Brazil's container port operator seeks to avert 'congestion' surcharge

China Merchants Port Holdings

13/06/2024 16:17

By Ana Mano
       SAO PAULO, June 13 (Reuters) - TCP, an arm of China
Merchants Port, is working to dissuade a logistics firm from
applying a surcharge on outgoing cargos at South America's
largest container terminal, TCP Commercial Director Carolina
Brown said. 
    France-based logistics firm CMA CGM's $150 surcharge, which
would take effect on July 1, could impact the cost of shipping
goods through Brazil's main refrigerated container terminal,
which is also the world's biggest chicken export corridor.
    "We have already contacted CMA, asking first for
clarification of the measure but also for them to review it,"
Brown told Reuters late Wednesday. 
    CMA  CMACG.UL  did not immediately reply to repeated
requests for comment.
    The company announced the surcharge last week, citing
"congestion" at Paranagua port. The move highlights logistical
challenges faced by Brazil, a farm powerhouse and one of the
world's ten largest economies. 
    CMA said the surcharge would apply to cargo headed to the
U.S. East Coast, U.S. Gulf, Canada, Mexico and Central America,
among others. 
    Brown said paper, wood and refrigerated cargo consignments
could be affected if the surcharge is confirmed.
    The executive said Paranagua and other Brazilian container
ports were facing a surge in demand, which coupled with
operating contingencies at competing terminals in Santos and
Santa Catarina state, have spurred "a perfect storm."
    Felipe de França, TCP's manager of operations, said more
demand drove up ship waiting times from an average of 3.5 hours,
a record achieved at Paranagua, to close to 48 hours in recent
weeks. The waiting time has since dropped to about 12 hours at
Paranagua's container terminal, while vessels at competing hubs
still face a week's wait, he said.
    Brown said Paranagua's container terminal is also absorbing
diversions of cargo and receiving ships from other ports.
    "We are operating without operational restrictions," she
said. "By contrast, a surcharge does not reflect our level of
service."

 (Reporting by Ana Mano; Editing by Shinjini Ganguli)
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