Ship with imported fertilizer may jump in line at Brazilian ports

The federal government is preparing a change in port rules to allow ships loaded with fertilizers to have priority when docking in Brazilian ports to unload, at a time when the supply of these products is in doubt due to the war in Ukraine.

According to the plan announced this Friday (18), these vessels may, if necessary, have preference in disembarkation, cutting the line that in some ports lasts an average of four or five days. The intention is mainly to reduce import costs, in addition to facilitating access to fertilizers.

The strategy was announced by the National Secretary of Ports and Waterway Transport, Diogo Poloni, who coordinated the meeting in Brasília that takes place regularly with port managers.

This time, the meeting also included representatives from the Ministry of Agriculture and fertilizer industry associations, with both face-to-face and virtual participation.

“The Ministry of Infrastructure is working on a plan so that fertilizer loads have priority in loading and unloading freighters as a way of streamlining product logistics. This requires ports to review their exploration regulations and issue ordinances to elect priority shipments , since there are rules for the reception of ships”, says the ministry in a note released this Friday afternoon (18).

In the note, the ministry draws attention to the fact that the emergency policy will go against the current practice of the main ports in the world, according to which whoever arrived first disembarks first, except in the case of passenger ships.

“For this to occur, one of the possibilities is for ports to review their regulations and edit ordinances to elect the priority fertilizer load. The strategy has already been used previously with fuel ships in the water crisis, during the pandemic”, concludes the note.

In the opinion of the superintendent of the ports of Rio Grande do Sul, Fernando Estima, who is also the superintendent of the Port of Rio Grande (RS), it will be necessary, however, to balance the strategy with the need to maintain the rhythm of Brazilian exports, especially the of agribusiness.

“The idea is not to let any ship be dammed with these inputs, trying not to put them in queues to speed up the landing and not cause more cost in these products. exports of rice, soy and other items, in order to have a balance”, says Estima.

For Luiz Fernando Garcia da Silva, president of the Port of Paranaguá (PR), the logistics sector, importers and fertilizer manufacturers that use imported inputs are experiencing a phase of concern, although the information coming from Russia is favorable for the time being.

“We still haven’t felt the effects of the war. And recently we had information from importers that shipments continue to occur normally in Russian ports,” says Silva.

According to the person responsible for managing the Port of Paranaguá, the arrival movement has also increased due to the anticipation of purchases. “In January and February, we had a record in the arrival of fertilizers, with an increase of 28% compared to last year. Future sales [de fertilizantes] were paralyzed, and now they have been resumed, but with price increases of 35%”, he says.

In the Port of Itaqui, in Maranhão, the situation is similar. Until Thursday (17), the disembarkation movement followed normally. 540 thousand tons were received since the beginning of the year, from January to Thursday (17), with 10% of this volume coming from Russia.

“The volume that comes from Russia has not reached the level of 2021, but as we are still at the beginning of the year this can be achieved in the coming months”, considers Jaílson Luz, director of operations at the port of Maranhão.

At this moment, Itaqui awaits the arrival of a ship from Russia, which left there in March, after the beginning of the war with Ukraine. “We are waiting for the arrival after March 25th, but it will only dock at the port probably in early April”, says the Itaqui executive, taking into account the usual wait of four to five days, an estimate made before the disclosure of the federal plan.

In Luz’s assessment, a drop in Russian deliveries should be offset by higher volumes imported from Canada and, in the case of Itaqui, also from African countries –such as Morocco, Tunisia, Egypt– and, in the Middle East, Iran.

“In April and May, we can have more clarity on whether Canada will be able to supply more to compensate Russia. Therefore, imports are expected to grow in these months. If this does not happen, it will be a sign of the effects of the geopolitical situation in the world”, he says. Light.

For Cléverton Oliveira, president of the Port of São Francisco do Sul (SC), which last year showed the highest growth rate in the landing of fertilizers, 30%, according to Antaq (National Agency for Waterway Transport), the entries continue to grow this beginning of the year.

According to Oliveira, this growth had to do with investments outside the port, in storage. “Until this moment, the conflict in Russia has no influence on the landing of fertilizers. These were already closed contracts”, says Oliveira.

“In the next few weeks we will be able to scale this, and know to what extent there may be any additions [no volume desembarcado da Rússia] or even flight, assuming that other countries may want to ‘steal’ the cargo destined for Brazil, even if this is unlikely. But today this analysis would be premature”, he evaluates.

At the Intermodal fair, which ended in São Paulo on Thursday (17), which brought together transport companies, shipping agencies, fertilizer manufacturers and port managers, the comment was that the main companies in the sector believe that there will be no shortage of inputs for the harvest that will begin to be planted in September. The problems could start from there, as the war progresses.

One company that would have carried out this analysis is the Norwegian state-owned Yara Fertilizantes, which could increase its shipments from Canada. wanted by sheetYara Fertilizantes said it would not comment on the pace of imports and prospects for the coming months.

Mosaic Fertilizantes, a representative of US mining company Mosaic for distribution in the Brazilian market, said in a statement that it was working to honor all orders prior to the start of the war.

“[A Mosaic Fertilizantes] recognizes, however, that the scenario is delicate, generates price volatility and weighs on production costs and, consequently, on the profitability of our producers [rurais]”, continues the note.