Brazil’s bid to unseat the US as the top dog in the world of soybeans is running headlong into the South American nation’s god-awful infrastructure. China is already talking about shifting orders to Argentina due to the supply chain bottlenecks that are keeping beans from getting aboard ships bound for the soy-hungry Asian giant. The US was the largest exporter of soybeans to China, sending 24 million US tons (that’s 22 million metric tonnes) of the beans, worth $12.1 billion, to China in 2011. Brazil and Argentina were second and third, respectively.
Brazil’s farmers are doing their job to push to top of the global soybean rankings. The US Department of Agriculture forecasts the total soybean crop in Brazil will weigh in at 83.5 million tons (93 million US tons), with 38.4 million tons slated for export in 2013. That puts Brazil ahead of the US projected production of 82.1 million tons, of which 36.6 million export tons is to be exported.
But all those beans don’t amount to a hill of beans if Brazil can’t get the soy shipped. And Brazil still relies predominantly on trucking to move the beans the roughly 1,000 kilometers [621 miles] that stretch between the central-west Brazilian soy heartland and shipping centers. But getting to the port is just the start of the fun. Bloomberg recently reported “the line of trucks waiting to unload soybeans at Brazil’s busiest port surged to a record 15 miles long this month, while a total of 212 vessels awaited loading in a country that’s forecast to surpass the U.S. as the biggest producer.”
So it’s no wonder that a recent report from consultancy McKinsey noted that “up to 12% of all grain produced in Brazil spoils before reaching ports or consumers.”