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Thanks to ALL, Brazil’s Ethanol Gets on the Right Track

ALL train at Serra do Mar Brazil-based ALL (América Latina LogÀ­stica), the largest railway logistics operator in Latin America, is the newest player in the fuel alcohol sector in the state of São Paulo, which is responsible for around 75% of the whole alcohol and sugar production of Brazil. The state produces 24 billion liters of the product per year.

ALL has established a novel partnership with distributors and should invest 104 million Brazilian reais (US$ 64 million) in systems for collecting and distributing ethanol to the market in the state of São Paulo.

The partnership contemplates installation of 11 points for cargo centralization (loading centers) at strategic points in the main producer regions of the state of São Paulo, Mato Grosso and Mato Grosso do Sul, as well as a structure for railway unloading at Planalto Paulista Refinery (Replan), in the city of Paulí­nia, in the interior of São Paulo state.

According to ALL, the operation marks the start of cargo transport on the old Brazil Railways lines, purchased by the company in 2006, and covering three concessions, Ferroban, Ferronorte and Novoeste.

In 2009, the railway should move 1 million cubic meters of alcohol towards the market in São Paulo and surrounding region, and the total may rise to 2 million a year by 2010. The operation counts on 250 new tanker wagons each with a 103 cubic-meter fuel capacity to be used to collect the product in the interior of the states of São Paulo, Mato Grosso and Mato Grosso do Sul.

The partnership allows for optimization of the railway fleet, transporting alcohol on the return trip. Currently, ALL transports 170,000 cubic meters of diesel and petrol a month, collected at Replan.

Now the cars, which used to return empty for re-loading, may return full of alcohol produced in the countryside, completing the cycle of assets and reducing operating cost, which makes freight more attractive and the railway more competitive.

"We have entered a growing market, which will be supplied based on our spare capacity, offering the market more productive and cheaper logistics," said Eduardo Fares, who is responsible for the Liquids Unit at ALL.

Undergarments

The undergarments sector, which represents 9.5% of the textile production chain and had revenues of 4.59 billion reais (US$ 2.8 billion) in 2007, should grow around 15% this year. Brazil consumes 835 million items each year. For 2008, the estimate is to expand the number of items produced by between 11% and 15%.

Perspectives are also good when considering the foreign market. In 2007, exports were close to US$ 40 million. This year they should grow on average 10%. The main importer markets are the countries in Latin America and the European Union. Countries in the Middle East are also on the list of buyers.

Accelerate Brazil!

Between 1997 and 2006, the Brazilian participation in global agribusiness trade has risen to 6.9%. In the period, the average growth of Brazilian sector exports was 9.6% a year. This is revealed by the Agribusiness Commercial Exchange – Main Market Destinations, elaborated by the Secretariat of Agribusiness Foreign Relations, of the Ministry of Agriculture, Livestock and Supply.

In the period analyzed by the publication, released last week, global agribusiness trade grew 57% between 1997 and 2006. In the period, the value exported to the whole of the world rose from US$ 388.6 billion to US$ 609.8 billion.

In 2007, Brazilian agribusiness exports reached the figure of US$ 58.4 billion, 2.5 times more than the total registered ten years ago, when Brazil exported US$ 23.4 billion. This growth, however, has not been regular due to the oscillation of international commodity prices.

Over the last three years, the annual growth of 14% in the value of agribusiness exports is the consequence, mainly, of a 68% price hike in the period, as against a 32% increase in the volume exported.

State-Owned Companies

Site Contas Abertas (Open Accounts) informs that investment of state-owned companies in the first half of this year were the greatest of the last ten years. Between January and June, state-owned companies invested 20.1 billion reais (US$ 12.3 billion), around 35% more than in the same period last year.

Petrobras alone invested 18 billion reais (US$ 11 billion), that is, 89% of all the funds in the first half. The investment of the state-owned company also totaled 68% more than the average of the first six months of 1999 and 2007, calculated at 12 billion reais (US$ 7.3 billion), at current figures – already having discounted the effects of inflation.

Anba – www.anba.com.br

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