Company inks joint venture with Log-In Logistica Intermodal
TBS International has gained a foothold in Brazil’s coastwise shipping industry, via a joint venture that would ply three Brazil-flagged tweendeckers in the cabotage trade for break-bulk, heavylift and project cargo.
The Nasdaq-listed tweendecker and dry bulk major has a 70% stake in an entity called Log.Star Navegação, with listed Brazilian logistics and coastal shipping major Log-In Logistica Intermodal holding the other 30%.
Log.Star now has acquired its initial fleet and obtained commercial licensing required to start business, TBS chief executive Joseph Royce told Lloyd’s List.
Mr Royce said his company’s move into Brazilian coastwise trades is driven by a strong growth anticipated in the country’s economy and infrastructure development, the huge coastline, and an environmentally driven expectation that truck transport would gradually give way to coastal ships.
“The truck option is increasingly not viable – Brazil is the same as any other country,” Mr Royce said.
Log.Star begins life with three ships being pumped in by Log-In Logistica – the 11,274 dwt trio Log-In Belém, Log-In Macau and Log-In Manaus. The ships are all Brazilian-flagged, Brazilian-crewed and Brazilian-built.
Log.Star intends to concentrate on the movement of break-bulk, bulk parcels, heavy lift, general and project cargoes along Brazil’s coastline and Amazon River basin.
“TBS expects to use its international break-bulk shipping expertise to meet the growing demand of these lanes,” the company said in a statement.
Mr Royce said the three ships are coming out of semi-layup, and would be bareboat chartered to Log.Star.
Log-In Logistica’s fourth quarter report for 2009 noted that the trio was part of five ships laid up because of a realignment of the company’s coastal service, which in turn was driven by a need to cut costs in face of the economic slowdown.
Mr Royce said the partnership between TBS and Log-In Logistica would afford opportunities for the joint venture to use TBS’ non-Brazilian ships on a single voyage basis.
Vale and Petrobras’ pension fund are shareholders in Log-In Logistica.
TBS’ international fleet comprises about 50 ships, divided evenly between handy bulkers and tweendeckers.
Additional reading: TBS International’s Brazilian Joint Venture Establishes Brazil Flag Service