Brazil’s new administration is treading carefully but firmly in handling truck and port labor disputes that have bubbled since President Jair Bolsonaro, elected on a bold reformist platform, took office in January.
The specter of damage such disputes can have on containerized supply chains came into focus after a week-long truckers’ strike in late May 2018 crippled trade and dealt a blow to an already fragile economy. Bolsonaro’s predecessor, Michael Temer, caved to trucker demands, which included the creation of a Minimum Freight Rate Table (MFRT), which has aggravated shippers with higher trucking costs.
The impact of the latest labor flare-ups has been less dramatic. Truck drivers serving the port of Santos, the top South American container gateway, backed down from a full-blown blockade of the main highway into the port area in early February, instead creating a slow moving convoy that caused traffic jams. Truckers, upset about the pending loss of a parking area on the outskirts of the port to central Santos, mounted protests outside Santos City Hall.
With a mindful eye on how the federal government would respond, the truckers’ union Sindicam persuaded its members to ditch the blockade and watered down their protest, for fear of retribution from local and federal military police.
Bolsonaro’s firm stance
Bolsonaro has said he will not put up with any trade union or labor movement that brings the country to a standstill, and he pledged to act swiftly to scrap, or drastically change, the MFRT.
“I think after what happened last May that any attempts to block roads and create picket lines on the highways would be dealt with swiftly by the authorities under a Bolsonaro government,” Robert Grantham, a director for the Solve Shipping consultancy, told JOC.com. “I wasn’t surprised that they backed down from carrying out another blockade in Santos in the end.”
Indeed, many in Brazil believe that the strike actions that dominated the previous Workers' Party (PT) regimes (from January 1, 2003, to August 2016), under presidents Luiz Ignácio Lula da Silva and Dilma Rousseff, could have been prevented. They point to the long-running industrial action by Receita Federal customs workers, which ran intermittently for nearly two years, causing chaos and delays for shippers throughout the country, but especially in Santos.
Significantly, the Receita Federal unions stopped their so-called go-slows and strikes in December and have not resumed since Bolsonaro took office amid his pledges to reduce the public sector, especially their pensions.
Customs official retires
The early retirement of José Guilherme Antunes de Vasconcelos, the chief inspector at the Santos customs department, is — according to reliable sources in Santos — a political maneuver to remove PT supporters from key positions and bring in individuals more in tune with the Bolsonaro administration.
Petrobras oil workers in Santos and casual dock labor (OGMO) in the port city had planned a port strike for March 1.
“Everyone is watching Santos, and it is a big test for Bolsonaro. We want to see how the Bolsonaro government reacts and how it plans to deal with these issues,” said Joao Emilio Freire Filho, a port consultant for Rio de Janeiro-based M A Consultoria e Eventos Ltda.
At the end of last year, a truckers’ blockade was threatened in Minas Gerais, but that too petered out for fear of retribution from the national government, which, when it was PT, was reasonably supportive of such actions from truckers and trade unions.
"The port of Santos will be blocked because the City Hall did not know how to solve the truck drivers’ problem and so now we have nowhere to park,” one truck driver told a local TV station the day before the “Drive Slow motorcade” occurred. “They have had three years to solve this problem and have done nothing. We will be asking the truck drivers not to go to the port of Santos, and the port will be blockaded.”
Fear of federal intervention and punitive legislation against strike actions kept the union from following through with its plans.
"Obviously, we are not against making the [new] entrance of Santos,” Alexsandro Viviani, president of Sindicam, told local media. “The truck drivers are against being evicted without City Hall giving us an alternative. Our actions are also aimed at telling Brasilia that the mess must be sorted out.”
Viviani said that a suitable site, with current space for 400 trucks, was located in front of the Brasil Terminal Portuaria container terminal on the right bank of the port. Construction is needed to expand the site’s capacity to handle an additional 800 trucks.
After a week of threats and counterthreats, the National Secretariat of Ports — under the Ministry of Infrastructure and responsible for Codesp, the Santos Port Authority — said it would issue a plan coordinated with the municipality of Santos to address the problem.
“You do get the impression that a game of politics is being played out here,” one container terminal manager said. “Each authority is passing the buck and the blame on to everyone else. Truckers and shippers are now suffering because of this avoidable mess.”
Freire, who used to work for both the Association of Brazilian Ports and Terminals (ABTP) and the powerful port lobby Commissao Portus, said he believes allowing the truckers to refer to a MFRT is “unconstitutional” and has driven up road freight costs throughout Brazil. But he does sympathize with some of the trucker complaints, which have been exacerbated by rising fuel costs.
“I think the threat [to blockade] was a real one, but it will just highlight the need for various trucking issues in Brazil to be resolved as soon as possible, including better facilities for truckers in ports but also removing the MFRT,” he said.
Contact Rob Ward at rcward788@btinternet.