9 minute read
Intermodal South America
INTERMODAL SOUTH AMERICA: BACK IN BUSINESS
The Intermodal South America (ISA) trade show returned to the stage this year, after a three-year absence and exceeded all expectations, according to the organisers as well as dozens of attendees interviewed by Port Strategy.
Hermano do Amaral Pinto Junior, Business Director for Informa markets Brazil, said that around 22,000 people attended the 26th edition of ISA which, despite hosting almost no participants from China [which usually make up around 20% of the Expo], was only around 34 per cent less than the record number of 36,000 back in 2019.
“Up until the week before we only had 12,000 paid registrations so we were somewhat worried,” said Pinto, “but then we had 1000s of new registrations at the last minute, much to our relief. During the absence of a physical Intermodal show many people, and especially freight forwarders, have been very supportive of our efforts to bring this event back. People have been so grateful and happy to be together again, and we have provided the opportunity for contacts and deals to be made and for the government to outline its privatisation and infrastructure plans, such as the Green Line project.”
The keynote speech at the IM came from Tarcisio Gomes de Freitas, the Infrastructure Minister, who is pushing hard a privatisation programme in the transport sector (especially ports and port authorities: see preceding articles).
““Brazil will increasingly become a multimodal country, more and more efficient from a logistical point of view,” he confidently told those gathered. “We expect participation of the rail mode of transport to grow from 20 to 40 per cent by the year 2035.”
Running concurrently with ISA was the 25th National Conference on Logistics which also focussed on logistics developments in Brazil.
Several attendees expressed their “absolute delight” that ISA was up and running again as it gave them a “one shop stop” to see dozens of clients face to face after the three-year hiatus, as “Zoom meetings are just not the same”.
Marcelo Goncalves, the Kalmar director for Latin America Mobile Equipment Sales, further emphasised this. “This trade show is mostly for renewing
8 Intermodal South America back in
business after a two-year absence
contacts and meeting people face-to-face. Most of our customers are here and they are keen to talk about their future plans and if Reporto is brought back, as we expect, then more orders will be made,” he told Port Strategy at the show.
APMT Itajai Develops the Ro-Ro Option…
APM Terminals Itajai, which has been losing container volume and market share to Portonave, its rival across the River Itajai Acu, and also to Porto Itapoa, some 90 km away, is turning to ro-ro as a way of bolstering its bottom line.
The Florida Highway, operated by K Line, called at the south Brazilian terminal in mid-March, and it unloaded 460 high value BMW cars, the first in Itajai for nearly three years.
“We now have a monthly service from K Line and we are going to see more and more general cargo at our terminal this year,” said Aristides Junior, the CEO for APMT Itajai.
APM Itajai handled 528,000TEU in 2021, down 4.5 per cent from the 553,000TEU total in 2020. In the first two months of this year it handled just 58,000TEU, down 26.3 per cent from the 78,812TEU for same period in 2021.
Portonave Plots A Growth Path
On the other side of the River Itajai-Acu, the Portonave terminal, which now sits in the MSC/TIL portfolio, highlights its recent progress. It achieved a 1.1 million TEU throughput in 2021, a notable 29 per cent increase.
Talking to Port Strategy at the company’s stand at the Intermodal South America trade show, Rodrigo Lopes, Commercial Manager, Portonave, told us that last year was an outstanding one mainly because of its strategy of targeting new business from Sao Paulo (Brazil’s financial and industrial heartland), where many shippers had been having problems with congestion out of the port of Santos.
“The congestion in Santos has played into our hands for sure,” said Lopes. “We brought in a lot of frozen meat, auto parts, CKDs and fruit exporters [oranges and lemons mainly] from the Sao Paulo region. This year, however, we are only forecasting an increase of 5.8 per cent as we are facing our own capacity restrictions.”
If not for these restrictions Lopes believes Portonave could post another increase of between 15 and 20 per cent. He notes, however, that with new adjacent land bought measures were now being taken to double terminal capacity to well over 2m TEU per annum by the year 2026.
BRIEFS
IMETAME launch
Yet another new port project, specialising in containers but including general cargo, dry and liquid bulk facilities, was launched at Intermodal South America. Imetame Porto Aracruz, located only 55 miles from the port of Vitoria, splashed out on its own sizeable stand to launch its arrival on the port scene and reports it is constructing a breakwater for the new deep-water port with container operations scheduled to start in 2024. Pecem JV
The Pecem Industrial and Port Complex and Stolthaven Terminals (part of the Stolt-Nielsen group) are setting up a joint venture with the Port of Rotterdam, for a new storage terminal in the port of Pecem to handle green hydrogen and associated products. Located in the north of Brazil, Pecem is seen to off er great potential for generating wind and solar energy.
Diversifi cation
Ecoporto in Santos (which used to handle some 500,000TEU back in 2013 but now just a very small box volume) has become a leader in LCL cargoes and warehousing and hosts regular break bulk calls from Grimaldi ships. Similarly, DP World, Santos has recently added handling cellulose in breakbulk vessels to its operations. Bulk Alternative
Worldwide container shortages, accentuated in Brazil, have led the Ponta do Felix private port in Antonina (part of the Paranagua port complex) to switch to exporting wood pellets in bulk rather than in boxes. The increased cost of container transportation was also a catalyst to this course of action.
The reinstatement of the Reporto tax exemption scheme for imported rail and port equipment, announced shortly after the closure of Intermodal South America 2022 (ISA), provided a welcome boost to the equipment supply sector. It opens the door to the confirmation of many provisional orders taken at ISA. Kalmar, Liebherr and Konecranes had, for example, intimated during the Sao Paulo show that several new contracts would only be signed after a final decision was made in Brasilia on Reporto.
Reporto legislation rules that all port and railroad equipment imported into Brazil will be exempt from various taxes, sometimes totalling up to 45 per cent of the cost of the ship to shore gantry cranes, reach stackers, RTGs, terminal tractors, etc, etc. It had not been functioning since December 2020 but now makes a welcome return in 2022.
The rationale underpinning its introduction is that due to the effects of Covid and more recently the war in Ukraine, and notably the slowing of the local and international economies, it is seen as an essential measure to stimulate the purchases of port and rail equipment which, in turn, will help reduce logistics costs.
Renato Macedo, Director General for TFD, the main agent for Konecranes in Brazil, typifies the delight of the systems supply sector:
REPORTO TAX EXEMPTION MEASURE REINSTATED
“TFD Brasil is delighted that the Brazilian Government has re-introduced the Reporto benefit for our Port sector, as we believe this action will enable all our customers to continue increasing and renewing their
equipment fleets so that Brazilian Ports continue their role in helping our economic growth,” he told Port Strategy.
8 Reporto tax exemption measures for cargo
handling equipment back in action again
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UKRAINE WAR POSES CHALLENGES FOR THE FERTILISER SECTOR
Brazil’s Agro-Industry aims to “Feed the World” but the Russian invasion of Ukraine, on the other side of the world, has created major headaches for importing fertilisers which are vital to the agricultural businesses that drive the Brazilian economy: including soya and grain producers as well as beef and chicken exporters.
Brazil imports 20 per cent of its fertilisers from Russia and although embargoes are not affecting this trade so far, traders face the reality of shortages of supply and spiking of prices. Since the war broke out the price of urea (a nitrogen-based fertiliser compound) has risen 75 per cent to $965 per ton, at Brazilian ports.
Jose Bechara, Director, Litoral, a trading company operating out of Sao Francisco do Sul (SFDS), notes that prices have indeed “gone through the roof”. “We assist with the trucking to the farmers and the prices have been rising rapidly since the war started,” he says.
The ports of SFDS, Santos and Itaqui, in the far north, are taking measures to increase port capacity for fertiliser imports as agroindustrialists endeavour to import more now before the shortages really kick in. Cleverton Vieira, President of the port of SFDS, reports that in February it imported 400,000 tonnes of fertilisers, 300 per cent more than in the same month last year. Growing agro exports had already led the port of Itaqui to build a new fertiliser terminal, which will open shortly.
8 Brazil fertiliser trade impacted by Russia’s war
with Ukraine
For the longer term, in March this year Brazil launched a plan to reduce the share of fertiliser it sources from imports. The plan identifies different scenarios to reduce nitrogen, phosphates and potash imports dependency by 2050.
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