Railway modal registers highest result in history

Recently, the National Land Transport Agency (ANTT) brought the final figures for cargo handling in the rail modal in Brazil in 2017. And, for the fourth consecutive year, there was an increase in handling compared to the previous year, this time of 10 %, with 375 billion RTK transported in 2017.

This is the biggest increase recorded since 2010 and was mainly driven by the transport of iron ore on the Carajás Railroad (EFC), which handled 19 billion RTK more than in 2016. On the other hand, the Vitória-Minas railroads (EFVM) and MRS, two other important iron ore flow corridors in Brazil, had a drop in the movement of the commodity in this period, with almost 3 billion RTK less than in 2016.

In fact, any change in iron ore movements could have a major impact on Brazilian rail transport, as ore is responsible for more than 74% of products transported by this modal.

Figure 1 – Distribution of products handled on Brazilian railroads, by volume

Source: ANTT; Analysis: ILOS

The second most representative item on national railroads is agricultural bulk, specifically the soy complex (comprising soy in grains and bran), corn and sugar. They represent 17% of the items handled by rail, having reached 64 billion RTK in 2017. This number was 33% higher than that registered in 2016, which shows that agribusiness has been seeking to expand its participation in the railway modal. This is a natural tendency for an item with low added value and which needs to have large volumes transported over long distances.

Finally, in 2017, the transport of full containers on railways recorded a 4,7% drop compared to the previous year.

The expectation now remains regarding the anticipation of the extensions of the railway concessions, claimed by the concessionaires with the Federal Government. These promise important investments in the current Brazilian network, mainly when arriving at the port of Santos. In addition, there is still the expectation of handing over to the private sector the two stretches of the Ferrovia Norte-Sul and the concession of Ferrogrão, a greenfield railroad that promises to take grains from Mato Grosso to the waterway terminal in Miritituba (PA).