Tensions in the Middle East, notably among significant food importers and key fertilizer suppliers like Iran, have shaken Brazilian grain farmers and traders. As Brazil prepares for a large corn harvest and the upcoming 2025/26 soy crop, these geopolitical issues could severely impact the agricultural sector. Frederico Humberg, founder of grain trader AgriBrasil, estimates that the unrest may result in approximately 5 billion reais, or $909.84 million, in losses for Brazilian grain producers. This projection is influenced by soaring input prices, particularly urea, a vital nutrient for corn, which once spiked by $100 per metric ton.
Additionally, exporters are facing a 20% increase in maritime freight costs, equal to $7 per metric ton on certain routes, amid ongoing market instability. Despite the current abundance, with 80 million tons of corn and soy scheduled for shipment, Brazil is encountering stiff competition from expected high yields in the U.S., Argentina, and Ukraine. Agroconsult reports that Brazilian farmers can export around 44 million tons of corn this season, but doubts remain. Mauricio Buffon, a farmer in Tocantins state, expressed his frustrations regarding the closed market with Iran, revealing that only local buyers are currently purchasing corn.
Higher prices and volatility have hindered farmers like Buffon from procuring essential nutrients for their crops, while the withdrawal of Chinese buyers further complicates matters. Endrigo Dalcin, a farmer from Mato Grosso, noted stagnant input sales, indicating his inability to purchase necessary seeds, chemicals, and fertilizers for the upcoming soy planting season. He mentioned that unfavorable exchange rates hinder the potential gains from corn sales in export markets. Additional challenges arise as farmers face disruptions in the supply chain.
Marcos da Rosa experienced delays from a phosphate fertilizer supplier, who offered a refund that would not suffice for current prices. The ongoing conflict has raised costs and increased the risk of losing vital importers like Iran.