Feb 17, 2025
Brazilian State of Para to Impose Small Export Tax on Grain
Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.
The governor of the state of Para in northern Brazil is set to sign into law a tax on the export of soybeans, corn, cattle, mining, and other items. Farmers had petitioned Governor Helder Barbalho to veto the bill, but after negotiations to reduce the amount of tax, they agreed to a compromise.
After negotiations, the proposed tax of R$ 4.32 per sack of soybeans (approximately $0.33 per bushel) was reduced to R$ 1.00 per sack (approximately $0.08 per bushel). For corn, the proposed tax of R$ 2.09 per sack (approximately $0.16 per bushel) was reduced to R$ 0.50 per sack (approximately $0.04 per bushel). The tax is set to take effect on March 26, 2025.
Revenue from the new tax will be allocated to the Economic Development Fund (FDE) to finance infrastructure projects such as improved roads and bridges. There will be four members on the management committee including the Soybean and Corn Producers Association of Para (Aprosoja/PA).
The best way to view these new taxes is to consider them the Brazilian version of "checkoff" programs in the United States. In the U.S., the funds are used to promote specific products and export programs. In Brazil, the funds will be used to develop the basic needs of the developing agriculture sector.
Aprosoja/PA agreed to the new tax because agriculture in Para is still in the development stage and it cannot be compared to more developed states in central Brazil such as Mato Grosso, Goias, and Mato Grosso do Sul. Para needs additional funds to improve soil fertility, crop yields, and the infrastructure needed for modern agriculture.
Conab is estimating the 2024/25 soybean crop in Para at 3.9 million tons and the corn crop at 1.7 million tons.