Santos - Too Important to Delay

Santos accounts for 10% of Brazil maritime trade – foreign and cabotage – moving over 125 million tons in 2021 and over 106 million tons in the first 9 months of 2022. The 3 container terminals – BTP (joint venture between APM Terminals and Terminal Investment Limited, DP World Santos and Santos Brasil – moved close to 5 million TEU in 2022, or 45% of all containers in Brazil. This already brings the terminal utilization above 85% and it is critical and urgent that new capacity is added.

Yet, ABTP - Asociación Brasileña de Terminales Portuarias – has now presented a request to competition authorities to investigate Maersk and MSC for abusing their market position. Maersk and MSC have strong market positions today and together - via APM Terminals and Terminal Investment Limited – control the BTP terminal. ABTP has also argued that verticalization is bad for competition, yet the competition authorities have previously concluded against this argument too. ABTP has different members, but this particular initiative seems be to lead by Santos Brasil that has an obvious bias towards less competition in its core market Brazil. Of course, the objection to verticalization goes well beyond STS10 but, ironically, Santos Brasil is itself vertically integrating with hinterland logistics. The foundation for verticalization is value creation for the beneficial cargo owners, but of course a threat to incumbent operators. 

This is the first of a series of 3 articles that will explore the topics and urge authorities – notably Brazil’s newly appointed minister of ports (and Airports) Márcio França to move forward with the STS10 auction. A fourth terminal will both increase competition and add critically needed capacity, while likely to attract a higher bid for and income for the port of Santos. A single company should not be allowed to delay free competition, especially not on infrastructure critical for Brazil.

Source: Linkedin | Michael Kaasner Kristiansen | Oner/President of CK Americas & Head of Shipping at DCX

| Foto: Divulgação