Jose Roberto Serra, president of the federal company Codesp which operates the Port of Santos, told Reuters that investments in the port's infrastructure will help unclog Brazil's main trade artery. But he cautioned that government bureaucracy still stifles the flow of goods by holding up everything from the release of fruit imports to dredging the channel.
"We need to get the port turning a regular profit before we turn to the market with a share offer. My goal is in as few as four years," said Serra, a 53-year-old engineer by training.
Santos, which handles a quarter of all trade in Latin America's largest economy, is expanding its access roads and will soon build a tunnel to break up old rail and truck bottlenecks. After years of delays it is deepening its main channel to allow bigger ships to berth and is even preparing a new passenger terminal to handle cruise ships in time for the 2014 FIFA World Cup.
Upgrading Brazil's underdeveloped roads, railways, airports and ports is a main focus of Dilma Rousseff's government, which wants to replace the country's past of boom-and-bust growth with a more stable economy that can support a growing middle class.
Despite these investments which will streamline operations, government bureaucracy -- some beyond the control of the port itself -- will still drag on Santos and other ports in the future as Brazil tries to stay competitive as the world's main supplier of sugar, coffee, orange juice, meats and iron ore.
"It's going to be difficult but we need more private management in areas that are now in the government's hands," Serra, who is a government-appointed steward of the port, said in an interview in his office overlooking the main channel.
Santos has made undeniable strides in efficiency. It moves 97.2 million tonnes of goods a year, twice that of a decade ago, from roughly the same area.
"They always say we're not improving," he laughed, adding that there was still room for gains in efficiency.
Currently 85 percent of the trucked cargo enters from 8:00 a.m. to 6:00 p.m. under no schedule, and access roads are near their limits. Santos will implement a system similar to one that helped the port of Paranagua, which will schedule trucks' arrivals and spread out the flow of goods over the entire 24-hour day to improve efficiency. The practice is commonly used in ports in developed countries but not in Brazil.
Although there are several ports in Brazil that move more tonnage than Santos, mostly due to the weight of iron ore shipments, none come close to the value of goods that pass through the port on the coast of Sao Paulo state.
Santos moved 213 billion reais ($118.3 billion) in goods last year, a quarter of Brazil's total imports and exports and almost as much as the next four biggest ports combined: Vitoria in Espirito Santo, Itaguai in Rio de Janeiro, Paranagua in Parana and Rio Grande in Rio Grande do Sul.
"Brazil is growing and the government is too slow for the needs of Santos under the current model. It takes two to three years to sign a concession for dredging services," he said.
In 1993, Brazil opened the door to private sector participation in the country's ports with 20- to 50-year concessions to operate terminals. This played a big role in expanding Brazil's market share as one the world's most important suppliers of raw materials.
Santos has long been Brazil's main sugar, coffee and orange juice exporter and in the past decade has become a leading exporter of soybeans and corn.
Serra said the port will always be the focal point for Brazil's sugar, orange and to some degree coffee shipments due to the proximity of their respective production areas. But grain production is migrating from the traditional southern growing states to the center-west and northeast, where other sm
