UPDATE - BRAZIL - SOUTH AMERICA - JUNE 2010
- Brazil's current political and economic strengths have done much to boost trade in 2010; there is also a renewed confidence in the economy as millions of Brazilians become more economically active. All this bodes well for long term investment in Brazil.
- The Brazilian economy is one of the largest in the world, and benefits from a rich abundance of agricultural and mineral resources. The country's success in bidding for the 2016 Olympic Games in Rio de Janeiro, only two years after the FIFA World Cup in Brazil, is likely to further strengthen investor interest in Brazil.
What is the situation with regard to volumes in and out of Brazil?
- We have seen a recovery in port volumes in 2010 compared to 2009. Brazilian ports are key ports of call for the majority of shipping companies serving South America and public-private investment in the country's port sector has led to increased port expansion and the development of several new port sites.
Can you provide an overview on Brazilian Exports and Imports - 2009 vs 2010?
- According to available information, beef production dropped in 2009 but Brazilian beef exports are expected to increase in 2010. Forecasts indicate an increase in Brazilian beef export volumes of 10% in 2010, according to the Brazilian Beef Exporters Association (ABIEC) which has also highlighted the growing Iran market, the opening of China, and the possible easing of farm certification approval for the European market as factors which will contribute to this growth.
- Brazil, one of the world's top exporters of poultry, did experience a drop in poultry exports towards the end of 2008/2009.
- Brazil has been particularly active in exporting poultry to countries requiring Halaal certification and the country see the Islamic market as one of its most important markets. In 2009, the Middle East was the leading market for Brazilian chicken and data for 2010 indicates continued growth in this market.
- The export of high-quality Arabica beans - which account for about a large percentage of Brazil's exports - were strong in 2009 and are expected to increase in 2010-2011.
- Automobile output in Brazil was up in early 2010 compared to 2009. Increased domestic demand and government-sponsored incentives in 2009 fuelled an increase in Brazilian auto imports, compared to exports.
- According to available data, an estimated 3 million plus cars and light commercial vehicles were sold in Brazil in 2009 (a new record), spurred partly by a reduction in sales tax and, in part, greater access to consumer credit. This resulted in the cost of auto imports exceeding industry export earnings for the first time in more than 10 years.
- Auto exports from Brazil were down in 2009 because of the impact the financial crisis on some of its key markets (egg Argentina and Mexico). The slowdown in these countries, together with the steady rise in the value of the real against both the dollar and most other currencies, contributed to the drop in exports in 2009. The outlook for auto exports in 2010 is more positive.
Exports - general
- Overall, exports from Brazil to its main markets (Asia, European Union, Africa and the USA) were down during 2009, mostly as a result of the financial crisis.
- China has become Brazil's largest export market as a result of the
Country's demand for iron ore and other raw materials. We expect these factors to drive export growth over the long term.
Imports - general:
- Imports into Brazil grew in early 2010 and are expected to continue increasing in line with stronger domestic demand.
What shipping services does Safmarine offer to South America?
Safmarine offers the following services to/from South America:
- L-Class Service - North Europe & Mediterranean
- Samex - Europe ports
- Samba Service - Middle East ports
- Apollo - Europe ports
- Asas Service - South Africa and Far East
See www.safmarine.com for more details.
Which ports are called in the South American region?
- Santos, Paranaguá, Vitória, Rio Grande, Pecem, Itajai/São Francisco do Sul in Brasil..
- Montevideo in Uruguay.
- Buenos Aires in Argentina.
- We also cover Asuncion (Paraguay) via Buenos Aires and Patagonia area via Buenos Aires
- We also plan to cover Manaus and Suape regions (mainly import cargo)
What enhancements/changes have you made in 2009/2010 in the interest of better serving your customers in this region?
- Port call/rotation changes have been made in order to reduce operational constraints previously faced by the trade - and to accommodate the peak export fruit seasons. Because of the number of services available, Safmarine can deliver a constant, quality service to reefer shippers.
- Safmarine also offers improved coverage of the North West Continent following the inclusion of Algeciras, Rotterdam, Thamesport and Bremerhaven on the main South America - Europe service (L-Class). Our transit times from the main reefer source areas in the East Coast of South America to Europe are extremely competitive.
What are some of your objectives for 2010?
- Our aim is to expand our market coverage. Through our reliable hubs in Algeciras, Gioia Tauro, Rotterdam and Bremerhaven we offer top quality service with the widest possible scope to an area stretching from the Mediterranean to the Iberian Peninsula, Ireland and the UK up to Scandinavia and the Baltic.
- Safmarine's service from Europe to and from East Coast South America is known for its service reliability and top quality reefer and dry equipment.
Safmarine in Brazil
• Safmarine Brasil Ltda is headquartered in the city of Santos, with offices in Paranagua, Fortaleza and Itajai.
• We have more than doubled our size since the opening in 2002 (in terms of both volume and revenue)
• Safmarine's South America business includes import and exports to Europe, Far East, Arabian Gulf and India/Pakistan and West/South Africa.
• Safmarine Brazil's main markets are South Africa, North Europe, Mediterranean and West Africa (EXPORTS) and Far East (IMPORTS)
• We currently transport significant volumes of seafood, meat, poultry, fruits, vegetables, chemicals and pharmaceuticals in integrated reefers as well as various other commodities in dry cargo containers.
• The corridors we traditionally operate from are markets offering high potential when it comes to refrigerated cargo. And it is Safmarine's expertise in the reefer (refrigerated cargo) industry that has fuelled the line's growth in South America. (We have also been active in the dry container shipments for many years).
• The Middle East is another traditional market for Brazilian reefer exports and a market which has become increasingly important to Safmarine in South America. We have increased our capacity to the Middle East and this will enable us to grow even further.
• Brazil is still very much regarded as a 'reefer market'; significant volumes of meat, fruits and fish are shipped from South America to West Africa, Europe and the Arabian Gulf. The region is likely to remain one of the key growth areas for Safmarine in the years to come.
• Key to growth is the availability of reefer equipment, the optimum use of equipment (reefer containers) and the fast turn-around time of containers. Being part of the A.P. Moller Group gives Safmarine access to one of the world's largest and most sophisticated 'container pools' - both reefer and dry.
• The South America - Europe trade is predominantly an export trade with more goods moving from South America to Europe than from Europe to South America. In order to facilitate the logistics of having sufficient reefer equipment in South America, Safmarine deploys non-operated reefers (NOR), using reefer equipment for suitable dry container cargo (ie cargo which is non-soiling, non-damaging).
• The reefer market has grown, not only as a result of increased consumption of perishable goods, but also due to the move - for many years - from conventional to container refrigerated transport. Demand for reefer capacity on container vessels has been high, as opposed to demand for space on 'reefer ships'. This has been the case for major export areas in the southern hemisphere. Safmarine has responded to this trend with a focus on providing our reefer customers, both existing and new, with the opportunities and the tailor-made solutions they look for.
• One of the reasons for the popularity of reefer containers is their technological sophistication. Other reasons for choosing reefer containers over conventional transportation are: Containers make it possible for a wider variety of perishable goods to be shipped; furthermore, the type of service offered by liner shipping companies is becoming more attractive to shippers looking for year-round, fixed day shipping service as opposed to a tramping service. In many instances, shipping perishables in containers has also become more price-competitive, which is further encouraging shippers to consider containers versus conventional reefer vessels.
• Safmarine transports consumer goods such as coffee, furniture, shoes, clothes etc from South America to a number of destinations around the world.
• Our success in securing more reefer slots/space has meant that Safmarine is better placed to serve its reefer customers in South America.
As at June 17, 2010
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