Brazil delivers more than 263 thousand tons of rice to Rio Grande do Sul after floods

In response to the devastating consequences of the historic floods that hit the country’s main rice-producing state, Rio Grande do Sul, the Brazilian government has held an exceptional auction for the purchase of 263,370 metric tons of imported rice.

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The total amount of the acquisition amounted to 1,320 million reais (approximately 250.51 million dollars), reported the national crop agency Conab.

The challenges arising from the catastrophic floods, which threatened to trigger a price escalation, led the authorities to manage this operation.

Although the quantity purchased was slightly lower than the 300,000 tons initially projected, it is expected that this measure will contribute to stabilizing the market and guaranteeing the supply of rice in the country.

According to statements by a Conab spokesperson at the conclusion of the auction, approximately 36,600 additional tons will be obtained in a future bid, in an effort to satisfy domestic demand and alleviate the effects of the ongoing crisis.

The operation to purchase imported rice has generated controversy among the growers of Rio Grande do Sul, responsible for about 70% of the national rice production, as well as among various agricultural groups in the country.

Despite the criticism received, the government has confirmed that it will subsidize the retail sale of imported rice at a fixed price of 4 reais per kilogram.

Conab has warned that the Brazilian government could acquire up to 1 million additional tons of rice with the aim of countering price speculation, especially after recent fluctuations caused by disastrous weather events in the south of the country.

According to Cepea/Irga data, in June there was a slight decrease of 1% in the price of processed rice in Rio Grande do Sul, after an increase of more than 10% during the month of May. Meanwhile, the region’s rice growers federation, Federarroz, has chosen not to comment on the matter.

To date, no official estimates have been issued on the volume of rice affected by flooding in the central region of Rio Grande do Sul, which represents approximately 10% of the state’s total production.