“If everything is on time, the infrastructure will be operating next week”, said Rafael Alvarez de Toledo, Sercobe’s director of the South American area. Sercobe is the national association of capital goods manufacturers.
Rafael is content that they are nearing the end of a process that began in 2011, culminating with the opening of a revolutionary infrastructure. This is the most important grain terminal in Uruguay, which will serve to increase transport and reduce transport costs of grains from Argentina, Uruguay and Paraguay, mostly demanded by Asian countries. Alvarez de Toledo recalled that the first point of contact took place in 2011 and it was not until 2013 when it was assigned to Uruguayan firm Obrinel.
Infrastructure data
- First phase: Silos Cordoba company has built twelve silos to store grain and has put the system in place, through chain conveyors, for loading grain on ships. The contract is approx. 36 million euros.
- Second phase: Scheduled for 2016, eight more silos will be built and they will connect with the railway network in Montevideo.
Sercobe led directly the negotiations with the concessionaire and presented the offer of Silos Córdoba, a company created in 1975 that has undergone a profound process of internationalization, parallel to the collapse of domestic demand. In 2014, the latest data available, exports accounted for 84% of its production, (it has distributors in 17 countries and sells its goods to 45 different countries). One of the most important locations will be Uruguay, where the construction of the twelve silos, assembly and commissioning of the grain handling systems from the port of Montevideo to the freighters has reported 40% of the contract assigned to Obrinel, valued in 100 million dollars (90 million euros). Thus, the amount of work done by the Cordovan company would be approx. 36 million euros.
Revenues that could be increased in the short term, since the company is already preparing to participate in the expansión of the project.
Expansion plans are justified by the huge grain production in the area, specially in Argentina. According to the latest data from the International Grains Council, Argentina produces 50 million tons of grain per year (2.5% of the world total), of which more than half goes to third markets, especially Asian markets. The most important product is soybean, since Argentinean soybean production matches perfectly with Chinese demand. Argentina produces 61.4 million tons, representing 20% of the world total.
Paraguay is also an important soybean producer, with a production of 8.6 million tons (2.7% of the total), more than half to be exported. Paraguayan soybeans, which largely go to China, will go now through Montevideo’s processing plant.
China is the world’s largest importer of soybeans. It imported 77.5 million tons of soybean last year (62% of global purchases), followed far behind by the US, with 13 million tons.
Source: Cinco Días
