Brazil will suspend tariffs on corn and soy imports from countries outside the Mercosur trade bloc until early next year to help reduce food prices that are pushing up inflation, the economy ministry has said.
The decision to remove the tariffs temporarily was taken late on Friday at a meeting of Gecex, a technical body within the economy ministry, as reported by Reuters.
Soybean meal and soy oil imports will also be exempt along with soy imports until January 15, 2021, while corn imports will cease paying the tariffs until March 31, 2021, the ministry said in a statement.
"Both measures are aimed at containing high prices for food," the ministry said.
Record high prices for both grains have impacted food prices that are fuelling inflation and squeezing incomes of Brazilians that have already been hit by the coronavirus pandemic. Inflation in August hit its highest in four years for that month, driven by rising fuel and food costs.
High prices for soy and corn are also hurting the margins of poultry and pork sector that relies on both grains for animal feed and last month requested that the government free up imports.
The tariff on corn and soy imports from outside Mercosur, which includes Paraguay, Uruguay and Argentina, is currently 8%, and 6% for soy meal and 10% for soy oil.
The economy ministry decided in early September to eliminate tariffs on rice imports through the end of the year, amid record high prices for the grain.