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.

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.

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.