Brazil’s Trucker Strike Affecting US Soy Markets
By admin March 5, 2015




For nearly two weeks, truckers in Brazil have been on strike, due to the high cost of diesel. According to Reuters, a spokesman of Brazil’s second-largest soy exportation port, the Port of Paranagua, explained that over the weekend, “only 590 of the usual 3,000 trucks arrived;” while on Monday, it received 950 trucks, “double the previous days, but still well below normal for this time of the year.” Despite worries that if the strike continues the port could run out of stock for exportation by Wednesday, the number of road blockages has shrunken from 99 in four states to 24, indicating that it may be losing momentum at this point.

The disruption in shipping and transport of soybeans in particular has driven up prices of soy in the United States. Bob Burgdorfer, senior editor of Farm Futures, has said that “opinions (of strikers) changed on Thursday after the two sides failed to settle their differences,” Burgdorfer says. “The truckers want relief from high fuel prices and road tolls and apparently the government offers were not enough.”

There are doubts among truckers about President Dilma Rousseff’s new bill to lower toll costs, build more rest stops, and waive any outstanding overweight fines accrued over the past two years for truckers. As their main reason for striking was apprehension over rising diesel and freight costs this bill is especially important to bring the current dispute to an end.

On Sunday, it was reported by Reuters that demonstrations had turned violent and had disrupted food deliveries, and as a result, Brazilian police had begun cracking down on the road blockages, ending them in all but two states. The violence was initiated after protester Cléber Adriano Machado Ouriques was hit and killed in São Sepé by a truck that failed to stop at a blockade, becoming the only fatality thus far.

Discrepancies in police reports compared to reports from highway spokespeople are also doing nothing to quell the growing unease for exportation firms. For example, the police reported zero blockages along BR-163, one of the country’s main land shipping routes for soy, located in Mato Grosso, while the spokesperson for Rota do Oeste (the operator of BR-163) reported at least three blockages.

Brazil’s soy industry isn’t the only one facing disruptions in shipping. The country’s meat and grain industries are also facing setbacks as the strike continues. Since Friday, Brazil’s main poultry exporting port, the Port of Itajai, has been cut off from shipments, which has in turn affected meat-packing companies.

The AgRural consultancy said in a report that Brazil’s soy harvest is 29% complete nationwide, down from 39% from last year as the strike also disrupts the diesel fuel deliveries needed to run farm equipment. If the strike fades and loses momentum, it will still take time for production and exportation to return to normal, while continuing strikes and blockages will further impede Brazil’s agriculture sector.


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