The particularities of shipping soy in Brazilian ports

The shipment of soy beans from Brazilian ports is full of particularities. From the most important points of outflow to the specific legislation, there is a series of details that can’t escape the eye of those who act directly or indirectly with the chartering of the product.

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Considering the importance of the subject, we elaborated this article with relevant information for those interested in the area. Throughout the text, we will show how the infrastructure of the ports impact despatch and demurrage and see if the port terminals are prepared for the demand. Enjoy!

Which are the most important ports used for shipment of soy beans?

Among the most important ports, we can highlight:

• Rio Grande;
• Paranaguá;
• Santos;
• Tubarão;
• Salvador;
• Itaqui;
• Santarém;
• Barcarena;
• Itacoatiara.

The port of Paranaguá, by the way, recently registered a historical record. As reported by G1, the port exported 9.5 million tonnes of soybean between January and September of 2017, more than in any other full year.

According to data disclosed by the government of Paraná, the mark represents a 12% increase over the previous annual record, which was of 8.5 million tonnes in 2015. Besides, the number is 27% bigger than the total transported in 2016, which was of 7.5 million tonnes.

In relation to the ports of the so-called North Arch (Itacoatiara, Itaqui, Santarém, Barcarena, and Salvador), the expectations for the next few years are also encouraging, since there has been a significant increase in shipping from those ports.

Information from the Ministry of Agriculture, Livestock, and Supply (Mapa) shows that, together, they correspond to 24% of the total of soy and corn exported by Brazil. The port loading capacity in those ports combined reaches 40 million tonnes.

Are Brazilian ports ready for the demand? Find out!

There is a lot of doubt about the capacity of the national ports in relation to foreign soy demand. In this scenario, the current infrastructure is able to supply a good part of the demand generated by the flow of national production. However, there are logistic problems on inland transportation, meaning, the roads and railways.

Today, this connection has been established as one of the biggest challenges for the activity to get even closer to its ideal results.

In this way, the deficiencies of intermodal transport — which consists on the connectivity between different means and ways of transport (inland waterways, roads, railways etc.) in the country — emerge as some of the biggest obstacles to be faced by the sector.

Considering the context of the soy from harvest to loading, it’s necessary to highlight that there isn’t one single standard model behind these operations. There are terminals in Santos and in Tubarão which only receive cargo by railway, for example.

Parallel to that, around 95% of terminals receive cargo via reel. The port of Barbacena, which is located in Vila do Conde, is developing quickly and raising flow — the same goes for the previously mentioned port of Itaqui.

However, Barbacena needs to deal with problems brought on by motorway BR-163, which crosses from Mato Grosso do Sul until Pará. On this route, 80% is done by land, which results in difficulties depending on weather or other similar situations. Besides, the average speed of a truck riding along the highway is of approximately 48 km per hour.

This study carried out by Embrapa about the 2015-2016 harvest can help you understand better the paths traveled until the cargo arrives at the ports.

How does the ports’ infrastructure impact despatch and demurrage?

Usually, when there is a grain sale, the parties involved already think about using a certain port and terminal, knowing the loading capacity in those places. Therefore, everything is done based on that information.

The only factor which might stop loading from being done out of the gangway or of the pier, which happens sporadically, is rain, but that may not impact in a despatch or demurrage depending on the terms negotiated.

What are the particularities related to shipping soy in Brazilian ports?

From a legal standpoint, only the Normative Instruction 15 (IN-15) lists terms about cargo inspection. Specifically in relation to soy shipping, there is no norm.

About IN-15, one of the concerns in any loading process refers to the quality of the cargo. That is, when soy is exported, a certificate must be issued at the end of the process. However, that can bring on the following doubt: if inspection is carried out before loading, how to make sure it’s the same cargo at the end?

Every terminal has cells in which certain types of cargo are stored, since not all types of soy have the same nutritional value, for example. Therefore, it’s possible to know if shipper X has a separate pile from other shippers, and a sample is collected before loading.

The terminal is responsible for ensuring that the loaded cargo comes from that same pile, and a partial check is done every 5 thousand tonnes. Besides, every 5 thousand loading processes, the loading inspectors collect from the cargo and send their samples for analysis.

Why is shipping increasing on the North of Brazil?

Mentioned at the beginning of the article, the increase in soy shipping in the North of Brazil happens for a variety of reasons.

Formerly, soy shipping was concentrated in the ports of Santos and Paranaguá. When the export volume became too high, an occasionally excessive volume of exports stopped the terminals from being able to fulfill the demand.

Two years ago, it wasn’t rare waiting 30 days for a ship to dock in Santos or in Paranaguá, considering that this period was counting for the contracts both of the charterer and of the shipowner. When the concession and the equipment were renewed both in Itaqui and in Vila do Conde, these ports started to be considered valuable options for outflow.

First, due to a logistical reason — even though the road is not in good condition, there is a direct connection between Mato Grosso and Vila do Conde. Besides that, in Itaqui, there is a heavy transport of soy planted in the region of “Matopiba” (Maranhão, Tocantins, Piauí, and Bahia).

All in all, the fact is that shipping soy in Brazilian ports still lacks structural optimizations so that negotiations in the sector can become even more satisfactory. However, the recent increase in exports points to a better future.

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