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Ferroeste Railroads is coming for real

Paraná long dreamed railway seems to be coming out of paper.

We are known as megalomaniacs whenever we are dealing with big projects, which most of the time never come out of the paper and/or not completed ending up with serious complaints and heavy accusations towards whoever plans and try to execute larges enterprises.

However, this time it seems that an old dream will at last come true. It is called the Ferroeste Railroad Project that will link Dourado in Mato Grosso do Sul to the port of Paranagua in the state of Paraná.

The Public Consultation In order to obtain subsidies and suggestions for the construction of this new railroad is almost concluded. As informed above the aim is linking Dourados (MS) to the Port of Paranaguá / Pontal do Paraná (PR). According to the Paraná State Government, the Infrastructure and Logistics Department and the Railroads West – Ferroeste prepared a cycle of Public Consultations successfully with the purpose of broadening the debate about the need to update the railroad model of Paraná.

The Public Consultations are taking place in the cities of Curitiba, Guarapuava and Cascavel, where Ferroeste has its headquarters and railway terminals, and in the city of Dorado’s, in the state of Mato Grosso do Sul.

Too many facts are on the stake. The growth of Paraná State, with a GDP of US $ 115 billion that represents the fourth or fifth largest economy of the country, cannot do without a railway solution. In the last decades, the agricultural production and the Port of Paranaguá have modernized, but the field-port connection continues with the same obsolete railway infrastructure. Due to its characteristics, Paraná has a strong participation in the agribusiness sector. The State holds 33% of Brazilian soybean and corn production, 25% of chicken meat production and 16% of pork production. The outflow of production from the West of Paraná is limited by two major bottlenecks outside the Ferroeste concession area. In some segments, the railroad is saturated, mainly in the Serra da Esperança (between Guarapuava and Ponta Grossa) and the Serra do Mar descent (between Curitiba and Paranaguá port).

The deficiency in West-East railway infrastructure also impairs the production of Mato Grosso do Sul, which in 2016 was the largest national grain producer and grain-producing Paraguay.

To ensure the continuity of the development of this huge producing region, which crosses borders, a new railway line is required for the sea, the largest project in the last six years in Paraná.

The train is the best alternative to reduce costs and make the Brazilian product more competitive in the international market. Therefore, the inversion in the regional matrix of transport favours the highways and increases the freight of commodities, grain and products of low added value, loads typical of the railway modal, which require the transportation of large volumes over long distances.

The producers want a new railroad to the Port of Paranaguá to attend theirs needs. The State Government and the Union, through ANTT (National Agency of Land Transport) and the Ministry of Agriculture; have already made it clear that they also approve the work of Paraná. The rail project will promote the founding of a new investment cycle and the proliferation of several development poles along the new railroad.

The port commercial director told us that the total volume of product movement in the Port of Paranaguá, the second largest in Brazil, is 45 million tons, of which 80% of all import and export demand for the terminal is transported by road. The volume of rail freight currently corresponds to only 9 million tons, or 20% of terminal production. By 2030, the total volume of cargo projected by the Development and Zoning Plan (PDZ) of the Paraná terminal will be 80 million tons, almost double the current one, and the rail volume, in the most pessimistic scenario, will remain the same as in 9 million tons, reducing its share of total Oporto production to 11%. Only the western region produces 14 million tons / year, but only 440 thousand tons of this production is transported by rail to the port. Production is estimated at 21 million tons / year in 2035 for the Western region. It is necessary a set of actions in the transport system so that the logistics chain works without major bottlenecks that strangle port imports and exports. The ideal system for increasing agribusiness capacity is the railroad, since there is no room for capacity increase of highway  BR 277, which is already doubled, and, in addition, the implantation of a third track in the Serra do Mar is quite complex. The Rumo concessionaire currently operates the railroad that serves the Port of Paranaguá. It is a historic, century-old railroad of cultural and tourist interest, built between 1880 and 1885. Its old geometry does not favour a good operational performance of the freight trains that run to Paranaguá. It is worrisome that there is only this railroad of arrival to the Port of Paranaguá, susceptible to blockades in case of fall of barriers in Serra do Mar.

PMI – Expression of Interest Procedure Regionally – the governor of the state Paraná  declared in an interview that has sought alternatives to the railroad problem of the western corridor. Through Resolution No. 04/2016 of the Concession Management Council – CGC, a Working Group was created to develop new railway projects in the State of Paraná. The Working Group concluded that technical-operational, economic-financial and environmental studies are necessary for structuring the new railway project. The technical-operational, economic-financial and environmental studies for the structuring of the project will be tendered through the publication of a Public Call for Proposals to interested companies. The estimated value of the study is R $ 24 million, being approximately R $ 10 billion, the average cost for the implementation of the new railway and the new extension that together must reach the extension of a thousand kilometres of rails. The new railroad will be composed of two railway sections: Section 1 – Guarapuava to the Port of Paranaguá, (state concession). Article 21 of the Federal Constitution says that only federal concession is the services that go beyond the state limits or connect ports to the borders; Excerpt 2 – Dourados, in Mato Grosso do Sul, Guarapuava, in Paraná (the federal sub-concession of this segment is already Ferroeste). Excerpt 1 of the new state concession rail linking Guarapuava to the port will be 400 km long, descending the mountain parallel to highway BR-277. The concession of this section will be state. Excerpt 2 provides for the extension of an extension of Cascavel to Maracaju (MS) with the construction of 350 km of railways. The project also foresees the revitalization of the 250 km stretch already existing and operated by Ferroeste between Guarapuava and Cascavel. This section will also be sub-concessioned.

For your easy reference, please note here below a map showing how the railroad will be stretched, showing the areas to be served.

The route of the new railway will not be able to use the existing railway network operated by Rumo, nor even it’s domain Range. It also offers reserve of operational capacity for independent railway operators and establishes interoperability rules between the two new sections and the existing network.

The documents that give technical support to the project are the PDZ of the Port of Paranaguá; the ANTT Grants 9 and 16; the PELT (State Transport Logistics Plan) of the Paraná Future Forum 10; and the Study “Western Export Corridor” of the Government of the State of Paraná.

At the same time, the State Government develops the Strategic Infrastructure and Logistics Program for State Transportation – IDB I Integration, with the Inter-American Development Bank, for the creation of new logistics centres in Paraná. The investments are US $ 435 million (R $ 1.4 billion).

The Ferroeste cargo terminal should be the first logistics centre to receive IDB investments for strategic storage areas.



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