You are here
UPDATE 1-ADM Brazil unit completes $85 mln Santos port investment
(Adds details from news conference on rail infrastructure
improvement, quotes from executive, background)
By Ana Mano
SANTOS, Brazil, May 19 (Reuters) - The Brazilian unit of
Archer Daniels Midland Co on Friday said it had
completed a 33 percent expansion in its Santos port terminal's
export capacity, to 8 million tonnes of grains per year.
The company invested 280 million reais ($85.19 million) in
the project, which comes two years after Brazil extended ADM's
license to move grains including soybean and corn at the
terminal for 20 years, through 2037.
The investment underscores ADM's commitment to retaining a
leading position in Brazil, whose agricultural heartland is seen
as critical to supplying expanding world food markets.
Recent changes in Brazilian port legislation, which extended
the duration of operating licenses in a bid to attract private
investment, is positive for ADM's logistics plans, Eduardo
Rodrigues, the company's ports director, said at a news
ADM is currently analyzing a project to improve rail
infrastructure around the port area in partnership with other
operators, but any decision will depend on how the government
applies the new rules, Rodrigues said, referring to a decree
published on May 11.
Brazil extended the duration of operators' first port
licenses to 35 years from 25, renewable for another 35 for
contracts signed after 1993, such as ADM's.
In theory, Rodrigues said, this could give ADM an additional
30 years, until 2067, to operate its Santos grain terminal,
depending on how the authorities apply the new regulation.
"For us, it would make sense to increase investments if our
license lasts longer," Rodrigues said. The investment needed to
modernize the rail infrastructure around the port terminal would
be "sizeable," he said, declining to elaborate.
With Brazil poised to harvest a bumper soy and corn crop
this season, Rodrigues said that ADM expanded capacity of its
Barcarena terminal, in the northern Pará state, which is
operated as a 50-50 joint venture with Glencore.
Barcarena's capacity is being raised fourfold, to 6 million
tonnes. Works will be completed by June, but Rodrigues declined
to comment on the size of the investments.
ADM kicked off activity at Santos in 1997, coinciding with
its arrival in Brazil, which the company says is key for its
global strategy. It began the Santos port operations after
purchasing several crushing plants, grain elevators and silos.
($1 = 3.2868 reais)
(Reporting by Ana Mano; Editing by Christian Plumb and Leslie
© Copyright Thomson Reuters 2017. Click For Restrictions - http://about.reuters.com/fulllegal.asp