The Brazilian transport matrix needs a diversification

The logistics costs in Brazil directly impact the competitiveness of the national product.

The predominance of road transport, for insufficiency or deficiency of other modes, turns the production much more expensive .Moreover, the country suffers from certain asymmetric centers produce and demand or exports from others, especially when it comes to agricultural commodities.

Brazil is a continental country, but demographically still has a coastal dynamics. Coastal states represent 84% of the population and 85% of GDP. The North and the Midwest represents 15% of GDP, 16% of the population, and 64% of the country area.

Domestic production must travel long distances. And the most interesting modes for this function – cabotage on the coast and the inland rail intermodal inside – have historically been taken aside.

Moreover, there’s a lack at the storage system, especially for agricultural production. So that the producer needs to get rid quickly of the crop or use trucks as grain silos.

See below the opinion of Professor Manoel Reis, logistics studies coordinator of Getúlio Vargas Foundation (FGV) Projects:

“Our supply chains have suffered much in their competitiveness by cost overruns and time, especially in foreign trade. Why? We have disabled highways, insufficient railways, river transport almost nonexistent and insufficient cabotage. Also, inefficient ports, lack of cargo transshipment terminals, and insufficient storage system, especially for agricultural commodities.”

“The modes of transport have their applicability to different distances, showing clearly that the waterway system or waterways in general; the long distance is what matters.

We are a major producer of commodities are low value-added products, large volume and long distances. Inside the country, these products must be transported preferably by rail and river. And on the coast, clearly it has to be transported by cabotage, and the general cargo as well. ”

“Cabotage is the shipping transportation on the coast of a country. When Manaus is included, we’re allowed to reach a distance of almost ten thousand kilometers in total. Therefore, it is an important system for Brazil in the north-south flow. Logically, for streams that are closer to the coast it is more attractive.

Cabotage participates with 12.5% in the Brazilian matrix of transport. In other countries, for example, in the European community represents 37% of the cargo movement. In China 48%, similar to our countries have much more coastal than we have, so this gives us the expectation of having a great development of cabotage in Brazil. ”

“Today, there is great concern in the logistics process with  the sustainability aspect. This here is an example only to illustrate. Carrying tons of rice pellets to Fortaleza, I generate 225 tons of CO2. Doing the same for intermodal cabotage I generate 70 tons. That is, it has a reduction of almost 70% in the carbon generation process “.