Nov 17, 2022

Brazil's "Northern Arc" of Ports Increasing Market Share

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

Brazil's "Northern Arc" of ports on the Amazon River and along Brazil's northeastern Atlantic Coast continues to increase their market share of Brazil's grain exports.

Brazil's Foreign Trade Secretariat (Secex) reported that 14.03 million tons of corn were exported from Mato Grosso to various countries between June and October of 2022. This represented an increase of 64% compared to the same period in 2021. The increase reflects the lower corn production in 2020/21 and an increased world demand for corn. Mato Grosso produced 33.2 million tons of corn in 2020/21 and that increased to 41.6 million tons in 2021/22.

Of the total corn exports in 2022 from Mato Grosso, which is Brazil's largest corn producing state, 54% was exported through the Northern Arc of ports and 46% through the traditional ports in southeastern Brazil. The northern ports increased their market share by 6% in 2022 compared to 2021.

The biggest increase in Mato Grosso's corn production is occurring in the central and northern parts of the state which are closer to the northern ports. Improvements in Highway BR-163, which provides the primary link between northern Mato Grosso and ports on the Amazon River, has allowed transportation companies to be more confident that their trucks will make it through unimpeded.

Before the entire highway was asphalted two years ago, it was routine to have miles-long traffic backups during the rainy season due to muddy stretches that were impassable. Truckers had to wait days or weeks for the highway to be reopened which greatly increased their cost of operation. That problem was solved two years ago when the last 40 kilometers of the highway were asphalted. Since then, freight costs have declined and transportation companies have established a more routine shipping schedule.

The northern ports are also increasing their capacity and efficiency in anticipation of larger volumes of grain exports in the future.