MercoPress. South Atlantic News Agency

Argentine fruit exports to Brazil loosing 300.000 USD per day

Trucks loaded with perishables delayed at Brazilian Customs

Argentine exporters claim they are loosing huge sums of money because of Brazilian delays at Customs posts and in extending import licences. This is particularly sensitive for fruit and other perishable exporters.

“At the beginning it was only delayed trucks, but now we are loosing 300.000 US dollars per day in exports” to Brazil claims Marcelo Loyarte, manager of the Argentine Integrated Fruit Farmers Chamber, CAFI, which represents producers from the provinces of Rio Negro and Neuquén from where most Argentine apples, pears, onions and garlic originate.

“Currently the licences are delayed which makes it even more complicated to agree on delivery dates to the Brazilian market, plus the fact they are granted drop by drop”, added Loyarte.

Canada’s Argentine branch of McCain which produces frozen food has been forced to close down its plants five days a week because of lack of storage space

“Until we can guarantee a normal or reasonable flow of exports and can count with operative space in the refrigerated plants, there’s no way we can keep production”, said Lucas Alvarez Bayon, McCain Argentina general manager, quoted in the Buenos Aires press.

The current situation was triggered a year ago when Argentina imposed the non automatic import licences with the argument of protecting its industry and jobs. But the Brazilians finally reacted since the system which is contemplated under WTO rules allows for a maximum 60 days (delay) but in some cases the award of the documents “have extended to almost 180 days”.

Besides the hurdles include a list of “sensitive goods”, which Brazilians complain has been reshuffled several times.

Argentina annually sends 460.000 tons of pears and 280.000 tons of apples to Brazil making her one of the world’s leading exporters of fresh fruit.

“We’ve been told that they are working on the issue, we requested for some solution before the summit but had no reply yet”, said Loyarte.

However analysts are not so sure. “Summits help to defuse and create a new climate, but not a definitive solution. Following the summits serious negotiations begin”, said Dante Sica political and financial consultant from Abeceb.com

The current trade deficit of Argentina with Brazil impedes the Cristina Kirchner administration to back-step and the Brazilian government faces a delicate political situation since the country is preparing for the 2010 presidential election and the succession of Lula da Silva.

“The government has to listen to complaints from exporters and other groups” said Dante Sica.

Last September Argentina managed a modest 84 million USD surplus in bilateral trade with Brazil, but in the first nine months of 2009 the overall contraction has been of 31.8% compared to the same period of 2008.

Brazil’s trade surplus with Argentina last year was several billion US dollars. Argentina cut off from global financial markets must appeal to the two-surplus system, primary budget surplus and trade surplus.