December 30, 2010

Dry Port in Parana will Facilitate Paraguayan Soybean Exports

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Soybean producers in land-locked Paraguay now have another alternative method of exporting their soybeans to foreign customers. In recent years the export bound soybeans, corn, and wheat from Paraguay was barged to the Port of Nova Palmeira in Uruguay or the Port of Rosario in Argentina. These barging operations are relatively slow and inefficient. Using the existing barging operations, it takes approximately 20 days to move soybeans from Paraguay to the ocean going vessels. That time could be reduced to 8 days by using what is called a "dry port" in western Parana.

In reality, the "dry port" is a grain terminal along the West Railroad in the city of Cascavel, which is located in western Parana. Soybeans produced in Paraguay would be trucked to the city of Cascavel and from there; the grain will be shipped via the railroad to the Port of Paranagua for export. This rail terminal will act as a point of entry and exit for products shipped out of and into Paraguay. All the documentation will be handled at the rail terminal just as if it was an actual sea port.

The governor of the state of Parana, in partnership with agricultural cooperatives and private companies from Paraguay, recently re-dedicated this "dry port." More than half of the R$ 4 million investment to upgrade the facility came from the Paraguayan partners.

New silos and loading facilities are scheduled to be operational by April and it is expected that 200,000 tons of grain will move through the terminal in 2011 and 400,000 tons in 2012. Land has also been purchased which will allow the facility to double its capacity over the next several years.

Producers and exporters in Paraguay are anxious to use this new terminal due to the cost savings compared to the existing barging operations. It is also expected to reduce the cost of imported items such as fertilizers.