September 1, 2003

Brazil Paranagua in Negotiation to Export Large Volume of Soybean to China

The Brazilian grain port of Paranagua is negotiating a deal with Chinese authorities who would commit to buying a fixed annual volume of soybeans from the port in exchange for supply and quality guarantees, Paranagua said on Thursday.

"The Chinese sought us out offering a guarantee to buy in exchange for supply and quality assurances," said port superintendent Eduardo Requiao. "Our product will have a seal and port to port insurance. If the product is inadequate, the insurer pays," said Requiao, adding that the cost would be bankrolled by companies operating in the port.

"Quality would become a requirement of the port," he said, adding that it would not be a problem for the exporters who are already obligated to produce certificates of quality. Furthermore, Chinese importers will have the option of paying for part of their port tariffs with equipment produced in China, that Requiao says will help Paranagua expand.

China should import about 20 million tons this year. From Brazil alone, China bought 4.47 million tons of beans from January through July, a volume that already surpasses total 2002 Brazilian soy imports of 4.14 million tons, said Brazil's Foreign Trade Secretary (Secex).