January 1, 2013

New Truck Driver Regulations in Brazil Worry Soybean Producers

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Truck drivers and trucking companies in Brazil agree on one thing: Brazil does not have the infrastructure needed to meet the regulations imposed by the new law that is being called the "Truck Drivers Law". When fully in force, truck drivers in Brazil will only be allowed to work for eight hours before they would then be required to rest for eleven hours. They will also be required to rest for thirty minutes for each four hours that they are behind the wheel.

The goal of these new regulations, which were passed in mid-2012, was to reduce driver fatigue and the number of accidents caused by excessive hours behind the wheel, but the lawmakers apparently did not take into account the fact that there are not enough rest areas along Brazilian highways to accommodate these new regulations.

To meet the requirements of the law, drivers indicate that rest areas would be needed every 200 kilometers along major highways and each rest area should have ample room to park trucks including restrooms, showers, a convenience store, and accommodations for drivers to cook meals. Unfortunately, such facilities are few or nonexistent especially in central Brazil.

If strictly enforced, these new restrictions on Brazilian truck drivers have the potential for major disruptions in the transportation of what is expected to be a new record large soybean crop in Brazil. If a driver is caught violating the rules, he could face fines and loose points on his driver license. Repeated violations could result in suspension of his lisence.

No fines have been imposed as yet and in September a judge suspended for six months the collection of fines and the loosing of points on drivers licenses. Without the threat of fines, drivers are still behind the wheel sometimes for 24 hours straight in order to meet deadlines imposed by company owners.

When the law is fully in force, estimates are that the number of trucks available for grain transport might decline by 30% because of a lack of qualified drivers to keep the trucks on the road. It's going to be particularly difficult for independent owner/operators who generally work by themselves and many have already indicated that they will no longer do long hauls such as from Mato Grosso to the ports in southern Brazil. Trucking companies could better accommodate the new regulations by putting a second driver in the truck, but that would increase costs which then must be passed on to the farmers or the grain elevator operators.

Approximately 60% of Brazil's grain production is moved by trucks and with a record large soybean crop expected to be harvested over the next several months, the agricultural community fears that there will be logistical bottlenecks all along the transportation system in Brazil.