Feb 02, 2024

West Railroad in Southern Brazil to Expand into Neighboring States

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

Planning is underway for a railroad extension that will eventually connect the states of Mato Grosso do Sul and Santa Catarina with the Port of Paranagua in southeastern Brazil.

A railroad called the West Railroad already exists connecting the city of Cascavel in southwestern Parana with the Port of Paranagua and the extension of the existing railroad is being called the New West Railroad.

The city of Cascavel will serve as the epicenter of the New West Railroad that will have three spur lines branching out from the city. A southwestern spur line will connect the city of Foz do Iguacu on the border with Paraguay and Argentina with Cascavel. A southern spur line will connect the city of Chapeco in western Santa Catarina with Cascavel and the northwestern spur line will connect the city of Maracaju in Mato Grosso do Sul with Cascavel. Upon completion, the New West Railroad will extend 1,567 kilometers from the Port of Paranagua into some of the most productive agricultural areas of Brazil.

The project will include an upgrade of the existing West Railroad between Cascavel and the Port of Paranagua. The total cast of the project is estimated at R$ 35.8 billion (approximately US$ 7.3 billion)

This new rail system will also facilitate the movement of grain from eastern Paraguay and northeastern Argentina to the Port of Paranagua. Currently, the only way to move soybeans from eastern Paraguay to the Port of Paranagua is by truck to the city of Cascavel. Most of Paraguay's soybean exports move by barge down the Parana River to the ports near Rosario, Argentina.

As part of the expanded rail system, a new grain terminal is being planned for the city of Toledo, which is located 48 kilometers northwest of Cascavel and near the route of the new rail line. The municipality of Toledo has the largest agricultural GDP of any municipality in Parana.

The New West Railroad is in the final stage of obtaining environmental licenses which are required before bidding on the railroad can begin.