On the last day 16/07/2020, the National Land Transport Agency (ANTT) published in the Federal Official Gazette (DOU) the Resolution No. 5.899, through which the table of minimum floors for road freight in Brazil was updated. The new Resolution came into force last Monday (20) and sought to reflect, mainly, the drop in diesel prices in the market in the calculation coefficients of the minimum freight to be remunerated.
In fact, since the beginning of new coronavirus pandemic, in mid-March of this year, the average price of diesel has been suffering significant consecutive falls, and in the months of March, April and May of this year, there was a decrease of 3,4%, 7,4% and 7,4% , respectively, in relation to the previous month. From January to June 2020, there was an 18% drop in average fuel price.
Figure 1: Evolution of the average diesel price. Source: ANP (consultation in Jul/2020). Analysis: ILOS.
If, on the one hand, the graph above makes clear the downward trend in diesel prices at the beginning of 2020, on the other hand, it is possible to note that June was the first month, since the beginning of the pandemic, in which there was an increase, albeit a small one. (0,4%), of the price of diesel in relation to the previous month. When we look at even more recent data, in consultation held on 21/07 on the ANP website, the average price of diesel calculated for the month up to the date of the consultation was R$ 3,28. If we compare this value to the average price practiced in June (R$ 3,15), we notice a more significant increase, of 4,2%.
Despite this, as the new ANTT table has just been released, it is reasonable to predict that this upward trend in prices observed in July has not yet been incorporated into the new publication. And, in fact, this new version of ANTT's minimum floor table brought, in general, a drop both in the loading and unloading cost coefficient (CC), which makes up the fixed portion in the composition of the minimum price of road freight , and the displacement cost coefficient (CCD), which represents the variable component of the minimum freight price.
The figure that follows brings a comparison between the 3 versions of the table published in 2020, through the resolutions No. 5.867 of January, No. 5.890 of May, and No. 5.899 July. The analysis was divided into two parts: a first dedicated to a common vehicle profile in the freight transport market in Brazil (general cargo, 5 axles, standard performance) and a second more general section, with an analysis of all types of cargo. and vehicle profiles (axles).
Figure 2: Comparative analysis of the last 3 publications of ANTT's minimum floor freight table (Resolutions No. 5.867, No. 5.890 e No. 5.899. Analysis: ILOS. The last two decimal places of the CC and CCD coefficients in the figure have been omitted.
The analysis shows that, from the January table to the May table, there was general maintenance of the loading and unloading cost coefficients (CC) and a reduction of 4% to 6% in the displacement cost coefficients (CCD). When we compare the version published now in July with the May publication, it is possible to notice that, although not generalized, there was a downward trend in the loading and unloading cost coefficients (CC), which reached, in some cases, 11%, in addition to an overall drop in commuting cost ratios ranging from 3% to 8%.
However, it is important to note that, although ANTT commonly publishes half-yearly updates of the minimum freight table, the agency also provides for intermediate versions of the table whenever there is an oscillation, positive or negative, greater than 10% of the value of S10 diesel, according to data published by the National Petroleum Agency (ANP). Therefore, if the upward trend in prices highlighted earlier in this post, due to the gradual recovery of the economy, is confirmed, we can expect that, before January 2021, the agency will make a new publication readjusting the coefficients for calculating the minimum floors of road freight, this time with a general tendency to increase.
Although ANTT has made this new publication of the table, it is worth remembering that the matter still has pending legal issues to be resolved by the Federal Supreme Court (STF). Minister Luiz Fux is the rapporteur of 3 Direct Actions of Unconstitutionality (ADI) related to the tariff, filed by the National Confederation of Industry (CNI), Confederation of Agriculture and Livestock of Brazil (CNA) and Association of Road Transport of Brazil (ATR Brasil ). The trial, initially scheduled for February 2020, ended up being postponed, in order to try, firstly, to seek conciliation between the parties involved (productive sectors and truck drivers), as requested by the Attorney General's Office (AGU). The last conciliation meeting took place in March of this year, with the next one scheduled for April. However, due to the worsening of the pandemic, the meeting has been postponed, still without a set date to take place.
In this way, due to the lack of definition about the constitutionality of the table, even if provided for in the resolutions, the application of any fines or sanctions related to the table, including those resulting from the non-compliance with the tabled values by the freight contracting party.
After yet another chapter in the history of freight scheduling in Brazil, everyone hopes that, as soon as possible, important definitions as to the constitutionality or otherwise of the measure will be taken to bring greater security to the freight negotiation environment between shippers and carriers/self-employed in the Brazil. Dialogue, instead of regulating the market through a price-fixing law, sounds like a more sensible way of resolving the stalemate between the parties involved and correcting eventual market distortions. Cargo Transport in Brazil will be one of the themes of wide debate in the Forum ILOS 2020, which this year will take place in its first 100% online version, between the 13th and 15th of October.
References:
- ANP - Average price of diesel
- Globorural – Decision on shipping table is set for April
- Poder 360 – New shipping table comes into effect this 2nd. fair
Gabriel Tambelli
More than 3 years of experience in consulting projects in Logistics and Supply Chain for companies in the Retail, Food and Beverage, Chemical and Petrochemical, Telecommunications, Health and Hygiene and Beauty sectors. Worked on logistics network modeling and optimization projects, definition of stock supply policy, strategy for contracting primary and secondary transport with synergies study, evaluation of modals and alternatives in view of ANTT's minimum freight floors, sizing of fleet for urban collection and distribution, support for negotiations with transporters with the development of a heuristic tool for the allocation of route packages and benchmarking with large dry and frozen cargo shippers regarding market practices in transport operations.
