Brazil to suspend tariffs on corn and soy until 2021
Brazil will suspend tariffs on corn and soy imports form countries outside the Mercosur trading bloc until early 2021 in a bid to reduce food prices that are contributing to inflation.
Reuters reports that Brazil’s economic ministry announced the suspension on 17 October.
The decision to remove the tariffs temporarily was taken late on Friday 16 October at a meeting of Gecex, a technical body within the economy ministry, as reported by Reuters.
Soybean meal and soy oil imports will also be exempt along with soy imports until 15 January 2021, while corn imports will cease paying the tariffs until 31 March 2021, the ministry said in a statement.
"Both measures are aimed at containing high prices for food," the ministry said.
Record high prices for both grains have impacted food prices that are fuelling inflation and squeezing incomes of Brazilians that have already been hit by the coronavirus pandemic. Inflation in August hit its highest in four years for that month, driven by rising fuel and food costs.
High prices for soy and corn are also hurting the margins of poultry and pork sector that relies on both grains for animal feed and last month requested that the government free up imports.
The tariff on corn and soy imports from outside Mercosur, which includes Paraguay, Uruguay and Argentina, is currently 8 percent, and 6 percent for soy meal and 10 percent for soy oil.
The economy ministry decided in early September to eliminate tariffs on rice imports through the end of the year, amid record high prices for the grain.
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