Brazil considers bartering with Iran for fertilizers

Western sanctions on Russia left Brazil starved of fertilizers. Heavily dependent on Russian products, the country’s agricultural sector is braced for a shortage of nitrogen, phosphorus, and, above all, potassium in the following months, should the sanctions continue. 

In such a scenario, importers are pushing the federal government to allow negotiations with Iran, one of the world’s largest fertilizer producers. U.S. sanctions, however, severely hinder Iranian exporting capabilities, as getting money to Tehran is complicated. On the other hand, Brazilian importers are considering some sort of bartering deal with Iran, exchanging agricultural commodities for fertilizers.

“Iran has a large fertilizer production capacity, with an updated average of seven million tons of urea per year. Last year, we exported a record amount to Brazil,” said Iran’s ambassador to Brazil, Hossein Gharib, in an interview to newspaper O Globo. 

“Iran has been one of the biggest buyers of Brazilian corn in recent years and the country has a great demand for other grains, mainly soybeans,” he adds. In 2022, Iran intends to buy 15 million tons of grain and, according to the ambassador, “a large part” will come from Brazil. 

Other than grains, Brazilian farmers are eager to access the Iranian cloth markets. “Currently, there is no direct export of cotton from Brazil to Iran, but there is potential for the partnership. The Iranian textile market is expanding, and today it is estimated that imports will be 120,000 tons of lint per year, which places the country among the ten largest cotton importers globally,” says the Brazilian Cotton Producers Association. 

“Among the possibilities for expanding bilateral trade is the so-called barter operation (exchange) between urea and cotton,” it adds. 

In February, cotton producers accompanied Agriculture Minister Tereza Cristina on her trip to Iran. Among the issues discussed with Iranian authorities was a potential expansion to bilateral trade.

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