Cargill Brazil Executive Urges Sector to Keep Investing in Logistics

August 7, 2023

© oasisamuel / Adobe Stock
© oasisamuel / Adobe Stock

Paulo Sousa, the president of Cargill's unit in Brazil, said companies should continue making investments in logistics to help Brazil, the world's largest exporter of commodities like soybeans, coffee and sugar, to store and move its agricultural products more efficiently.

Speaking at an industry event on Monday, Sousa cited the Ferrograo railway as a priority project as it will help the country ship millions of tons of grains from the heart of Brazil's farm country to northern ports, where grain traders built private port terminals over the past few years to reduce reliance on the more traditional southern ports.

Sousa said Brazil had record harvests and yields were higher than never seen before this year. "This brings concern about lack of storage, logistics. The sector as a whole needs to continue investing in storage."

However, companies demand legal security in order to approve new investments and take risks.

"(We need) a clear and predictable regulatory framework to make investments in infrastructure," he noted.

Sousa denounced criticism of the Ferrograo project based on "biased" assumptions in relation to the railway that will move millions of tons as soon once it is built.

"One cannot be against Ferrograo. It is an irresponsibility," he added.

In June, Brazil's Supreme Court upheld the suspension, pending studies, of a government plan to reduce a forest conservation park in the Amazon to allow for the building of Ferrograo.

The railway, which stretches almost 1,000 kilometer (620 miles) and is considered strategic to move soybeans and corn more efficiently to export markets, would reduce reliance on roads but also affect local communities in Brazilian states like Mato Grosso and Para.


(Reuters - Reporting by Ana Mano; Editing by Chris Reese and Marguerita Choy)

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