Brazilian logistics group Rumo, the country’s largest rail operator, is accelerating its investments in digital transformation with a focus on data analytics, IoT and artificial intelligence to monitor tracks, trains and freight.
Since last year, the group has invested 700 million reais ($130 million) in technology projects and IT systems, and the forecast calls for similar spending in the next investment cycle, Rodrigo de Souza, rail technology manager at Rumo, told BNamericas.
However, the total amount may vary depending on the project profile. Initiatives where the phase is more related to development typically require fewer resources than projects that are already in the deployment phase or that require hardware purchases, for example.
“The budget varies greatly depending on the need. Today, perhaps, I use more than I develop. And with that, next year could be a little lower [than this year’s capex]’ said Suza.
Rumo prioritizes projects related to automation, digitization and mapping of the rail network to improve preventive and corrective maintenance.
The Broken Rail Detection System (DTQ, in Portuguese) was developed in 2017. In 2018, the company started implementing the system.
Now the project has entered a second phase with the inclusion of artificial intelligence to allow more accurate algorithms to recognize patterns and help the system spot errors. Currently, 60% of the DTQs deployed on the Rumo network are AI-powered.
In August and September, DTQ used AI to help identify 102 cases of broken rails.
The software, including the algorithms, was developed in-house at Rumo, while the hardware (sensors) was developed by a company from Curitiba, State of Paraná. Both companies share a product patent.
DTQ will be implemented in the company’s main corridor connecting the cities of Rondonópolis, Mato Grosso state, to the Port of Santos, São Paulo state, in addition to some sections in its southern network in Paraná and Santa Catarina.
Rumo is currently mapping the next sections to maintain the DTQ system.
“These corridors [where DTQ is present] have an intensive circulation that puts a lot of strain on the rails. Future implementation depends, among other things, on whether rails are new or not, whether there is a higher risk or not. The option might be to just install new rails. This is all geared towards the infrastructure sector. We are currently planning this with the team,” said Souza.
The company currently manages around 14,000 km of rails in the states of Paraná, Santa Catarina, Rio Grande do Sul, São Paulo, Mato Grosso do Sul, Mato Grosso, Minas Gerais, Goiás and Tocantins.
It also owns 1,400 locomotives and 35,000 wagons.
CLOUD AND IoT
Rumo is also investing in migrating most of its data to the cloud. Both operational data, which includes the rail system itself, and internal data related to the back office and its Network Operations Center (NOC).
The company has contracts with two of the most important public cloud providers on the market. Souza said he couldn’t name her.
The largest cloud providers are AWS, Microsoft, Google and Oracle.
When it comes to IoT, Rumo has prioritized low-cost solutions.
“The dollar and even the war in Ukraine have greatly affected the cost of foreign components. Today we work a lot with the data we already have, with the implementation of systems in partnership with local companies and finally with the collection of data via sensors.”
This detection is done by a system called Way Side, which is equipment distributed along the track that monitors, among other things, the acoustics and the impact of the wheels on the rails.
In the past, this data came separately and the reading was mostly on a case-by-case basis. All of these measurements are now centralized by the company, read and processed at once, Souza said.
Rumo does not necessarily intend to install IoT sensors in the wagons, as the external systems already generate a lot of data to be processed, according to the board.
To mitigate issues related to connectivity in the areas where its carriages cruise, many of which have little or no coverage, the company has relied primarily on satellites. The main providers are Globalsat and Inmarsat.
Wherever possible, Rumo uses the public mobile network, including 2G (GSM) technology, as much of the data transmitted is simple and requires low bandwidth. In this case, the mobile network used is that of Claro.
According to Souza, the company is also conducting tests using LoRa (Long Range) IoT cellular technology. A key feature of LoRa is its low power consumption, which allows devices to run for long periods without recharging.
Although the sensors individually transmit simpler data, the total amount transmitted creates a “data lake” of about 1.8 terabytes, the executive said.
In July, Brazilian company Surf Tech partnered with Rumo to lay fiber optic networks along the company’s tracks. The goal is to bring connectivity to communities in the nine Brazilian states covered by the network under the company’s concession.
This specific project will not be carried out by Souza’s team, but the executive said that DTQ and WaySide are expected to benefit from this connectivity.
Initially, the project envisages an investment of 1.5 billion reais by Surf Tech.
Digitizing operations is critical for the company as Rumo expands its rail network.
The company’s board of directors just cleared a 4.5 billion real estate, 211 km long first phase of a 15 billion real estate railway project in the state of Mato Grosso.
“This project is fundamental for Rumo and the state of Mato Grosso, the region with the highest grain production in the country. Our investment thesis is based on the expectation of growing food demand in Asia. Our forecast is that grain production in Mato Grosso will grow by 30% by 2030, which will require a lot of logistical structures,” said Rafael Bergman, Rumo’s CFO, in a conference call to unveil project details.
The first phase will connect the cities of Rondonópolis and Campo Verde. Work is expected to last three years and operations are scheduled to begin in 1H26.