Report: Cargill in talks for Brazilian rail project

by Eric Schroeder
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SAO PAULO, BRAZIL — A consortium that includes Cargill, Archer Daniels Midland Co., Bunge Ltd. and Amaggi is in discussion to bid for a $4.3 billion railway project that would bring together grain-growing regions in central Brazil with northern ports, according to a report from Reuters.

Luiz Pretti, president of Cargill in Brazil, discussed the Ferrogrão railway project with Reuters on the sidelines of an American Chambers of Commerce event in Sao Paolo this week.

As soybean production and export availability have soared in recent years for Brazil, the country’s infrastructure has failed to keep up. This has led Brazil to launch the Ferrogrão railway project, which would create a nearly 700-mile long railway corridor for commodities. Plans call for the railway to connect the grain producing region of the Midwest with the State of Para, ending at the river port of Miritituba.

Once completed, the railway is projected to be able to accommodate the transport of up to 20 million tonnes of grain per year by 2025 and will cut freight costs by 40%.

The consortium including Cargill and Bunge is not the only group interested in building and operating the railway, though. According to Reuters, a government official told the news agency back in October that a group of state-owned Chinese companies also is planning to form a consortium to bid for the railway project.

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