Brazil aims to double its railway network, but the cost of R$27 million per kilometer and environmental hurdles stall the locomotives of development.

“When we talk about mining, the perfect project is one that has all three ends: mine, railway, and port,” says Solange Costa, a lawyer specializing in mining. The phrase reveals the structure of a business that moves 406.6 million tons of iron ore annually on Brazilian rails, but it also exposes the frustration of a country that has never been able to replicate this model for other productive chains.

The numbers are clear: 73% of national rail cargo in 2025 was ore, with Vale moving 301 million tons on its own networks. Outside this closed ecosystem, agribusiness placed only 104.4 million tons on the rails, corresponding to 19% of the total, as pointed out by the InvestNews portal.

The mathematics of expansion is relentless and helps explain the imbalance. Each kilometer of railway costs, on average, R$27 million, more than three times the cost of a kilometer of highway, which is around R$8 million. The financial return can take decades and, even in rich countries, requires heavy state subsidies.

The federal government is now attempting a new cycle of auctions with eight projects totaling 9,000 kilometers and R$140 billion in planned investments. Of this package, three involve entirely new lines, while the rest recycle existing networks. The question hanging over the sector is where the money will come from. “Today, I don't see this having 100% private demand. I don't see that viability,” summarizes a source with market experience.

The most symbolic — and stalled — project is Ferrogrão, designed to connect Sinop, in northern Mato Grosso, to Itaituba, in Pará, creating a grain corridor to the ports of the Arco Norte. The railway entered the federal agenda in 2014, but since then has languished in environmental disputes that landed at the Supreme Federal Court, involving the reduction of the protected area of the Jamanxim National Park. The recent STF decision to validate the law that altered the park's boundaries opened a window, but environmental licensing remains the main knot of the undertaking.

Another strategic axis is the Leste-Oeste Corridor, which plans to connect the Fico and Fiol railways along 1,700 kilometers between the Center-West and the ports of Bahia. The Kartado platform details that Fico and Fiol are already underway within the Growth Acceleration Program, but the physical integration between them still depends on new investments in concession and sub-concession. The corridor promises to shorten the distance between Mato Grosso soy and the Port of Ilhéus, reducing dependence on the saturated Port of Santos.

It is precisely at this point that the Chinese presence ceases to be geopolitical speculation and becomes a concrete piece of the logistical equation. The state-owned CCCC, which is already taking root at the São Luís Port, in Maranhão, has expressed formal interest in the Fico-Fiol corridor, while CRRC, the world's largest train manufacturer, is preparing a factory in Araraquara with an initial investment of R$50 million. The Shanghai government, in turn, is articulating a special financing line from BNDES with terms of up to 60 years for payment, a horizon that no private Brazilian bank would dare offer.

The Chinese appetite has a harsh logic: 70% of the soy and corn imported by China comes from Brazil, turning Brazilian logistics into a matter of food security for Beijing. The state-owned Cofco already operates as one of the largest grain exporters in the country, buying from Brazilian farms and shipping to the other side of the world. For the Chinese government, investing in rails here means lowering the cost of the final product that reaches the Chinese consumer's table, even if the railway takes decades to yield a financial return.

The memorandum of understanding signed in July 2025 between Infra S.A. and the China Railway Economic Planning Institute takes this logic to the extreme. The agreement foresees studies for a transcontinental railway from Ilhéus, in Bahia, to the port of Chancay, in Peru, cutting through Goiás, Mato Grosso, Rondônia, and Acre, according to a report by G1. The route would reduce the transit time of Brazilian cargo to Asia from 40 to 28 days, a logistical gain that stirs the geopolitics of the Pacific.

The bet on intermodality and public-private partnerships, however, runs up against a Brazilian railway network that still mostly operates on narrow-gauge tracks with routes designed for 20th-century mining. The recent regulation of the Dispute Board by ANTT attempts to create arbitration mechanisms to avoid excessive judicialization of concession contracts, but the measure is palliative in the face of the central problem: the construction cost of a new railway is prohibitive without a strong state as guarantor. While BNDES designs long terms and China scours the projects with strategic interest, the locomotives of Brazilian development keep slipping more in the offices than on the rails.