Damage to Logistics

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Source: Semana Económica

The damages of FEN will have a medium-term impact. The sector represents 7.2% of Piura’s GDP.

The recovery will depend on the speed with which the transport routes are reconstructed, mainly the terrestrial ones. 1,700 km of roads have been destroyed and its total reconstruction cost would amount to US$ 1,479 million, according to APOYO Consultoría (AC).

“The accesses (land) from Virú (south of Trujillo) to the north have been blocked. The supply to Piura, Chiclayo and part of Trujillo has been carried out via coasting trade”, says Andrés Diez, Yobel SCM corporate manager.

FEN raised the operating costs of both carriers and their clients. The cost of transporters to supply the affected areas increased more than 300%, adds Diez. After that, Yobel’s sales dropped 25%, of which 17 percentage points were due to damages from the north. Although the companies most affected by transport have been the mass consumption, fashion, textile and direct sales segment, the increase in distribution and transportation costs in the medium term will vary depending on the type of product. At least in the short term, the transport of heavy loads of construction inputs will face greater difficulties due to the size of the vehicles required for these tasks and the use of alternate routes. “It has been decided to split the load into smaller vehicles, which increases the distribution cost by (around) 10% for each fractional load”, adds Ángel Becerra, director of GS1.

AC points out that the rehabilitation of the Panamericana Norte highway, with the exception of the 450 km Del Sol highway that connects Piura with Talara, will be quick due to private concessions. The latter could accelerate the demand for transport services in 2018.

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