According to Wolfgang Goerlich, President of the Center of Tannery Industries of Brazil (CICB), increasingly frequent cancellations of ships at main Brazilian ports has caused enormous damage to exports of leather. He said that vessel owners blame the poor conditions and overcrowding for the problem and pointed out the high costs and delays at ports, which often do not meet minimum requirements for vessels arriving and leaving on time. This is the main reason for the rerouting of vessels and cancellations.
Goerlich said that companies processing and producing of leather attached to the CICB have suffered losses from this situation, "which is very serious in the ports in the northeast, especially in Salvador and Santos as well as Rio Grande do Sul.”
The President of the CICB affirmed that cancellations had reached 20% and damages for failure to embark on contract dates agreed had caused losses of between R$150 and R$200 million as well as damaging the reliable reputation of companies in the eyes of customers abroad.
The tanning industry in Brazil, responsible for fifty thousand jobs, depends on exports to sell more than 50% of its production. Despite all the difficulties the industry contributed a significant 11% to the Brazilian trade balance in the first seven months of 2010.
“Our industry has mobilized all possible resources and made major efforts to restore and increase our exports after the crisis of 2008/09. Despite the unfavorable exchange rate and high costs in Brazil, extraordinary results have been achieved,” added Goerlkich.
Goerlich estimated that if Brazil had a proper infrastructure combined with a modern port facilities, instead of exporting US$ 1.7 billion worth of leather (forecast for 2010), it could reach $ 1.9 billion. Before the port situation became critical, the CICB sent a document to all spheres of government warning about the problem and asking for urgent solutions.
Source: Exclusivo Translation from Portuguese and editing Richard Smith
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