The Loadstar leader: Santos decision on Maersk is the right one for a modern economy

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Brazil’s competition regulators appear determined to block Maersk’s efforts to bid for the next terminal concession at the port of Santos.

Under the country’s laws, operators of an existing terminal within a port are excluded from submitting first-rounds bids on another – the logic being it offers opportunity for new operators, increasing competition and preventing the build-up of monopolies, known in competition legislation circles as “a substantial lessening of competition”.

There is nothing particularly unusual about this, authorities around the world have legislative provisos to prevent companies acquiring too much market power – in liner shipping for example, EU guidelines say a carrier or VSA should have a maximum market share of 30%.

The BTP facility in Santos, a 50-50 joint venture between the terminal operating arms of Maersk and MSC, claims to have 1.5m teu annual handling capacity, representing around a quarter of the port’s total.

Adding the proposed 3m teu capacity of Tecon 10 would give AMPT and/or MSC up to half the port’s capacity when fully built out.

That’s a hefty market share by most standards and comes on top of local market dynamics where Maersk is part of an unofficial triumvirate – with CMA CGM and MSC – of European operators that snap up anything that hits the market, and who already respectively own Brazil’s three domestic cabotage operators.

Meanwhile, as this Premium analysis shows, Brazil has its own national champion waiting in the wings – the “mega-sized Brazilian food shipper JBS,” which this year took over the port of Itajai as part of a push into supply chains and, crucially, brings its own volumes to a port project. It has as much interest in securing terminal capacity for its exports as a carrier would to support its volumes in a port.

Does JBS have the same track record as APMT, or any of the existing Santos operators, as a terminal operator? No, frankly. Could it bring the same “value” to the Brazilian economy? Probably, and possibly more.

Underneath all this is a broader supply chain resilience story that is little different to, say, US attempts to revitalise its shipbuilding industry, or the massive state subsidies issued by China to support manufacturing supply chains over the past 25 years.

First the pandemic, then the Red Sea crisis, and now the tariff turbulence… governments have woken up to the fact that the provision of adequate supply chain infrastructure is a key component of a modern economy, which can be threatened in all manner of ways.