Jul 18, 2017

Grain Movement back to Normal on BR-163 in Northern Brazil

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

After a week of blockades on highway BR-163 in northern Brazil, the protestors removed their blockade last Friday allowing for a normal flow of grain trucks heading north from Mato Grosso to the Amazon River. The protest ended after President Temer sent to the Brazilian Congress the text of a proposed law that would alter the limits of an environmental protected area in the region. The protestors, which included ranchers, farmers, miners, and commercial interest, claimed the old limits would take away their livelihood.

The operations most impacted by the blockade were at the Port of Miritituba on the Tapajos River. From this port, barges loaded with corn and soybeans are sent downriver to ports near the mouth of the Amazon River. During the blockade, more than one company was forced to cancel contracts and pay fines because they did not have grain to load their barges. Estimates are that the blockade resulted in R$ 150 million losses for the various companies. Representatives from the Brazilian Association of Vegetable Oil Processors (Abiove) indicated that the situation at the Port of Miritituba is now back to normal.

While this blockage has been resolved, it will not be the last time that protestors use this highway to draw attention to their grievances. Back in March, the road was closed for several weeks due to torrential rains that made part of the unpaved section impassable. Since then though, there have been three separate episodes of protestors closing the highway for various reasons. At the peak of the grain export season, more than 800 grain trucks per day head north from central Mato Grosso to the Amazon River.

As long as there is only one way north from central Mato Grosso to the "Northern Arc" of ports on the Amazon River, BR-163 will remain a tempting target for protesters wanting to highlight their cause.