Brazilian State Seeks Paraguayan Corn Amid Massive Supply Gap

Santa Catarina, Brazil's state in the south, faces a significant challenge when it comes to corn supply. Despite producing around 2 million tons of corn annually, the state consumes approximately 8 million tons, leaving a gap of 6 million tons that must be filled through external purchases.

The majority of this volume comes from Brazil's Midwest, which is over 1,500 kilometers away from Santa Catarina. However, the distance between origin and destination significantly increases the burden of freight costs, making transportation account for a high percentage of the total cost.

According to Governor Jorginho Mello, in certain situations, freight can cost more than the corn being transported itself.

To address this issue, the Santa Catarina government is seeking to increase imports of corn produced in Paraguay, which is located about 300 kilometers from the state. This proximity could reduce transportation costs and make Paraguayan corn more competitive for certain buyers.