Brazil truckers strike for 5th day

Sao Paulo declares emergency; group says livestock at risk

Brazilian truckers protesting rising diesel costs block a highway earlier this week on the outskirts of Sao Paulo. A truckers group said Friday that the number of blockades had reached 521.
Brazilian truckers protesting rising diesel costs block a highway earlier this week on the outskirts of Sao Paulo. A truckers group said Friday that the number of blockades had reached 521.

A paralyzing truckers' strike in Brazil entered its fifth day on Friday, prompting the president to deploy national security forces amid warnings of a calamity in one of world's largest cities and potentially devastating livestock losses.

Sao Paulo, a megacity that's home to more than 12 million people, declared a state of emergency and warned that shortages caused by the strike may cause a state of public calamity, while export group ABPA said a billion chickens and 20 million pigs may die in coming days due to a lack of feed.

President Michel Temer said he's called for the deployment of national security forces to unblock roads and asked governors to do the same.

"Those who act in a radical manner are harming the population and they will be held responsible," Temer said in a televised national address Friday.

The strike began on Monday, as truck drivers blocked federal highways in almost every Brazilian state in protest of soaring diesel prices amid generally low inflation. On Wednesday, state-run oil company Petrobras cut the price of diesel by 10 percent for two weeks, but that retreat spooked investors and also failed to appease the truckers.

While the government said on Thursday evening that eight of 10 unions agreed to a proposal that would suspend price increases and lower taxes on diesel, the country's truckers' confederation issued a statement on Friday saying it had committed to just "pass along" the offer, and not to end the strike.

As part of the accord announced on Thursday, diesel prices, which had been adjusted daily according to market rates, will now be fixed for 30 days. The government and state-run oil company Petrobras will split any extra costs.

Still, truckers group Abcam -- which didn't take the government's deal -- said the number of highway blockades rose to 521 on Friday from 402 the day prior. Local media reported that drivers continued protesting in at least 14 states. Abcam represents about 700,000 of roughly one million self-employed truck drivers.

Chief of Staff Eliseu Padilha told reporters on Friday that the strike will be gradually demobilized. "We've fulfilled our part of the agreement and expect them to fulfill theirs," referring to truckers' unions. "It's a slow process."

Authorities are struggling to calm the chaos let loose by the strike that began Monday, set off by fuel-price increases of about 50 percent over a year. Temer fumbled initial attempts to pacify the situation, and the rapidly-escalating sense of chaos looks set to discredit yet further his deeply unpopular administration.

While the president has abandoned plans to run for re-election in October, those candidates associated with his government or even those merely sympathetic to its market-friendly agenda have been dealt a major blow. Brazil's presidential contenders have been reluctant to criticize the strikers, though some have questioned their tactics.

On Friday, there were signs of further damage to Latin America's largest economy. Carmakers were due to stop production lines, while airlines notified customers of flight cancellations due to lack of fuel in several of the country's main airports. The largest port in Latin America was said to be running out of soybeans.

Brazil, which is larger than the continental U.S., is specially vulnerable to disruption in transportation. It relies heavily on trucks to move cargo as it has only a small network of railways that cater mostly to shipping raw materials such as iron ore or soybeans.

Information for this article was contributed by Rachel Gamarski, Bruce Douglas and Robert Jameson of Bloomberg News.

Business on 05/26/2018

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