Brazil customs workers up strike pressure with new ‘zero clearance’ period at Santos port

SAO PAULO (ICIS)–Brazil’s customs auditors have announced a new five-day “zero clearance period” at the Port of Santos on 2-6 June in which no physical inspections will be carried out, according to a letter to customers by logistics company Unimar seen by ICIS.

The action at Santos – Latin America’s largest port – extends a strike started in 2024 which has disrupted logistics for months. The port is a key exit and entry point for some chemicals and a wide range of industrial goods, as well as of fertilizers imports feeding Brazil’s powerful agricultural sector.

“Brazil’s Superior Courts have ruled that industrial action cannot entirely paralyze essential public services, such as the clearance of perishable cargo. Judicial intervention may be required to ensure the continuity of critical operations, assessed on a case-by-case basis,” said Unimar’s letter.

“Currently, marine terminals at major ports have reported that most cargo is cleared automatically via the system, except for those not classified under the ‘Green Channel.’ Therefore, the strike is expected to primarily impact cargo that requires physical inspections.”

Under normal conditions, average clearance times at Santos are five to seven days for imports and one to two days for exports – the action plan up to 6 June may cause delays for cargo requiring physical inspection, while clearance of vessel spare parts at major airports typically takes three to five days.

Brazil’s Superior Courts have ruled that industrial action cannot entirely paralyze essential public services, such as clearance of perishable cargo.

Judicial intervention may be required to ensure continuity of critical operations on a case-by-case basis.

A YEAR-LONG STRIKE
The strike by customs workers, with no sign of resolution in sight, is about to reach one year of duration, some of the longest strikes by civil servants ever seen in Brazil.

Smaller strikes started to take place in mid-2024 but then escalated into a comprehensive two-month stoppage.

Several rounds of talks between the union representing tax auditors and the government have failed to reach agreement.

The union is demanding salary increases and better working conditions, including maintenance and upgrades at ageing customs points across Brazil.

President Luiz Inácio Lula da Silva’s government is attempting to control spending amid investor concerns about the fiscal deficit.

Chemicals players have said to ICIS they are increasingly concerned about rising logistics costs, in part due to the strike.

The trade group Brazilian Association of Distributors of Chemical and Petrochemical Products (Associquim) warned that companies handling perishable goods or materials requiring quick delivery – pharmaceuticals, food products – are facing particular difficulties.

“We have chemical products that have to have a special place for storage, and if too much accumulates in those special storage places, then it will filter down to the end-user, and create a safety problem,” said Associquim president Rubens Medrano earlier this year.

NEW SYSTEM DEPLOYMENT AT RISK
Something most logistics players have mentioned and remain a key concern is how the strike could threaten the implementation of Brazil’s New Import Process on the Single Foreign Trade Portal, approved in 2023 to reduce delivery times and costs.

The system’s third and most critical phase is due in the second half of 2025.

Trade group the Brazilian Machinery Builders’ Association (Abimaq) estimated the new system could save companies Brazilian reais (R) 40bn ($7.07bn) annually when fully implemented, nearly halving delivery times from nine days to five days through increased electronic processing.

Meanwhile, the trade group representing chemicals producers Abiquim has equally warned that prolonged strike action could negatively impact the current implementation phase of the import system designed to simplify processes and reduce logistics costs.

The Santos Port Authority had not responded to a request for comment at the time of writing.

Front page picture: The Port of Santos in Sao Paulo state
Picture source: Santos Port Authority 

Additional reporting by Sylvia Traganida