They unloaded urea at the beginning of last month, and wanted to fill the back leg home with some of Brazil’s second-crop corn that’s more than half harvested now. But U.S. sanctions mean nobody wants to sell them fuel to make the trip. After all, Petrobras, Brazil’s oil and gas company of which the government owns over half the shares, is listed on the New York Stock Exchange.
Iran is Brazil’s biggest corn customer, buying 36% of all the corn Brazil exports each year, and among the South American country’s top buyers of beans, soybean meal and beef, too. And since the U.S. sanctions don’t cover food, there’s no problem for Brazil to sell the Islamic Republic all the soy, beef and corn they want. But they’d better bring along one or two of those red plastic gas cans full of diesel in the hold so they know they can get back home. After all, the Iranian ship Bavand is already loaded with 48,000 tonnes of Brazilian corn.
Here’s what Brazil’s state-owned oil company said, according to local media: “Were Petrobras to refuel these ships, it would be subject to the risk of being included (on a list of sanctioned companies,) suffering grave losses as a result of the sanctions.”
The Petrobras statement added that there are other, non-Iranian, companies that can easily buy the fuel needed to ship goods to the Islamic Republic. After all, several non-Iranian flagged ships have been doing it. As a result, the effect of the sanctions on Brazil’s corn, bean and beef shipments to the big buyer should be relatively small. But still.
Over the first half of 2019, Iran bought nearly 2.5 million tonnes of Brazilian corn, says the Brazilian government.