South America Calling
Alastair Stewart South America Correspondent

Tuesday 10/16/12

Brazil Starts Exporting Soy in Containers

Brazil is starting to explore the use of containers to ship soybeans.

Last week, Wilson Sons shipped a consignment of 22 metric tons of non-genetically modified soybeans in containers to Japan through Salvador port in the northeast.

And much more soy is being sent via containers in the south. Brado Logistica, a subsidiary of rail operator America Latina Logistica, has ramped up operations and plans to send over 500 containers of soybeans through the southern and southeastern ports of Rio Grande, Paranagua and Santos this year.

Just as in the U.S., where containerized soy shipments through the Pacific Northwest ports to Asia are fairly common, the idea is to take advantage of favorable backhaul rates on otherwise-empty eastbound containers.

Using sealed containers also allows for better segregation of produce -- the Salvador consignment contained five separated soybean varieties. In a country where 85% of soybean production is GMO and the chance of contamination is elevated because of frail infrastructure, this is a particularly strong selling point for farmers seeking premiums for identity-preserved produce.

Containers are obviously a more expensive option than using grain terminals at the principle ports, but the bulk quays are currently so overstretched and inefficient that there are operational savings. By avoiding the long delays in unloading trucks and loading ships at the grain terminals, exporters estimate they cut port costs by between 15% and 30%.

This is a niche that will certainly grow. ADM plans to ship 500 containers of soybeans from Brazil this year, according to an article in the Gazeta do Povo, a local regional daily, while Brado Logistica's long-term goal is to ship 15,000 containers per year.

Posted at 11:38AM CDT 10/16/12 by Alastair Stewart
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