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February 13, 2017

Port of Paranagua Announced Major Dredging Project

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

After announcing a major improvement project at the Port of Santos, which is Brazil's and Latin America's largest port, the Brazilian Minister of Transportation, Ports, and Civil Aviation, Mauricio Quintella Lessa, also announced a major dredging project at the Port of Paranagua. The Port of Paranagua is Brazil's second largest port and a major grain export facility and fertilizer import facility.

The R$ 394 million project will deepen the draft of the Galheta Cannel leading to the port and the draft of the public berths at the Export Corridor. The increased draft will allow each vessel to load more cargo, which will increase efficiency and lower costs. It will also speed the entrances and exits of vessels reducing wait times and saving money. The company in charge of the project is DTA Engenharia Ltda. and they will have 11 months to complete the project.

The draft at the public berths will be deepened by 1.5 meters which will allow 10,500 more tons of cargo to be loaded on each vessel using the Export Corridor. On a monthly basis, it will allow 315,000 more tons of cargo to move through the export corridor.

It has been 20 years since the draft of the port has been deepened. Since 2012, the port has conducted three dredging projects, but they were done just to maintain the existing draft, not to increase it.

This project is coming on the heels of the just completed biggest upgrade in 80 years at the port. The R$ 624 million upgrade included new shiploaders and conveyors, upgraded berths, new entrances to the balances, upgraded unloading facilities for trucks and rail, improved truck staging areas, and a computerized system of calling in trucks that eliminated long waiting times. Combined, these two projects represent over R$ 1 billion in improvements at the port.

The dredging will include the Galheta Cannel, which is an artificial channel that was opened in the 1970's allowing greater access to the port. The 45 kilometer channel will go from its present 15 meter draft to 16 meters. The area where vessels wait to enter the channel will also be dredged gong from 12 meters to 14 meters.

While the Minister was at the port to announce the dredging project, he also took the opportunity to approve the new plan for the Development and Zoning of the Port of Paranagua (PDZPO) which is part of the National Port Logistical Plan (PNLP). This is a plan developed by the government in conjunction with all the participating parties at the port to plan for expansion at the port to meet the expected demand until the year 2030.

Brazilian ports such as Paranagua and Santos have been upgrading and expanding their capacities in order to stay competitive with new ports being developed on the Amazon River and along the northeastern Atlantic Coast of Brazil. These new "Northern Arc" of ports are expected to take market share away from the traditional ports in southern Brazil. In order to stay competitive, the southern ports of Brazil have been increasing their efficiency and reducing their cost of operation.