SAO PAULO: Brazilian truck drivers vowed to extend their protest against high fuel prices into a third day despite a government compromise to cut a fuel tax, threatening to slow economic activity and interrupt exports of grains and other goods.
Thousands of trucks were parked to obstruct major roads as the protests interrupted traffic along a major soy shipping route in the grains state of Mato Grosso and impeded access to the country’s two main export ports, Santos and Paranaguá.
Brazil is a key global supplier of grains, meat, coffee and sugar — most of which reach ports by road. Soy futures rose in Chicago on Tuesday for a second straight day as the protests threatened to halt shipments of Brazil’s record soybean harvest.
In an effort to address truckers’ demands, congressional leaders floated a plan on Tuesday afternoon to eliminate the CIDE fuel tax and put additional revenue from payroll taxes toward reducing fuel prices, which have surged nearly 50 percent in less than a year.
Diesel prices ended last week at 3.595 reais ($0.99) per liter, according to regulator ANP.
However, the trucking group organizing the protests, ABCAM, said demonstrations would continue on Wednesday, complaining that the CIDE accounted for only a fraction of the taxes on diesel fuel. According to Petrobras, state and federal taxes make up 29 percent of the final price paid by the consumer.
