Government receives project Ferrogrão

This week Estação da Luz Participações (EDLP) filed in the federal government an application to develop feasibility studies for a railway between Lucas do Rio Verde (MT) and Miritituba (PA), using the section which is part of the highway BR-163. The estimated investment in the project is USD 2,5 billion.

The project is aimed at taking advantage of the logistics demand arising from the production of grains, especially soybeans in the Midwest, through an export path toward the North of the country. The project follows the reverse direction of the path that exists today, to the South, toward the ports of Santos (SP) and Paranaguá (PR).

Ferrogrão’s capacity – Ferrogrão is the name assigned to the railroad – which has an estimated extent of 745 miles from São Lucas do Rio Verde, would be around 60 million tons of grains per year. Departing from Miritituba, cargoes would then be carried on barges to terminals able to receive ships in Santarém, Itacoatiara, Barcarena (PA), and Santana (PA).

The route would start exactly where Ferrovia da Soja, also known as Fico, ends, linking the North-South Railroad up to Lucas do Rio Verde. This project, which was already released by the government, is in study phase to the biding.

EDLP requests the Ministry of Transport to issue a notice for preparing studies for the grant, which according to the company, would provide the railroad grant still this year.

According to EDLP, owned by businessman Guilherme Quintella, there is already an investment fund interested in participating in the project and others would be sought, including major contractors.

The businessman informs that with Ferrogrão, Fico, and ALL (that reach Rondonópolis-MT), almost 100% of the grain production in Mato Grosso (around 50 million tons) would be transported by the rail network by 2020 . The freight cost reduction would be around 50% compared to road transportation.

Quintella, who also heads the International Railroad Union (UIC, in its French acronym) in Latin America, says the project is touted as one of the most important in the world for its location in the area.

However, in a preliminary assessment of those involved, the project competes with highway BR-163 from the division of Mato Grosso and Pará Currently, the federal government is already putting into practice the logistics chain inversion of the Midwest production through concessions of sections of the area’s main highway. Two lots of BR-163, from Mato Grosso do Sul to Mato Grosso, were already auctioned by CCR and Odebrecht group, respectively.

This year, as announced a few days ago, the federal government also intends to grant BR-163’s section between Mato Grosso and Pará Thus, agricultural commodities could be brought to transhipment terminals to Northern waterways in duplicate highways after five years under private management. This is the period determined in contracts.

The concession of this section to Para, which was already announced, is still at an early stage, and the notice was not released.