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  • Historic lowering of the Paraguay and Paraná rivers. How does it affect Paraguayan trade?

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    The fluvial system of the Paraguay and Paraná rivers has been at its lowest level since the last great sequence recorded in 1944, affecting the movement of cargo through the main waterway in the country.

    This river originates in the region of Mato Grosso, Brazil, and travels a short stretch across Bolivian territory before entering Paraguay in direction sur. From here, is the largest river route in the country and in some places marks the border between Paraguay and Argentina.

    After traveling 2,695 kilometers, it leads to the Paraná River, in Argentine territory. It is located among the 40 widest rivers in the world.

    Above all, the Paraguay river is the main waterway of Paraguay and together with the Paraná and the river of La Plata constitute the main route out of the Atlantic Ocean for international trade in our country.

    The reasons for the drought affecting the Paraguay-Paraná river basin are much, but experts say the intensive deforestation, the global warming and the climatological phenomenon “La Niña” as the main causes.

    What consequences have the historic low of the Paraguay and Paraná rivers?

    The impact of this decline on the level of these rivers is notable. Thousands of fishermen are threatened with losing their single ticket source and some 40 million Brazilians, Argentines and Paraguayans have been threatened with access to their main source of potable water.

    However, the descent in the level of this waterway is seriously affecting the logistics operations of importers and exporters in Paraguay.

    Its costs are high, although alternative means such as air and land transport must be used with greater frequency, whose cargo capacity is lower and more expensive.

    Bad boats but with less capacity

    According to the Center of Shipowners Fluviales and Maritimes of Paraguay (CAFYM), the boats used for the transport of goods by the Paraguay-Paraná system not able to carry a full load.

    The low level of water obliges them to occupy the soil and 35% of the capacity of their cellars to avoid run-off.

    For this reason, the businessmen are obliged to hire more boats to carry the same cargo quantity that is only 3 years ago. This situation has lost them over US$300 million since the beginning of 2020.

    The president of CAFYM, Esteban Dos Santos, informed that the number of delays in the delivery of import and export cargo has increased.

    In addition, many companies have had to change their transport routes in order to carry cargo from where the rivers are allowed to continue by land.

    An example in Asunción, north of the Paraguayan capital is practically impossible to navigate by boats at this time. On their part, just outside the city, they can sail boats with a draft of 2.65 meters (8 feet).

    For this reason, only the naves with smaller drafts can reach Asunción or Villeta, while the rest is obliged to unload in Pilar.

    Paraguay has one of the largest fleets of barges in the world and at this moment the losses are accumulating at a worrying rate.

    While the cargo that still moves by river under this contingency, the majority corresponds to exports of soybean grains and imports of mineral minerals, other grains and fuels.

    What is the situation in October 2021?

    The first crisis caused by the decline of the Paraguay river was present in the summer season of 2020. Without embargo, the situation this year, according to experts

    Since September on the Paraguay River, navigation has become impossible for tugboats, barges and boats that have more than 8 feet of draft.

    On August 23, 2021, the level of the Paraguay river fell below the hydrometric level, with an elevation of -0.71 meters above the sea level (msnm).

    For October 10, the situation had improved slightly, as it showed a level of 0.93 msnm in Bahía Negra, 1.47 msnm in Fuerte Olimpo, 0.79 msnm in Isla Margarita and 0.92 msnm in Vallemi.

    These figures are slightly hopeful, considering that on October 25, 2020, the river fell to -0.54 msnm against Asunción and at this moment it has recovered slightly to reach -0.65 msnm,

    Companies are required to change their logistics

    Due to this situation, decades of importing and exporting companies are obliged to change their transport logistics.

    The simplest solution is moving the cargo from where the rivers are allowed and continuing from there by land or air.

    The problem is that water transport is always cheaper when it comes to large areas of cargo.

    What happens with the dredging of the Paraguay river?

    If the Paraguayan Government is moving ahead, the dredging of the rivers is as fast as possible, it is estimated that only 20% of the Paraguay river channel has been cleared and there is no way to complete the work before diciembre.

    In addition there are criticisms of dredging work that is carried out in places such as Itapirú, Yvyratí, Villeta, Vuelta Queso and Lovato, which should be at least 10 feet and ground to 7.5 feet. This dredging level is insufficient for the tugboats to operate safely.

    In addition, the beginning of the river dredging was delayed by a company’s protest against the bidding organized by Construcciones Públicas. This forced us to reevaluate the offers of the participating companies and lost valuable time to start the work.

    At this moment there are 10 dredgers cleaning the Paraguay River, belonging to the companies T&C, Tosa y Arte y Estructura SA.

    But this is insufficient to address the more than 70 critical points that have been identified from the Apa River to the mouth of the Paraná River.

    We offer you assistance to reorganize your river transport plan

    At Alfa Trading we offer you our experience and advice to redesign your international logistics project in these moments of contingency.

    We are prepared to give you support in the search in the most efficient way to move your cargo through this situation that affects the rivers of the country.

    We have more than 28 years of experience in multimodal transport and we can help to reorganize your cargo movement plan in a less expensive and fast way.

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