Port delays in Brazil causes the amassing of 2.1m bags of coffee until September
October 23 - 2024
Coffee Geography Magazine
According to a survey carried out by the Brazilian Coffee Exporters Council (Cecafé), the high rates of delays and frequent changes in the scale of export vessels caused the country to accumulate 2.155 million bags – 6,529 containers – of the product not shipped until September 2024. With an average Free on Board (FOB) price of US$ 269.40 per bag (green coffee, Sep/2024) and the average dollar at R$ 5.5410, this implies that the country failed to receive US$ 580.55 million, or R$ 3.217 billion, in foreign exchange revenue.
The scenario becomes even more critical when analyzing the losses that coffee exporters have been accumulating due to the lack of adequate port infrastructure for containerized cargo in the country, according to Cecafé's technical director, Eduardo Heron.
“Our associates reported an additional cost of R$5.938 million due to detentions , additional storage, pre-stacking and early gate , caused by high delay rates and regular changes in vessel schedules. These obstacles reveal that our ports have not evolved at the same speed as the agricultural sector and have inadequate structures for containerized cargo, exposing the exhaustion of the infrastructure and the need to expand the capacity of the yard, berth and deepen the draft to receive larger vessels”, he reveals.
In September alone, 69% of ships, or 190 out of a total of 277 vessels, had their schedules changed or were delayed when exporting coffee from Brazil's main ports, according to the Detention Zero Bulletin (DTZ), prepared by the startup ElloX Digital in partnership with Cecafé. The longest waiting period was recorded at the Port of Santos (SP), with 38 days between the opening of the first and last deadlines.
The survey shows that Santos, the main terminal for exporting Brazilian coffee, recorded an 84% delay rate for container ships in September, which involved 108 of the total 129 vessels.
Last month, only 10% of boarding procedures took more than four days for ships to open the gate at the Port of Santos. Another 36% took between three and four days and 54% took less than two days.
“The level of ships that had a window open for less than 48 hours reached its worst rate since January 2023, when we started the survey, and, even more worrying is the fact that 42 ships did not even have a gate open , increasing the scenario of extra and high costs for exporters”, comments Heron.
In the port complex of Rio de Janeiro (RJ), the second largest exporter of Brazilian coffee, the rate of vessel delays was 58% last month, with the longest interval being 29 days between the first and last deadline. This percentage implies that 42 of the 72 vessels destined for shipments of the product had their ports of call changed.
Also in September of this year, 13% of export procedures took more than four days for container ships to open their gates in Rio de Janeiro ports; 44% took between three and four days; and 43% took less than two days.
Heron reinforces that the growth in containerized cargo shipments reveals the lack of adequate infrastructure in Brazilian ports and its impacts on foreign trade, which trigger problems such as the addition of logistics costs to exports, lower transfer of the FOB value to producers and, more recently, issues involving the issuance of phytosanitary certificates for certain destinations due to delays and changes in scales.
“Thanks to the competent and tireless work of the logistics teams of coffee exporters, together with the support and collaboration of some port terminals, Brazil has been able to honor its commitments, even with the addition of high logistics costs. However, it is very important that public authorities are aware of this scenario and promote broad dialogue so that we can continue to supply our buyer markets and avoid further losses in exports,” he comments.
Cecafé president Márcio Ferreira praises the commitment of Brazilian exporters to their international customers, giving up a good part of their margins, covering the extra costs due to bottlenecks and honoring their commitments with shipments.
In September, Brazil exported 4.464 million bags, the highest volume ever recorded for this month and representing an increase of 33.3% compared to the 3.348 million bags shipped in the same period last year. Year-to-date, exports total a record 36.428 million bags, an increase of 38.7% compared to the first nine months of 2023.
“Our associates have clearly demonstrated their resilience. Despite the various logistical problems, the sector has shown clear signs of its ability to achieve new export records in practically every month of this year, and this security has made the relationship between importers and exporters increasingly solid, as far as possible, due to the punctuality in fulfilling contracts within the FOB terms,” he emphasizes.
The opinion is shared by Cecafé's general director, Marcos Matos, who highlights that, despite the logistical issue, Brazilian coffee exporters are committed to supplying coffee to the world, to the most diverse and demanding markets.
“We are showing that we can work two, three, four, five times harder and ensure that our coffee reaches the entire global consumer market. Despite the difficulties, we are able to work hard and guarantee supply in the face of all these adversities, even breaking records,” he says.