Blairo Maggi rejects Temer's freight rate table.
“There’s a stalemate here. As a producer, I don’t accept this table,” says Agriculture Minister Blairo Maggi regarding the freight rate table created by the Temer government and approved by Congress; according to him, in some cases, the prices are higher than agreed upon, and therefore, producers are avoiding making commitments and delaying planting, which could cause a drop in crop productivity.
By Daniel Mello, for Agência Brasil - The Minister of Agriculture, Livestock and Supply, Blairo Maggi, said today (23) that the freight rate table approved almost two weeks ago by Congress is a “deadlock” and could cause losses in the next harvests.
“There’s a stalemate here. As a producer, I don’t accept this price list. I don’t accept the values that have been put forward,” the minister emphasized after participating in the opening of the Global Agribusiness Forum in São Paulo.
The National Policy on Minimum Freight Rates for Road Transport was created by the federal government as a way to address the demands of truck drivers, who went on strike in May, blocking several roads.
According to the minister, in some cases, the established prices are considerably higher than those previously agreed upon, and therefore, producers are avoiding making commitments and delaying planting. "Since it [the price table] is out of sync with what the market was operating at, neither exporting companies nor those who don't want to take on new risks are engaging in futures trading," he emphasized.
Maggi said that the delays can cause a drop in crop productivity, such as soybeans. “In Mato Grosso, we plant soybeans from mid-September to mid-October. When November arrives, if you're still planting, each passing day means one less bag, on average. The windows we have are very small, and the losses can be quite significant,” he explained, referring to the sector and the region where he operates as a businessman.
The minister added that, in addition, there have been disputes between suppliers and producers regarding the fulfillment of contracts made before the price fixing. Some input manufacturers, who sold with freight included in the price, have been trying to renegotiate already agreed-upon deliveries, while producers are demanding compliance with the agreements, said Maggi. “There are also legal discussions taking place. In the end, it's just confusion.”
The Brazilian Supreme Court (STF) is expected to revisit the issue at the end of August. Justice Luiz Fux is the rapporteur at the STF for three direct actions of unconstitutionality against the provisional measure that established the minimum price policy. The actions were filed by the Brazilian Road Transport Association (ATR Brasil), which represents transport companies, the National Confederation of Industry (CNI), and the Confederation of Agriculture and Livestock of Brazil (CNA).
Russia
Blairo Maggi also commented on the Russian embargo on Brazilian pork and beef. The restrictions were announced in December, when Russian health authorities claimed to have found ractopamine – a substance that promotes muscle growth in animals – in Brazilian pork. The products are legal in Brazil, but the trade agreement with Russia stipulates that production sold to the country must not contain these substances.
A Brazilian technical commission arrives in Russia this Monday to try to reverse the ban on Brazilian meat. Maggi said he also intends to have President Michel Temer discuss the matter with Russian President Vladimir Putin during the BRICS summit, scheduled for this week in South Africa. BRICS is a group formed by Brazil, Russia, India, and South Africa.