Brazil adds rail capacity as farmers harvest record soy crop

Brazilian logistics company VLI SA has increased the capacity of its Ferrovia Norte-Sul railway to serve farmers now harvesting this year's summer crop.

Brazilian logistics company VLI SA has increased the capacity of its Ferrovia Norte-Sul railway, a 720 km (447 miles) line linking the central state of Tocantins to the northern port of Itaqui, to serve farmers now harvesting this year's summer crop.

The company said it invested 160 million reais (USD 48.5 million) to buy 240 train cars, raising the number of units by almost 10 percent as producers start collecting soybeans in Matopiba, Brazil's new agricultural frontier in the North/Northeast region.

Igor Figueiredo, the general manager of VLI's agribusiness unit, told Reuters during a visit to the company's installations in the municipality of Porto Nacional, Tocantins state, that the new cars entered operation this month.

He said the investment is tied to VLI's strategy to boost use of its Center-North logistics corridor, comprised of grain terminals at Porto Nacional and Palmeirante, in the Tocantins, and Porto Franco, in Maranhão state, where cargoes pass through before reaching the grain export port of Itaqui.

"The crop will grow, so we need the additional train cars," Figueiredo said.

Matopiba, a nickname for the four states (Maranhão, Tocantins, Piauí, and Bahia) making up this new grain growing region, accounts for about 11 percent of Brazil's soybean production, which this year is expected to reach a record 117.5 million tonnes, according to estimates by independent consultancy Agroconsult.

In 2017, VLI moved 5.8 million tonnes of grains on the Ferrovia Norte-Sul railway, predominately soybeans, the manager said. This compares with 4.2 million tonnes in 2015.

The numbers for 2016 are not available and last year's figures are a record, Figueiredo said, declining to estimate volumes VLI would move this year.

VLI has among its main shareholders Brazil's mining company Vale SA, Japanese commodities trader Mitsui & Co Ltd and Canadian asset manager Brookfield. 

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