On November 25, Brazilian Minister of Transport Renan Filho announced the government’s new freight concession policy that introduces a new financing model that combines public and private financing.
Setting clear guidelines for the planning, governance and sustainability of new construction projects, the new policy will see the Department for Transport award eight concessions next year covering more than 9,000 kilometers of new and existing railway.
According to the ministry, this is expected to attract financing worth 140 billion riyals (US$26.3 billion), opening the way for a total of 600 billion riyals of investment in the railway network. New financing sources could include real estate development, while the National Bank for Economic and Social Development (BNDES) will participate in developing new lending instruments for the railway sector.
The timetable for awarding the eight concessions in 2027 is as follows:
- April: Minas – Rio Pass
- June: Southeastern Railway Loop
- July: Western Network
- August: East-West corridor
- September: Grain Railroad, the
- December: Southern Network, Paraná-Santa Catarina Corridor;
- Southern Grid, Rio Grande Corridor;
- Southern Grid, Mercosul Corridor.
In each case, the concession will be awarded by public auction, with bidding documents made available three months prior to the auction. Documents for the ninth concession, covering the northern extension of the north-south railway, will be published in December 2026 ahead of the auction scheduled for March 2027.
The Ministry of Transport says thousands of jobs will be created when concessions open railway construction projects. It highlights Grain Rail’s project to build a new line from Sinop in Mato Grosso state to Itaituba in Pará which has the potential to create more than 100,000 jobs during construction.
Under the new concessions policy, the government will be responsible for obtaining environmental approval for new construction, avoiding litigation, increasing legal certainty, and ensuring that work can be completed more quickly, according to the ministry.
Renewal of privileges
Since taking power in 2023, the administration of President Luiz Inacio Lula da Silva has sought to accelerate the pipeline of shipping concessions, although progress has been slowed by the complexity of attracting private capital. In order to reduce risks and stimulate participation, the government has adopted a strategy for early renewal of concessions. Under this model, operators receive extended contracts in exchange for upfront payments that are then used to fund the riskier initial years of new franchise agreements.
As part of this approach, the government signed the final contract for the early renewal of the Southeast Network franchise, which is owned by MRS Logistics. The 1,600-km network serves the states of Minas Gerais, Rio de Janeiro and São Paulo, and its concession has been extended from the end of 2025 to 2056. The renewal has freed up R$2.8 billion in funding for the federal railway programme.
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