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August 26, 2013

Brazil Corn Trucked an Extra 1,500 km to Avoid Port Congestion

Some of Brazil's record large corn crop is being trucked an extra 1,000 to 1,500 kilometers to Brazil's southern-most port in order to avoid the long wait time to berth at the Ports of Paranagua and Santos. Currently in the bay at the Port of Paranagua there are about 100 vessels waiting to berth with some waiting up to 90 days for their turn to load. If you want to load corn quickly, it's better to head south to the Port of Rio Grande where the wait time to load corn is only four days.

The problem is that this can add up to 1,500 kilometers to an already very long trip resulting in even higher transportation costs. Generally, the Port of Rio Grande ships out a significant amount of soybeans and only a limited amount of corn. Thus far in 2013, the port has moved only 700,000 tons of corn compared to the 8 million tons of soybeans that are expected to move through the port in 2013.

Trucking corn all the way from central Mato Grosso to the southern port of Brazil (approximately 2,700 kilometers) a very expensive proposition and another example of how inefficient Brazil's transportation system has become in the face of record large grain crops. The Brazilian government has announced a series of expensive projects to improve the nation's infrastructure, but in the face of a slowing economy, it is uncertain if the government will be able to fulfill all of its ambitious promises.