Feb 25, 2014

More Traffic Woes for Brazil's "Soybean Highway"

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

Traffic woes on Brazil's "Soybean Highway" in Mato Grosso got much worse over the weekend when a dam broke sending torrents of water cascading over highway BR-163. The water eroded much of the shoulder leaving only one lane open for traffic. Authorities indicate that they will continue to use only one lane until repairs can be made which could take several months. Traffic is expected to be backed up for hours in both directions while the highway is being repaired.

The broken dam was part of a fish farming operation located seven kilometers north of Locus do Rio Verde in central Mato Grosso along highway BR-163 which is the principal highway in the state of Mato Grosso. Heavy rains have been pounding the state for several weeks as farmers try to harvest their soybeans and plant a second crop of corn. A similar accident occurred at this same fish raising operation in 2004.

This new problem along the highway could not have come at a worse time as the harvest ramps up and thousands of trucks use this highway on a daily basis hauling grain to southern ports and bringing back fertilizers and other products. Delays getting through this section of the highway will be hours long and it will increase the already high cost of transporting grain out of the state. In 2013 more than 100 persons were killed in accidents along BR-163 which is considered one of the ten worst highways in Brazil.

Even along the good sections of the highway, the potholes are the worst ever this year and these are not your run-of-the-mill potholes. The worst are about half the size of a bathtub and if you accidently hit one, you run a high risk of a flat tire or worse. On Saturday we drove 10 hours on BR-163 and we saw two overturned grain trucks and eight cars with flat tires. The trucks overturn when they lose control trying to avoid the potholes. The problem with the cars is the fact that you have to stay right behind the trucks to take advantage of passing opportunities and when you are right behind the truck you can't see the holes and if you hit one, it can cause a lot of damage.

The entire length of the BR-163 within the state of Mato Grosso is in the process of being turned into a toll road. The majority of the highway within the state (850 kilometers) will be operated by a company called Odebrecht which is expected to invest R$ 6.28 billion in the highway and receipts from the tolls will be used for the upgrades. Farm organizations in the state opposed the conversion to a toll road because the tolls will increase transportation costs which in the end will be paid by the farmers in the form of lower prices.