Bloomberg — Brazil could auction a controversial grain railway project crossing through a swath of the Amazon rainforest next year after legal hurdles are resolved, according to a top government official.
A large business group already has investment plans for the railway that would connect Brazil’s soybean belt with northern ports to ship the beans to Asia, said Infrastructure Minister Tarcisio de Freitas. The project measuring nearly 1,000 kilometers (621.37 miles) has been halted by a supreme court justice over fears of deforestation.
“The judicial issue is simple to resolve,” Freitas said in an interview in Madrid during a roadshow of airports, ports and highways. The sale of the 25.2 billion reais ($4.6 billion) railway license “could come next year, but most importantly it will happen because it is a necessity for Brazil,” he said.
The railway, known in Portuguese as Ferrograo, is a flash-point between global activists and President Jair Bolsonaro’s administration. Environmentalists warn that the project will bring further destruction to the Amazon by encouraging land development and endangering nearby indigenous communities. The government says it will boost one of the world’s top agricultural export sectors and that the environmental impact will be limited.
The railway will be built 40 meters from an existing road, thus minimizing environmental damage, Freitas said, adding that it will replace grain-laden trucks that discharge one million tons of carbon dioxide every year. He also said the project would not encroach on any indigenous land.
Allegations of environmental devastation stem from an international commercial war aimed at undermining the agriculture sector in Brazil, one of the world’s biggest producers of grains and meat, he said. Thwarting the railway project would make the country less competitive against other major soft commodity producers.
“When the Ferrograo starts operating, costs for producers will drop by 40%, and that scares a lot of people,” Freitas said. “So, in order to destroy the Ferrograo project they keep the focus on the environment.”