Brazil govt strikes deal to end truck drivers’ strike

Brazil’s government obtained an agreement last Thursday May 24th to suspend a four-day protest that had crippled much of the Latin America’s largest economy, including shipping imports and exports. The government promised changes to diesel pricing. Truckers agreed to suspend the strike for 15 days.

Lack of deliveries had led to perishable items disappearing from store shelves, fuel shortages threatening airports and public transport, and the country’s automakers association Anfavea announcing that all vehicle production had been halted for Friday May 25th.

Under the deal, a 10% price cut for diesel announced by Petrobras on Wednesday will be extended to 30 days, with the government compensating the company for costs beyond the originally announced 15-day period.

The price will then be re-evaluated every 30 days, replacing the policy of daily price changes, Finance Minister Eduardo Guardia said.

The country will not return to normal immediately. Truckers group Abcam, a major force behind the strike and which did not sign onto the government accord, had said previously that it would take up to 12 days to normalize cargo deliveries in Brazil after demonstrations ended.

The protests froze deliveries of fuel, feed and other essential inputs, threatening economic activity and exports of soft commodities. Poultry and pork processors association ABPA said 120 plants had halted production for lack of feed and storage space, up from 78 previously.

At grain export hub Paranaguá port the protests impeded 1,000 trucks from delivering goods over two days, Brazil’s largest cooperative Coamo Agroindustrial claimed last week. Brazil’s major coffee exporter Cooxupé had warned about possible shipping delays.