BTP to expand Port of Santos operations

Brasil Terminal Portuário (BTP) plans to deliver its request for early renewal of its contract at the Port of Santos by March. The idea is to extend the lease, expiring in 2027, for another 20 years in exchange for new investments.
“The plan is to increase capacity within the current limits of the terminal. We started the conversation with the federal government and now we are preparing feasibility studies. The expectation is that the entire process -from presentation to signature – takes 12 to 14 months,” said the company’s president, Ricardo Arten. According to him, the investment amount that will be proposed has not yet been finalized.
But the group’s expansion plan is not limited to the current terminal. The company also aims at new auctions in the Port of Santos. The main opportunity should be the bidding for a large container terminal in the Saboó region, in an area close to BTP; this is still under study by the federal government. The company, a natural candidate in the competition due to its proximity, had previously proposed the annexation of the area, which would have been included in its early renewal process. The government, however, opted for a new bid.

The group is also studying other areas in the Port of Santos, both on the right and left margins, always focusing on containers. “We are very anxious, not only for this terminal next door but also for other areas that may be operationalized. Today, BTP’s capacity is strangled, we need to find spaces for our operations,” he said.
The company is a partnership between two global shipping groups: APM Terminals (from Maersk) and Terminal Investment Limited (TIL, from MSC). The controllers also move cargo at other terminals at the Port of Santos, but the market perception is that the container logistics chain is going through a verticalization that tends to benefit the expansion of BTP.
BTP has had good results in the Port of Santos, even with the pandemic. In 2020, the terminal’s handling increased 10%, driven by exports, which overcame the drop in imports. This year, the expectation is to grow 3.3%, in line with the gross domestic product (GDP).

“We learned to deal with Covid. Even with the second wave of the pandemic, which brings uncertainty, we already know that Brazilian export products – such as animal protein, cotton, sugar – will not fall, ”he says.
For him, the biggest concern is the lack of containers – a problem that started almost a year ago, when the pandemic started to impact the global logistics chain. “It can be a bottleneck and hurt the prospects for 2021.”
The lack of containers results from the mismatch between imports and exports in the countries, aggravated by measures of social isolation. When the pandemic exploded in China last year, many containers were trapped in Asian ports. Then, with the fall in Brazilian imports, the problem started to hurt the country’s exporters – as the ships did not arrive, the exporters lacked equipment.
In the BTP terminal alone, the number of “extra calls” jumped from 10 in 2019 to 56 in 2020. In view of last year’s good financial results, the company does not plan to ask for economic and financial rebalancing due to the impacts of the pandemic on imports – as other infrastructure sectors have done. However, there are plans to negotiate a change in the contract readjustment index, which follows the general market price index (IGP-M) – whose accumulated increase in 2020 was 23.14%. “It is somewhat unreasonable to readjust this level. We started talking to the government about this issue last year, and we need to file a claim”, concludes Arten.

See the two graphs below for volumes imported and exported via BTP compared to other Port of Santos terminals:

Source: Valor Econômico

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