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Brazil Freight Transport Report Q1 2010Published by: Business Monitor International Published: Nov. 10, 2009 - 80 Pages Table of Contents
AbstractBrazil's ports were in need of BRL43bn (US$23.4bn) worth of investment to upgrade capacity and meetsignificant long term growth forecast for the sector, it was stated in August. Brazil's ports areunderdeveloped and, although trade has declined significantly over the previous year, over the long term,trade is expected to expand rapidly. The figure was announced in a report by Brazil's Institute for AppliedEconomic Studies (IPEA), as quoted by Dow Jones, which noted that 265 projects are needed in order tobring the country's port sector up to standard, including upgrading existing facilities and greenfield portprojects. New ports, however, are not the main focus of investment needs, with the IPEA noting that just9% of the recommended amount, or BRL4bn, should go to new projects. The remainder should beinvested in upgrading infrastructure at existing ports. Investing in Brazil's port sector is an ongoingpriority in the country, which is export-dependent for much of its economic growth.Since our last report, we have slightly raised our Brazilian growth forecast. We continue to estimate GDPcontraction of 0.6% in 2009, but are now expecting a stronger recovery in 2010, with growth of 3.6%(was 2.0%). We have also raised the number for 2011 to 3.9% (was 2.9%). These figures constitute ourlatest update and may supersede those in the preceding section. We now expect annual GDP growth toaverage 3.9% in the 2010-2014 period, up from 3.5% in the preceding five years. We have adjusted ourmaritime freight forecasts to link them to changes in overall trade volumes (rather than GDP) and toreflect slower export performance and the downturn in shipping rates. We maintain an earlier reduction ofour airfreight intensity estimates, given the downturn in demand in H208 and H109. The pipelinethroughput forecast was earlier raised marginally towards the end of the forecast period, taking intoaccount increased gas demand and the expected growth in ethanol exports. As a result of these changes,our freight carried forecast is for annual average growth of 6.7% in 2010-2014, measured in milliontonnes per km. According to our latest estimates, transport and communications GDP will have fallen by 0.2% in 2009,less steeply than overall GDP, which we estimate will have contracted by 0.6%. For the 2010-2014forecast period, we expect the transport and communications sector to outpace the economy as a whole. Itwill achieve average annual growth of 4.2%, versus 3.9% for overall GDP. The total value of transportand communications GDP will rise to US$144.8bn in nominal terms by 2013, representing 5.4% ofBrazil’s GDP. The transport and communications sector employed 4.99mn people, or 5.0% of the labourforce, in 2009. We see these figures rising to 6.18mn and 5.5% by 2014. For the rail sector, we see freight carried, measured in million tonnes per km, growing by an annualaverage of 5.9% during the five-year forecast period, down from 6.5% in 2005-2009. Despite theeconomic slowdown, rail should enjoy a favourable combination of demand and expanding capacity, asnew investment flows into the operations of the privatised operators. There continue to be no reliablestatistics on Brazilian road freight haulage. However, based on BMI estimates we expect freight carriedto be growing more slowly than rail, at an average of around 5.1% a year, because investment to improveand repair the highway network will take longer to have an effect. Despite the collapse of Varig, thecatastrophic TAM accident of July 2007, and real concern over the ability of the air traffic control systemto cope, underlying demand for air freight will remain resilient. We now expect the growth figure in2010-2014 to be an annual average of 6.9%. Total traffic carried by Brazilian shipping will rise by anaverage of 8.1% per annum in the forecast period, compared to 7.7% registered in the preceding fiveyears. Get Full Details About This Report >> |
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