Brazil Trucker Strike Hits Suppliers of Consumer Staples

06/20/2018 - 10H52

FINANCIAL TIMES

Multinationals operating in Brazil are counting the cost to their revenues following a nationwide trucker's strike that brought the country to a near standstill, disrupting supplies and hitting Latin America's largest economy.

Unilever, producer of Dove soap to Magnum ice cream, was the first to quantify the damage when it warned last week that revenues in its second quarter, ending June 30, would be reduced by €150m. Brazil accounts for 6 per cent of the Anglo-Dutch group's sales.

Others are expected to follow. Analysts at Goldman Sachs said: "The challenges Unilever has faced in Brazil are unlikely to be entirely company-specific and we believe a similar headwind to other [European] consumer staples companies with a meaningful exposure to Brazil is likely to include AB InBev, Ontex, Heineken and Danone."

Budweiser brewer AB InBev, which makes 16 per cent of its sales in Brazil, declined to comment. Rival Heineken said on Friday that although the strike had caused "major disruption" to supply chains, the blow was cushioned by having a few weeks' supply in the system. Stocks ran out in a few places but "we have also seen volumes picking up after the strike ended," Heineken said.

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https://www1.folha.uol.com.br/internacional/en/business/2018/06/1972415-brazil-trucker-strike-hits-suppliers-of-consumer-staples.shtml