The Capricorn Bioceanic Corridor, a new logistics artery that will connect Brazil, Paraguay, Argentina and Chile, is expected to boost agricultural product exports — such as meat, processed foods and cellulose — from the region to Asian markets, while increasing imports of fertilizers and farm inputs, according to the agriculture and livestock federation of Mato Grosso do Sul state, Famasul.
The corridor will reduce the average transportation time for Brazilian goods to Asian ports to 42 days from 55 days, reducing logistics costs by around 20pc, according to the government of central-western Mato Grosso do Sul state. Approximately 65pc of the state's exports, which is an important agricultural production hub, are destined for Asian countries. The route could also encourage exports to potential markets in Oceania and the Americas' west coast.
New road route crossing South America
The 3,250km (2,020-mile) road route will reduce dependence on other logistics routes, as well as the cost of freight to Asia, Famasul said.
It will connect the Chilean ports of Iquique, Antofagasta, Mejillones and Tocopilla to the Brazilian port of Santos, crossing eight territories in four South American countries: the regions of Tarapaca and Antofagasta in Chile; the provinces of Jujuy and Salta in Argentina; the departments of Boqueron, Presidente Hayes and Alto Paraguay in Paraguay; and the states of Mato Grosso do Sul and Sao Paulo in Brazil. It will cross tropical wetlands, grasslands, the Andes mountains and the Atacama desert of Chile to reach the Pacific Ocean.
The 24,000km span between Brazil and China would be reduced by approximately 5,479km, according to Famasul. In 2023, the Asian country was the final destination of around 34pc of all Brazilian agricultural exports, according to the agriculture and livestock ministry.
The Santos port, one of the main shipping points for Brazilian goods, handled more than 131mn metric tonnes (t) of agricultural products in 2024, according to the Santos Port Authority (SPA), with emphasis on sugar, soybeans, corn and coffee shipments. Vessels traveling from Santos to China must cross the Panama Canal or the Cape of Good Hope, taking more than 50 days to make the journey.
Main challenges
One of the project's main challenges is that Brazil and Paraguay are not part of the International Transport of Goods under Cover of TIR Carnets, according to Mato Grosso do Sul state government.
This agreement aims to promote seamless multilateral road transport, simplifying and standardizing processes.
Brazil's acceptance to the agreement has been under discussion in congress since September 2024, while Argentina, Chile and 76 other countries have joined it. Mato Grosso do Sul's government said that it is necessary to unify migration and customs processes to make the future corridor a high-performance logistics route.
While Brazil's entry now depends solely on congressional approval, Paraguay has not yet begun its accession process.
Standardizing customs requirements between Brazil-Paraguay would reduce the waiting period for import and export processes by 90pc, according to Mato Grosso do Sul's government. Currently, customs clearance takes up to 20 days and is carried out between the cities of Ponta Pora, in Mato Grosso do Sul, and Pedro Juan Caballero, in Paraguay. The expectation is that the waiting period would take up to two days after both countries join TIR.
Construction and start of operations
The main hurdle to build the route is the binational bridge over the Paraguay River, between the cities of Porto Murtinho, in Mato Grosso do Sul, and Carmelo Peralta, in Paraguay.
Construction work of the 1.3km-long and 350m-wide bridge has advanced by about 65pc and is expected to be completed in the first quarter of 2026, according to the Paraguayan public works and communications ministry. The R576mn ($99.7mn) project was funded by the Itaipu binational hydroelectric power plant administration, which the two countries share.
Also, about 225km of roads still need to be paved on the PY-15 highway, between the Paraguayan cities of Mariscal Estigarribia and Pozo Hondo, on the border with Argentina.
A second binational bridge over the Pilcomayo River — between Pozo Hondo, in Paraguay, and Mision La Paz, in Argentina — is still on the drawing board, as is another 20km unpaved stretch on the Argentinian side.
The financial fund for the development of the countries of the Río de la Plata basin, Fonplata, financed approximately $354mn for works on the Paraguayan side and is negotiating contributions with the Argentinian government to complete the construction there. The Inter-American Development Bank contributed $600,000, with the Brazilian government providing another R472mn ($80mn).
