Market News & Headlines >> Chinese Firms Plan Bid In Brazil Grain Rail Auction

A group of state-owned Chinese firms plan to form a consortium to bid in an auction for the right to build and operate a railroad known as Ferrogrão, Brazil's secretary for the government's public-private partnerships program said on Friday. 

Adalberto Vasconcelos said he was informed about the Chinese companies’ intention to participate in the auction during a recent trip to China. "The Chinese are very interested in Ferrogrão," he told Reuters News Service, referring to state-owned enterprises in sectors such as cement and steel. 

At 1,100 kilometers (683 miles), Ferrogrão will connect grain producing regions in Brazil's center-west to the river port of Miritituba, in the northern Pará state, where grain can be loaded onto barges for shipment to northern export ports. The railroad is expected to be an alternative to the BR-163 highway, (the “soy highway”) which is currently the only way to transport grains from central Brazil to northern ports. Estimates are the project will require $3.89 billion in investments.