Jul 26, 2019

Brazilian Supreme Court allows Iranian Grain Vessels to be Refueled

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

Four state-owned Iranian vessels had been stranded in Brazil for up to month because Petrobras refused to sell them fuel due to U.S. led sanctions against Iran. Reuters reported on Thursday that the Chief Justice of the Brazilian Supreme Court overturned an injunction that prohibited Petrobras from selling fuel to the vessels. The fate of the two remaining Iranian vessels is unclear.

The four state-owned vessels transported urea fertilizer from Iran to Brazil and they were scheduled to transport Brazilian corn back to Iran. Petrobras was refusing to sell them fuel because their stock is traded on the New York Stock Exchange and they were concerned about violating U.S. imposed sanctions against Iran and Iranian companies.

Other companies were free to sell fuel to the vessels, but Petrobras is basically the only oil company that services Brazilian ports. The vessels are stranded near the Port of Paranagua in the state of Parana and the Port of Imbituba in the state of Santa Catarina.

According to the National Association of Cereal Exporters (Anec), they view these vessels as isolated instances and other transportation companies are not having any problems at all loading and shipping Brazilian corn to Iran.

Iran is the largest importer of Brazilian corn and a main importer of Brazilian soybeans and beef. During the first semester of 2019, Iran imported 2.5 million tons of Brazilian corn, which was essentially unchanged from the previous year. During the first semester, Iran imported 1.25 million tons of Brazilian soybeans compared to 1.0 million tons during the same period in 2018.