View
1
Download
0
Category
Preview:
Citation preview
1 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Copyright ©
Sobratema 2014
Construction in Brazil CONEXPO-CON/AGG Emerging Market Session
Las Vegas, March 5th, 2014
Paulo Oscar Auler Neto, Vice President, Sobratema Superintendent for Equipment Acquisition, Odebrecht Brazilian Association of Technology for Construction and Mining
2 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
BR-020, Goiás – photo CNT
Contents About Sobratema Economic indicators Challenges and opportunities in infrastructure Significant projects Infrastructure concessions Equipment market
3 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Three SOBRATEMA trade fairs – one per year – your gateway to Brazil
June, 2015 June 3-6, 2014 June, 2016
• Created 1988
• 1,052 members, counting companies and professionals
• Unique concept: brings together equipment manufacturers, rental companies, construction companies, importers, parts makers, others
• Unique market intelligence: annual equipment study, investments study
• Works + infrastructure
• Equipment + materials
• Project management
• Logistics, HR, ITC + administration
• Huge market for parts + services
• Total equipment population in 2015: 710,000 units
• More than 110,000 constructors and 12,000 maintenance companies
The 2012 fair:
• 1,042 brands; 494 exhibitors
• 224 international
• Visitors: 54,597 (2,053 foreign)
• Business volume: US$600 mm
• Total area: 85,000 m²
All in São Paulo, Brazil
About SOBRATEMA
4 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
-2
0
2
4
6
8
GDP Growth
2000 2010 2005 2015
% p.a.
GDP ranking 2012 - IMF 1 United States 2 China 3 Japan 4 Germany 5 France 6 United Kingdom 7 Brazil 8 Russia 9 Italy 10 India
Economic indicators #1
Brazil’s slow emergence • Commodities boom helped drive growth • Now, reforms are needed • Presidential election in October 2014
5 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Population 202 million
GDP US$2.5 tri
GDP/capita 12,400
Unemployment 5.4%
Inflation 5.6%
Foreign reserves US$376 bi
Top imports (2012) Fuel + lubricants,
mechanical equipment, electrical/electronic equipment, vehicles + parts, chemicals
Top exports (2012) Minerals, oil+fuel,
soy complex, vehicles + parts, engineering products
-10
0
10
20
30
40
50
2000 2002 2004 2006 2008 2010 2012
Trade surplus US$ bi p.a.
0,20
0,30
0,40
0,50
0,60
0,70
2000 2002 2004 2006 2008 2010 2012
Exchange rate R$-US$
Brazil’s challenge
Economic indicators #2
Challenges • End of commodities boom • Must boost productivity
6 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Risks to growth of the Brazilian construction equipment market through coming years Possible domestic factors
• Continued under-investment in infrastructure
• Low economic growth
• Bottlenecks – mainly lack of skilled labor
• Political inability to move projects forward at required speed
Possible external factors
• Fall in global commodities demand
• General international insecurity
Infrastructure: challenges
Sobratema surveys of construction and equipment rental companies
Problems 2013 (%)
Project delays 76 Lack of specialized labor 24 Cost of labor 24 Lack of credit to buy equipment 5 Lack of equipment for purchase 0 Nothing significant 3 Cause of project delays Rank (2011-13)
Environmental licensing 1 Slow payment 2 Tender delays 3 Injunctions 4
BR-116, Serra do Cafezal, SP
7 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Infrastructure: opportunities
Huge requirements
• Brazil has 96,714 km of highways, of which: - 39% in bad or terrible condition - 36% in good or excellent condition (National Transport Confederation survey 2013)
• Vehicle fleet: 80 million (Sept. 2013, Denatran)
• Fleet growth (CAGR) 2003-2013: 8.35% (Denatran)
• Population growth (CAGR) 2003-2013: 1.29% (IBGE)
• Air travel – passenger growth (CAGR) 2006-2012: 11.19% (Infraero)
• Foreign trade (US$ imports+exports, CAGR) 2003-2013: 14.94% (Bacen)
• Power consumption (MWh/yr, CAGR) 2004-2013: 3.86% (EPE)
• Shopping malls (CAGR) 2006-2014 (est): 5.48% (Abrasce)
• Rail freight is ≈ 30% of national total; goal is 35% by 2025 (Transport Ministry)
BR-122 in Bodocó, PE – Photo CNT
8 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
BR-020, Goiás – photo CNT
Significant projects
9 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
US$13 billion 11,233 MW
• Firm capacity: 4,571 MW • Where: Xingu River • On stream: 2016 • US$800 m. for mitigation +
sustainable development
Three main dams • Maximum height: 90 m • Total length: 10,144 m • 30.36 million m3 rock, earth,
concrete movement • 20x550 MW Francis turbines • Lake 516 km2 • Norte Energia S.A. –
(consortium, 10 companies)
World’s 3rd largest hydropower dam
Belo Monte
10 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
2016 Olympic Games
• Direct cost: US$2.8 billion
• Stadiums, urban transport systems, etc: US$11 billion
• Most major projects now under way
• Many billions of dollars of private investment also expected: hotels, etc
• Games take place at four main venues, all within the city
Legacy → urban transportation, athletes village, sports facilities, new cruise liner terminal + dockland redevelopment
Olympic Park
World Cup → Olympic opening and closing ceremonies in the Maracanã Stadium, rebuilt for the 2014 World Cup
11 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
• One of four BRT projects in Rio
• Connects North Zone to Barra beach, site of Olympic village
• 23-km BRT and light vehicle toll-road
• 3 lanes each way: 1 BRT + 2 other traffic + local
• 18 BRT stations, no stop-lights
• Completion 2016; part of Rio’s Olympic legacy
• 35-year PPP concession, awarded 2012
• Consortium: Odebrecht, CCR, Invepar
• Construction cost =/- US$800 million
• 90,000 vehicles/day; 400,000 passengers/day
All conversions at US$1.00 = R$2.00
BRT in Brazil
• Nine other BRT projects for Olympics + World Cup
• Big demand after demonstrations for better public transport
• 2015-2019 Development Plan – “PAC-3” – likely to feature urban mobility systems
Rio TransOlímpica BRT
12 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
First Metro (subway) BOT concession awarded as PPP
• Line 6-Orange: 15.9 km, 634,000 passengers/day
• 15 stations including 3 interchange points with existing network
• 25-year BOT concession awarded 2013; work starts 2014; partial operation in 2018
• Consortium “Move São Paulo”: Odebrecht/Queiroz Galvão/UTC/Fundo Eco Realty
• Likely cost US$3.9 b; state will contribute up to 50%
All conversions at US$1.00 = R$2.00 São Paulo Metro and urban rail
Line 6
Expo Park extension
Metro system in São Paulo
• São Paulo has 74 km, 5 lines, 64 stations
• 3.4 million passengers/day
• 1 line already operating under 30-year PPP
• Goal is 150 km by 2020
• Integrated Metro+urban rail system is 330 km
Metro systems in Brazil
• Brasília, Fortaleza, Porto Alegre, Rio, Salvador
• Another 10 cities have metro systems under construction or under study
• Challenge is to increase investment
São Paulo Metro Line 6 PPP
13 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
BR-020, Goiás – photo CNT
Major concessions
14 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
US$ b Status February 2014
Highways 7,500 km 21.0* 5 concessions auctioned
Railways 10,000 km*** 45.5* Auctions delayed to 2014?
High speed rail 511 km 17.8 Project in doubt
Ports 159 27.3 Delayed; 5 terminals authorized
Airports 2 international 9.4** 2 concessions auctioned
Logistics subtotal 121.0
Oil & gas 3 bidding rounds 40.0 Auctions held; reduced interest
Power generation 32,971 MW 74.0 Auctions held normally
Transmission 23,200 km
TOTAL 235.0
** Includes expected investments in several regional airports *** May increase to 11,000 km
Source: Ministry of Finance, Feb. 2013 All conversions at US$1.00 = R$2.00
* 60% through 2017
President Dilma Rousseff announces concessions program Aug. 2012
Federal concessions program
15 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Hydropower + transmission lines
Major hydropower auction due 2014
• Tapajós river: 6,133 MW, possible expansion to 7,880 MW
• Output: 29,550 GWh/year; start operation 2018 or 2019?
• Lake 722 km2
• Head of water: 35.9 m
• Turbines: Kaplan; 31 x 198 MW; 2 x 109.2 MW
• Largest of five-dam complex, total 10.682 MW
Hydropower concession auctions scheduled
Year Stations MW Investment US$ bi 2014 7 7,241 12.2 2015 3 3,249 6.2 2016 2 1,117 2.7 2017 6 8,407 15.8
Other auctions due through 2017
Type Investment MW US$ bi Wind power 11.9 5,720 Bioelectricity 3.5 3,160 Small hydro (<30MW) 3.6 1,170 Gas-fired thermal 1.5 1,500 Transmission lines: 8.6 14,070 km
Chinese investment: 2,092 km transmission line from Belo Monte auctioned Feb/2014; 800 kV; investment > US$ 2 bi; won by China’s State Grid Corporation with Brazilian state companies Furnas and Eletronorte.
16 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Oil & Gas
Petrobras investment plan 2013-2017
• US$236.7 bi – 62% exploration + production; 18% refining
• Crude oil: planned production ramp-up (million BOPD): end 2013 – 2.0; 2017 – 2.75; 2020 – 4.2
• 11 new offshore production platforms on-stream through 2015
E&P auctions in 2013
11th round: on-shore + conventional off-shore Potential: 7.5 billion barrels
Auction: May, 2013, 30 companies bidding
12th round: non-conventional (shale basins) Potential unknown; mainly gas?
Auction: November, 2013, limited interest
Libra field: auction October 2013, just one bidder Petrobras (40%), Total (20%), Shell (20%, CNOOC (10%), CNPC (10%)
R$15 billion signature bonus
Sub-salt petroleum • Recent discovery; ultra-deep offshore; technical challenges • Total potential unofficially estimated as high as
80 billion barrels; 1st auction potential: 10 billion barrels • New concession format: production sharing • Petrobras is operator; minimum 30% stake
Next auctions: probably in 2015
17 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Coming next
689 regional airports • 270 in first phase of program • US$3.6 b of public investment (est.) • Administrative concessions
Opportunities
• New concessionaires now planning mandatory expansion
• Airlines say Brazilian airports need US$28 bi of investment through 2020 to meet traffic growth
6 airport concessions already auctioned
Airport Price paid Min. investment
1. Natal (RN) US$85 m US$325 m 2. São Paulo (SP) US$8.1 b US$2.3 b 3. Campinas (SP) US$1.9 b US$4.4 b 4. Brasília (DF) US$2.3 b US$1.4 b 5. Rio de Janeiro (RJ) US$8.5 b US$3.3 b 6. Belo Horizonte (MG) US$900 m US$2.4 b
❹
❺
❻
❶
❷ ❸
All conversions at US$1.00 = R$2.00
Airport concessions
18 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Transnordestina railway, 1,728 km, moving
ahead slowly with public financing
• 12 concessions planned for 2013, involving US$45.5 bi of investment over 25 years
• None went to auction
• Difficulty in finding adequate economic + legal structure
• Other projects are underway with public investment
All conversions at US$1.00 = R$2.00
Railway concessions
19 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Investment (first block):
• US$11.8 b in first 5 years
• US$9.2 b in 6 – 20 years
Six auctions in 2013: • Five awarded, one failed (no bidders) • Challenge is to accelerate investments
PAC under way
Existing
First block – 9 lots
Brazil highways snapshot:
• Government struggling to attract private investment while keeping tolls low for social, economic reasons
• Some concessions may become PPPs
• Big demand if/when viable model is found
Highway concessions
Auction successful
Auction failed
Second block announced 2014 5 lots; 2,625 km; US$8.9 bi
Source: federal government: Dec. 2012; Feb. 2013; Jan. 2014 ; conversions US$1.00 = R$2.00
20 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Investments could total US$27.1 b
Investment schedule • US$15.5 b through 2014/15 • US$11.6 b in 2016/17 As announced by gov’t in 2012
Two main options • Private terminals: concession • Public ports: leasing of terminals
❹
❺
❻
❼
❶ ❷
❸
All conversions at US$1.00 = R$2.00
16 concessions – first auctions 2014? Largest: Investments 1 Vitória (ES): US$6.7 b 2 Itaguaí* (RJ): US$5.8 b 3 Itaquí (MA): US$2.3 b 4 Belém* (PA): US$2.3 b 5 Paranaguá* (PR): US$2.2 b 6 Aratu* (BA): US$2.0 b 7 Santos* (SP) US$1.9 b
Note: Values include investments at concessions and leased terminals * Concession for more than one ports
Brazil ports snapshot:
• 34 public ports; 35% of cargo tonnage
• 128 private terminals; 65%
• Total 2012 tonnage: 904 million
• Investments needed: dredging, quays, equipment, access
Port concessions
21 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
BR-020, Goiás – photo CNT
The Brazilian construction market
22 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
Established manufacturers (date of factory opening)
Atlas Copco (1995) Case (1970, 2009) Caterpillar (1960, 2011) Ciber (1958)
JCB (2001) Komatsu (1975) Liebherr (1974) New Holland (1970)
Schwing Stetter (1975) Terex (2002) Volvo (1975)
Recent manufacturers
Ammann Bomag Doosan Hyundai
John Deere Hitachi Manitowoc Putzmeister
Sany Tadano XCMG Zoomlion
Equipment market: major players
Broderson Daemo Dieci Genie Hamm
Haulotte Herrenknecht IMER JLG Link-Belt
LiuGong Lonking Manitou Merlo Metso
Shantui Sandvik Sullair Sunward Skyjack
XGMA
Selected importers
23 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
• All equipment: growth 2014/2013: + 1.8%; CAGR 2013-2018: + 6.6%
• Earthmoving equipment: growth 2014/2013: - 3.3%; CAGR 2013-2018: + 5.5%
Sobratema Study of the Brazilian Construction Equipment Market 2013-2018
2007 2009 2011 2013 2015 2018
60
40
20
0
80
100
83,545
30,645
34,521
11,691
74,135 102,000
43,580
33,355
‘000 units
All equipment
Earthmoving equipment
“All equipment” includes earthmoving equipment, portable compressors, tower cranes, hydraulic cranes, aerial work platforms, telehandlers, and an estimate of agricultural-type tractors and highway trucks used in construction. Source: Sobratema Market Studies 2007-2014
forecast
Equipment market: growth
Sobratema forecasts
24 Copyright © Sobratema 2014
Sobratema for CONEXPO-CON/AGG 2014 Emerging Market Session
BR-020, Goiás – photo CNT
Paulo Oscar Auler Neto, Vice President, Sobratema Brazilian Association of Technology for Construction and Mining Superintendent for Equipment Acquisition, Odebrecht poaneto@odebrecht.com Sobratema: (55) 11 3662-4159 www.sobratema.org.br sobratema@sobratema.org.br
Thank you!
Recommended