Bullish on Brazil, Hapag Lloyd eyes Santos terminal

German shipping company Hapag Lloyd is considering bidding for the new container terminal planned for the Port of Santos, known as Tecon 10. The company believes it’s still too early to assess the long-term impacts of the tariff war, but sees Brazil as well-positioned in the current global turbulence, CEO Rolf Habben Jansen told Valor.

“The Brazilian market will develop over the next ten to twenty years. The purchasing power of the population is likely to increase, and the commodity trade is also expected to advance,” said the executive during a visit to Brazil last week.

Besides operating long-distance shipping lines along the Brazilian coast, Hapag Lloyd has a cabotage company in the country since the end of 2023, Norcoast, in partnership with Norsul. However, the group does not yet manage port terminals in Brazil–globally, the company operates 21 terminals in 11 countries, including Chile and Colombia.

Mr. Jansen confirmed the group is analyzing the auction for the new terminal in Santos while noting that bidding is only scheduled for the end of the year, with several other companies also interested. When asked whether Hapag is eyeing other terminals in Brazil, he stated that Tecon 10 is the primary opportunity at present.

“In any case, it’s very good to see a project like STS 10 [name of the new terminal in Santos]. The container capacity in the country is tight,” the executive remarked. According to him, the main bottleneck in Brazil today is infrastructure, not only at ports but also on road and rail connections.

Regarding the new tariffs imposed by the U.S., Mr. Jansen noted that there is still much uncertainty. “Tariffs are never good for global trade. The biggest challenge today is the unpredictable scenario that changes from week to week, day to day. We hope that in 90 days, we will have a bit more stability and predictability about what is actually happening. Only then can we judge what will happen with global trade. It is still too early to judge.”

In the short term, he anticipates an irregular second quarter, following a start to the year with higher volumes than in 2024.

“There will be a period of instability due to the tariffs, which in some cases have resulted in companies putting orders on hold. The overall volume we handle hasn’t changed much yet, but looking at the China-U.S. route, there has been a significant decline. Meanwhile, the Southeast Asia to U.S. service has increased significantly, but of course, this might be compensatory. Exports from Japan and Korea are stable, but we also see other routes, like U.S.-Europe, on the rise,” he said. “It’s still difficult to predict the long-term impacts,” he summarized.

Beyond the tariff war, global shipping has been facing various disruptions since the pandemic. Last year, the main issue was the attacks in the Red Sea, which closed the Suez Canal to large vessels. “It’s still hard to predict [when the company will resume using the route]. A few months ago, in January, we were optimistic,” he said. However, today the executive doesn’t foresee a short-term resumption, at least not within the next six months.

He emphasized that to resume using the route, more stability is required, as restarting operations only to halt them again could cause even greater damage.

He believes that the recent global market disruptions highlight the advantages of a more diversified supply chain and, in the case of shipping companies, the merit of maintaining spare capacity to mitigate such disruptions. “In the Red Sea crisis, which required ships to take longer routes around the Cape of Good Hope, there was additional capacity that helped absorb part of the impact. If supply and demand had been balanced, the crisis would have been much more severe.”

Source: Valor International 

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