mexico nearly the same—but both are considered dynamic markets with high growth potential. The deal promises to eliminate Brazil’s 27% tariff on EU wines, improve protection for Geographical Indications, simplify import procedures, and create a more predictable framework for trade.
Still, wine producers remain realistic. CEEV secretary Ignacio Sánchez Recarte cautioned: “Brazil and Mexico cannot replace the U.S. market. However, they are dynamic markets where European wines are highly valued, and this agreement removes a major barrier to growth.”
From Italy, Lamberto Frescobaldi, president of the UIV, echoed the sentiment: “With U.S. tariffs affecting exports, the key is to diversify. Mercosur, with its 270 million consumers, represents a real opportunity.” The UIV Observatory notes that Italian wine exports to Brazil grew 5.5% in value in the first half of 2025, reaching €18.5 million, with strong growth in sparkling wines.
Agricultural Concerns: The Flip Side
Beyond wine, however, the Mercosur deal opens the door to sensitive agricultural imports, sparking protests among European farmers. The EU Commission insists the agreement includes safeguards—such as limiting beef and poultry quotas, protecting 344 Geographical Indications, and setting aside a EUR 6.3 billion agricultural crisis reserve—but skepticism remains strong.
Italian organizations, including Confagricoltura, Coldiretti, Filiera Italia, and Cia-Agricoltori Italiani, warn that European farmers risk unfair competition. They argue that Mercosur producers benefit from lower labor costs and looser environmental, food safety, and animal welfare regulations, allowing them to export at prices up to 50% lower than European equivalents.
“Without reciprocity on production standards, this deal could devastate sensitive supply chains like beef, poultry, sugar, and rice,” said Coldiretti, pointing to over 130 food safety alerts in 2025 linked to Mercosur imports. CIA president Cristiano Fini stressed the need for rapid safeguard clauses and strict checks: “Monitoring is positive, but action must be swift when crises hit.”
The Confcooperative federation, representing agri-food cooperatives, was even more blunt: “This agreement contradicts the EU Green Deal. It promotes imports from countries with lower sustainability standards while demanding costly compliance from European farmers.”
Government Position
Italy’s government has taken a cautious stance. Palazzo Chigi welcomed the inclusion of additional safeguards, such as enhanced phytosanitary checks and rapid intervention mechanisms, but stressed that final support for the deal will depend on their effectiveness.
As the agreement moves to the Council and European Parliament for ratification, the EU faces a delicate balancing act: opening vast new markets for industries like wine, while ensuring that Europe’s most sensitive agricultural sectors do not pay the price.
For the wine sector, the deal is largely seen as an opportunity. For agriculture at large, it is viewed with apprehension. The final decision will determine whether this agreement is remembered as a triumph of diversification or as a threat to European farmers.
Source: WineNews