Stellantis cuts 2024 US forecast

Chancay Port takes center stage at APLA

Chancay Port takes center stage at APLA

Sao Paulo, 25 November (Argus) — The new $3bn Chancay Port in Peru could disrupt polymers trade throughout Latin America, according to conversations at the 44th Latin American Petrochemical Association (APLA) conference last week in Cartagena, Colombia. Located 80km north of Lima, the Chinese-built port promises to reduce shipping times for Chinese products to the region by up to 20 days, thanks to its direct route across the Pacific Ocean. Chinese President Xi Jinping inaugurated the port in Peru on 14 November. The port was a focal point of discussions among producers and traders in Latin America, but especially for those in the west coast of South America (WCSA), the first region to be possibly affected by Chancay's operations. A polypropylene (PP) producer in Colombia told Argus that the news is not good for them as it would be easy and fast to ship Chinese PP from Chancay to Buenaventura, Colombia's most important seaport on the Pacific Ocean. The company said it is trying to figure out how to deal with the expected increase in resin imports from China. Several other regional resin producers and traders are closely monitoring the situation, trying to strategise their next moves. In the US, the largest polyethylene (PE) exporter to South America, Chancay has already been causing concerns for local producers and traders selling into the region, one source told Argus . The combination of more Chinese PE arriving on South American shores and local governments placing anti-dumping duties on US-produced, as is foreseen in Brazil in the short-term, should lower US sales for the whole region, the source added. Asian resin is already gaining market share in Peru. Currently, the country is the second largest PP importer in South America by volume, and its imports had a significant increase this year even before Chancay's inauguration. PP imports climbed 32pc from January to October, with 90pc more purchases from Asia-Pacific, whose market share expanded from 41pc to 58pc year on year. South American purchases fell 7pc to 57,800t in the same period. Concerns were also raised about the Chancay port being used to distribute Chinese resins to other regional markets, including Brazil and Argentina, via smaller containerships being sent through the Panama Canal. Chancay set to change routes The first phase of the Chancay Port project, which began in 2021, features four berths and a maximum depth of 17.8 meters, allowing it to accommodate ultra-large container ships with capacities of up to 18,000 twenty-foot containers (TEUs). With a projected throughput capacity of 1mn TEUs annually in the short term and 1.5mn TEUs in the long term, Chancay Port is set to significantly impact maritime routes from Asia to Latin America. Over 80pc of the project is already completed, including the main quay structures finished earlier this year. Once fully operational with its 15 docks, Chancay will be South America's first port capable of handling ships too large for the Panama Canal. Additionally, China plans to build a railway linking Chancay with Brazil, its largest Latin American trade partner, later in the decade. The ownership of Peru's Chancay Port is split between two major entities. Cosco Shipping Ports, a Chinese state-owned company, holds a 60pc stake in the port. The remaining 40pc is owned by Volcan Mining Company, a Peruvian firm. This collaboration is part of China's expansive Belt and Road Initiative. By Fred Fernandes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.