Brazilian State of Maranhao to Impose 1.8% Tax on Grain Exports

The Brazilian Association of Vegetable Oil Industries (Abiove) filed suit last week against the Brazilian State of Maranhao over the proposed tax of 1.8% on the export of soybeans and corn from the state. The tax would be imposed at the Port of Itaqui in the city of Sao Luis which is one of the most important export facilities for grain produced in northern/northeastern Brazil.

In 2024, approximately 14 million tons of soybeans and 4.3 million tons of corn were exported through the deepwater ocean Port of Itaqui. The port was already the main export destination for iron ore from Brazil and it has been expanded in recent years to handle grain as well.

Trading companies and farm organizations contend that the added tax will make already tight margins for farmers even tighter and it will make Brazilian grain less competitive compared to grain from the United States and Argentina.

The port is serviced by a rail line that was built to haul iron ore and it extends deep into the heart of agricultural production in northeastern Brazil. The reduced cost of transportation to the nearby port has been one of the main driving factors behind the agricultural expansion in northeastern Brazil.

This export tax on grain from Maranhao comes on the heels of recent action taken by the State of Para that also is set to impose a small export tax on grain exports from the state. The State of Para indicated that the tax revenue would be used to improve the transportation infrastructure in the state. The State of Maranhao has not indicated how the tax revenue will be applied.

Tags: Port of Itaqui, Maranhao, corn, export, Brazil, soybeans, tax