The new U.S. tariffs take effect on August 1, presenting the Brazilian fruit sector with one of its greatest challenges as the U.S. imposes a surcharge of 50 percent. The impact on Agrícola Famosa will be limited, but other producers, especially in the Petrolina region, are on the verge of collapse, according to Carlo Porro, CEO of Agrícola Famosa. "This is devastating for growers, for all of Brazil," he said.
The U.S. tariffs will directly affect mangoes and grapes, two major export products in northeastern Brazil. Agrícola Famosa plans to export 300 to 400 containers to the U.S. this season, a manageable amount that minimizes the impact on the company. "The region of Petrolina expects to ship almost 3,000 containers of mango. That won't be feasible with these tariffs," Porro stated.
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Unlike grapes, which find some relief in the domestic market and Europe, the Brazilian mangoes exported to the U.S. don't have an alternative avenue that can absorb the volume or offer competitive prices. "Neither the domestic nor the European market can absorb these volumes or pay the right price. As a result, the fruit will be left on the trees. The season starts at the beginning of August. That means growers had already bought boxes and arranged transport. It will be a powerful blow for the sector," Porro stated.
Exporters have already started to lose customers and contracts in the United States. In addition, they can't redirect shipments quickly due to logistical limitations and lack of demand in other destinations, he added. "There are no new markets, certainly not in the short term."
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The sector has asked the Brazilian government for support, but there are no clear solutions. "The government has to do something, but I don't know exactly what," Porro said. "The situation is truly dire right now."
The impact of the tariffs transcends the fruit sector. "Fish, orange juice, timber, and other exports from the northeast are also affected by the tariffs. This will have a huge impact on many companies."
© Agricola FamosaAsked if he had a message for U.S. authorities, Porro stated: "We ask them to be sensitive and respectful of Brazil and its people."
For more information:
Carlo Porro
Agricola Famosa
Tel: +55 85 991999392
Email: [email protected]
www.agricolafamosa.com.br
