Antaq Is Revising the Privatization Project Model for the Port of Itajaí Due to Investment Requirements and Market Demand

Expected to occur still during this year, the privatization project of the Port of Itajaí is now undergoing a review of the modeling conducted by Antaq due to the possible exit of companies due to investment requirements.

On Thursday, (08/18), the National Agency for Waterway Transportation (Antaq) is conducting a review of the modeling of the privatization project of the Port of Itajaí, located in the state of Santa Catarina. Among the reasons that led to an analysis of the process is the high demand for investments in the project and the demands of the port sector, which may deter interested companies from the concession auction, expected to take place still during this year of 2022. 

Scheduled to Happen Still in 2022, the Privatization Project of the Port of Itajaí is Now Undergoing a Review of the Modeling by Antaq

The Federal Government, through Antaq, continues the project of granting port sector assets to the private market and is now accelerating the privatization of the Port of Itajaí, one of the most anticipated processes for the future of the industry, scheduled to happen still during this year of 2022.

However, some market factors led Antaq to review the modeling of the project and analyze possible changes. In privatization projects of assets to the private market, it is quite common to use a methodology known as “capacity share,” which causes quick effects on the captured demand as a result of capacity increases.

However, this method has become a problem for the project’s modeling, as the concessionaire will have to compete in the port market for the sector’s demand even after the initial investments in privatization. And, considering the high competitiveness in the Southern Cluster of the port sector, this characteristic of the project may end up deterring investors.

Another issue analyzed by Antaq in the review of the modeling of the privatization of the Port of Itajaí is the project’s requirements, which include the construction of a new passenger pier and the removal of the “Pallas” ship, which will allow operations with larger ships in the future.

Although this is a justifiable requirement in the project, some smaller investments, such as maintenance dredging and deepening works, acquisition of adjacent areas, and equipment (portainers, RTGs, among others), are also needed. Thus, the final investments required in the modeling will end up being larger than initially planned.

Outdated Capex in the Privatization Project of the Port Complex is the Main Issue Analyzed by Antaq in the Review of the Modeling

Due to the infrastructure problems being analyzed in the privatization modeling of the Port of Itajaí, the considered Capex is currently below what is expected for activities of that type, and this has an effect on increasing the grant value.

This happens because the modeling foresees a series of cheaper investments considering the current market and the rise in product prices, in addition to considering overly optimistic demand volumes at certain times. 

Thus, all these combined factors, according to Antaq, result in uncertainty and insecurity regarding the investment that will be made in the privatization by the interested companies in the process.

The agency’s review then considers points such as cost items, demand capture, and even the restriction of participation from consortia with companies that are part of competitors in the region, aiming to ensure more security for the companies intending to participate in the concession project. 

Although the review has not yet been completed by Antaq, the port sector expects it to happen soon and that the privatization project of the Port of Itajaí will not be affected in terms of its deadlines, taking place still during this year.