The confrontation between Iran and Brazil worries farmers



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Dispute over supply of fuel to Iranian ships stranded off the coast of Brazil highlights the approach of the South American agricultural giant towards Middle East, a major buyer of Brazilian corn, sugar and poultry.

President Jair Bolsonaro The traditionally neutral position of Brazil's foreign policy has changed to align more with the United States and Israel. One of his first announcements after winning last year's elections was the intention to transfer the Israeli embbady to Jerusalem. While this was bothering Brazilian companies dependent on the Middle East markets, the events of recent days have intensified their concerns.

Exports from Brazil to the Middle East. Source: Bloomberg
Exports from Brazil to the Middle East. Source: Bloomberg

Public company Petroleo Brasileiro SA refused to refuel two Iranian ships for fear of US sanctions, which led Iran's threats to stop imports. While Petrobras, as the oil company calls it, is now complying with a court order to proceed with the supply of fuel, commercial concerns persist.

Iran is the fourth largest importer of Brazilian agricultural products and accounts for one-third of all maize shipments in the country. The Middle East bought 7.2 billion US dollars, or 8.5 percent, of Brazilian agricultural exports last year.

"The resolution of this problem is good news for us"Sergio Mendes, general manager of Anec's grain export group, said by phone. "The vast majority of Brazil's grain production is exported to Asia and the Middle East. Trade relations have nothing to do with politics. "

"Brazil has the opportunity to maintain good relations with everyone," Saifi said. "We do not need to import foreign issues."

Ali Ahmad Saifi, executive director of CDIAL Halal, a company that represents about 60 percent of all certified chickens in the country under Islamic law, said Brazil should try to reconnect with the region.

South American officials plan to visit the United Arab Emirates, Saudi Arabia and possibly Qatar in October.

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