(Bloomberg) — Protests that have blocked roads following Brazil’s presidential election are threatening to upend the country’s massive agriculture industry.

The protests are hampering road shipments of grain, meat and fertilizer around the country, while disruptions to feed distribution put chicken and pork production at risk, according to people familiar with the matter, who asked not to be named for safety reasons. The Paranagua port authority said in a note early Tuesday that the main road giving access to the port was blocked, delaying truck deliveries to one of Brazil’s main export sites.

Truck drivers have led protests by backers of incumbent President Jair Bolsonaro following his defeat in Sunday’s election to Luiz Inacio Lula da Silva. Protests that have spread across the country are a consequence of dissatisfaction with the election, Bolsonaro said in his first speech after the ballot outcome. The president vowed to follow the constitution, but didn’t formally concede. While defending peaceful demonstrations, he didn’t directly ask protesters to end the blockades. 

An extended blockade of trade routes would cripple the ability of the world’s biggest crop exporter to move soybeans, corn and coffee to ports, and threaten to leave shelves empty at supermarkets around the country. Supermarket group Abras has reported shortages of some products, according to Valor newspaper.

Brazil’s Federal Road Police has dismissed 339 blockades in Brazilian roads as of 3 pm local time, while dozens of protests were still reported in all regions, according to its official Twitter account.

Crop Shipments

Transportation of agricultural products is down by almost one-third as of the start of protests Monday compared to the previous week, according to a provider of road freight in the country. Of that, the number of trucks loaded with soybeans fell by almost half, corn dropped by 40% and fertilizer by 18%.

Not only have shipments of live animals, feed and refrigerated meat been disrupted, production in some meatpacking plants has started to slow, according to one of the people. 

Soy-processing plants, which turn the beans into meal for animal feed and oil used in everything from cooking to cosmetics, also are struggling to receive and send cargoes to ports, said another person. Biodiesel production has been the most affected so far. 

Orange juice production is nearly halted, as truck drivers are refusing to take cargoes as they want to avoid protesters, another person said.

The situation is beginning to hit the fuel sector, with fewer orders reported at distributors due to concern that deliveries would not reach clients on time, while supply issues are more prominent at smaller ethanol distributors, mainly in the south of the country. The National Oil Agency (ANP) said it’s in contact with distributors to prevent fuel shortages.

The Brazilian Petroleum and Gas Institute (IBP), which represents Big Oil in the country, said in a statement that it’s worried about potential fuel shortages if protests linger, especially given blockages in Santa Catarina, Parana and Sao Paulo states.

A Petroleo Brasileiro SA spokesperson said there is no impact on refinery operations, as the fuel is distributed mainly through pipelines. 

Groups representing chicken, pork producers, soybean crushers and exporters haven’t replied to requests for comment

(Updates with IBP comments in 11th paragraph.)

©2022 Bloomberg L.P.


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