Middle East conflict drives cost surge in Brazil’s agricultural aviation

Escalating geopolitical tensions in the Middle East are beginning to reverberate across Brazil’s agricultural aviation industry, triggering a sharp increase in operational costs and raising concerns about the broader impacts on food production and export competitiveness.

After a momentary relief in February 2026 when the Agricultural Aviation Inflation Index (IAVAG) declined by 0.85%, the cost environment shifted abruptly. The earlier drop had been driven by a 1.54% currency depreciation and a 6.44% fall in ethanol prices, temporarily easing pressure on operators.

Preliminary data for March, however, points to a reversal of this trend. The IAVAG is expected to rise by more than 6.75%, representing a swing of approximately 7.6 percentage points compared to the previous month. The surge reflects a sharp escalation in energy costs, led by a 58.46% increase in heating oil prices, alongside a 1.35% currency appreciation and a 3.64% rise in ethanol.

This cost pressure is compounded by broader inflationary signals, including domestic indices such as the INPC and IPCA, as well as the U.S. Consumer Price Index (CPI), all of which are expected to further influence input costs in the coming months.