An Argentine government official said on Wednesday (16.11.2017) that the cost of pilotage in the ports of the Rosario region, the South American country's agricultural export hub, will be reduced by 30% when a maximum rate is applied in December to the service of entry and exit guides to port terminals.
The official decision comes as part of an offensive by President Mauricio Macri to reduce the country's production costs, which he points to as one of the main impediments to economic growth.
"The expected decrease will be 30%, meaning that future values (of the pilotage rates) will be 70% of the current ones.", said Jorge Metz, National Undersecretary of Ports and Waterways, on the effects of the maximum rate that he said will be applied at the end of next month.
According to Metz, the current cost of pilotage services in the Rosario area, where nearly 80% of Argentina's agricultural and agro-industrial exports are shipped, is around US$108.000 per vessel.
That figure represents about 30% of the port costs faced by a ship entering the Paraná River to supply itself in Rosario's ports, said Metz, who added that thanks to a decree published at the beginning of the month, the secretariat has the authority to regulate the rate.
According to the Chamber of Port and Maritime Activities (CAPyM), approximately 2.500 cargo ships enter the Rosario port complex, where agro-export giants such as Cargill and Bunge have their own terminals, each year.
A reduction "is important because it is one of the largest costs you have. The largest cost today is the toll and the second is the pilotage, so it is very important," explained Guillermo Wade, manager of CAPyM.
As part of a crusade to increase productivity in the agro-export sector, one of the pillars of the Argentine economy, in September the government pushed a union that concentrated stevedoring in Rosario to accept competition from rival companies after decades of monopoly.
Metz explained that, thanks to the diversification of suppliers of the loading and unloading service of grains and their derivatives, and to the negotiations carried out by the Government, The stevedoring rate has already registered a 60 percent drop.
Towards the world's supermarket
Since his presidential campaign in 2015, Macri has maintained that Argentina's agricultural and agro-export chains should receive all possible incentives to become the "supermarket of the world."
After winning the elections in December of that year, he kept his promise: within weeks of taking office, he eliminated limits and taxes on corn and wheat exports, a decision that was celebrated by agricultural producers and boosted exports.
According to data from the Ministry of Agribusiness, wheat exports between January and September rose to 9,4 million tons, 150 percent more than the same period in 2015, when former President Cristina Fernández was in power under interventionist measures.
In the case of corn, shipments grew by 2017% in the first nine months of 24 compared to the same period two years ago, with 18 million tons shipped.
One of the main obstacles to agricultural development in Argentina continues to be the obsolete transport infrastructure, as well as the need for water investments, reasons why the Government seeks to attract investments and financing.
Source: Reuters
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