Bolivia May Use Uruguay’s Nueva Palmira Port for Mining Exports

Despite the current logistics issues at the Uruguay’s Nueva Palmira port, it is one of the fastest developing ports in all of Mercosur. Nueva Palmira’s advances in infrastructure and shipment volumes, has led the Bolivian government to begin talks with Uruguay about using the port as an outlet for Bolivian goods into the Atlantic.

The head of the Bolivian Ports Administration, reported that the organization had inspected Nueva Palmira to evaluate using it for export’s from Bolivia’s mining sector.

Bolivian mines currently export from the Chilean port of Arica but production increases have forced Bolivia’s government to seek alternatives. Nueva Palmira is seen as the best option.

The President of Uruguay’s National Port Administration (ANP) emphasized that the project is not new and Bolivia has been considering this possibility since 1976, although it much is closer to becoming a reality this year.

This Uruguayan Business Reports news article is a translation of a news article that appeared in the Uruguayan newspaper Todo Logistica. The original article is available in Spanish here. Uruguay Business Reports translation by Donovan Carberry.

Uruguay’s Nueva Palmira port saw 43% increase in cargo moved during the first seven months of 2013

Port of Nueva Palmira (Photo from Uruguay’s National Port Administration

The head of the Nueva Palmira Port, Flavio Vaccarezza reported that from January to July the port moved 2,000,000 tons compared to 1,400,000 tons during the same period in 2012, a 43% increase.

Vaccarezza said that the port recently added a 200 meter mooring front. He explained that it is a “riverside quay which allows us to attend to a higher number of barges and, as a consequence, to satisfy the growth in demand for services that accounts for the increase in tonnage moved”.

The port also recently added an additional 22,500 square meters for merchandise storage which also allows it to receive more ships.

This Uruguayan Business Reports news article is a summarized translation of a news article written that appeared in the Uruguayan newspaper Ultimas Noticias. The original article is available in Spanish here. Uruguay Business Reports translation by Donovan Carberry.

Soy and Grain exports from Nueva Palmira Port are experiencing 30 day delays

Map showing Nueva Palmira, Uruguay’s principal port for soy exports. Nueva Palmira is now experiencing delays of up to 30 days to load soy exports

Soy and grain cargo going through Nueva Palmira is experiencing significant delays in loading. In some cases cargo has been delayed 30 days.

The president of Uruguay’s National Port Administration (ANP), Alberto Díaz, told the Uruguayan newspaper El País that theses delays are caused by the timing of ships arriving into Nueva Palimra port to load merchandise. “The sale of grain for export has unique characteristics”, said Díaz.

He explained that producers sell their grains in July, for example, but the boats charged with transporting them don’t arrive until the end of the month. “The seller sells their produce but the boat arrives in the last few days of the month. The seller is inside the deadline to comply with the request, but it generates a delay in the cargo for several weeks.” Díaz said. Regionally these delays are being seen mainly in Brazilian ports but also in Argentina.

“What we should do is try to improve access and cut down the time frames and find some benefits for the export sector” Díaz added. The ANP, which he heads, is in charge of coordinating all aspects of the supply chain passing through the port.

ANP is studying the possibility of loading merchandise at the floating station Punta del Arenal, located in the River Uruguay north of Nueva Palmira, to bypass the delays. ANP would only permit this option in the case of significant delays. If there weren’t delays at Nueva Palimra and exporters still wanted to use the floating station, they would face additional charges.

The majority of the grain being exported through Nueva Palmira is soy. All these exports are connected which is an important aspect of the harvest said Díaz. “Everyone wants to be the first to ship because that is when it [soy] has the highest value, later on the market begins to change and it trades at a lower price” Díaz explained.

This Uruguayan Business Reports news article is a translation of a news article that appeared in the Uruguayan newspaper El País. The original article is available in Spanish here. Uruguay Business Reports translation by Donovan Carberry.

Lobraus to build 21 story office tower and logistics facility in the port of Montevideo

Simulation of the proposed Lobraus Tower in the port of Montevideo’s free trade zone

The logistics company Lobraus is expected to begin a major development project within the port of Montevideo’s free trade zone by early in 2014. The project will include a 21 story office tower and a 30,000 square meter logistics depot.

The logistics company Lobraus was the only company that bid on a public tender to improve the port issued by Uruguay’s National Port Administration (ANP). The ANP is in the final stages of reviewing Lobraus’ proposal and is expected to approve it in the next few weeks.

Lobraus had originally presented the undertaking to ANP in 2007 as a private project but now they will operate a public concession. The proposed Lobraus tower would be the first high-rise building in the port. It is predicted to house offices for more than 250 companies, along with restaurants, a convention center and auditoriums.

The building will be 17,000 square meters and utilize the latest generation technology to guarantee security and reduce its environmental impact. There will be four parking levels.

The tower will be complemented by the largest storage and logistics facility in any Uruguayan port. The proposed facility will be able store 800,000 cubic meters.

The total cost of the project is predicted at $55 million USD. 70% of the investment will be financed with bank loans and the remaining 30% will come from development funds and private sources. Construction is expected to take three years.

The port facility will be constructed first and then the tower. Lobraus will receive a 30 year concession for the area being constructed as well as additional space attached to the development. The concession begins

The project will be built within the port’s free trade zone, which grants tax benefits to business located within it. Additionally, a foreign company can open an office within that section of the port without creating an Uruguayan company.

The idea behind the project is that foreign companies will locate their offices within the tower and store their merchandise at the depot before it is distributed or sold in the region.

Although Lobraus was founded in the United States in 1989, today it is headquartered in Montevideo with offices in the ports of Montevideo and Punta Sayago. It also has offices in the United States and Brazil. The company is already involved in the construction of several other logistics depots throughout the region.

This Uruguayan Business Reports news article is a translation of a news article that appeared in the Uruguayan newspaper El País. The original article is available in Spanish here. Uruguay Business Reports translation by Donovan Carberry.

Port of La Paloma will add wood log handling capabilities and weekly shipments to Fray Bentos

The port of La Paloma will enter the wood cargo shipping circuit after completing dredging work to increase the depth of its terminal by six meters. The principal reason for the dredging is to allow wood log shipments from La Paloma to the Uruguayan port of Fray Bentos where they can be processed into wood pulp. Pier 2 is also being reconstructed to aid the port’s development as a wood shipping center. Both projects are being funded by the National Department of Hydrography (DNH) and the Ministry of Transportation and Public Works.

The director of Hydrography, Jorege Camaño, explained that the dredging will practically double the depth of the port, which is currently 3 meters and will be increased to 5.5 or 6 meters. After the compeletion of the two projects now underway, in which 5 million dollars have been invested, La Paloma will be able to ship 250 thousand tons of wood logs per year. The development of La Paloma would lower the cost of transportation for the pulp industry. It would also reduce the number of trucks on the road with everything that implies for pavement maintence and safety.

Camaño announced that the first 60 meters of the pier reconstruction and the dredging work should be finished at the same time. This June could see the first ships leaving toward the river port of Fray Bentos.

The idea is for there to be one ship a week until the end of the year. There will be a hiatus druing the summer season (Uruguay’s summer is at the end of the year) for a commission on the development of the port at La Paloma composed of representatives from the Ministry of Transportation, the Ministry of Tourism and the Rocha regional government.

After the compeletion of the 60 meters of pier, the National Department of Hydrography will issue a tender for the remaining 120 meters of sea wall. The tender will be issued in the second half of the year and the DNH estimates the work will be finished in 2013.

With the arrival of logs from La Paloma, activity at the port of Fray Bentos will increase. Activity at the port is already rowing from the instalation of UPM’s (formerly Botnia) celulose plant.

Currently, naval repairs and boat breaking are the main activities at the port of Fray Bentos, which shows a good capacity for adaptions to distinct types of port and river work.

This Uruguay Business Reports news article is a translation of a news story which appeared in TodoLogistica. The original news article in Spanish is available here. Uruguay Business Reports translation by Donovan Carberry.

Work on Pier C in the port of Montevideo will be finished in 2013

The work on Pier C in the port of Montevideo which began this April will be finished during 2013. A purpose public pier is being constructed alongside Pier B. According to an announcement by the president of the National Port Administration (ANP), Alberto Díaz, Pier C will have a mooring post 285 meters long which will allow containers ships and bulk carriers with up to 12 meters of draught. “Work officially began in the month of April and we will finish it by the middle of 2013”, confirmed Díaz.

“Pier C will have a 285 meter long new mooring post that will allow container ships and bulk carriers with up to 12 meters of draught. It will also have a four hectare paved surface for the transferring goods and for storage as well as vehicle traffic (…). The work will cost 60 million dollars” reported the “Handbook of Uruguay Commercial Ports 2012-2013” published by the ANP.

Díaz maintains that it is “a project in progress that we have to continue giving a lot of attention so that it keeps moving and that it doesn’t stop. It is intended to be a solution in the short-term”. He added that the ANP aims to complete each planned stage ahead of time and for the contractor to finish the work in the planned 18 month period.

“The fundamental value of this work is that it creates a new mooring post. We have a problem with the number of mooring posts so this is a solution that will permit us to add a public pier and multipurpose area”  he emphasized.

Asked what benefits Pier C’s construction will bring to cruise ships which arrive at the port of Montevideo, Díaz answered that the benefits will be indirect. He explained that the cruise ships will not operate at this pier but will benefit because the new pier will mean more room for their maneuvers. “At the moment you can observe the workshop under construction but there are still are not prefabricated pieces in the area”, he said.

Recently, ANP finished moving more than 34 abandoned boats which they shaped into an island in a distant part of Montevideo port’s operational section. “Now what one sees are buoys and ships, some are doing dredging work, others are performing searches to confirm where there are useful materials (sand)  for proper construction”, said Díaz.

This Uruguay Business Reports news article is a translation of a news story which appeared in Todo Logistica. That news article in Spanish is available here. Uruguay Business Reports news translation by Donovan Carberry.

MARTÍN GARCÍA CANAL CONFLICT: Argentina agrees to advance tender process for canal dredging

The Argentinean foreign secretary sent a letter to his Uruguayan counter part, Luis Almagro, guaranteeing that the dredging tender process will continue despite investigations into alleged bribes.

The Argentinean foreign secretary, Héctor Timerman, sent a letter to the Uruguayan Foreign Relations Minister Luis Almagro, in which he assured that the start of an investigation into bribery allegations will not impede opening the negotiations on calling a tender to deepen the Martín García canal, sources inside the Uruguayan foreign ministry told the tv program Subrayado.

The note is a reply to the letter sent by Almagro this past Monday the 14th of May. In that missive the Uruguayan government asked to open bidding on a tender for canal maintenance, after which Argentina proposed freezing the tender while beginning the investigation into alleged bribes requested by Buenos Aires.

UNoticias, reported that Almagro communicated to Timmerman the resignation of traveling ambassador, Julio Baraibar, “after he admitted that he heard from mouth of [Uruguayan diplomat] Fransico Bustillo, that they had tried to bribe him to retain the [canal maintenance] concession”.

This Uruguay Business Reports article is a translation of a news article which appeared in the Uruguayan newspaper El Observador. That article is available here. Uruguay Business Reports news translation by Donovan Carberry.

MARTÍN GARCÍA CANAL CONFLICT: Uruguayan opposition asks to freeze tax treaty with Argentina as long as the canal dredging is delayed

The leaders of the opposition closed ranks after asking the government not to send the tax information exchange treaty with Argentina to parliament now that the neighboring government has decided to suspend the process of dredging the Martín García canal while they investigate reports of corruption surrounding it.

“We told them not to send the treaty because we won’t vote for it. We think it’s a very weak position to accept everything Argentina tells us when they don’t accept anything” Colorado senator José Amorín told EL PAÍS digital.

The senator believes that the letter sent by foreign minister Héctor Timerman to External Relations minister Luis Almagro is proof that the Argentinean foreign minister “is only interested in obstructing this [the dredging] and not moving forward, but this something that Uruguay needs”.

He saw that the parliament has to vote on a treaty that is of special interest to Argentina (it will stop Argentinean citizens from using Uruguay as a tax haven) and that this exchange treaty could be used as an element to pressure them in the same way that “they have been using the dredging”.

The same sentiment was shown by blanco senator and president of the National Party, Luis Alberto Heber, who told EL PAÍS digital that “Uruguay should not hurry to sign the tax office information exchange treaty and that we suggested to the executive office not to send it to parliament” he added that now “we will have to wait” to see what happens.

Nationalist senator Jorge Larrañaga told Subrayado (a Uruguayan tv program) that “it would be good to delay the treaty agreement in parliament as a signal to Argentina. It is very difficult to discuss this agreement when Argentina has postponed dredging the canal again”, he explained.

LETTER.

The opposition leader also closed ranks behind the government, to support the tone of the reply letter that Almagro sent to Timerman about the request to initiate an investigation into the alleged corruption.

“the note that Timerman sent to our foreign minister is unacceptable” said Heber and he emphasized that Almagro’s reply mentioned the publication of the proceedings and their dissemination to the public.

“No one doubts the honesty of Almagro and the delegates of the Rio de la Plata Administrative Commission (CARP) but we want to stand firm, we won’t vote on what they [Argentina] asked when they don’t do anything to honor our interests. We there to be feedback[sic]”.

This article is a translation of one that appeared in the Uruguayan Newspaper El Pais. The original news article can be found, in Spanish, here. Translation by Donovan Carberry.

Opinion in translation: Scandal in the Martín García Canal

The [Uruguayan] government has been trapped in a tangled defeat on the issue of dredging the Martín García canal. It is not the bilaterally postponed dredging of the Martín García canal, committed to a few days ago in Montevideo by the Argentinean foreign minister Héctor Timerman and immediately locked in by their representatives in the Río de la Plata Adminstrative Comission (CARP), in a swift demonstration of the almost habitual hostility of the Kichner government towards Uruguay. The more serious issue is the scandal surrounding the renewal of the contract with Riova [a subsidiary of the Dutch company Boskalis International B.V.] for maintenance dredging in the middle of well founded claims of corruption. The questionable contract renewal was accepted by [the Uruguayan] government, causing millions of dollars in damage to the country.

The canal dredging is essential for larger ships to operate from the port serving the majority of our exports Nueva Palmira, the second biggest             port in the country. Argentina has delayed this work for years, in order to protect the competitiveness of their ports which use the other canal, the Mitre, to move Argentinean products. After the meeting with Uruguayan foreign minister Luis Almagro, Timerman assured him that the issue was solved and that finally he would call for the immediate bidding on the Martín García canal. Less than a week later, the Argentinean delegates in CARP put sticks in the wheel by requiring bureaucratic steps causing a new set of delays.

But not even this new blow is the worst of the story. While they were rejecting open bidding and postponing the dredging of the canal Argentina promoted the renewal of the current CARP maintenance dredging contract with Riovia at along with an increase from $12 million USD to $15 million USD in the annual fee paid by both countries. The additional cost was uselessly opposed by the Uruguayan delegation which had established on technical grounds that any increase should not exceed $1 million USD. The embarrassing final wound was the absurdity that CARP never even considered offering the contract to the other Dutch company, Van Oord, who offered to take over the dredging for $9 million USD, six less that what CARP  generously conceded to Riovia under Argentinean pressure.

The CARP decision has been followed by reports of giant bribes from Riovia, who will remain in charge of the work until whatever day CARP calls for open bidding to assign dredging and maintenance on the canal, something that could take two more years. Moreover given the level of corruption that permeated the whole episode it is unbelievable that [the Uruguayan] government could accept the Argentinean impositions in favor of Riovia without any apparent justification, just following head down behind the Kitchener regime and the irregularities of their representatives. A Uruguayan diplomat informed CARP and our foreign minister that he had been offered a million dollar bribe to support Riovia, something that Almagro failed to report as he should have. The foreign minister is trying to clear the confusion in the [Uruguayan] Parliament, which has convened to investigate this case. But it will be difficult to erase what appears to be a painful official setback.

This article appeared as an editorial in the Uruguayan newspaper El Observador. The original article (in Spanish) can be viewed here. Translation by Donovan Carberry.

This year’s soybean harvest will require Uruguay’s full logistic capacity; Port terminals must move a historic harvest of two million metric tons of Soybeans

The record soybean harvest that begins this month will require the full logistic capacity of the Uruguayan economy. Port operators and transporters assured El Observador that the advances in infrastructure still are not expected to be complete but that with more organization and coordination in the supply chain the challenge coming in the following months can be successfully met

The port of Nueva Palmira is the principal point of exit for Uruguayan soybeans and both the capacity and time it takes to load the vessels, as well as truck access to the port area, have been important obstacles to improving operation during previous seasons.

This year the country’s exits points will have to move close to two million metric tones of soybeans that will bring in close to $1,100 million USD, with this harvest soybeans will displace beef as Uruguay’s principal export.

During the 2011 harvest, the principal complaint of the sector was the need to improve truck access to ports, including the means of arrival at Nueva Palmira.

This weakness in infrastructure lead the government to make routes 21 and 24, which connect the port terminal with the region’s agricultural zone, priorities in the work plan and Public Private Participation (PPP) framework .  However, these advances await the practical implementation of the scheme.

The Captian of the port of Nueva Palmira, Flavio Castro, and the director of the Guild of Professional Cargo Transporters, Humberto Perrone, assured El Observador that many of the problems have been solved. Some improvements have been made to the routes connecting the agricultural zone of the country with the port terminals and  a truck ramp has been constructed that accommodate 100 vehicles and allows direct entry to the center of the port, composed of the Navíos terminal, Uruguayan Grain Terminals terminal (which operates as public terminal) and Ontur.

“this ramp has organized truck arrivals and avoided the bottleneck that had been forming at the entrance of the port. What is more, it was a solution for the truckers because they have access to services that they didn’t have when they were waiting in the street to enter the port”, said Flavio Castro.

For his part, Humberto Perrone insisted that “more than the physical space, the fundamental thing has been the coordination”.

Perrone believes it is the only way to organize the transit of vehicles in the area and that “was already demonstrated during the recent wheat harvest”, which was much more organized than in past years.

Another important factor for the logistical success of this harvest is the increase in the storage capacity and changes in procedure at many of the businesses in the field. A trip through the outskirts of Nueva Palmira is enough to realize the importance and growth of silos. Further, procedures have changed making the process more efficient.

In this vein Humberto Perrone indicated that “last year they would only load until 6pm and since then many business have opted to work 24 hours, knowing there is demand for this service.”

Flavio Castro pointed out that in Nueva Palmira many businesses have invested very heavily and that within a radius of 15 kilometers a lot has been invested in the construction of silos. Further, “there are plants that have their own parking lots which has done a lot to reduce congestion in the area”.

In regards to the storage capacity of the port, he emphasized the expansion of the Navíos terminal where they added a silo with capacity for 50,000 metric tons and pointed out that the Uruguayan Grain Terminals terminal stores 72,000 metric tons.

Put the problem is at the end fo the supply chain, the transport belts which are used to load the boats still have not reached the desired productivity. The three operators have tried to improve conditions, but are still far from the optimal level.

The head of the port, Flavio Castro, said that for the 2012 harvest, Navíos will have capacity to load 2,000 metric tons per hour, Uruguayan Grain Terminals 700 and Ontur 450. In the first case, an improvement in one stretch of the belt allowed for 300 more metric tons per hour, while on the other side Ontur added a belt that can work with two trucks simultaneously and it will increase capacity by 150 metric tons per hour.

Nevertheless, Castro maintains that he is not worried about the huge volume of cargo that will pass through the port because knows that a good performance, like the one exhibited by all the operators during the wheat harvest, will overcome any obstacle.

Humberto Perrone said that the demand for trucks is covered, but emphasized that the fundamental thing is not losing logistic organization. With regards to prices he said that an increase was already made in February to cover the wheat harvest and that, “if nothing strange happens, it will remain the same”.

This article is a translation of the orignal article by Diego Molinelli which appear in El Observador on May 7th, 2012. That article can be seen (in Spanish) here.