Brazil drought hits soya exporters as key waterway closes

[SAO PAULO] Drought in Brazil's Sao Paulo state has cut off barge traffic on a key waterway used to transport soyabeans as the government prioritises hydro-electricity generation amid falling river levels.

The Tiete-Parana waterway has been drying up since February as a result of one of the hottest and driest summers on record in Brazil's most populous state, spurring fears of water rationing and electricity shortages during the World Cup.

Soya exporters and farmers appear to be the latest victims of the drought, as part of the waterway was completely closed to barge traffic on May 30. Exporting firms, including Cargill, said they have had to hire trucks to transport their goods the full distance to Brazil's main soya exporting port of Santos. That has raised shipping costs by 10 to 12 per cent for those that normally use the waterway, and farmers are getting paid less for soyabeans as a result, said Edeon Vaz, logistics coordinator for Aprosoja, Brazil's largest soya lobby.