March 8, 2013

Brazilian Port Strike Set for March 19th

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

Unions representing Brazilian port workers announced that they will strike 36 Brazilian ports on March, 19th. The announcement was made even though the unions and the government are still in negotiations concerning workers unease about the government's plan to privatize Brazil's ports. A series of mini strikes were staged in mid-February to bring attention to the workers concerns, but the mini strikes were called off after the government agreed to reenter negotiations and suspend a hefty fine they levied against the unions because the government considered the mini strikes illegal.

The unions had agreed to suspend any further labor action until March 15, but they now feel that the negotiations have made little progress and the threatened strike on March 19this there way to try and force the government into serious negotiations.

The workers main concern is that the privatized ports will lead to fewer jobs and lower wages. Currently, workers at the public ports are hired through a centralized pool of workers that helps maintain wages and benefits for the workers. The new legislation to privatize the ports eliminates the requirement for new workers to be hired through that pool, and that is the union's major concern.

In contrast to the earlier strikes that only lasted six hours, the strike scheduled for March 19this scheduled to last for 24 hours starting at 7 o'clock in the morning. The unions have already stated that if negotiations stall they will launch additional work stoppages of indeterminate length. The last 6-hour strike is estimated to have cost the Port of Santos R$ 60 million.

The Port of Santos is the largest in Brazil and can ill afford anything that would slow the loading of a record large soybean crop. The waiting time to load vessels at the Ports of Santos and Paranagua is already 50-60 days and any further labor stoppages are sure to make that even longer. Soybean importers have already switched some of their business to the U.S. due to the delays at the Brazilian ports.