Sunday, May 26, 2013

Corn logistics

Government and private sector are investing together to solve problems of corn chain

Funds will be allocated for the construction of warehouses and an annuity to farmers, who are hampered by the high cost of logistics in the country
Daniela Castro | Brasília (DF)

Large supply of the product will cause a reduction in the price paid by the market

The high cost of logistics remains as one of the worst obstacles to the competitiveness of the supply chain of corn in the country. Of every three bushels of corn that are aimed at Brazilian ports, two are on the way to pay the freight , since it is necessary to overcome long distances to the regions that produces to consumer.

To change the picture, the industry must develop a plan of action that will receive investments of
R$ 1.2 billion from the federal government and the private sector. The measure has been requested by  President Dilma Rousseff. The idea is to invest in the construction of warehouses and have an insurance policy that guarantees the producer income.

Harvesting of the second corn crop begins in the coming days. The prediction is that there is a surplus of 22 million tons compared to the consumption needs of the country. The harvest of grain in the United States , which will begin to be harvested in September should also have export surpluses.

The large supply of the product will cause the reduction of which is paid by the market value that is already under R$ 13.00 for a 60 kilo bag - guaranteed minimum price stipulated by the government.  - Last year, we have  R$ 15.20 per bag depending on the region in Mato Grosso. This year, we are working with R$ 11.12 per bag.

This means that we already broke the barrier of the minimum price and the government will have to intervene to ensure that is provided by law - highlights the executive director of Aprosoja Brazil, Fabricio Moraes Rosa.  

 - The price to carry a sack of corn from Mato Grosso the Rio Grande do Sul is already higher than the actual value of the product. Is costing around R $ 15.00 in freight cost for a bag of corn MT to RS, while corn is costing R$ 12.00. So, it is absurd.

 Where the price of shipping is higher than the price of the product itself? - Asks the executive director of the Brazilian Association of Swine Breeders (ABCS), Fabiano Coser. while in the United States, shipping a ton of farm to the port is US$ 12.00, here the value is ten times higher because corn is put on a truck, which reaches 1100 km run to reach the port.  - Every three sacks you move this production to export, you leave two bags just to cover the shipping. It is really a very serious problem - adds Rose.