The most significant drop in the level of the Paraná River in a decade is forcing agro-exporting companies in Argentina to reduce the load on ships, an agricultural powerhouse whose shipments were already suffering problems due to the impact of the coronavirus pandemic.
The Paraná is the main export route for Argentina's grains and by-products, which move from the ports and processing plants in the Rosario hub - one of the largest in the world - to the Atlantic.
«The ships (in Rosario) continue loading. What happens is that instead of loading what they normally would at this time, about 34 feet (deep), Today they are loading at 31 feet"Guillermo Wade, manager of the Chamber of Port and Maritime Activities (CAPyM), told Reuters.
Measured in tons, those three feet mean a reduction of about 7.500 tons of cargo on a Panamax ship, Wade explained. These ships usually leave Rosario with between 50.000 and 55.000 tons in their holds.
According to a report from the Rosario Stock Exchange (BCR), due to the lack of rain in southern Brazil and in areas of the Paraná tributariesThe height of the river in Rosario was only 1 meter, a level that had not been recorded for almost 11 years.
The National Water Institute (INA) predicts that figure will fall to 0,98 meters next week and could drop to 0,9 meters by April 21, which according to Wade would imply the loss of an additional foot of cargo in ships' holds.
In river level measurements, zero corresponds to a reference measurement that is never crossed and not to the depth to the river bed.
The Rosario Stock Exchange said that the areas affected by the lack of rain would only receive significant volumes of water from mid-April.And even if this were to happen, this flow of water could take up to 20/30 days to be reflected in a rise in the river at the height of our city., Agregó.
The river's decline comes as Argentine farmers are beginning to step up harvesting of soybeans and corn, the country's two main crops, whose harvests are expected to reach 49,5 million and 50 million tons, respectively, according to the Buenos Aires Grain Exchange.
While ships leaving the Rosario area without their full load can complete their work in Argentine sea ports such as Necochea and Bahía Blanca - or in southern Brazil - the other two important Argentine agricultural port centres are in areas where corn and soybean production is significantly lower than in Rosario and their logistical capacity is lower.
The significant drop in the level of the Paraná River is a new problem for the Argentine agro-export sector, which in recent weeks has experienced difficulties in receiving grains by truck - the country's main freight - due to traffic restriction measures in various districts to stop the spread of the coronavirus.
Argentina has ordered a general and mandatory quarantine due to the coronavirus that began on March 20 and will last until at least April 12. Although the government exempted cargo transport from the measure, many municipalities prohibited the passage of trucks, causing shortages in ports.
However, the governments of the Nation and of several provinces have managed to get many of these localities to allow the passage of loads and, according to a statement from agricultural export chambers on Tuesday night, "improvements are being seen in several municipalities in several provinces that restrict the entry and exit of trucks."
Delays in Paraguayan soybeans. The significant drop in the Argentine level of the Paraná is also delaying the arrival of barges with Paraguayan soybeans to Rosario, which impacts the protein level of soybean meal from Argentina, the world's leading exporter of the product, explained Julio Calzada, director of Information and Economic Studies at the Rosario Stock Exchange (BCR).
The reason is that the fall of the Paraná, a river that originates in Brazil, is due to lower than usual rainfall in southern Brazil and in Paraguay, where the river also called Paraguay flows, one of the tributaries of the Argentine branch of the Paraná.
Soybeans arriving from Paraguay «It is very important because this soybean goes down to the factories in Greater Rosario, it is mixed with Argentine soybeans and, as Paraguayan soybeans have a higher protein content, what it does is raise the protein level of the soybean flour that Argentina sells.", Calzada explained.
«Today there are delays in these barges when they arrive in Rosario, which affects the activity of the oil industry."He said. Last year, according to data from the Argentine statistics agency, Argentine companies imported a total of 3,4 million tons of soybeans from Paraguay.
Source: Reuters
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