Maersk’s APM Terminals to Invest $1B in Expanding Operations in Brazil

Santos Brazil container terminal expansion — APM Terminals will expand in Brazil with a priority on the operations in Santos

Maersk’s terminal operator, APM Terminals, is pledging to invest at least $1 billion in port expansion and modernization across Brazil. The investments were announced during a Dutch trade delegation visit to Brazil and would be made over the next three years in ports including Santos in southern Brazil as well as Suape in the north, three additional ports, and the company’s inland container depots in the northeast and southeast.

The company highlights that approximately a third of its investment, $320 million, will be going to Phase One developments of a new terminal in Suape. It is the largest port in Northeast Brazil and one of the five largest in the country as well as serving as an important link to serving Latin America. APM said they are in the final stages of the acquisition and will rejuvenate the infrastructure at the port to increase competition in the port. The total investment is expected to reach $524 million for the port of Saupe.

The largest focus, however, is on the renovation of the terminal in the Port of Santos. It is operated in partnership with MSC’s Terminal Investment Limited (TIL). According to the companies, the terminal is operating at 92 percent of capacity, far above the optimal efficiency achieved at 80 percent capacity.

The previous government in Brazil had been moving aggressively to privatize port operations, but Maersk and MSC encountered opposition to their plans for expansion of the Santos terminal shared by the two companies. Concerns had been raised over the potential for dominance by Maersk and MSC.

APM Terminals’ CEO Keith Svendsen said that experience in other countries shows that the concern is unfounded. “Our primary focus is increasing capacity and modernization. There is now an urgent need for investment in the Port of Santos, both to ensure the deepening of the access channel - which will allow the entry of new, larger, and more efficient ships - and to expand the capacity of the port complex, which is close to the limit.”

Currently, they are in negotiations with the federal government to extend the concession agreement, which expires in 2027, for another 20 years. In exchange, the partners would modernize and double the current 1.5 million TEU capacity of the terminal. They are allocating $310 million for the planned expansion of the operations of Brasil Terminal Portuário in Santo while saying the investment could reach nearly $450 million over the next five years

As well as expanding BTP, APM Terminals and TIL have expressed joint interest in a new container terminal at the Port of Santos, which would be located in an area adjacent to its existing terminal. The new government, however, has not yet defined the future of the project, which has been put on hold for reassessment.

In addition to the efforts in Saupe and planned for Santos, APM Terminals is committed to investing over $400 million in the company’s three other terminals and inland depots. The company plans to multiply storage capacity fivefold at its inland container depots in the Northeast and Southeast of the country.