Imported wheat prices in Brazil could rise due to higher logistics costs
Rising diesel and marine fuel prices are increasing Brazil’s grain transportation costs, potentially raising imported wheat prices despite favorable global supply prospects. Ocean freight rates rose 3% in early October, while trucking costs increased on key routes, adding pressure on Brazilian wheat processors and importers.
Rising diesel and marine fuel prices are increasing grain transportation costs in Brazil, creating risks of higher imported wheat prices. Despite a relatively favorable global grain supply outlook for the MY 2026/27, higher ocean freight and road transportation costs could increase the final cost of wheat for Brazilian processors. This is particularly relevant to imports from Argentina, which remains Brazil’s main foreign wheat supplier.
According to Safras & Mercado analysts, ocean freight rates to Brazilian ports increased by an average of 3% between October 5 and 13. Shipping costs to the port of Rio Grande rose from $28 to $29/t, while rates to Santos and Paranaguá increased from $31 to $32/t, and those to Fortaleza climbed from $37.5 to $39/t. The main driver was higher marine fuel costs, with average prices across 20 major global ports reaching approximately $876.5/t. Meanwhile, the Baltic Dry Index has declined in recent weeks, indicating a lack of broad-based growth in demand for ocean freight.
Higher domestic diesel prices are adding further pressure on Brazil’s grain logistics. The country imports around 30% of the diesel it consumes, leaving it exposed to developments in international energy markets. As of October 6, the average diesel price reached BRL 7.17/liter, up 6.4% over the month. Prices for low-sulfur S10 diesel increased in 25 of Brazil’s 27 states and federal districts. Despite government subsidies, transportation costs continue to rise.
Higher fuel prices have already affected grain trucking rates. Between September 28 and October 19, average freight rates on routes from Goiás state to the port of Paranaguá increased by approximately 11%, from BRL 320 to BRL 355/t. On the route from Sorriso in Mato Grosso to Paranaguá, transportation costs rose by 5%, from BRL 490 to BRL 515/t. Meanwhile, rates on some routes to the port of Santos remained stable, while certain routes in southern Brazil even recorded declines. This reflects the uneven impact of fuel costs and transportation demand across different regions of the country.
Logistics costs could rise further as Brazil’s wheat harvest progresses, increasing demand for trucks to transport grain between farms, storage facilities, ports and flour mills. Under these conditions, even stable global wheat prices may not prevent higher costs for Brazilian importers. Elevated fuel expenses, ocean freight rates and domestic transportation costs could intensify price pressure in the market, while future developments will depend on energy price trends and the utilization of transport infrastructure.
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Source : Ukr Agro Consult
