Fertilizer distribution flows and logistic costs in Brazil: Changes and benefits arising from investments in port terminals

Débora da Costa Simões, José Vicente Caixeta-Filho, Udatta S. Palekar

Research output: Contribution to journalArticlepeer-review

Abstract

This study analyzes the impact of anticipated investments to alter Brazilian port infrastructure on fertilizer flows and fertilizer transportation logistics costs using a linear programming model designed for the task. The most notable among these investments are directed toward accelerating port development in Brazil's "Northern-Arc", thereby increasing fertilizer supply to new markets opening throughout the country's expanding agricultural frontier, particularly in northern Mato Grosso state, while increasing supply to existing markets. Results from model runs show that the anticipated port infrastructure investments should ensure nationwide fertilizer logistics savings of US$ 845 million over the 2017 through 2025 period. Although these estimated benefits are outstanding, the study indicates that further expansion of Brazil's port system, particularly in the Northern-Arc, presents additional opportunities. Model projections were that in 2025, after all planned infrastructure improvements are operational, port terminals will be near full capacity, which should make planning for future projects a current priority.

Original languageEnglish (US)
Pages (from-to)407-422
Number of pages16
JournalInternational Food and Agribusiness Management Review
Volume21
Issue number3
DOIs
StatePublished - 2018

Keywords

  • Fertilizer market
  • Logistic flows
  • Mathematical programming
  • Northern-Arc

ASJC Scopus subject areas

  • Food Science
  • Business and International Management

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