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By Ana Mano
SAO PAULO, Aug 7 (Reuters) - JBS SA, the world’s largest meatpacker, is importing more corn from Argentina into Brazil for feed as rising local freight costs push up prices for the domestic crop, a person with knowledge of the matter said on Tuesday.
JBS operations in Brazil had resorted to importing the grain earlier this year, at the end of the country’s smaller first corn harvest, for feed in the southern state of Santa Catarina, where it operates several meat processing plants.
“To be importing corn in the middle of Brazil’s second corn harvest is absurd,” said the source, who spoke on condition of anonymity. The company’s corn imports into Brazil so far this year will amount to about 120,000 tonnes, once two new shipments arrive at Imbituba port later this month, the source said.
“Corn imported from Argentina can arrive around 5 percent cheaper than the same product from Mato Grosso,” the source said, highlighting the cost of shipping over long distances in Brazil from its main farm belt to its biggest meat plants.
The state of Mato Grosso, part of Brazil’s agricultural heartland, produces nearly one third of the country’s corn.
JBS did not immediately reply to a request for comment.
Brazil consumes an estimated 5 million tonnes of corn per month, 30 percent of which goes to JBS, rival meatpacker BRF SA and privately owned Aurora Alimentos.
Santa Catarina’s proximity to Paraguay and Argentina gives local meat processors an incentive to source corn from abroad instead of buying from Brazil’s main grains belt.
Additional corn imports this year cannot be ruled out if the situation persists, the source said.
Freight costs jumped in Brazil after the government set minimum shipping prices in response to the demands of striking truckers, whose protests in late May paralyzed major highways and dented economic growth. (Reporting by Ana Mano Editing by Brad Haynes and Christian Plumb)