The November 14, 2024 inauguration of the agricultural export-inclined port of Chancay in Peru will open up Asian-Latin American trade.
During the event, China’s president Xi Jinping hailed the $1.3-billion undertaking north of Lima as a logistics game-changer.
According to Xi, the port that his country’s Cosco Shipping LLC built, marks the beginning of the “21st century maritime Silk Road.” This is a reference to the ancient Chinese trail of trade routes with especially the southern hemisphere.
He added that it will cut intercontinental export logistics expenditure by 20% and bring $20 billion in annual turnover.
The gateway will improve the competitiveness of Peru’s fresh produce in the Far-east market by reducing voyage time by a third. Currently, navigation from other ports in the country to China takes 35 to 45 days. Arguably, Chancay’s port will slash the duration to as little as 23 days.
The initial ship to sail from the new port will be a fruit carrier, underlining the port’s strategic importance to Peruvian agriculture.
Brazil to Connect to the Port
Regional agriculture will also connect with the port, particularly Brazil’s soybean exports, which could transit to China via the port.
Accounts indicate that China’s chief reason for developing the megaport was to improve export connections with Brazil’s soy and iron ore.
Beijing has begun to plan a rail connection from Brazil to Chancay as a way to reduce circumnavigation costs.
According to a report by Reuters on November 14, 2024, the cost of building the railway could reach $3.5 billion.
In expanding trade routes, Beijing aims to tap resource-rich countries as buffer against long-term tariff war with the United States.
Ultimately, the port will be a primary gateway for Asia to South American farm goods such as meat, corn, fruits and oilseeds. To learn more about the agricultural importance of the port, below are salient facts on size and more.
Port of Chancay Statistics
A port whose conception began in 2018, with construction taking place between 2021 and and 2024, Chancay cost $1.3 billion to develop. Its ownership is by bilateral consolidation. China’s builder, Cosco, has a lion’s share of 60% in shares while Peru’s metal company, Volcan, retains 40%.
How big is the agricultural hub of the port?
The port has a 1.5 km-long quay that can hold up to four large cargo ships at a time. This means that several agricultural shippers can manage exports, simultaneously.
What is the capacity of container feet of the port?
Due to its deep water reach of 17.8 m deep, Chancay has the capacity for 1 million twenty-foot equivalent (TEU) containers in four berths. This capacity will in the future expand to 1.5 million TEUs.
Which countries will benefit from the port?
Asian nations on the west Pacific such as Japan, South Korea and China will benefit from the reduction of shipping time by 10 days. In Latin America, Brazil, Bolivia and host country Peru will gain from the port for agricultural shipments. These include grain, soy, meat and fruit, as well as metal ore. Brazil will benefit greatly, given that its soybean exports to China had already risen year-on-year by 211% to 6.96 million tonnes in both January and February 2024. Annual revenue from international trade activities at the port will total $4.5 billion, alongside 8,000 new jobs.