Brazil grain exporters challenged by port tax collectors protest

Delivery of phytosanitary certificates has been delayed
calendar icon 23 March 2022
clock icon 2 minute read

Agricultural exporters in Brazil are facing a hard time getting paid for their shipments due to a protest by tax collectors at Latin America's busiest port, the National Association of Grain Exporters (Anec) told Reuters on Tuesday.

The protest is delaying the issuance of phytosanitary certificates, an inspection document used for plant products, which is required for exporters to receive payments, Anec's director Sergio Mendes said. Inspections can only happen once tax collectors have cleared the shipments.

The setback comes as Brazil reaches a seasonal peak for soybean shipments. The Santos port in Sao Paulo, where the protest is taking place, accounts for about 30% of the country's soybean exports and half of its corn and soy meal exports.

"A 65,000-tonne soybean shipment is currently worth $42 million, and if the exporters do not get the phytosanitary certificate, they will not get that revenue as well," Mendes said.

Major global grain traders are among Anec's associates, including Archer Daniels Midland Co., Cargill Inc and Louis Dreyfus Company.

Brazilian tax collectors have initiated a work-to-rule effort - which legally allows workers to meet only the minimum job requirements - last year as they campaign for higher wages.

The labour action has just recently started affecting the grain industry, Mendes said, adding that he sent a letter to Economy Minister Paulo Guedes asking for solutions.

Brazil's Economy Ministry did not immediately respond to a request for comment, while the federal revenue service declined to comment.

Mauro Silva, head of tax collectors' union Unafisco, said the workers will keep protesting.

"If our problem does not get solved by the end of April, the work-to-rule effort might be kept in place until a new administration takes office," Silva said.

Brazil will hold general elections in October. Far-right President Jair Bolsonaro is expected to run for re-election, but he currently trails former leftist President Luiz Inacio Lula da Silva in opinion polls. The winner will take office in January 2023.

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