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Brazil should consider eliminating import tariffs on corn, soy -Conab president

SAO PAULO, Sept 10 (Reuters) - Brazil should consider temporarily eliminating import tariffs on food staples like soybeans and corn, Guilherme Bastos, president of the country’s food supply and statistics agency Conab, told Reuters.

Eliminating duties could be an option to lower internal grain prices, which are historically high in the local currency, Bastos said in an interview late on Wednesday.

The levy on corn and soybean imports from outside Mercosur, which includes Paraguay, Uruguay and Argentina, is 8%.

He proposed the measure as Brazil scrapped import duties on a 400,000-tonne rice quota through Dec. 31.

On Thursday, Agriculture Minister Tereza Cristina Dias said the temporary import duty exemption could benefit rice imports coming from the United States and Thailand.

Bastos said if the tariff drops, Brazil could buy soybeans from countries like the United States, which is starting to harvest now.

“Why not allow international trade flows in?,” he said, adding the same reasoning could apply to corn. Bastos is in favor of “open frontiers,” which Brazil’s Mercosur accord allows to regulate supply and demand domestically.

In the case of oilseeds, high internal prices raise costs for the crushing industry, which produces biodiesel and soyoil for local consumption. Brazil sells most of the soybeans it produces to China, and that has left little to sell domestically.

Higher corn prices are also a problem for food processors, which use corn as livestock feed.

The temporary reduction of the so-called “common external tariff” on soybeans and corn coming from outside the Mercosur was discussed last month by the government, but no decision was made. (Reporting by Roberto Samora Writing by Ana Mano Editing by Chris Reese)