(Adds latest dredging work)
By Caroline Stauffer
SAO PAULO, June 10 Brazil is struggling to keep
the ship channel running through Latin America's largest port
Dredging problems at the Port of Santos are preventing
modern container ships from docking at some terminals, and
Soybean cargoes leaving the world's top soy exporter must either
leave partly full or wait until high tide to sail.
The stakes are high. About a quarter of Brazil's exports
move through Santos and Sao Paulo, the country's most
industrialized state, depends on the port for raw materials.
President Dilma Rousseff's government is hoping to improve
Brazil's port efficiency with private investment but has not yet
managed to award concessions to operate terminals or sign a new
contract to dredge Santos.
Despite years of warnings and promises of government action,
dredging has failed to keep up with surging port traffic over
the past decade. Shallow channels and outdated docks have
limited the use of a new generation of larger, more-efficient
ships, allowing high transport costs to limit economic growth.
"The biggest ships aren't able to enter, or at least they
aren't able to use their full capacity," said Paulo Barbosa, a
harbor pilot who has guided ships into Santos for 20 years.
For exporters of soybeans and corn, the problem is most
severe when ships dock, according to vegetable oils association
Abiove, which represents agribusiness giants like Cargill
Daniel Furlan, an economist for Abiove, calculated that the
problem results in a 15 percent reduction in productivity at
Santos and said it is a frequent complaint of Abiove's members.
"Fully loaded ships are only able to leave when the tide is
high... so that leaves ship loaders idle and prevents the next
vessel in the line-up from loading," he told Reuters.
The other option, favored from February to May when grains
exports are highest, is to let ships leave port less than fully
loaded to prevent expensive delays, Furlan said. Some ships have
been forced to anchor off Santos, Brazil's main soy exporting
port, for up to two months before being allowed to dock.
PROMISES OF BETTER DREDGING
The government promised to improve port dredging around a
decade ago and launched a national dredging program in 2007. But
lots of work remains.
Private port operators EcoPorto and BTP Brasil, a
joint-venture between Terminal Investment Limited and APM
Terminals, have been forced to pick up the government slack.
They have spent 6 million reais ($2.67 million) on dredging, a
BTP spokeswoman said.
Both terminals are located in section 4 of Santos, the
shallowest part of the port.
A consortium called Dragagem Brasil had a concession to
dredge Santos, but it expired last year. Dragagem Brasil was
unable to meet a contractual obligation to maintain a channel
depth of 15 meters.
In January, Santos had to reduce the draft, or maximum depth
of a ship's hull beneath the water, to 12.3 meters from 13.2
meters. In section 4, the draft is 11.2 meters.
Codesp hired Brazil DTA Engenharia in April for emergency
dredging and was able to lower the draft in most areas to 12.7
Most recently, dredging started at a pier by Cargill's TEG
terminal on Monday but was scheduled so as not to affect
operations, authorities said.
An auction for rights to dredge Santos took place in April,
but the government did not accept any of the bids. Another was
scheduled for June 6 but has been delayed until June 27.
U.S. dredgers may get in on the act. U.S. Secretary of
Transportation Anthony Foxx told Reuters that Brazilian
officials want help from U.S. and other foreign companies to
perform $1.5 billion of port improvements.
($1 = 2.25 reais)
(Reporting by Caroline Stauffer; Editing by Jeb Blount, Andrew
Hay and Cynthia Osterman)