Shippers already rate Santos as one of the most expensive ports in the region, if not the whole world. As of October 1st., they'll have to pay almost 40% more at Brazil's largest port. The port board, which is a collegial organ composed of politicians, port officials and the private sector, voted in favor of a 44% hike Sept. 27, but will offer a transition discount of 5-6% for the next six months.

The full fee will be applicable after such a transition period as long as critical maintenance work, such as dredging of the access channel, is completed in the meantime.

The port management authority Companhia Docas do Estado de Sao Paulo (Codesp) has tried to defuse criticism, saying that fees had actually been cut drastically since 1995. Codesp argues that eventual cost increase for exporters and importers will only be marginal.

In the cabotage trade between Brazil and Argentina for instance, port fees account for less than 2% of overall shipping costs, according to Fernando Vianna, president of Codesp.

Additional revenue is destined to dig Codesp out of its financial hole. The heavily indebted company is currently under the control of the federal government, but plans are underway to transfer management control to local authorities. However, the debt, estimated at about $200 million, has to be reduced before any reform can be implemented.

During the first half of 2001, Santos handled 339,000 TEUs, (TEUs), an increase of 9.9% compared to the same period last year, according to official figures. The port also handled 22.4 million tons of cargo during that time, a 16.6% increase over 2000. Around a quarter of Brazil's foreign trade goes through Santos.

For more details on the new fees may be found at

http://www.portodesantos.com.br/authority/tarifa1.html

Source: Journal Of Commerce - Thierry Ogier