Paraguayan soy origination company Ovetril has taken over the administration of Paraguay’s Don Severo port terminal, in the town of Antequera, as surging Brazilian soy sales to Argentina tend to increase volumes passing through that strategic hub, the company said on Friday.

The port is located on the banks of the Paraguay River, which boasts the world’s third-largest barge fleet, and currently handles Paraguayan corn and soybean shipments destined mainly for Argentina, the company said.

Joao Paulo Barbieri, Ovetril’s port manager, told Reuters by telephone that Don Severo offers an option to Brazilian companies looking to ship soybeans to Rosario, in Argentina, where a drought destroyed the crop, sparking a rise in Brazilian soy imports.

Barbieri said Don Severo can be competitive in relation to Porto Murtinho, a barge port in the Brazilian state of Mato Grosso do Sul, as it is closer Rosario.

“Cost savings related to the use of barges offset the road freight cost,” he said, referring to the movement of grains directly on barges from Porto Murtinho to Argentina’s Rosario, whereas trucks would need to move Brazil’s soy southward for delivery at Antequera before they could be loaded onto barges.

Global grain traders including Cargill Inc CARG.UL and Bunge Ltd BG.N run facilities in the Rosario region, where the bulk of Argentina’s soybeans are crushed to make soyoil and soymeal for export markets.

Ovetril’s Don Severo terminal can store 110,000 tonnes of grains.

When operating at full capacity, it will handle around 1 million tonnes of bulk cargoes per year. That should happen soon, as investments were made to improve the port’s efficiency, according to Barbieri.

The terminal’s acquisition and initial investments exceeded $20 million, the company said.
Source: Reuters (Reporting by Ana Mano in Sao Paulo Editing by Matthew Lewis)