Cargill’s top executive in Brazil called for maintenance dredging of the Tapajós River, located in the Amazon region, arguing that keeping the waterway navigable is critical to grain exports as El Niño raises the risk of drought.
“Waterways have to be dredged,” Paulo Sousa, Cargill’s Brazil CEO, said Thursday at a Bradesco BBI event in São Paulo. “In the US and Europe, everything is dredged. A waterway is infrastructure that nature has given us — it is the cheapest capex — but you have to take care of it and give it a little help.”
The comments come amid a dispute over dredging the Tapajós river in Pará state, a major artery in Brazil’s northern grain-export system. Indigenous protesters occupied Cargill’s port terminal in Santarém in January in opposition to a government decree that would have facilitated waterway concessions and dredging projects in the region.
The government revoked the contested decree earlier this year following local pressure. Maintenance dredging has also been held up, increasing the risk that parts of the river could become unnavigable during a drought — a concern heightened by El Niño.
MoveInfra, an association representing infrastructure companies, estimates that 3 million to 5 million metric tons of grain exports could be affected if the dredging does not take place. Potential financial losses could reach about $167 million (850 million reais).
“We ended up being something of a scapegoat in this debate,” Sousa said. Cargill strongly supports dredging and efficient waterways as long as projects comply with environmental rules, he said, adding that the issue needs to be addressed through dialogue rather than allowed to drag on.
For now, traffic on the Tapajós continues to flow, with barges carrying soybeans from the Miritituba terminal to the port of Santarém, Sousa said.
If the waterway becomes impassable, Cargill can move grain by truck over a route of just over 200 kilometers (124 miles), giving the company an advantage over some rivals that would face much longer detours.
“We can load trucks and take them there,” Sousa told reporters. “Of course, it is a little over 200 kilometers by road, so it is not as efficient, but we don’t stop. Other players would have to take a much longer route, to the point where it may no longer be viable.”
Cargill and Louis Dreyfus currently operate at the port of Santarém. Cargill’s terminal there has annual export capacity of 5 million to 6 million metric tons.
Cargill began investing in its own river transportation network in Brazil in 2016 and now operates 44 barges, each with average capacity of about 3,000 metric tons. Another 10 barges were expected to enter service by mid-2026.
Sousa said river transportation should expand over time, increasing its competitiveness against other freight modes and helping reduce logistics costs.
Recent Regulation
Expanding Brazil’s waterway network will require overcoming regulatory hurdles, Transport Minister George Santoro said at the same event. Rules governing waterways are much newer than those for highways and railroads, he said.
“We started developing waterways in an unorganized way,” Santoro said. “Private operators simply began operating them. It wasn’t like highways and railroads, where we have a 30-year learning curve for dealing with problems.”
Brazil still lacks a waterway project structured with what Santoro described as adequate environmental studies. More studies will likely need to be commissioned over time to improve understanding of the sector among environmental authorities without making projects unworkable, he said.
Santoro also expressed concern about prosecutors invoking International Labour Organization Convention 169 in the Tapajós dredging debate. The convention requires free, prior and informed consultation with Indigenous peoples when projects may affect them.
“I am very concerned about regulating such a complex issue in a standardized way for every situation,” Santoro said, citing the FICO, or Center-West Integration Railway, as an example.
The Transport Ministry resolved three of four environmental obstacles affecting the railway’s route after a year of negotiations, according to Santoro. Applying a uniform standard sought by environmental authorities would have stretched that process to four years, he said.
This story was translated from the original Portuguese with the assistance of artificial intelligence and reviewed by The AgriBiz editorial staff.
