Brazil's new sugar terminal at the port of Suape in the state of Pernambuco loaded its first ship on Friday, opening a new export corridor for mills in the Northeast at a time of strong demand for the sweetener.
The Suape Sugar Terminal (TAS) was built by the Agrovia do Nordeste consortium, which is controlled by the logistic arm of Brazilian engineering conglomerate Odebrecht and by transportation firm Agrovia.
The terminal's first phase of construction, which is nearly completed at a cost of 58 million reais ($17.1 million), should give it an annual capacity to move 500,000 tons of refined sugar.
"We're seeing growing interest in shipping through the terminal," Director of Agrovia do Nordeste, Rodrigo Veloso, said. "Timing of the start of operations was planned to coincide with the start of harvest" in the region, he said.
Northeast mills are expected to produce 3.4 million tons of sugar (raw value) in the 2016/17 crop, while the main center-south region in Brazil should produce 36.6 million tons according to official statistics agency Conab.
Shipping data showed the vessel Jumper contracted by French sugar trader Sucden will carry 20,000 tons of refined sugar to Argentina.
The terminal's goal is to provide an export corridor to mills mainly in Pernambuco, possibly also in neighboring Alagoas, Veloso said, adding that the first ships will be loaded by crane but a shiploader has been bought and will be installed.
The conveyor belt system should be operating by the end of January, which should reduce the time for loading ships from 15 days to six.
"When we are fully operational, we will have capacity to attend all the export needs of the mills in Pernambuco," Veloso said. "We have 10 contracts in negotiation for sugar shipments."
The price of refined sugar reached four-year highs in September on the London exchange, as a global deficit in the sweetener drags on.
The terminal will have a hybrid shiploader that will be able to load both bulk raw and refined sugar, which is bagged, but the movement of bulk raws will only start in the second phase of the terminal's development, Veloso said.
He said the terminal could handle grains in the future.