“There have been severe consequences in the logistics sector, which I would separate into three phases. When the pandemic hit, there was a lot of uncertainty and strict lockdowns in countries such as Argentina, Peru and Ecuador that caused consumption across the region to decrease. The Brazilian market represents 80% of Newport’s Latam volume, and this also suffered during the pandemic, but less so than neighboring countries.
As we entered the third quarter of 2020, we began to notice a slow recovery in consumption, consequently, more logistics contracts started to come in and the supply chain accustomed to restrictions, albeit prices went up and delays remained. In 2021 there has been a visible recovery, with the petrochemical and chemical industries going back to their usual production volumes.
Meanwhile, the maritime logistics business has been recovering, but the ocean freight industry is not easy to modify overnight as it requires strategic planning. There is more demand now, nevertheless, supply is restricted in terms of ocean freight availability. As far as costs are concerned, prices have been accepted because there has simply been no other option and the chain has adapted to the situation. However, I believe that by 2022 logistical costs will start to decrease as availability improves.”
Fabiano Machion, General Manager – South America, Newport Tank