Mon Oct 25, 2010 3:31pm GMT
* Rising bagged sugar exports swallow up container capacity
* Problem seen persisting, terminals lack space to expand
By Peter Murphy
BRASILIA, Oct 25 (Reuters) - Coffee exports from world top grower Brazil are facing delays as the container terminals at the country\'s largest port clog up, exporters said, slowing deliveries to a market already jittery over tight supplies.
Brazil\'s coffee exporter association, Cecafe, estimated that due to the congestion, about 10 percent of coffee exports were behind schedule in leaving Santos port in Sao Paulo state, from where about three quarters of Brazil\'s coffee is shipped.
The jam is partly the knock-on effect of increased exports of another top Brazilian commodity export, sugar, which has been turning to shipments in bags that require containers as soaring demand and wet weather delayed loading in bulk form.
\"We\'re now experiencing a lack of containers. (Sugar) exporters have turned to bags and containers and with this, demand for containers has risen at a peak export time for sugar,\" said Ronaldo Taboada, in charge of logistics at Santos Commercial Association, and also a coffee exporter.
Ships have been forced to set sail without the coffee cargo they had been scheduled to collect, unable to wait for it.
The inadequacies of Brazil\'s sea ports came to the fore in recent months when a surge in demand for sugar led to huge queues of more than 120 vessels that waited weeks to load.
Exporters said coffee began to suffer when containers began to be in short supply and it became harder to gain access to the chock-full container terminal unable to accept more cargo.
\"I would say it is affecting about 10 percent of the loads but as the days go by, this is likely to increase,\" head of the Council of Coffee Exporters, Guilherme Braga, told Reuters.
Exporters had to rent warehousing space in the meantime at a cost of 419 reais ($246) per container, per day, Taboada said, and pay 262 reais to move and stack each of the 20-foot metal box containers.
Once inside the container terminal, some cargoes picked out at random for customs inspection were unable to complete the procedure, which can take up to three days, before their ship set sail without the coffee sitting just meters away.
Brazil has just finished harvesting a crop officially estimated at 47.2 million 60-kg bags, and is the main source of arabica beans while Central American crops are still developing. They are mostly picked from November to January.
Though restricted, coffee exports are nonetheless at high levels, at nearly 3 million bags in September versus 2.4 million bags in the same month a year ago, which was an off year in the coffee trees\' high-low biennial cycle.
Shipments would have been higher still if all cargoes of coffee had been delivered to their ships on time.
\"We have had cases where if we missed the ship, we might not have been able to get another one for five or six weeks,\" said trader Ole Kerbsties at the Stockler exporter in Santos.
\"We had one client in Europe running a serious risk of having to close the factory ... They were running out of coffee to roast,\" he said.
Coffee exports are stable throughout the year, despite the harvest lasting only about four or five months. But sugar exports, which totaled 2.4 million tonnes in September, up a quarter from 1.9 million a year earlier, should tail off by the end of the year, which could give coffee some breathing space.
But with no physical space to expand the Santos container terminals, and plans to expand on nearby sites likely to take years, exporters expect the problem to continue.
The government is investing nearly $1 billion in a dredging program that will enable larger vessels to gain access to its ports and effectively increase throughput capacity because they can load more cargo in less time.
\"We had problems two or three years ago, then we had the (global economic) crisis which meant it was calm. Now we are back where we were with these bottlenecks,\" said Kerbsties.
\"Things are going to keep getting worse,\" he said.
(Editing by Lisa Shumaker)