Ferrovia Centro Atlantica (FCA), Vale’s subsidiary, closed the biggest sugar transportation contract of its history, with Copersucar. According to the deal, FCA will transport 500 thousand tons of sugar per year, from Ribeirao Preto, countryside of Sao Paulo, to the port of Santos.
FCA had ended year 2009 transporting 1.3 million tons of sugar on its network, a 44% increase compared to 2008. According to the company’s sale director, Fabiano Lorenzi, another two important contracts must increase the freight business this year: with ED&F Man trading and Santa Juliana’s plant, in Minas Gerais, owned by Bunge, closed between October and November.
Together, the two new contracts can guarantee a 70% increase of the sugar cargo transported by rail – which surpasses two million tons/year. There were 360 thousand tons per year closed with ED& F Man and 180 thousand tons with Bunge – which included 150 million liters of ethanol.
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According to Lorenzi, today there is just one agreement with Copersucar that guarantees the transport of 200 thousand tons/year. The contract doubles the actual volume, and will require investments in freight terminals in Ribeirao Preto and Santos – banked by Copersucar itself. The contract predicts the transportation of 2.4 million tons in five years.
In 2009, FCA transported 8.4 million tons in agricultural, which is the main freight of the company, responsible for 37% of the 22 million tons – and also, responsible for 53% of the company’s net revenue, which ended 2009 with US$ 380 million. The main freights are soybean, meal and corn, which totalize 4.9 million tons. The improvement on the sugar and ethanol sectors this year helped offset the underperformance on industrial freight – steel products and iron ore for the local market, among others. In this business, revenue fell 25% between 2008 and 2009.
FCA’s network passes through the center of Sao Paulo state, follows to Uberlandia and finishes in Brasilia, and it does not dispute with ALL’s network (America Latina Logistica), which has consolidated role in the ethanol and sugar business in the Northeast of Sao Paulo. ALL had closed recently a contract with Cosan to make up Rumo Logistica, which will transport 9 million tons of sugar per year.
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