Despite Brazil’s predicted record corn and soybean crop this spring, labor regulations and rain delays have slowed both the harvest and movement to port, as well as loading, according to the U.S. Grains Council.
A new Brazilian law requires that truck drivers rest 30 minutes every four hours, with a minimum of 11 hours a night of rest, similar to the U.S.’s hours-of-service rules that will take effect on July 1. The new law is causing delays and early morning congestion at the ports. In addition, customs, agriculture, health and treasury personnel at the ports are only available for eight hours a day, with an hour for lunch, further exacerbating the situation.
“The impact on the bottom line is dramatic,” said the U.S. Grains Council in a written statement. The cost of moving a metric ton of corn or soybeans from Mato Grosso to the Port of Paranagua, a distance of 1,435 miles, has jumped 506 percent in the past year. Soybean prices simultaneously rose 20 percent, but three quarters of the price increase was absorbed by higher freight costs.