SAO PAULO (Reuters) – The Brazilian government will no longer need to buy imported rice, Agriculture Minister Carlos Favaro told a local TV channel on Wednesday, after the plan attracted flak from local farmers.
“Prices have already dropped,” Favaro said, adding the government will continue monitoring the market. “As there is no speculation, in my opinion, new auctions are not necessary.”
Last month, Brazil’s national crop agency Conab canceled the results of a controversial rice auction over doubts about the winners’ financial capability to honor their commitments. The government said then it would hold a new auction to purchase imported rice, but stopped short.
In that rare auction, Brazil had purchased 263,370 metric tons of imported rice for 1.32 billion reais ($236.28 million). The goal was preventing a price hike after historic floods in the top producing state Rio Grande do Sul, which submerged entire towns, killed livestock and disrupted harvesting of crops like corn and soy.
According to the minister, Brazil’s Plano Safra farm credit program, to be announced later in the day, will offer loans to increase rice production in the flood-hit state, as well as in others.
($1 = 5.5867 reais)
(Reporting by Eduardo Simões and Letícia Fucuchima; Writing by Ana Mano, Editing by Franklin Paul)
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