August 30, 2008

 

Brazil back to taxing wheat imports at 10 percent

 
 

Brazil's Foreign Trade Committee, Camex, decided on late Thursday (August 28, 2008) that it will return to its policy of taxing wheat imports at 10 percent, a Camex press agent confirmed on Friday (August 30, 2008).

 

Only countries that constitute part of the Southern Cone Common Market, or Mercosur, can sell wheat to Brazil without paying any trade tariffs.

 

For months, North American wheat exporters have been able to ship wheat to Brazil duty free following a decision by Camex to temporarily remove the tariff. Camex removed that tariff because wheat imports from Argentina, Brazil's main supplier, had been stopped by the Argentine government. Argentina's wheat imports are picking up again, but are still below levels of previous years.

 

Brazil is expected to harvest a bumper wheat crop this year, upwards of five million tonnes, and that pressure likely led Camex to return to the 10 percent tariff for wheat traders outside of Mercosur. Wheat producers were against the tariff change to 0 percent from the beginning. Wheat milling companies, however, were successful in their pleas with the government to allow for the temporary tariff exemptions, which made importing wheat from North America more affordable.

 

Brazil consumes around 11 million tonnes of wheat per year and relies heavily on Argentina for supply.
   

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