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Iran threatens to suspend imports from Brazil if Petrobras fails to supply freighters

In an interview with Bloomberg , Iran’s ambassador to Brasilia, Seyed Ali Saghaeyan , said he contacted Brazilian authorities on Tuesday to inform him that his country could look for new partners to buy corn , soy and meat if Brazilian authorities did not resolve the situation.

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In the first half of 2019, according to data from the Ministry of Development, Industry and Foreign Trade , Brazil imported US $ 26 million in Iranian products.The high compared to the same period of 2018 is 800%. Urea, a fertilizer, corresponds to 96% of this value.

In return, Brazil exported $ 1.3 billion to Iran in the first half of this year , up 23.85% from the same period last year. The main product of the relationship is corn, which accounts for 36% of sales. Soy comes next with 34%.

“I told Brazilians that they should resolve this issue and not Iranians,” Saghaeyan said in a contact at the embassy in the Brazilian capital qualified by the news agency as rare. “If (the situation) is not resolved, the authorities in Tehran may wish to make decisions since (the agricultural market) is a free market and other countries are available.”

In addition, the ambassador confirmed that his country is considering sending fuel to both ships, but this would be a lengthy and expensive option, according to Saghaeyan. “Large and independent countries like Brazil and Iran should work together without interference from third parties or from another country,” said the diplomat.

Still according to Bloomberg , Saghaeyan has asked for a meeting with Brazilian Foreign Minister Ernesto Araújo , but has not yet received a response.

Crisis between Brasilia and Tehran

Two Iranian-flagged ships, the MV Bavand and the MV Termeh , have been at a standstill since early June at the Paranaguá Port in Paraná. The freighters brought urea and would return loaded with corn, but Petrobras fears American punishments and refuses to supply vessels, which are blacklisted by the US Treasury Department .

The state company said there was a risk of being punished in the US, so it refused to supply Iranian ships. “In addition, the ships came from Iran loaded with urea, a product also subject to US sanctions. If Petrobras supplies these ships, it will be subject to the risk of being included in the same list, suffering serious losses ”, said the company.

Last week, President Jair Bolsonaro stated that US sanctions on Iran are a risk to Brazilian companies . “There is this problem. The US unilaterally, as far as I am aware, has embargoed against Iran (in fact, it meant “an existing embargo”). Brazilian companies have been warned of the problem and are at risk. ”

He also said he was aligned with the US on the topic , even though he had not spoken with US President Donald Trump. “We don’t talk about that particular subject. But there are certain things you don’t need to talk about. We are aligned with their policy, so we know what we have to do,” he said.

The Attorney General, Raquel Dodge , also gave her opinion on the matter and said she was in favor of suspending the injunction that forced Petrobras to supply fuel to vessels in Paraná.

In the document, Raquel states that the company has not proven to have a subjective right to buy the fuel from Petrobras and that it has alternatives to purchase the product from other suppliers – which is disputed by importer Eleva Química, which hired the Iranian cargo ships.

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