Brazilian port employees strike! More than 2 million bags of coffee stranded in port

According to Brazilian media reports, on October 22nd, port workers across Brazil staged a 12-hour strike. The operation was coordinated by the National Federation of Dockers, the National Federation of Port stevedores and the Union of Boatmen, repairmen, stackers and berths, which represent nearly 60,000 employees working in Brazil's main ports.

It is reported that the strike is mainly due to the government's amendment to the Port Law (decree No. 12.815 / 2013), which will abolish the night shift bonus and port risk bonus, and will also allow the outsourcing of services such as port guards. this will deprive temporary workers and dock workers of some of their labor rights, and abolish Santos's public wharf, which has an impact on the welfare of port staff. Therefore, the port workers chose to go on strike and protest, as the strike is national and will affect the loading and unloading activities of all ports in Brazil.

Today, amendments to the law will be submitted to the House of Representatives, which the government believes are aimed at modernizing the industry, updating outdated rules, reducing bureaucracy, simplifying port operations and delegating regulatory authority to attract more investment. As a result, port terminal staff representatives plan to hold a demonstration outside the House of Representatives in Brasilia, the capital, on the day the bill is submitted.

Although the strike lasted for a short time, it had a certain impact on Brazil's import and export trade, especially for the coffee and other agricultural products industry. Earlier, the Brazilian Council of Coffee exporters (Cecafe) said in its coffee export report released on 16 October that due to high delay rates and frequent shipping schedule changes at ports, some 2.15 million bags (6529 containers) of coffee products were still not exported at Brazilian ports, which may be further exacerbated by the current difficult situation of the terminal labour force and strikes.

According to the report, 69 per cent of ships experienced delays at Brazil's main ports in September, with the longest waiting time at the port of Santos, which reached 84 per cent of container ship delays in September and 108 of 129 ships. These delays and delays in coffee products could lead to a loss of 3.217 billion reais (about US $580 million) in foreign exchange earnings. Moreover, due to detention, additional storage, etc., exporters incur additional costs of approximately 5.938 million reais.

However, Brazilian ports are being privatized and the government has announced plans to auction 35 terminals, mainly the new terminal in Itagua í and the container terminal in the port of Santos. Last month, Dafei acquired a 48 per cent stake in Opportunity, while Opportunity also owns 48 per cent of terminal operator Santos Brasil (Santos, Brazil). And, a few days ago, MSC acquired the Wilson Sons Group, involving the world's second-largest container shipping operator and Brazil's largest terminal operator.

The Brazilian government believes that the privatization of national ports can improve management efficiency, reduce the financial burden of the government, improve the quality of services and enhance competitiveness, so the Port Law is amended, but at the same time because of the interests of port workers and employment issues, it led to this strike, affecting the global supply chain.

For Brazil's main coffee industry, in addition to the port transport problem, the climate problem is still very serious. According to media reports, Brazil's coffee-producing areas have entered the rainy season after a severe drought, but coffee trees are unlikely to return to maximum production. According to Fundacao Procafe, a coffee research institute in Minas Gerais, the soil in the southern part of the state lacks 250mm of water compared to the ideal level, the second largest loss of water on record.

Even if the rainfall resumes now, the rainfall is not up to the historical average, making the coffee trees miss the best flowering time, and some coffee trees cannot blossom. Many farmers choose to prune trees because of the poor condition of the trees, which will cause the trees to not bear fruit after pruning, and production will not resume until 2026, so the yield will not be very large next season, and losses have been expected. At present, due to the decline in production in many countries affected by bad weather, pushing up the price of coffee, if Brazil's production is reduced next season, the global coffee supply will be reduced.

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