With the market in crisis, rice farmers demand a government response

The National Supply Company (CONAB) announced a ministerial order to purchase 110 tons of rice through a put option contract for the current harvest. The measure was announced after a meeting between CONAB President Edegar Pretto, Denis Nunes, President of the Federation of Rice Growers' Associations of Rio Grande do Sul (Federarroz), and Andressa Silva, Executive Director of the Brazilian Rice Industry Association (ABIArroz).

Pretto explained that the initiative aims to balance market prices. "We've now set a price of R$73 per 50-kilogram bag for August. R$73,48 for September, and R$73,91 for October." Furthermore, the president emphasized the ongoing dialogue with the industry to expand the market. Conab forecasts a harvest of over 12 million tons in 2026.

Federarroz president Denis Nunes noted that low grain prices in May and June required a response from the industry, and that one alternative would be the adoption of COVs (put option contracts). "We always feel very uncomfortable when we have to resort to government marketing tools (Conab). We feel a certain inability to manage our farms in the face of these price depressions," he reflected.

Nunes emphasized that the sector has been working to conquer new markets, thanks to the quality and technology of rice production in the state. "And we have, indeed, been working to win over markets and consumers, raising awareness among Brazilians about the importance of rice in their diet," he added.

The director pointed out, however, some production obstacles that hinder more balanced competition within Mercosur. "We need the Ministry of Agriculture to monitor packaging for rice classification. There are some cases of fraud in classification. We have tax issues at the federal and state levels that need to be addressed," he noted. Nunes advised producers to reduce their rice planting area, given the current situation and the need to continue exporting paddy rice.

Andressa Silva, executive director of Abiarroz, emphasized that the sector has expressed concern about the sustainability of the rice production chain. "And the industry is not in its interest to operate with significantly depreciated prices, much less with the price fluctuations we've observed in the sector. This instability compromises the producer's ability to produce and the industry's ability to sell, and it also negatively impacts rice consumption," she reflected.

Andressa explained that when prices are too high, consumers migrate to alternative products. And when prices are too low, consumers lose their sense of value for rice. "Brazil is self-sufficient in rice production, and this is a fact to be celebrated, because we don't depend on the external market to supply the population. This requires commitment from all stakeholders in the chain, including the government, to ensure the viability of the activity, with a view to maintaining food security for the Brazilian population," she concluded. In this regard, the executive director emphasized the importance of the ongoing dialogue with governments.