BRAZIL CONTAINER PLANT WILL EASE BOTTLENECK

BRAZIL CONTAINER PLANT WILL EASE BOTTLENECK

American companies importing manufactured products from Brazil and U.S. subsidiaries doing business here can look forward to an improvement in this country's chronic shortage of shipping containers next year.

Sea Containers Ltd., an international container manufacturer and fleet owner, has set July as the tentative start-up date for a new Brazilian container manufacturing plant located near the Port of Santos.The $12 million plant, Sea Containers' 10th, will produce up to 12,000 units a year of standard 20-, 40- and 48-foot containers for dry cargoes. Management expects to turn out 6,000 units during the first year of operation.

Production costs are projected at between $2,800 and $3,000 a box. The company plans to export 70 percent of its Brazilian production, leasing the containers in one-way operations itself or through third parties.

This marks the first attempt to manufacture containers in Brazil since the French company Luxair produced a few here in an abortive effort in the 1970s.

"Their problem was higher Brazilian production costs," Alfredo Costa Neto, industrial director of the new plant, said. International prices, about $1,800 a box at the time, have since caught up with Brazilian prices.

For years Brazil has posed special headaches for container owners and users.

With the government pushing exports and suppressing imports in its efforts to resolve chronic balance of payments problems, traffic in boxes has been seriously one-sided since the outset of the international petroleum crisis in the mid-1970s.

The rapid increase in manufactured exports, which demand better transport handling, also contributed to the container bottleneck.

"For every (loaded) one that comes in, two leave," said Mr. Costa Neto.

As a result, industry suffers a chronic shortage of containers for its manufactured exports, and users regularly shoulder the approximately $500-a- box cost of relocating empties.

In Brazil for seven years now, Sea Containers also operates a container terminal and repair company, Paulista Containers Maritimos Ltda., at Santos.