New Silk Road: impacts on the commodities market

The New Silk Road (or Belt and Road Initiative - BRI) is one of the most ambitious initiatives of the 21st century. Understanding its effects could be crucial for the commodities sector, including Brazil. Officially launched by China in 2013, the project envisages trillions of dollars in investments and has already been joined by more than 150 countries. 

Throughout this article, you will understand: 

• What the New Silk Road is and why it's more than an infrastructure plan; 

• How the proposal affects the dynamics of transportation, trade and commodity pricing; 

• Brazil's strategic position, its opportunities and the risks involved; 

• Why monitoring the progress of the Silk Road is essential for more assertive decisions in the agro-export sector. 
  
  

Happy reading! 

Read also: 

• Brazil's role in China's food security: a 50-year partnership 
  
  

What is the New Silk Road? 

The New Silk Road, inspired by the ancient trade network between China and Europe that existed between the 2nd and 15th centuries BC, was launched in 2013. It represents an ambitious geo-economic expansion project led by the Chinese government.  

Its focus is the construction and financing of an integrated transportation infrastructure between Asia, Europe, Africa and Latin America. Railroads, ports, highways and logistics corridors, both land and sea, make up the backbone of this plan. 

The initiative is divided into two main axes: 

• Silk Road Economic Belt: covers land connections, passing through countries in Central Asia, the Middle East and Europe; 
  
  

• 21st Century Maritime Silk Road: ocean routes and port infrastructure, linking Southeast Asia to the rest of the world. 
  
  

The proposal is part of China's strategy to expand global connectivity and strengthen its economic influence. With this plan, there is a great possibility of reducing its dependence on trade routes dominated by Western powers. 

How will the Silk Road affect the commodities market? 

The New Silk Road will connect producing and consuming regions by faster and more efficient logistical means. As a result, it could significantly alter commodity trade flows and, consequently, supply, demand and global pricing. 

Among the main expected impacts are:

Reduced logistics costs 

The construction of railroads and ports in the accession countries aims to make the transportation of grains, minerals and fuels more efficient. As a result, delivery times tend to decrease and favor the competitiveness of exporters operating in the Asian market. 

Integration of production chains
 

By integrating agro-industrial and energy chains through logistics corridors, the project facilitates the movement of commodities with less intermediation. This can benefit both the producer and the buyer, with better margins and more dynamic long-term contracts. 

Changes in pricing dynamics 

The increasingly intense use of ports and corridors controlled by Chinese companies can directly influence logistics costs and the final values of strategic commodities such as soybeans, oil and iron ore. The dependence on infrastructures dominated by China raises the alarm about changes in the geopolitical balance of global trade. 

Read also:  

• The challenges of grain storage and transportation in Brazil in 2025 
  
  

What is Brazil's role in this scenario? 

Despite not having formalized its membership of the New Silk Road, Brazil has been expanding its trade relations with China. The country is the main supplier of soybeans to the Chinese market and has strategic bilateral agreements, especially in the areas of energy, technology, agriculture and infrastructure. 

The decision to maintain an independent stance and avoid formal accession is in line with Brazil's diplomatic tradition of balance between powers. This choice also has a practical motivation: preserving political and economic autonomy to avoid the risk of becoming dependent on a single investor. 

Even so, the Chinese presence in Brazil is growing. Companies from the Asian country are increasingly involved in logistics and structuring projects, such as ports and railroads to transport grains and meat. 

This type of partnership can generate benefits for Brazilian agribusiness, especially in regions such as the Midwest. However, there are associated risks, as shown by the case of the port in Peru, where the concession to Chinese companies created an operating monopoly for three decades. 

Read also:  

• How does the trade rapprochement between Brazil and China affect soybean prices?
  
  

Opportunities and risks for Brazil: what to watch out for? 

The expansion of the Silk Road represents a concrete opportunity for Brazilian agribusiness, but it is necessary to evaluate each move with caution. Below, we list some points to watch out for in the coming years: 

• Opportunities 
   
• Expansion of export infrastructure with foreign capital; 
   
• Easier access to the Asian market; 
   
• Greater logistical predictability with a reduction in internal bottlenecks. 
  

• Risks 
   
• Dependence on routes controlled by foreign companies;
  
  
• Lower negotiating margins in futures contracts;
  
  
• Potential changes in commercial diplomacy with the USA and the European Union. 
  
  Brazil's current strategy prioritizes regional agreements, such as Mercosur-European Union, and its leading role in multilateral forums such as BRICS. This avoids automatic alignment with any one power and preserves margins for maneuver in times of global instability. 

Read also:  

• Exports to Asia: what role for risk management? 
  
  

Keeping an eye on the global scene? Hedgepoint can help 

The progress of the New Silk Road shows how international dynamics are increasingly connected to logistics and strategic planning for those operating in agribusiness and the energy sector. 

At Hedgepoint, we follow political, commercial and climatic movements in real time to provide analysis that guides decisions more clearly. Our market intelligence team combines global vision, technical expertise and analytical tools to support those looking to navigate complex and volatile scenarios with confidence. 

Want to know how initiatives like the New Silk Road can influence your market? Get in touch and find out how Hedgepoint's market intelligence can contribute to more strategic management, focusing on risks and opportunities. 

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• Hedgepoint Market Calls: strategic information for intelligent decisions 

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