Brazil to open public consultation for US$545mn Itajaí port concession

The Brazilian government will this month open a public consultation for the planned 2.8bn-real (US$545mn) concession of the Itajaí port in Santa Catarina state.

Itajaí is likely to be one of the assets in the port segment that will attract the strongest investor interest in 2022, according to local experts speaking to BNamericas. 

The consultation will run from February 24 to April 10, federal port authority Antaq said in a press release without providing information for when the auction will be held. 

Itajaí is the country’s second largest port in terms of container handling, transporting almost all of the southern state's production. 

Along with Itajaí, the government will in the coming months offer auctions for the concessions of Espírito Santo state port operator Codesa, Bahia’s Codeba, the Santos port authority in São Paulo and the São Sebastião port. 

"On the government's list of planned concessions there are very small ports, with limitations for future expansion, like the ports of São Sebastião and Codesa. I’m not sure about the [investor] interest in these assets," Murillo Barbosa, president of the Brazilian association of private port terminals (ATP) and former Antaq director, told BNamericas. 

According to Barbosa, Itajaí and Santos are the concessions that are likely to attract the strongest investor appetite given their expansion potential.  

The fact that Itajaí is used to export sugar, among other agricultural products, could be of interest to financial investors.

"There are many global investment funds that are interested in investing in the Brazilian agriculture segment and these funds see the port area as an infrastructure asset directly linked to the commodities sector," Clovis Meurer, founder of Brazilian private equity and venture capital association ABVCAP, told BNamericas. 

ITAJAI CONCESSION DETAILS

The future concessionaire will act as both port and container operator, providing services directly to users. 

The contract will be for 35 years, with the possibility of extending it to 70 years. 

The auction’s minimum fee has been set at 603mn reais, and the winner will pay the government 25 annual 35.8mn-real installments, from the 6th year to the 30th year of the contract period. 

There will also be a variable payment from the concessionaire, corresponding to the annual amount resulting from the container handling charge of 52.6 reais per TEU.