The unprecedented flood in Rio Grande do Sul, Brazil’s southernmost state, is likely to impact food production and distribution in the country, according to the federal government. For this reason, President Luiz Inácio Lula da Silva (Workers’ Party) announced on Monday (6) that the Executive power should make it easier to import rice and beans as a way of reducing the possible consequences of high prices for two products considered essential for Brazilians.
“If it's necessary to balance production, we'll have to import rice and beans so that we can present to Brazilians prices compatible with what they earn,” he said on the program Bom Dia, Presidente (Good Morning, President, in English), from Empresa Brasil de Comunicação (Brazilian Communication Company, also known in Portuguese as EBC).
On Wednesday (8), the president of Conab, Edegar Preto, said that a provisional measure that should be issued soon may authorize Brazil’s National Supply Company (Conab, in Portuguese) to import up to 1 million tons of rice. “Rio Grande do Sul is a rice-producing state. Part of its production had not been harvested and 15% is underwater,” he said at a press conference in Rio Grande do Sul.
The possibility of importing food and beans, however, would not be necessary if the government had replenished public food stocks managed by Conab, according to experts.
Public stocks are kept with grains and other agricultural products bought with public funds. The products guarantee supplies in times of scarcity – such as those expected after floods – or when prices are higher than usual.
Dismantling
Former president Michel Temer (Brazilian Democratic Movement) suspended public food purchases. Jair Bolsonaro's (Liberal Party) administration also did not buy food, and even closed the existing Conab warehouses. There were 27 in 2019. Another 124 were put up for sale, but the process was canceled after Lula's election in 2022.
In his third presidential term, Lula promised to rebuild Conab's stocks. In June last year, Conab announced its first food purchase in six years.
So far, however, the company has only bought corn. Rice stocks have not been supplied since December 2022. Bean stocks have been empty since December 2016. There are also no stocks of coffee, cassava and wheat, making imports the only option.
“If we had stocks, we wouldn't need to import,” criticized Diego Moreira, from the national coordination of the production sector of the Landless Workers' Movement (MST, in Portuguese). “The government has, so far, taken no initiative to create a public stockpile to regulate food prices. Obviously, this is not the fault of this government alone, but there is no objective national supply policy.”
Vitor Hugo Miro Couto Silva, an economist and professor in the Agricultural Economics department at the Federal University of Ceará (UFC, in Portuguese), also criticizes the current Lula administration and its predecessors. “The policy of regulatory stocks has been abandoned in recent years. In 2023, the policy was resumed very discreetly,” he explained. “The current government was elected defending issues related to food security and the fight against hunger. I believe the definition of strategies in this direction has been slow.”
The problem of prices
When contacted by Brasil de Fato on Monday (7), Conab did not comment on the situation of its stocks and their replenishment.
In March, when food prices were rising in Brazil, Brasil de Fato also questioned the agency about stocks. It was informed that soaring food prices prevented public purchases. “It is only possible to replenish stocks when market prices are below minimum prices,” he explained.
Economist and agronomist José Giacomo Baccarin, the federal government's Secretary for Food Security and Nutrition between 2003 and 2005, stressed the importance of reestablishing public stocks, but confirmed: “It doesn't make sense to replenish public stocks while prices are high; that would only further increase prices.”
“Since the beginning of the 21st century, public food stocks in Brazil have been very low,” he recalled. “Brazil must replenish public stocks when prices are low, bad for the farmers [to sell]. With public stocks, prices go down when they are soaring, putting pressure on consumers' incomes.”
Regarding rice prices, Baccarin mentioned data from the Food and Agriculture Organization of the United Nations (FAO) showing a worldwide drop in prices in 2008 and 2016. After that, it rose steadily, which seems to have cooled down at the beginning of this year.
Regarding beans, he adds that the price is defined by national production, which has been losing ground to soybeans and other grains.
Baccarin doesn't see any significant effects of climate change on food prices. However, he says that “from now on, climate events will play a more substantial and negative role in food prices.”
