Brazilian farmers fear grain shortages

The Brazilian government is trying to calm the sector, which is asking for lower taxes on grain imports.

The Brazilian livestock sector fears a shortage of corn and soybeans due to high prices and speculative behavior of grain producers. This is a peculiar situation, as this year Brazil expects the largest grain production in history, which will amount to approximately 271 million tons.

Although international corn prices have declined slightly recently, the pig and poultry sectors have reiterated that the government should intervene to prevent costs from rising too high.

In a direct warning they sent to Brazilian President Jair Bolsonaro, they detailed the risks of higher prices for such basic products as poultry and pork. Experts also argue that the market is likely to reduce the supply of these goods.

“The authorities must intervene because there may be nothing on Brazilian dinner tables if the government does not act quickly. This will not mean a shortage of goods, but their availability may decrease. Poor people will suffer,” said Ricardo Santin, President of the Brazilian Animal Breeders Association (ABPA), speaking in the Chamber of Deputies.

Livestock sector officials want to meet with the president to discuss the situation they are facing as prices for corn rise 180%, soybeans 140%, cardboard 68% and diesel 30% since 2019, Santin said. of the year.

Santin has identified corn price speculation as grain farmers still see an uptrend in international markets. As a consequence, Santin is asking for federal tax exemptions on the import and sale of foreign grain. The sector is also seeking permission to import restricted varieties of transgenic corn from the US .

Silvio Farnese, DIRECTOR of the Department of Agriculture's Commercialization and Procurement Division, said that despite financial difficulties, there is room for federal corn import tax cuts to ease pressure on farmers' costs. He also encourages more grain production for the next crop and believes in lower prices in the long run.

The National Supply Company's (Conab) 8th study on the 2020/2021 grain crop, published 2 weeks ago, suggests that Brazilian grain production will reach 271.7 million tons, which means an increase of 5.7% or 14.7 million tons compared to from 2019/20

The historic mark is driven by record soybean production and an estimated increase in overall corn production. Soybeans will account for nearly half of Brazil's total grain production at 135.4 million tons, up 8.5% or 10.6 million tons from last year. Maize results are estimated at 106.4 million tonnes, up 3.7% from 2019/20 production levels.