Understand the growth in the movement of liquids in the Brazilian market

  • 29/10/2020
  • 9 minutes

The growth in the movement of liquids in the Brazilian market has been quite prominent over the past few years. As the impacts are still recent, some doubts may arise when measuring them.

After all, what liquids are these? When and for what reasons did this evolution begin to manifest itself? What are the main peculiarities of this market and what to expect from it in the coming years?

To address this very relevant topic, we interviewed Ricardo Cecílio M. Neves, who is an energy specialist. Read the text to the end to enjoy all the information!

What are the main liquids handled in Brazil?

According to the specialist, Brazilian ports and waterway transport in general include chemical products and from various other sources. “Despite this, there is an enormous predominance of the movement of crude oil and its derivatives in the national market”, he adds.

In this sense, it is necessary to highlight the numbers referring to the operations carried out on pier 2 of the Port of Pecém, where the Pecém Regasification Terminal is located. According to data released by the Ceará State Government portal, from January to September 2019, 405,376 tons of liquefied natural gas were handled – a type of liquid bulk. The growth, when compared to the same period in 2018, is 70%.

Such brands, added to the information brought by Ricardo, help to understand the variety in the movement of liquids in our market. The new terminal at the Port of Paranaguá, opened in mid-2018, is another fact that confirms the development of the activity, since it increased the capacity for handling liquid cargo by 20.4%, as reported by Folha de Londrina.

It is worth remembering that the Port of Paranaguá – one of the main centers of liquids next to the Port of Santos – can store more than 93,715 cubic meters, divided into 18 tanks, which handle up to 200 million liters per month.

As disclosed by the magazine Portos e Navios, the movement of liquid cargo through the port of Paraná grew 81% between the years 2011 and 2017. In addition, it emerges as one of the largest exporters of agricultural products, such as soybean meal and soybeans.

When and for what reasons did the liquid handling market grow?

The investment in logistics infrastructure and the recent works at Brazilian ports represent, to a certain extent, the expansion of the liquid handling market. However, why did it happen? What are the biggest motivators for such a remarkable development and when did it start?

In Ricardo’s view, “the growth of the impact of these goods on the Brazilian market has been increasing since the 2000s, but has intensified mainly with the increase in oil exploration and export – which has had a strong rise since 2015” .

It is worth mentioning that the logistics of liquid products regulated by the ANP (National Agency of Petroleum, Natural Gas and Biofuels) is completely linked to the pipelines and liquid fuel terminals. This also applies to companies and consortia that operate the facilities and offer a variety of services, such as storage, transportation and loading and unloading services.

In the second half of 2018, the sector underwent a significant recovery through the Oil and Gas auctions – Oil and Gas. A publication by Agência Brasil even includes speeches by important figures who work and / or invest in the area, associating the practice with the heating of the market.

“The main factor in triggering the expansion was the increase in domestic oil production followed by its export, with emphasis on explorations in the pre-salt region”, points out Ricardo. Not by chance, one of the challenges to keep the movement of liquid cargo and the Oil and Gas industry as a whole continue to grow over the long term is to attract financial contributions in other exploratory areas in addition to those in which the pre-salt is concentrated.

What are the peculiarities of the liquid handling market?

According to Ricardo, the greatest peculiarity of this market is associated with the need to have a good infrastructure for receiving and disposing. “When these issues are totally or partially resolved, companies will start to increasingly adhere to maritime and waterway transportation. After all, it can reduce logistics costs for liquid products with low added value”, he explains.

It should be noted that costs in maritime transport can be optimized through a Charter Party – Charter Party – prepared in an appropriate manner, which meets the needs of the parties involved. Some aspects must be addressed to reach the best possible terms, such as:

• amount of cargo to be transported;

• ports of origin and destination;

• embarkation and disembarkation period.

What are the prospects for the future of this market?

For Ricardo, there are several reasons to view the sector with optimism, as it is very likely that the growth bias will continue: “the year 2020 will continue to mark growth, which increases every year”. However, he says that much needs to be done for the modal to reach its full potential. “When we also look at the issues of inland waterway transport, that is, that which is done within the country, we detect some structural deficiencies for receiving and disposing of cargo”, says the specialist.

Regarding expectations about the national Oil and Gas market in general, some regulatory adjustments, such as the revision of the rules of local content, may be welcome. In addition, it is possible that the technologies tested in the pre-salt bring cost reductions and efficiency gains in different directions, further contributing to the increase in performance and, consequently, the results obtained.

This scenario, together with the continuous progression of renewable energy sources and their increase in representativeness in the energy matrix, will contribute to the search for a combination of low exploration and production costs. Therefore, the trend is for companies in this segment to reposition themselves as energy organizations, addressing the issue from a global perspective.

The growth in the movement of liquids in the Brazilian market is clear and its future is announced as something promising and full of possibilities. Therefore, it is worth continuing to follow the recent changes to learn more about it!

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