Port Strategy June 2022

JUNE 2022 VOL 1022 ISSUE 5

portstrategy.com

The Propane Option | Clean Fuel Terminal Tractors | Ballast Water: Tightening Regulations

CONTAINER ROLLERCOASTER: WHAT NEXT? TERMINAL CHOICES US GULF REVIEW RIO RENAISSANCE

PORTSTRATEGY INSIGHT FOR PORT EXECUTIVES

The international magazine for senior port & terminal executives EDITORIAL & CONTENT Editorial Director: Mike Mundy mmundy@portstrategy.com Features Editor: A J Keyes keyesj186@gmail.com Consultant Editor: Andrew Penfold andypenfold@yahoo.com

VIEWPOINT MIKE MUNDY

What’s not new and what’s next?

Accurately forecasting the future is always a challenging business.

Imagine doing this prior to early 2019 – how wrong would you have been?

Who could have imagined COVID-19 or Russia initiating a war in the Ukraine? At an industry level, who could have forecast the phenomenal profits of shipping lines, the mega investment in new tonnage and diverse new business streams. A similar scale of change has been triggered in the bulk agri-products and energy markets. A lot to discuss – hence the timely restart of the Terminal Operations Conference in Rotterdam this month, one welcome return to normality!

So, what has not changed since the last Terminal Operations Conference (TOC) convened on a face-to-face meeting basis? Short answer, not a lot!

So, what’s up next? Anymore big shocks in the system round the corner? We hope not, although parties are talking about the spectre of recession in today’s climate of rising inflation, but let’s not talk that up.

There is presently a fair amount of speculation about a return to normal – i.e. life before COVID-19. From our perspective this may occur in parts but not across-the-board.

In the container sector the lines have all enjoyed hitherto unseen profits, a significant part of which has been invested in new tonnage. A flood of new capacity – equivalent to near 30 per cent of the existing fleet - is thus expected on the market over the short-term. It would be ironic indeed if this ‘home cooked’ reality were to turn out to be a brake on positive future development. It is hard to imagine where all this capacity is going to find gainful employment and the cascading of bigger capacity vessels into secondary trades is to be expected. This, in turn, will have consequences for port investment plans (p24).

We also see in today’s liner sector a greater interest in investing in terminal assets – the landmark deal in this area being MSC’s acquisition of the Bollore terminal and logistics network, the biggest acquisition of its kind undertaken to-date.

This trend also presents a more competitive picture in the bidding for terminal concessions. A line invariably comes to such an opportunity with the promise of bringing substantial container volumes more-or-less from day one, an enticing aspect for port authorities, but how much of an advantage will it prove to be over the long-term? We discuss this important subject on p27, presenting the pros and cons.

This issue of Port Strategy contains discussion of future prospects across diverse market sectors and subjects, not the least of which is how to unlock the Ukraine’s agri-products in order to avoid massive famine and starvation in the developing world (p64).

These are fertile times to engage in discussion to positively shape the future of the global ports and terminal industry. The re-start of TOC is to be welcomed in this respect – if you are attending we wish you a good event and would like to extend the invitation to visit us at Stand F38.

For the latest news and analysis go to www.portstrategy.com/news

Regular Correspondents: Felicity Landon; Stevie Knight; John Bensalhia; Ben Hackett; Peter de Langen; Barry Parker; Charles Haine; AJ Keyes; Andrew Penfold; Oleksandr Gavrylyuk Johan-Paul Verschuure; Phoebe Davison Production David Blake, Paul Dunnington production@mercatormedia.com SALES & MARKETING t +44 1329 825335 f +44 1329 550192 Media Sales Manager: Tim Hills thills@portstrategy.com Marketing marketing@mercatormedia.com Chief Executive: Andrew Webster awebster@mercatormedia.com PS magazine is published monthly by Mercator Media Limited, Spinnaker House, Waterside Gardens, Fareham, Hants PO16 8SD UK t +44 1329 825335 f +44 1329 550192 info@mercatormedia.com www.mercatormedia.com

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JUNE 2022 | 3

at 14 - 16 June Rotterdam Ahoy

Join us at stand B28 #SafetyVillage #TOCEurope Safe operations are sustainable operations.

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CONTENTS JUNE 2022 VOL 1022 ISSUE 5

portstrategy.com

The Propane Option | Clean Fuel Terminal Tractors | Ballast Water: Tightening Regulations

NEWS

23 More for Less

17 Damiea Terminal

24 Container Rollercoaster

Hapag Lloyd JV

19 Ukraine’s Grain re-starts TERMINAL CHOICES US GULF REVIEW RIO RENAISSANCE

On the cover Container operations since March 2020 have a ridden a rollercoaster triggered by COVID-19. This scenario is still in play with more surprises yet likely to emerge. But is an end in sight and will there be a return to normality or will it be a new normal? Views of the future are offered in diverse areas of coverage in this issue and notably in our lead feature Container Rollercoaster: What Next?

Picture: Hapag Lloyd container vessel in Hong Kong

More capacity needed

19 Batam’s Back

Government Push

11 Świnoujście Port Progress, but issues

11 MSC-Nortarc Deal Terminal takeover

13 Autonomous Docking

Refined berthing process

13 Global Port Integrity New platform launched

15 US DoD Security

Security enhancements

15 Cyber fighter group Threat reduction

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GreenPort magazine is a business information resource on how best to meet the environmental and CSR demands in marine ports and terminals.

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17 Antwerp ASCs

Automation interest builds

17 Koper Capacity

New cranes ordered

19 Innovation in Chile Smart Port Solutions

The Congress is a meeting point that provides senior executives with the solutions they require to meet regulatory and operational environmental challenges.

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Online portstrategy.com 5 Latest news 5 Comment & analysis 5 Industry database 5 Events Social Media links LinkedIn PortStrategy portstrategy YouTube Weekly E-News Sign up for FREE at: www.portstrategy.com/enews

FEATURE ARTICLES

17 Progress Unlikely Northern Sea Route

CONTAINER ROLLERCOASTER: WHAT NEXT?

JUNE 2022

19 Panama Plans

New tender and security

Building resource

What lies ahead?

27 Terminal Choices Common user or dedicated?

29 Downgrades and Upgrades Container shipping analysis

32 US Gulf

Going great guns

35 New Supply Chain Playbook

Change to the status quo

37 Millionaire’s Club Florida’s ports

40 Rio Renaissance New cargo streams

43 Special Relationship MultiRio & MSC

45 South America News 47 Domino Eect

Supply chain forecasts

49 Game On?

The propane option

53 Future Fuel Proof

REGULARS 20 The New Yorker Talk up the USA

20 The Analyst

Who dares wins

21 The Economist

Clean fuel tractors

57 Ballast Water

Tightening regulations

64 Postscript

Grain lockdown consequences

Threatening fog

21 The Strategist Simplistic view

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 5

PORT & TERMINAL NEWS A major fallout from Russia’s move to pariah status because of the Ukraine invasion amounts to a further undermining of the vaunted Arctic shipping route.

Take-up was already very slow, with only limited bulk flows attracted to the route and these were primarily driven by commodities sourced in the Russian Arctic – transit volumes from East Asia have never moved beyond trial shipments.

It seems certain that the Arctic Council, (headed by Russia, but with five NATO members plus potential NATO newcomers Finland and Sweden), is currently dead and resuscitation looks difficult, to say the least.

It is unlikely that major container lines will risk high volume services through this politically sensitive route, so the only real beneficiaries will be

CURTAINS FOR THE NORTHERN SEA ROUTE? bulk commodities sourced within the region.

Aside from well-known arguments concerning seasonality, vessels size constraints, lack of supporting infrastructure, etc., which already limited the true potential, there was seen be real opportunities for LNG sourced within the region for shipment to Europe and Asia.

These developments were predicated on the technical and financial involvement of the major oil companies. Since February, Total, BP and Shell have all announced a withdrawal from Russia and it is very unlikely that, if they return, they will prioritise these more ‘difficult’ projects.

There is a transport cost advantage for some trades in using the potential route between Asia and Europe, but practical difficulties have limited interest here. The outcome of the current conflict will determine the real potential. If Russia continues to be blacklisted by the rest of the world, only gas and bulk trades to China could be targeted. If the situation is resolved, there may be some recovery in interest, but commercial companies will remain extremely cautious about significant investments. It is difficult to see real progress being made.

JV FOR NEW DAMIETTA BOX TERMINAL DEVELOPMENT

A second container terminal is being developed at the Port of Damietta in north-east Egypt and joins the growing throng of new projects in the country.

The new facility, located just 62km from the northern entrance to the Suez Canal, will be known as Damietta Alliance Container Terminal SAE and is expected to commence operations in 2024.

Ultimately, up to 3.3 million TEU of annual capacity is due for development.

Hapag Lloyd Damietta GmbH is taking a 39 per cent stake in the 30-year concession, with joint venture partners consisting of Eurogate Damietta (a 29.5 per cent share) and Contship Damietta Srl (29.5 per cent), with

the remaining minority interest held by local shareholders.

Rolf Habben Jansen, CEO, Hapag Lloyd, explains the interest in this location. “With the new terminal Hapag-Lloyd will significantly improve its transshipment operation in the East Mediterranean market as well as access to the local Egyptian trade.”

Activity with new port developments in Egypt remains strong. Hutchison Ports is developing a new container facility at Abu Qir in Alexandria, while Abu Dhabi Ports Group has confirmed its intention to build a new multi-purpose terminal at Safaga Port and DP World is expanding Sokhna Port.

For the latest news and analysis go to www.portstrategy.com/news

8 Artist’s impression of the new Damietta Alliance Container Terminal SAE which, when fully built out, will offer an annual capacity of 3.3 million TEU

However, the interest in the Mediterranean coast is where port competition looks set to increase most. The new projects, including the new Hapag Lloyd-led facility, are in addition to existing terminal facilities including two terminals in Alexandria (in which Hutchison Ports already has an interest), at Damietta and, significantly, the Suez Canal Container Terminal (SCCT), operated by APM Terminals, which has recently increased capacity to 5.4 million TEU per annum.

BRIEFS New Cambodia Kampot Port

The Cambodian Ministry of Public Works and Transport has broken ground on a major new port facility in Kampot, in the southwest of the country. The US$1.5 billion project is sited in a 600ha area and will have 15m water depth. A new container terminal is included, with up to 600,000TEU capacity.

Phase one operations are due to commence in 2025.

A special economic zone, free trade area, on-site logistics support and an oil refinery are also planned.

Adani Disqualified Jawaharlal Nehru Port Authority has confirmed that it has disqualified Adani Ports and Special Economic Zone Ltd (APSEZ) from a tender to privatise its self-operated Jawahar Lal Nehru Container Terminal (JNPCT). This decision is in line with the specifi c tender condition that prohibits the engagement of fi rms involved in contract termination at other ports.

Local reports indicate that APSEZ is to appeal to this decision in the Bombay High Court.

Autonomous Feeder

Leading logistics provider, DB Schenker, has outlined plans to operate an innovative zero-emission coastal container feeder in Norway. The fully electric vessel will operate between the ports of Ikornnes and Ålesund, completing the 23-nautical mile journey within three hours, at a speed of 7.7 knots. The vessel will be 50m in length and have a carrying capacity of 300 deadweight tons of cargo. Partners in the project include Ekornes, vessel designer Naval Dynamics, KONGSBERG and Massterly.

JUNE 2022 | 7

PORT & TERMINAL NEWS

BRIEFS Antofagasta Concession

In early April Chile’s Competition Court (TDLC), in compliance with the State Ports Law issued Report 24/2022, setting the public bidding conditions for the concession of Terminal No 1 in the port of Antofagasta, northern Chile. Terminal No 1 is effectively a multi-purpose terminal now understood to be operated on an as needed basis with public sector and private agency input.

Contrecoeur Candidates

The Montreal Port Authority has confirmed that three companies have qualified following the recent request for proposals for its major Contrecoeur new container terminal project.

The companies are Axium Infrastructure Canada, Ports America Holdings and Mediterranean Shipping Co’s terminal operating arm, Terminal Investment Ltd (TIL). The next phase, involving detailed bid submission, is expected to run for 12 months, with terminal operations targeted to commence in late 2026.

ADP Profits Up

Abu Dhabi Ports group (ADP) reports strong Q1 2022 financial results.

Net profi t record levels of US$83.3 million were achieved, up 41 per cent, with revenues of US$285 million representing year-on-year growth of 15 per cent. The group’s adjusted EBITDA was also up, by 34 per cent, reaching US$142.66 million. ADP has been particularly successful in securing dedicated terminal deals in conjunction with liner operators.

8 | JUNE 2022

UKRAINE GRAIN EXPORTS RESTART BUT MORE CAPACITY NEEDED The Ukraine is actively seeking new export gateways, as opposed to its main ports of Mariupol and Odessa, in an endeavour to implement foreign grain sales. There is no major expectation that typical grain export levels will be achieved but there is a determination “to do what we can,” as one grain trader puts it.

The focus is on foreign ports and smaller Ukraine ports that have not been subjected to attack

by Russia. Mariupol, one of the country’s main ports is now in Russian hands as well as devastated by repeated attacks and Odessa has also been subject to attack as can be seen in the picture – both have been closed for some time.

As an alternative, in late April a first shipment of 71,000 tonnes of Ukrainian corn was shipped from the port of Constanta in neighbouring Romania. At this time, further shipments were announced for May. Other surrounding nations have also offered to help with Lithuania’s Transport Minister reporting a test shipment planned from Klaipeda port.

There has additionally been discussion of the use of Latvian ports but in this respect and generally there are considerable logistical challenges. Aside from war damaged roads and bridges in Ukraine, differences in the gauges of European and Ukrainian railways serve to severely hamper export activity

through foreign ports. The EU has talked of establishing ‘green lanes’ to expedite cross-border traffic but this is widely seen as offering only limited potential to get cargo moving.

Ironically, virtually all the candidate foreign ports do have the spare storage and cargo handling capacity required to move the cargo – the problem is getting it there.

Closer to home thousands of trucks carrying corn, wheat and sunflower seed are now making the long trip through the south of Ukraine to the ports of Izmail and Reni on the Danube River. From these ports product is loaded into barges for shipment to Constanta for onward transport by ocean carriers. There are long queues of trucks and capacity is limited.

The situation also has the potential to grow even worse when very shortly Romanian, Bulgarian, Hungarian and other

8 Odessa under attack from Russian forces – alternative routes for grain exports are being sought but they are dogged by logistical problems

farmers harvest winter wheat and barley ramping up capacity usage at alternative ports.

The resulting impact on world food supplies promises to be extremely serious. In 2021-22 crop year the US Department of Agriculture (USDA) assessed Ukraine’s maize (corn) production at 42m tonnes, with exports of at least 33m tonnes – around 17 per cent of global supply. Similarly with wheat the USDA placed production at 33m tonnes with exports of 24m tonnes (global market share of 12 per cent). Loss of major parts of these sort of export volumes will send prices higher, present alternative sourcing challenges and ultimately for a number of importing countries lead to major food security problems.

BATAM PORT PLANS TALKED UP BY CO-ORDINATING MINISTER FOR MARITIME AFFAITRS The government of Indonesia is revisiting the idea of developing a port facility on the island of Batam. This location is around 30km south of Singapore, close to international shipping routes, and has been under consideration for the past 30 years without any major development taking place.

However, following a recent visit to the site, in the Batam Free Trade Zone and Freeport in Tanjungpinggir, in Sekupang sub-district, Luhut Binsar

Pandjaitan, Co-ordinating Minister for Maritime Affairs and Investment noted that the available water depth was suitable for developing a port and that the idea is to link it to Kuala Tanjung port in northern Sumatra.

The current development area covers 94ha but there is scope to expand it, to 330ha, through reclamation. This would make the proposed port bigger than Indonesia’s largest existing facility, Tanjung Priok.

Not surprisingly, even at this early-stage doubts are being expressed over the scheme.

Indonesia’s National Maritime Institute (NMI) has raised concerns on both “technical and economic” grounds.

“I estimate the length of the Tanjung Pinggir coastline to be 1.5km at best,” says Siswanto Rusdi, Director, NMI. “With such a small area, how much throughput can be handled?,” he asks.

For the latest news and analysis go to www.portstrategy.com/news

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PORT & TERMINAL NEWS

SZCZECIN-SWINOUJSCIE PORT EXPANSION PROCEEDS BUT…

BRIEFS J M Baxi Acquisition

J M Baxi Ports & Logistics Ltd, a unit of the Mumbaibased J M Baxi Group, has gained complete – 100 per cent - control of the Visakha Container Terminal following the purchase of the 26 per cent stake held in the terminal by D P World. The terminal has recently performed well handling 512,000TEU in FY22, up from 48,100TEU in FY21. Recent expansion works have lifted capacity from 600,000TEU/yr to 1,300,000TEU/yr.

Valencia Results The development of a new largescale terminal in Świnoujście, Poland, near the German border, is gaining momentum with key elements of the necessary infrastructure coming to fruition.

Dredging contractors DEME and Van Oord have completed the deepening of the 65 km-long Świnoujście-Szczecin Fairway.

This provides access from the

Baltic Sea and runs between the city of Świnoujście and the Port of Szczecin.

The dredging project saw the channel deepened by two metres to a uniform depth of 12.5m and is a key part of the planned development of new terminal facilities in Świnoujście, which includes a proposal to develop up to two million TEU of container capacity per annum

8 The Świnoujście port project has recently seen the completion of the deepening of the 65 km-long Świnoujście-Szczecin Fairway

and construction of a new protective breakwater.

An investor/operator is currently being sought and the terminal project has a tentative date of 2025/2026 to commence operations.

….WITH ISSUES RAISED It is taking place, however, against the background of Poland’s main ports, Gdynia and Gdansk, implementing major expansion programmes with a number of analysts questioning the need for major new container capacity in Świnoujście.

There is another issue festering too. Located just five kilometres from the German border the project has been criticised by the

German Green party. Furthermore, most of Świnoujście is located on an island, of which the largest part of the landmass belongs to Germany. Therefore, the Espoo Convention applies in this instance and it states that both Poland and Germany are obliged to complete environmental impact assessments and ensure cross-country consultation.

Despite this situation,

Mediterranean Shipping Company (MSC) is to partner with Notarc Management Group to takeover the project to establish a major new container terminal in the port of Colon situated 6.5km from the North (Atlantic) Entrance to the Panama Canal.

The concession was originally awarded to a consortium of Chinese companies, led by Landbridge Group, which

MSC-NOTARC TAKEOVER PANAMA TERMINAL PROJECT committed to invest US$900 million in the new terminal. The concession was cancelled in June 2021 after a review by the Panama Maritime Authority which identified the consortium was in default with the terms of its contract.

The terminal is currently 40 per

For the latest news and analysis go to www.portstrategy.com/news

Świnoujście is already the site of a liquefied natural gas (LNG) terminal, which opened in 2016 and is currently being expanded, so there is a precedent for port activities in place.

The geographic location of the new port development envisages a cargo catchment area serving western Poland and hinterland areas around Berlin traditionally served by German ports.

cent complete - MSC and Notarc will commence the remaining development works in the fourth quarter of this year.

Notarc Management Group is a global advisory, investment and management consulting company with a subsidiary in Panama.

The Port of Valencia, Spain reports loaded containers for export falling by 12.72 per cent in the period January – April 2022 compared to the same period last year and loaded imports rising by 6.96 per cent. Total container volume was 1,702,236TEU, down 7.99 per cent. The port authority reports that the dip in export traffic and increase in imports mirrors experience in other cargo sectors with the Ukraine war, the increase in energy costs and shortage of raw materials all negatively impacting export activity.

Chittagong Cranes In early May Chittagong Port, Bangladesh took delivery of two Chinesebuilt ship-to-shore container gantries (SSG) and three rubber tyred gantries (RTGs). The two SSG units are intended for operation at the New Mooring Container Terminal No. 5 Berth with the three new RTGs deployed in the reefer yard operation. The Chittagong Port Authority is pursuing various new terminal development projects with the first one to come on-stream being the new Patenga Container Terminal in July.

JUNE 2022 | 11

DIGITAL NEWS

AUTONOMOUS SHIP DOCKING IS COMING Australian marine technology company, Marine Autonomous Intelligent Docking (MAID), has announced development of a fully autonomous docking system for maritime vessels.

The company says that its patented MAID Technology system will deliver enhanced safety, efficiency and environmental improvements by facilitating ships docking autonomously.

MAID additionally states that there are approximately 3000 marine incidents or collisions annually, of which around 75 per cent are due to human error.

Autonomous technology can enable faster vessel positioning and greater overall control of the berthing process, promoting safety, fuel savings and as a result fewer emissions.

However, there remain challenges to overcome. There is a need to adhere to COLREGS, which is the maritime process for vessel navigation at sea to prevent collisions, while there is also a requirement to ensure full cybersecurity and sufficient protection against the threat of hijack and, therefore, loss of control of the vessel. Full compliance, and safety, have to be demonstrated.

There is also the UN Convention on the Law of the Sea 1982 which clearly states under

Rotterdam Deal

The Port of Rotterdam is strengthening its ongoing partnership with the Port of Duisburg by collaborating on more initiatives relating to digitalisation and energy transition. The two ports have confirmed a desire to connect Duisburg’s ‘Rail Freight Data Hub’ initiative with Rotterdam’s own ‘Rail Connected’ service offering. Consequently, a combination of more digital processes and data sharing projects is actively seeking to play a part in increasing the one million TEU of containers moving between the two hubs annually.

New Lion JV Article 94 that every ship or maritime craft must have a master who remains ‘in charge’ at all times.

There is, however, progress in this respect, as MAID confirms.

In mid-2021 the International Maritime Organisation (IMO) did assess how Maritime Autonomous Surface Ships (MASS) could be regulated. A wide range of key criteria were identified, extending from crewed

8 Plans for autonomous ship docking are expected to reduce collisions and generate environmental benefits

ship with automated processes and decision support through to fully autonomous vessels.

A step-by-step approach will likely be adopted moving forward, with automation of smaller parts of the shipping process first, before leading to projects on a much larger scale.

GLOBAL PORT INTEGRITY PLATFORM LAUNCHED The Maritime Anti-Corruption Network (MACN) has launched the Global Port Integrity Platform (GPIP). This is a new product that includes over 50,000 incident reports that have been collected since 2011 and adds externally vetted data sources to compare integrity risks at ports..

Martin Benderson, Associate Director, MACN, notes: “GPIP will be a game-changer in the fight against maritime corruption.

Currently,” he points out, “there are no international standards, or systematic methods of measuring integrity within and between ports.

“GPIP will allow charterers, cargo owners, and shipping

BRIEFS

companies to compare ports’ integrity performance and identify risks when trading. For seafarers and shipping companies, GPIP will provide dynamic data that will help empower the industry to say no to corruption by making it easier to assess risk and prepare for calling ports in high-risk locations. GPIP will show very clearly what problems are most common and what challenges seafarers can expect to encounter.”

The new platform is also what MACN regards as an engagement tool that can help facilitate constructive discussions between governments, the maritime industry, ports and

For the latest news and analysis go to www.portstrategy.com/news

terminals and other interested stakeholders by supporting MACN’s objectives of targeting corruption in the maritime sector.

Cecilia Müller Torbrand, CEO, MACN, notes that the platform currently includes 106 ports from over 50 countries, with a target of doubling the number of ports involved before the end of 2022.

“For ports, GPIP will incentivise integrity by allowing for performance comparisons across ports regionally and globally. It will highlight ports that require investment and will also be a tool for international donors, private sector investors, and any stakeholder with an interest in port sector reform and trade facilitation,” she adds.

CMA CGM Group and PSA Corporation Ltd are working together to develop and implement sustainable solutions for port and terminal activities at their joint-venture partnership in the CMA CGM-PSA Lion Terminal (CPLT) in Singapore. This will include introducing PSA’s Opt-EArrive digital offering that reduces carbon emissions through optimisation of bunker consumption activities by synchronising data exchanges between ship systems and terminal operator. The two companies expect to see bunker savings of four to seven per cent for arriving ships.

Mobile Australia

PortxGroup and Aidrivers have signed a Memorandum of Understanding (MoU) to increase business opportunities for autonomous mobility solutions in the Australasia region. The new MoU will see both companies focussing on the development, provision and delivery of autonomous, AI-supported mobility projects and automated simulation.

JUNE 2022 | 13

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DIGITAL NEWS The US Department of Defense (DoD) has confirmed it is deploying a new software and data transport system as part of optimising and managing Vision AI security across its port network. The supplier of the new system is OStream and the product selected is the company’s Percept service offering.

The US DoD has previously utilised video analytics as its preferred tool for port security, but the growth in AI options has resulted in the change. Now, OStream’s software means it is possible for real-time analytics to be maintained and stored in a secure, private database.

Moreover, the Percept hub option allows the US DoD to fully integrate any camera in any location to over 300 different market AI services.

Alan Jaeger, Director of the

US DoD GOES FOR OSTREAM FOR ENHANCED SECURITY

The Port of Vancouver, USA has established a new group to enhance collaboration and communication to combat cyber threats for all stakeholders involved with port activities on the Lower Columbia River.

The new Lower Columbia River Maritime Information Exchange (LCR-MIX) is being developed in conjunction with the Maritime Transportation System Information Share and Analysis Center (MTS-ISAC) to actively target early awareness of potential cyber-attacks and adopt best practices to help avoid incidents occurring.

Chris Carter, Information Security Analyst, Port of Vancouver, USA outlines the approach going forward and how

VANCOUVER CYBER FIGHTER GROUP FORMED different stakeholders can benefit.

“So often the partners and stakeholders within the Lower Columbia River are using the same vendors, service providers and often are working with the same business contacts. A compromise can have cascading consequences and put the entire supply chain at risk. By partnering with the MTS-ISAC, LCR-MIX members are actively consuming and producing actionable cyber threat intelligence, sourced locally and from other MTS stakeholders from around the globe.”

Christopher Hunt, IT Director, Port of Grays Harbor, offers further confirmation of the anticipated benefits: “The

MTS-ISAC provides us with actionable intelligence in a timely manner. Their focus on privacy encourages the open exchange of information and the regional scope of the LCR-MIX means that the information is relevant in our daily operations.”

8 The Port of Vancouver, USA has established a new stakeholder group to target improved communication and collaboration in the fight against cyber attacks

COSCO Goes 5G

Veson Takes Q88

MSC Buys into GMS

Barbados Joins IPCSA

China COSCO Shipping Corporation (COSCO) reports it has successfully completed its first container unloading using mixed operations, including 5G unmanned container trucks. The Xiamen Ocean Gate Container Terminal issued a statement confirming that the 5G trucks were able to move to a precise and designated position supporting the gantry crane in one efficient move behind the COSCO Le Cong vessel, located at Berth 17 of its facility.

8 The US West Coast Port of Hueneme is one of a number of US ports benefitting from OStream’s Percept AI product

NavalX Ventura TechBridge, Department of the US Navy, explains the benefits and rationale behind the DoD

Veson Nautical, the maritime freight software provider, is acquiring information management and software platform specialist, Q88. In a joint release the two companies state that the acquisition will combine their respective capabilities, while allowing further development of a standardised platform supporting maritime commerce. Q88 has been offering digital solutions since 2001, initially in the tanker business and is now expanding its services.

For the latest news and analysis go to www.portstrategy.com/news

decision: “Vision AI is a strategic initiative at many sites, including the Port of Hueneme. OStream has proven that its data

As part of a continued move to increase sustainability throughout all areas of its operations, Mediterranean Shipping Company (MSC) has confirmed it is investing in Madeira-based Green Maré Services (GMS). Part of the decision is due to MSC using the Ship Review platform developed by GMS (and partner, Scope Group, of Germany), which is a specialist service providing a ‘scoring system’.

infrastructure products facilitate smooth integration of cameras to hundreds of different leading AI providers. The agility to leverage new IoT style cameras as well as existing video feeds is an appealing proposition.”

The US DoD has also confirmed that it has selected Percept AI service partners to act as providers for object detection, tracking and correlation, while OStream continues to support the US Navy on other research and development projects.

BRIEFS Barbados Port Inc (BPI) has joined the International Port Community Systems Association (IPCSA), with the aim of helping to advance digitalisation for the Port of Bridgetown. BPI states that gaining access to the Port Community System (PCS), when operational in 2023, will ensure efficient electronic data interchange and give real-time access to information for control, tracking and tracing processes.

JUNE 2022 | 15

EQUIPMENT NEWS

ASCs FOR ANTWERP AS EUROPE AUTOMATION INTEREST GROWS Component parts of new automatic stacking cranes (ASCs) have started arriving at DP World’s Antwerp Gateway Terminal (AGT) in the Port of Antwerp.

The new, rail-based, equipment is going to replace the traditional straddle carrier supported box stacks employed at the DP World terminal.

A key advantage of the new generation of ASC modules is the ability to place containers six high and up to nine units wide. This will offer DP World a capacity gain of 30 per cent compared to a straddle yard operation.

A total of 17 of the fully electric, fully automated ASC modules are going to be added over time in this location and represent a key part of a US$210 million investment that is intended to raise annual throughput capacity to a level of 3.4 million TEU/yr by 2026.

As Dirk Van den Bosch, CEO, DP World, AGT, explains, increasing capacity is only one part of the rationale for this investment. “The delivery of the new crane components is the starting point of the retrofitting of our terminal to achieve our maximum density in a CO2-neutral way. With these investments, we continue to play a pioneering role and create clear added value for the port of Antwerp.”

The automated stacking cranes when introduced at the Luka Koper d.d., operator of container terminal facilities at the Port of Koper, Slovenia, has placed a new order with Konecranes for three electric rubber-tyred gantries (RTG). The order will increase the RTG fleet at the port to 30 units when the new items are delivered in February 2023.

These latest units are similar to the existing machinery in use at the port, which comprises low-noise electric RTGs equipped with cable reel systems and an auto plug-in option. This means the equipment is able to feed regenerative power back to the local grid.

BRIEFS LB’s Electric Grant

The US West Coast Port of Long Beach has received a US$2.5 million California Energy Commission Grant to support Phase II of the Port Community Electric Vehicle Blueprint. This is a state-wide project designed to accelerate a sustainable and zeroemission port ecosystem.

This new funding will be used to develop terminal infrastructure, including at SSA Marine’s Pier J facility, to support the use of electric vehicles and zero-emissions equipment.

terminal will operate using 100 per cent green electricity, mainly produced at the terminal by means of a wind turbine and a biogas plant. In turn, AGT has confirmed that this new investment will further help it reduce its CO2 emissions, per container move, beyond the 51 per cent already gained over the past 10 years.

Interest in automated container terminal operations continues to gain traction in North Europe, with the opportunity to generate a more positive environmental impact providing added impetus.

German ports are a good example. More battery-powered automated guided vehicles (AGVs) have arrived at the HHLA Container Terminal Altenwerder

8 Antwerp Gateway is converting to an automated yard operation to boost capacity and reduce CO2 emissions – new equipment is arriving

in Hamburg and are driving forward the electrification of the fleet. This initiative, due for completion by 2023, will result in an annual reduction in emissions of approximately 15,500 tonnes of CO2 and 118 tonnes of nitrogen oxide.

At the same time, EUROGATE Container Terminal Wilhelmshaven (CTW) has confirmed plans to invest US$170 million to convert its container handling operations from a manual process to an automated system, with its first automated berthing operations set to commence during 2024.

KOPER UPS CRANE CAPACITY In addition to energy-efficient LED lights, the RTGs benefit from a range of smart features including DGPS Auto-Steering, Auto-TOS Reporting, Auto-Positioning, Truck Lift Prevention and Stack Collision Prevention.

Konecranes states that this contract forms part of its ‘Ecolifting’ project which targets a reduction in the carbon footprint of container terminal equipment.

“Koper is a forward-looking container terminal operator with ambitious environmental goals, a quality that is strongly

For the latest news and analysis go to www.portstrategy.com/news

supported by our Eco lifting approach,” notes Adel Issa, Sales Manager EMEA, Konecranes, Port Solutions.

This order follows in the wake of two new Super Post Panamax ship-to-shore gantries that recently arrived at the port.

The addition of these units raises to 11 the SSG fleet in service, atthe port.

The port handled just short of one million TEU in 2021 and has an expansion project underway that aims to raise annual capacity to 1.5 million TEU/year.

Extension and Expansion

APM Terminals, Gijón has recently secured a 10-year concession extension and is adding a Post-Panamax dimension ship-to-shore gantry as part of an expansion programme.

It is due to be operating

by April 2023 and will be able to reach across up to 16-container rows of containers on the deck of a vessel, three container rows more than the crane being replaced.

Kiel Piles on Power

The Port of Kiel is to receive two onshore power plants after port operator Seehafen Kiel awarded a contract to technology company, Siemens AG. This €17 million ($17.7 million) construction project, which follows earlier similar work undertaken

by Siemens in the port, is due for completion by the end of 2023 and includes a 50/60 Hz shore power system for cruise ships and ferries, as well as a separate 50 Hz shore power system exclusively for ferries. Up to six ships will be supplied with green electricity, simultaneously.

JUNE 2022 | 17

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EQUIPMENT NEWS

TERMINAL GRANELES DEL NORTE S.A. OPTS FOR SMART PORT SOLUTIONS

Kalmar has confirmed that it has received a major Smart Port Solutions order intended to support an innovative terminal development at Mejillones, Chile.

Terminal Graneles del Norte S.A. (TGN), located in the Antofagasta region of the country, has a US$105 million project underway to develop a second berth to handle shipments of copper concentrates being mined in the surrounding region. The terminal development, scheduled to come into operation in 2024, will deliver the ability to serve up to Panamax dimension vessels and to boost transfer capacity to up to four million tonnes per annum.

An innovative cargo-handling system has been configured, using 100 per cent electric automated cranes for the reception, storage and unloading

of the tiltable containers loaded with copper concentrate.

The automated rail-mounted gantry crane system ordered for this new facility will be supported by Kalmar SmartPort solutions to increase operating efficiency and performance.

The three specific Kalmar solutions to be introduced comprise the following and will be fully linked to the terminal’s gate operating system and a Navis N4 TOS: 5 SmartLane – use of RFID tags placed on containers that automatically register and track the units as they enter or leave the terminal.

5 SmartMap – provides real-time and historical visualisation of equipment location and container routing patterns in the yard.

8 Kalmar is to introduce three SmartPort solution modules to streamline cargo operations at Terminal Graneles del Norte S.A. (TGN), Chile

5 Road Trucks - automatically tracks road trucks to maintain full compliance with the work order, while increasing crane productivity when the truck arrives.

Eduardo Simian, Project Manager, TGN, highlights: “We chose Kalmar SmartPort solutions because of Kalmar’s ability to offer a solution that will be a key part of the automated container movement through the port. We are confident that the solution will help us ensure safe and efficient operations and fast truck turnaround times for our customers.”

DOCK OF PUERTO ARMUELLES TENDER AND… The Panama Maritime Authority (AMP) is calling for tenders for the construction of the new Fiscal Dock of Puerto Armuelles.

AMP is valuing the mandate at US$20 million and is seeking the study, design, development, and approval of plans and

construction of the Fiscal Dock infrastructure. The local authority for Puerto Armuelles expects the project to take about two years once the green light is given.

AMP notes that it “…recognises the direct impact on the economy that the construction of

this dock will bring, by promoting the creation of jobs and the reactivation of tourism not only in the area but throughout the West of Chirica.”

The region has a traditional role in serving the banana and oil trades.

…CYBER SECURITY BEEFED UP AMP is also working with ClassNK to improve its cyber security arrangements. A Memorandum of Understanding (MoU) has helped create a Cyber Incident Voluntary Reporting

Scheme, which supports the authority in better understanding the cyber threats faced by shipping and ways in which positive protective action can be taken.

For the latest news and analysis go to www.portstrategy.com/news

One specific aim of the project is to further encourage all Panama-flagged vessels to report any detected cyber incidents to AMP for further investigation.

BRIEFS Côte d’Ivoire Gears-Up

Côte d’Ivoire Terminal has received six yard gantries from ZPMC as part of the second container terminal currently being developed at the Port of Abidjan. The delivery is part of a total order for 13 units. The overall project investment is valued at US$416 million with additional equipment including ship-to-shore gantries and 36 tractors, with all equipment fully electric. The ship-to-shore cranes are due for delivery in August 2022.

UK Power First

Plans have been announced for the first floating organic flow battery for decarbonised port energy storage and shore power for cruise ships in the UK. The project has been dubbed ‘BlueStor’ and has been developed

by MSE International, with funding from the UK government’s Department for Business, Energy and Industrial Strategy (BEIS) under its Longer Duration Energy Storage (LODES) competition that includes a 10-point plan for a green industrial revolution in the UK.

Congo RTGs

Congo Terminal, a subsidiary of Bolloré Ports, has put two new rubber tyred gantries into operation at its container terminal located at PointeNoire, Congo. The new equipment represents an investment of €3.8 million (US$3.9 million) and increases the fleet in use at the facility to 20 RTGs. These RTGs are equipped with a real-time GPS that helps make imported containers available without delay, thereby improving productivity levels. In Q1 2022, Congo Terminal handled a total of 231,180 containers.

JUNE 2022 | 19

THENEWYORKER BARRY PARKER

Amidst all of the noisy headline grabbing national news regarding the Ukraine, the Supreme Court, and rising energy prices- infrastructure, a topic close to port executives’ hearts (albeit lacking frontpage news appeal) is back on the agenda. President Joe Biden has been talking about infrastructure spending tied to a bill passed late in 2021 and his recent messaging did include a visit to a New England port, with mentions of topics including dredging of channels and the much needed refurbishment of highway and railway bridges.

The political experts (I don’t claim to be one) have suggested that the bigger issues, including those mentioned here, are going to be dominating the election cycle; with various Primary Elections underway, the battling for the 2022 “midterms” has already started.

The ports, where a local focus is always important, need not get drowned out in all this loud political noise- and yes, a lot of it is partisan shouting of political points. Ports can have the best of

THE RIGHT TIME FOR US PORTS TO TALK UP THEIR ACHIEVEMENTS

8 The Ever Fortune at 12,118TEU capacity, the biggest vessel to call at the New England port of Boston – made possible by the implementation of a US$850 million programme to modernise the port’s Conley Terminal and a comprehensive dredging programme

both worlds if they point to their very positive steps in solving another “national” problem- the “supply chain crisis.” Counts of anchored vessels in recent trouble spots have decreased, while surface transportation analysts are suggesting that trucking demand has leveled off.

“Bottlenecks”- some real, and others created to garner media attention for a particular point of view, have been reduced. Vessel anchorages no longer feature on the evening news.

Each port has played a role, unique and tied to local circumstances, in ameliorating

what was a dire situation in late 2021 into early 2022. Some have influenced local work practices towards more efficiency, others have created facilities for storage and mobilisation that did not exist previously. The timing is auspicious for putting out messages all about those steps taken and their contribution to positive results being seen on a national level.

That last part is key; there is nothing wrong with celebrating local gains (maybe an uptick in payrolls, for example), howeverthe issues of disruptions moving goods around, or not, are national in scope. This non-expert cannot say exactly when- but infrastructure will be back on the minds of law-makers. Nor can I predict when the next Presidential visit to a seaport will occur, but the timing is right for the ports to continue developing, and fine-tuning talking points of their own, enumerating their own local victories, and their contribution to the national success in unclogging the supply lines.

THEANALYST PETER DE LANGEN

In the bigger scheme of things, the question where zero emission container ships will be introduced first is not very relevant; what matters is that they are introduced and as soon as possible. But still this question may matter, for ports, as they need to make decisions on providing zero emission fuels, for shippers, as they make (green) purchasing choices, and a range of other stakeholders in the shipping industry.

It seems a pretty safe bet that zero emission ships (ZES, most likely fuelled with electricity, ammonia, methanol, hydrogen or even wind) will be introduced first

20 | JUNE 2022

ZERO EMISSION CONTAINERSHIPS: WHO DARES WINS in shortsea routes. In fact, some ZES are already operating shortsea services, especially in the segment of ferry transport.

The Baltic area is the hottest zone in a global ZES initiatives heatmap (see ‘Mapping of Zero Emission Pilots and Demonstration Projects’ at https://www. globalmaritimeforum.org/ content/2022/03/Mapping-ofzero-emission-pilots-anddemonstration-projects_thirdedition.pdf) and is likely to be first in terms of ZES uptake in shortsea.

For deepsea, and especially in the container segment, there is no clear favourite, and arguably

competition may emerge between various ‘corridors’ or routes, to attract the first generation of deepsea container ZES. The notion of a green ‘corridor’ (as for instance assessed in the report, The Next Wave; Green Corridors by the Getting to Zero Coalition, and as advocated by a coalition including the Port of Los Angeles, Port of Shanghai, and C40 Cities) may be intuitive but the specifics are complicated. An open question remains, what will be the key driver of the establishment of zero emission routes: will this be driven by the

demand for zero emission maritime transport, from shippers with ambitious sustainability goals (and willing to pay a premium for zero emission shipping), or will it be driven by regulatory requirements (that either prohibit the use of ships with emissions, or make cost levels of ZES comparable to ships with emissions)?

If ‘ZES driven by a premium segment’ mechanism prevails, the Pacific trade lane seems to have the best characteristics for getting to ZES first, if the regulatory driver is dominant, the Atlantic may see ZES first.

For the latest news and analysis go to www.portstrategy.com/news

THEECONOMIST BEN HACKETT

OPERATING IN A FOG THAT THREATENS Economic indicators suggest that there is no recession on the horizon but practical realities are painting a different scenario.

In an environment of the continuing health crisis caused by the pandemic, rising inflation and a war in Europe that threatens to spread beyond the Ukraine in light of the irrational actions of Vladimir Putin, we are faced with a growing fog that threatens the world economy.

Economists and political pundits continue to argue over the potential for a recession and the timing thereof as economic indicators remain vague.

Inflation is up but Central Banks and politicians promise us that this is temporary, industrial production is robust in the U.S. and weak in the EU, consumer demand remains undaunted in the U.S. and in the EU whilst still positive growth is very low.

The war in the Ukraine has moved into the third month as the Russian invasion is not making

much headway but resulting in nothing less than the slaughter of civilians and massive troop losses by the Russians. Global markets are reacting with massive commodity price increases further fueling inflation. Add to this the enforced lockdown of Shanghai and soon Beijing the already struggling supply chains will get even worse as vessel congestion expands around the globe.

8 Economic and political factors are combining to threaten the world economy

Port activities are being disrupted with Coronavirus induced illnesses hitting labour and sanctions on shipping that are causing the re-routing of ships, and sanction busting by changing ships’ registries as well as vessels turning off their AIS. Ports and terminals are also

having to deal with ever increasing numbers of ultra large containerships taking up more quay space and time.

The net result of this will ultimately be reduced demand for shipping as commodity volumes decline, particularly to China as their industry is being shut down with the “Zero” covid policy.

We see reports that container exports from China to Europe and North America are down by some 30 to 40 per cent due to this policy but the reality remains vague.

In the meantime major container shipping lines continue to place newbuilding orders like there is no tomorrow, as if the huge 2021 profits are burning holes in their pockets. It is not clear where all this will lead to as many lines have reversed their efforts to integrate vertically and are back to expanding vertically into freight forwarding and airfreight.

THESTRATEGIST MIKE MUNDY

A SIMPLISTIC VIEW OF A COMPLEX PROBLEM The National Shipper Advisory Committee, an advisory group to the USA’s Federal Maritime Commission (FMC) is proposing that FMC extend its authority to cover the demurrage fees charged by ports and railroads.

The problem of excessive costs being incurred has risen to prominence due to the disruption caused by COVID-19 which has resulted in port congestion and as a consequence of this increased terminal dwell times for containers. Shippers are complaining that they have to pick-up the tab for all these costs when they are not wholly to blame for the problem itself.

Accordingly, the shipper advisory group, made up of 24 importers and exporters, voted to recommend the FMC adopt a new

rule that aims to prevent ocean carriers from passing along costs related to terminal dwell times.

The Committee further puts the case that the FMC should have oversight spanning all the parties involved in a Bill of Lading. It contends, for example, that as rail carriers are sub-contractors to ocean carriers that they too should be subject to FMC regulation.

Generally, the fundamental contention of the Committee is that: “The spirit of the FMC’s oversight should be founded at the Bill of Lading through to the final destination defined by the shipment parties.”

To take this approach is quite understandable from the shipper point of view and it is not difficult to have a degree of sympathy with it. Bottom line, shippers feel ocean carriers should be

For the latest news and analysis go to www.portstrategy.com/news

picking up these charges and not themselves.

Intertwined with this initiative, however, the Committee has additionally pushed back on the dwell fees that some US West Coast ports have recently applied; again arguing that such costs should not be passed on by carriers. Specifically, the charges that are in their sights are those such as the US$100 fee implemented last October by the ports of Los Angeles and Long Beach for containers left in terminals for nine days or more.

The shipper view is that carriers should be responsible for these charges and the resolution of disputes associated with them.

This, however, can be construed to be a rather simplistic view of a complex problem. It can be argued that placing the onus

on the importer to achieve timely box pick-up is the most appropriate course of action in order to generate results. Indeed, this is reflected in San Pedro Bay port experience where since the application of the fee in October a 50 per cent reduction in long dwell cargo has been reported.

Also, to draw a parallel, where Vehicle Booking Systems for terminals do not apply fees for no shows etc it is a matter of record that they do not function as efficiently as systems where charges do apply. Whatever new arrangements the Federal Maritime Commission comes up with, it is not seen to be desirable to take any power away from ports and terminals regarding the effective policing of their businesses. The ability to apply discipline in the business environment is essential.

JUNE 2022 | 21

DIGITAL: SPECIAL NEWS REPORT Effective use of resource is a port sector priority today. It is, however, not a task that has become any easier in recent times.

The impact of COVID-19 continues to reap havoc with supply chains, the Ukraine war is changing the fundamentals of trade in key commodity sectors and the world overall is advancing into an era of greater economic uncertainty.

The ports sector has, more than most, been buffeted on the waves of these dynamics – the practical outcome being realities such as late vessel arrivals, a general inability to plan around scheduled vessel arrival and departure times, yard congestion, labour and trucker shortages and an expanding web of health and other regulatory requirements to respond to.

There is no doubt that in today’s world, the world that has unfolded since 2019, port sector participants – port authorities, terminal operators and related service industries – have been challenged and continue to be challenged in the ‘new normal’ conditions.

An area of increasing interest as a path to establishing order under the prevailing challenging conditions, as well as generally in pursuit of higher levels of efficiency, is digitalisation. A prominent example of this in the fundamentally important area of asset management and resource planning is the MIMS software available from UAE-based Arrow Labs.

Arrow Labs flagship SaaS platform, MIMs, is a workflow management solution that helps organisations plan and execute complex workflows while ensuring field teams deliver results on time for each project milestone.

As Arrow Labs puts it: “The MIMS suite offers an integrated experience that ties all company processes and people into a time and money saving platform.” The company claims that typically use of the solution can increase staff productivity by up to 30 per cent and reduce operating costs by up to 20 per cent.

“Employing different applications, from no-code workflow builder to automated capacity planning, organisations can effectively schedule, manage projects and reduce the ‘slow-down’ caused by manual effort. MIMS real-time dashboards provide important KPIs for each project milestone as well as other important metrics,” explains Arrow Labs.

Introducing the system, experience shows, is straightforward – “…easy setup for companies of any size and anywhere,” as Arrow Labs puts it. This includes the option of the MIMS app, with a user-friendly interface, which further facilitates the overall goal of seamless collaboration, communication and exchange of information including from remote locations.

WORKFORCE MANAGEMENT The scope for application of the MIMS solution is considerable. It basically boils down to any aspect of day-to day-business or one-off projects where it is identified that an advanced

MORE FOR LESS The MIMS Software from Arrow Labs offers the means to enhance workforce performance and asset management in multiple areas of port and terminal activity at a reduced cost

workforce management solution can improve efficiency across company processes, assets and in conjunction with human capital. For port administration, for example, it can be deployed in conjunction with nautical services activities – tug, pilot boat and mooring – or with maintenance or security related activities.

At a terminal operating level, typical applications include: workforce resource planning; specific operations such as those related to container terminal gate activity or intermodal rail load/unload operations and with back-up activities such as maintenance or safety and security.

EFFECTIVENESS PROVEN The effectiveness of the MIMS software has been proven in the sphere of port activities – a prime example being as deployed for the DP World terminal operating group in conjunction with security activities across the group’s multiple terminal operating platforms.

Paper-based logs and disparate systems created difficulty in gathering information and presented challenges in coordinating response to various incidents in a timely fashion. This complexity placed a huge burden on security personnel to make informed decisions and resolve incidents quickly to ensure compliance to port safety standards.

As a result, DPW’s security management team felt it critically necessary to improve port safety operations by streamlining the basis for better decision-making and drastically

For the latest news and analysis go to www.portstrategy.com/news

8 The DP World project brought into sight opportunities to improve and eliminate bottlenecks, bridge the gaps and automate procedures

reducing incident response time. It is with achieving this important goal in mind that MIMS software was enlisted.

As DP World puts it: “MIMS helped us by automating and streamlining the operations of the security force in the field by accurately reporting incidents in real-time, enabling the capture of incident details supported by photos and videos via mobile phones. MIMS also provided electronic logging of all field tasks including patrolling and inspections, completely eliminating the need for previously used paper-based logs.”

Arrow Labs was engaged early on in the project right through to modelling processes and workflow. Drawing on information provided by DPW sources and its own due diligence it brought into sight opportunities to improve and eliminate bottlenecks, bridge the gaps and automate procedures that would in turn assist in achieving the key objective of reduced response times.

Overall, DPW’s security management team reports that the main advantages secured by using MIMS include: …”a considerable reduction in reporting times, quick handling and resolution of incidents, real-time operational visibility and access to electronically stored information that is readily available for decision-making and planning.”

JUNE 2022 | 23

CONTAINER ANALYSIS

CONTAINER ROLLERCOASTER: WHAT NEXT? How will the container sector emerge from the market shocks posed by ongoing COVID-19 issues and now the Russia-Ukraine war? Andrew Penfold explores this fundamental question Given the uncertainties and risks that have been noted since the pandemic, and now the Ukraine war, farreaching questions need to be answered concerning the outlook for the structure of future container trades. We have seen surging freight rates and chaotic logistic chain developments – how will this play out and what are the implications for container ports and terminals? Have the major shipping lines made the correct decisions regarding their windfall profits?

DISRUPTION NOT MORE DEMAND The first point to be made is that high freight rates have not really been driven by a surge in demand. Rather, supply chain disruption – way beyond port boundaries – has precipitated this situation. The effective withdrawal of a large proportion of container shipping capacity, especially on the major eastwest trades, has altered the market balance with surging freight rates the result.

The development of trade volumes on the major trades is detailed in Figure 1. The pandemic-led downturn in 2020 was limited, and the pace of growth since then has been within an anticipated range. There was a decline of some 1.6 per cent in 2020 and then a recovery of 6.6 per cent in 2021 with preliminary estimates of three per cent growth this year – hardly a massive surge in demand.

At the same time, container freight rates exploded, with the benchmark Shanghai Containerised Freight Index (SCFI) increasing from 995 at the end of 2020 to a peak of over 4000 in early 2022. Although there has been some subsequent decline, it remains at very high levels. The outlook for demand is not really that positive, with inflation-led uncertainties in the global economy and structural shifts underway away from a perceived over-reliance on China. Unknown fallout from the Ukraine crisis is also undermining sentiment in Europe.

The surge in rates is entirely due to labour shortages in trucking capacity in China and in the major import regions and resulting disruption in equipment positioning. There have been some periodic losses of labour in the port sector, but this has not been the major source of the problems – indeed, a degree of equilibrium in the terminal sector has been achieved (notwithstanding the threat of renewed lockdowns in Shanghai and other major Chinese export points).

So, what happens if the logistic chain problems are resolved, and a degree of stability returns to the container market? To try and answer this we need to look at the behaviour of the shipping lines in the past twelve months.

WINDFALL PROFITS: REACTIONS Following years of meagre returns the major shipping lines have recorded unprecedentedly good results in recent months. For example, Maersk has seen an increase of around 160 per cent in revenues per TEU between the third quarter of 2020 and the end of 2021. This pattern has been noted for all the major lines.

Resulting windfall profits have led to different strategies.

24 | JUNE 2022

On the one hand, some lines have assumed the current supply/demand balance is the new normal and rushed into further ordering of new capacity. Others have sought downstream investments and placed the emphasis on acquisition of strong regional forwarders and other transport companies. The jury is out on the correct approach.

Investment in logistics companies has been one strategy, with lines seeking greater control of the supply chain with the emphasis on e-commerce and local presence.

Maersk has been highly active with moves such as the US$3.6bn purchase of LF Logistics, a logistics and consumer sourcing company, the acquisition of Visible Supply Chain Management, a business-to-consumer (B2C) logistics company focused on B2C parcel delivery and B2C fulfilment services in the US and the purchase of B2C Europe Holding B.V. (B2C Europe), a business-to-consumer logistics company focused on B2C parcel delivery services in Europe CMA CGM has invested heavily in CEVA Logistics and followed this up with the acquisition of Ingram Micro’s Commerce and Lifecycle Services business, the purchase of last mile provider Colis Prive and the near 100 per cent purchase of GEFCO, the European automotive logistics concern. It is also implementing diversification into the air cargo market acquiring four A350F aircraft.

MSC has made a $6.4bn offer for Bolloré Africa Logistics.

This seems like a strong move and a useful way of investing the benefits of a unique (perhaps one-off) situation. It is also eyeing the airline sector with moves to acquire a major stake in the Italian state airline ITA Airways.

However, the degree to which downstream investments can be successfully integrated into shipping lines business models remains unclear. There are many examples of unforeseen difficulties with this approach. The uncertain

8 The spectre of a collapse in freight rates looms as the huge amount of new tonnage on order sails into service

For the latest news and analysis go to www.portstrategy.com/news

CONTAINER ANALYSIS

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If the disruption delays in the logistics chain are resolved, and with limited underlying trade growth, where will all the new tonnage be deployed?

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DEJA VU Anyone with a sense of perspective in the shipping markets will have the feeling that this has happened many times before. Over exuberance in ordering – either as the result of technical revolution (usually size-based) or a misreading of market fundamentals always results in a glut of tonnage being delivered onto an oversupplied market, with predictable results for lines’ financial positions.

A collapse in freight rates can be anticipated in the next two years as all of this capacity arrives and the container business faces unprecedented changes in direction.

In summary, the problems will be: 5 The danger of macro-economic contraction – with risks higher now than at any time since the Financial Crisis. Even trend expansion will not absorb all this new capacity.

5 Easing of the logistics issues that have distorted the supply side of the shipping equation. These are already being managed and the underlying situation is much improved.

5 The move towards nearshoring. The recent Russian situation and worsening political issues with China have undermined some of the confidence in globalisation. Even if alternatives to China can be found (India, Indonesia, Vietnam, etc.) the infrastructure for the largest vessels is not yet in place in these regions.

Shipping lines need to be very careful in capacity planning against this background, after all these levels of risks seem much higher than in previous cyclical downturns. But it may be too late for some…

PORT IMPLICATIONS Identifying the implications for containerports and terminals is a complex task and various local issues will need to be accommodated. However, some basic factors will emerge:

Source: Clarksons, MPL

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8 Figure 1: Container Volumes – East West Trades (m TEUs), 2016 - 2022

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8 Figure 2: Container Fleet and Orderbook, 2015 - 2022

5 There will be an oversupply of the largest classes of vessels. The established east-west trades cannot absorb this volume of tonnage. Shipping lines will seek to cascade some of this tonnage onto other trades. This cannot be easily achieved without uprating of terminal capacity – especially with regard to draught and quay lengths. Who will pay for this investment? Moves need to be made now to offset these problems.

5 Within terminals, the reliance on larger vessels – perhaps with less frequent services – will mean increased peak loadings on terminals. This will have an impact on crane and yard capacities. Once again high investment will be required to accommodate this.

5 As has been the case in other shipping market downturns, lines will seek to lower the prices they pay for container handling. These demands must be resisted, especially if terminal operators (and ports) are to provide the level of investments required.

At present terminal capacity is seen to be at a premium.

Given that this is really the result of one-off specific conditions now would be a good time to lock in line customers. Perhaps now is the time for longer term contracts? Joint ventures with cash-rich lines may also make some sense.

Batten down the hatches!

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 25

Source: Clarksons, Alphaliner

benefits of line investments in container terminals – especially when seeking third party customers – is an illustration of the difficulties inherent here.

The other development approach has focused on expanding liner capacity, and this can only generate severe concerns. Figure 2 summarises the development of the container fleet and the cellular orderbook. There has been a massive surge in the ordering of new vessels with the orderbook increasing from around 2.5 m TEUs at the end of 2021 to a current level of nearly 6.7m TEUs – 27 per cent of existing fleet capacity. If the disruption delays in the logistics chain are resolved, and with limited underlying trade growth, where will all this tonnage be deployed?

The situation is actually even more problematic than here suggested. A look at the orderbook position for the largest classes of vessels (15,000TEU+ – above New Panamax and the ULCS fleet) confirms that in early May this stood at some 3.8m TEUs, with this being equivalent to 95 per cent of existing fleet capacity. These vessels can only be deployed on certain trades.

Is it really the case that demand will double on Transpacific and Asia-Europe trades in the next two to three years? What happens when the supply chain issues are resolved?

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TERMINAL OPERATOR SELECTION

TERMINAL CHOICES Shipping line/shipping line affiliate or independent common user terminal operator, which way to jump in selecting a best-fit terminal operator? Mike Mundy highlights recent market developments and summarises key differences in the offerings of the two groupings There is no doubt that over the last couple of years as the prosperity of shipping lines has risen, off the back of supply lines disrupted by COVID-19, their interest in investing in the terminal sector has risen. There is no bigger signal of this intent than MSC’s knockout bid of €5.7 billion for 100 per cent of Bollore Africa Logistics which includes 16 container terminals in its network. The deal for the sale was signed on 1 April this year and is pending regulatory and competition approvals with it expected to be completed by the end of the first quarter of 2023.

In general, however, it is true to say that when a concession opportunity comes to the market there is today a greater incidence of shipping line (encompassing the line itself or its terminal operating affiliate) interest in bidding for the opportunity. Cash rich the lines are now actively looking for investment opportunities and the terminal sector is a natural target – one that has always been there and has been participated in previously as witnessed by the formation of APM Terminals by Maersk’s parent A P Moller, Terminal Investments limited by MSC and Terminal Link by CMA CGM. The increased activity on the part of lines is broad-based.

It doesn’t just encompass the development and operation of 100 per cent dedicated terminals – facilities such as those in Singapore or Abu Dhabi which have been put in place mainly to serve the interests of the line or consortia’s core shipping business. There is also a stronger focus today on facilities that have a more common user role – that serve multiple lines including lines that are competitors.

A current example of this is the forthcoming privatisation of the STS10 terminal in Santos, Brazil where both Maersk and MSC are known to be candidate bidders. Indeed, they jointly operate BTP, the biggest active container facility in Santos on a 50: 50 basis and had hoped to bid for STS10 jointly but have been prevented from doing so by the state watchdog Cade, based on concerns over them achieving a monopoly. Hence, they will now bid separately, albeit that they both promote the point of view that one enlarged terminal facility in Santos – the STS10 site is adjacent to their BTP terminal – will enable Santos to become the hub port for East Coast South America. The counter argument, promoted by competing terminals Santos Brasil, DP World Santos and other parties, is that one large terminal would effectively create a monopoly and stultify competition.

Suffice it to say that STS10 demonstrates both the interest of lines in bidding for common user terminal facilities and their expertise at putting a good argument together to achieve this goal.

WHICH WAY TO JUMP? Shipping lines and their affiliates do tend to carry one trump card when bidding on both existing container terminal businesses and new facilities aimed at serving multiple users – they can invariably achieve a quicker ramp up of volume over the early years of taking up a concession as a result of being able to direct group-generated volumes that way. The strong counter argument, however, is that the presence of a line operating a terminal or its terminal operating affiliate

Common User – Independent Financial Issues

Market & Service Issues

Other Issues

Shipping Line/Affiliated (Dedicated)

Market-led contracts

Corporate-led contracts

Maximised profitability

Cost centre

Profit driven

One cost centre amongst several

Terminal fees maximised

Corporate influence on pricing(1)

Higher yield per TEU

Downward pressures on yield

Capacity-utilisation maximised

Line demand serviced

Higher utilisation rates typical when developed

Faster initial ramp-up (secure demand)

Level playing field for all customers

Owning line receives priority service

Typically higher productivity

Productivity determined by owner’s needs

Open customer policy

Competing lines reluctant to call

Flexible customer base(2)

Counter party risk - lines can go bankrupt

Direct shipper deals

Alliance changes

Supporting investment - inland terminals, etc.

Limited importance in overall line business

Scope for multi-terminal agreements

Note: there is scope for a hybrid approach. I.e., specific deals can be made with large lines to deliver a ‘virtual’ terminal. Priority berthing, handling rates, tariffs.

(1) The corporate influence on pricing is manifest in various ways, typically: a/ The negotiation of preferential rates - if there is a minimum cap it will be the minimum cap. The line can get the benefit of a discounted rate plus it is able to maximise the margin on the Terminal Handling Charge (THC) passed on to the cargo owner. THCs are charged by lines at a level over and above the terminal fees applied. b/ The exclusion of certain terminal fees - which can be achieved by i/ not setting up the terminal with a comprehensive tariff list and ii/ via direct agreement iii/ not charging for certain ancillary charges that should apply. For reference, ancillary charges can account for 10 to 20 per cent of terminal revenue (2) Common user terminals offer unbiased neutrality and service to all comers - the only service differences are realised as a result of contract negotiations. They are thus appealing to all comers whereas there can be a reluctance on the part of diverse lines to call at a terminal where a competitor has influence over the terminal operation - there are concerns over service priorities and potential access to sensitive competitive data

8 Table 1: Differences in Key Market and Services Issues that Exist Between Shipping Line/Affiliated & Independent Common user Terminal Operastors

may ultimately act as a deterrent to use by multiple lines and thus volume development can be negatively impacted over the longer term.

It is a debate that has raged back and forth for a while but nevertheless one that is still very worthwhile considering – the anti-line lobby summarise it as: “short-term gain or longterm pain.”

Of course, while there are a lot of common denominators about concession opportunities no two cases are exactly the same and as such each case has to be judged on its own merits as to the right profile of investor. But what are the important factors to consider in deciding ‘which way to jump’ between selecting a shipping line/shipping line affiliate or a common user terminal operator in conjunction with a concession award?

Table 1 highlights key market and service issues that are worthy of consideration in the selection process. It is hoped the summary is both informative and a useful guide for those involved with the challenging task of terminal operator selection.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 27

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CONTAINER SHIPPING

DOWNGRADES AND UPGRADES Market consultancy Drewry sees container shipping freight rates continuing to climb but a new set of problems intruding. Felicity Landon reports

8 Drewry has extended its horizon for supply chain recovery and now expects the issues to ‘start unwinding’ in the first half of 2023

How crazy is the container shipping market? Presenting Drewry’s latest outlook briefing, Simon Heaney, Senior Manager, Container Research, Drewry, made it clear: the forecast includes a downgrade in the outlook for world port handling volumes but it also included sizeable upgrades for freight rates and carrier profits.

Container system inefficiencies, disruptions and port congestion have been the dominant drivers of freight rates and carriers’ substantial profits over the past two years, he said. Now Drewry considers these factors to be embedded in the market and ‘simply relegated to the margin’.

“Ultimately, carriers’ ability to charge customers extremely high freight rates is going to be dictated by the longevity of the liner supply chain bottlenecks, which sadly remain highly unpredictable,” said Heaney.

After a 110 per cent increase in 2021, Drewry is expecting average global freight rates to rise by a further 39 per cent this year.

‘Mounting headwinds’ for container lines include the RussiaUkraine war; inflation and the dampening of consumer and business confidence; Covid-19; regulatory scrutiny; bunker prices; and the implications of decarbonisation measures.

Individually, each risk is of concern and difficult to predict in terms of duration, “but the biggest source of uncertainty comes from not knowing how all these various risks are going to interplay with each other”.

Drewry considers the war in Ukraine to be the top risk; this is followed by, ‘rising fast’, China’s zero-Covid strategy and consequent lockdowns.

CONTAINER HANDLING PROSPECTS World port container handling increased by an estimated 6.5 per cent in 2021. Drewry has downgraded its previous 2022 forecast from 4.6 to 4.1 per cent, “and if we ran the forecast again, I am pretty sure it would be lower again”. For 2023, Drewry has lowered its outlook for port handling from 3.5 per cent to 2.8 per cent growth.

Nevertheless, Heaney said: “Slowing growth prospects are going to be a concern to carriers but as long as any formal growth and sharp contraction can be avoided, the party should keep on going from the carriers’ point of view. It is

entirely possible for rates to remain extremely high at the same time as headline demand growth is falling.”

He said carriers would be most concerned about the COVID-19 situation in China and whether its impact will be felt most at factories or in ports.

“Covid has been very good for carrier profitability – the primary side-effect was to create capacity shortages in nearly every link of the freight transport supply chain at a time of high demand. Production outages were mainly confined to the start of the pandemic, but any new factory slowdowns or shutdowns could choke demand for services,” he warns. “The ‘sweet spot’ is for disruption to be bad but not so bad that it closes the factory gates.”

Drewry has extended its horizon for supply chain recovery and now expects the issues to ‘start unwinding’ in the first half of 2023.

“That is going to mean at least another 12 months or so of lengthy delays and high freight rates, but we do expect to see gradual improvements beforehand.”

Using AIS data to measure the number of container ships waiting outside selected major ports around the world, in high, medium and low-volume categories, Drewry assesses port congestion based on a standardised score.

High-volume ports on average were very congested throughout 2021. “We haven’t seen any signs of improvement and the situation appears to be getting worse, as we are now starting to see medium-volume and even low-volume ports increase – the problem is now spreading to these too. That is to be expected as ships divert to find clear pathways,” said Heaney.

He was asked: What will motivate carriers to reduce rates?

“They don’t want to. But if port congestion is the thing that has propped up and elevated freight rates, if you take that away, the market fundamentals are not going to be so strong.

There is a slowing and potentially contracting demand environment with substantial amounts of new capacity to join the market from next year,” he said.

In this scenario, the traditional supply/demand fundamentals would come back into play once congestion is over, “and frankly, the market will dictate how much carriers will be able to charge customers”.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 29

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Monday 17th October 2022 Welcome Reception

DAY ONE - Tuesday 18th October 2022 0800 Coffee and registration 08:30 Opening by Chairman/Moderator Dr Christopher Wooldridge, Honorary Research Fellow - Cardiff University

08:40 Welcome Address by Port of Antwerp-Bruges

Keynote addresses 09:00 - Isabelle Ryckbost, Secretary General, European Sea Port Organisation and other invited high profile guests 10:00 Decarbonization - A Ship Operator’s perspective Capt Sameer Bhatnagar, Sr Decarbonisation Integration Manager - Decarb Business Development & Innovation, A.P. Moller - Maersk

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11:25 Baltic ports for climate Bogdan Oldakowski, Secretary General, Baltic Ports Organization

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A zero-emissions luxury cruise line in the making Rolf Andre Sandvik, CEO, Northern Xplorer

Congress Stream Green Corridors - A pathway to net zero

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Featuring Martin Kroger, CEO, VDR, Valter Selén, Senior Policy Advisor Sustainable Development, Cruise and Ferry Network, EcoPorts Coordinator - ESPO, Edvard Molitor, Head of Sustainability, Port of Gothenburg and other key players in the port, shipping and technology industry.

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Keynote addresses 09:10 09.55 Ms. Lamia Kerdjoudj-Belkaid, Secretary General, Federation of European Private Port Companies and Terminals ESPO Environmental Report Valter Selén, Senior Policy Advisor Sustainable Development, Cruise and Ferry Network, EcoPorts Coordinator - ESPO 09:55 Question & Answer with Presenters 10:20 Coffee & Networking

Session 5: Monitoring - How ports can monitor their emissions 10:50 Biodiversity and Environmental monitoring at the Port of Dover Megan Turner, Environment and Sustainability Manager, Port of Dover

11:05 emiTr – emission tracking software for ports and harbours Paul Martin, Director of Maritime, AqualisBraemar LOC

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Session 6: Ports/Terminals: Transitioning to Clean Fuels – The key Steps 13:30 PWRSwäp De-risks Decarbonization Actions for Marine Industry Brent Perry, CEO, Shift Clean Energy

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PORT DEVELOPMENT: US GULF

GOING GREAT GUNS Container ports on the US Gulf Coast are outperforming national growth and their peers on the eastern and western seaboards. AJ Keyes assesses the plans and strategies of ports in the region

8 The Port of Houston Ship Channel – Bigger, Deeper, Safer

Serving the US, and especially the large discretionary markets of the US Midwest, continues to be undertaken by ports located in each of the “four corners” of the US (Northeast, US South Atlantic, Southern California and Pacific Northwest),” explains Craig Anderson, Managing Partner at specialist maritime business intelligence company, Dataand, before adding, “but looking at the data, the US Gulf Coast ports are going great guns, driven by the pace of local economic growth in Texas and declining efficiencies in San Pedro on the US West Coast. Yet serving the US Midwest by waterway is still yet to be developed.”

For the period 2000 to 2021, container ports on the US Gulf Coast recorded average annual growth of 5.4 per cent. By comparison, total North American port demand grew by 3.9 per cent per annum, with East Coast ports generating 4.4 per cent per annum and West Coast ports seeing increases of 3.3 per cent per annum.

As a result, the US Gulf Coast has seen its share of total North American container port traffic increase from an estimated 5.4 per cent to 7.2 per cent over this assessment period, with total port volumes rising from 1.6 million TEU per annum to almost 4.9 million TEU per annum.

Figure 1 provides a summary of this position as it has developed and while the gap between the West and East coasts can be seen, the steady and continuing increase by the US Gulf Coast is evident.

USGC: ALTERNATIVE GATEWAY ROLE? To maintain growth levels and handle increasing volumes the ports on the US Gulf Coast must continue to increase productivity and improve efficiencies. A central question in this respect is with transport logistics congestion hitting the West Coast hard and now occurring more frequently at East

32 | JUNE 2022

Coast ports, are US Gulf Coast ports capable of keeping pace with projected future growth, while also acting as an alternate gateway to frustrated shippers and cargo owners?

A round up of developments at the ports of Houston, New Orleans and Mobile will answer this question.

Houston is by far the dominant gateway in terms of volumes, as Figure 2 shows, and unsurprisingly the port has also been the recipient of the strongest growth in recent years. In 2014 Houston’s total volumes were 1.95 million TEU, but by the end of 2021 this figure had risen to almost 3.46 million TEU, supported by the oil & gas economic boom and industry relocating from California.

HOUSTON: BIGGER, DEEPER, SAFER Subject to strong demand, Houston has continued to improve its infrastructure and access. The project to widen and deepen the 52-mile Houston Ship Channel commenced in 2021 and is expected to be finished by 2025.

The Houston Ship Channel expansion, also known as Project 11, will widen the channel by 170ft along its Galveston Bay reach, from 530ft to 700ft. It will also deepen some upstream segments to 46.5ft, further ensuring safety and efficiency improvements for shipping, while also reducing NOx emissions by 38 per cent.

The port’s container terminals currently handle about 24 ship calls a day, with an additional three to six ships usually waiting to get into the facilities, says Jeff Davis, the port’s Operations Officer, and there has certainly been an increase in the sizes of vessels calling.

However, the role of container operations in Houston needs perspective. Container ships only account for 20 per cent of total shipping activity in the channel, with liquid bulk clearly dominant, representing 70 per cent of the overall

For the latest news and analysis go to www.portstrategy.com/news

PORT DEVELOPMENT: US GULF

NOLA: OVERCOMING HEIGHT LIMITS The Port of New Orleans (Port NOLA) had a tough 2021, with its 2020 total container volumes of 572,853 TEU falling to 488,199 TEU, representing a drop of 14.8 per cent.

The US Gulf continues to suffer from a shortage of access to containers caused by global supply chain issues. Janine M. Mansour, Commercial Director, Port NOLA, cites this as an influential factor on the port’s 2021 performance. “On the container export side, we were down 12 per cent,” she points out.

Nevertheless, NOLA has big plans for future container activities and to be better placed to respond to changing market dynamics. Brandy D. Christian, President and CEO, Port New Orleans explains: “We continue to position ourselves as an alternative gateway during supply chain disruptions.” As carriers and shippers continue to look to Port NOLA as the US Gulf gateway of choice, we are committed to investing in our state’s existing maritime assets, while also making progress on a second container facility that will serve vessels of all sizes, and create more jobs and opportunity for Louisiana.”

The existing Napoleon Avenue Container Terminal recently received four new gantry cranes as part of a US$100 million investment, but the port’s major future investment focus involves the 1100 acres of land acquired in Violet, LA, where it plans to develop the Louisiana International Terminal (LIT) at St. Bernard Parish. A new terminal taking up 400 acres is planned, supported by adjacent logistics activities. This new location means ships do not have to pass under the Crescent City Connection Bridge, with its height restriction of 170ft, meaning the largest ships that can pass under it are 6200 TEU, whereas the Violet option can receive new Panamax size tonnage of 15,000 TEU. However, the potential new facility at Plaquemines Parish (covered on p35) will receive larger ships in deeper water and with its largescale planned capacity it is a clear rival to the LIT scheme and will be up and running before it.

MOBILE BARRELS ON Despite the global pandemic, the Port of Mobile handled record container volumes in 2021. A total of 502,623TEU passed through the facility, which the Alabama Port Authority

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Source: www.dataand.com

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says represents an increase of almost 19 per cent over 2020.

This trend has continued into 2022, with the port authority confirming that April 2022 was a 39.7 per cent year-on-year increase, as container activity rose for the eighth continuous month.

There has also been confirmation of terminal expansion.

As part of a US$100 million project, an additional 32 acres is being added to APM’s existing 115-acre site at Choctaw Marine Terminal. The project is due to commence during 2022, with the first 19 acres ready by 2024 and the remaining 13 by 2025.

8 Figure 1: Estimated Share of Container Port Traffic by North American Coast, 2000-2021 in %

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As part of the process, APM Terminals is expected to add two more ship-to-shore gantries to complement the existing four super-post-Panamax units. Overall the current 650,000 TEU/yr capacity will be raised in phases to an eventual level of 1.5 million TEU per annum.

Source: www.dataand.com, ports

number of ships calling. Put that into context with Houston being the largest US port in terms of foreign waterborne tonnage (of 193.9 million short tons in 2021), and the need for Project 11 is easy to see.

Of course, expansion of container facilities continues too.

Houston recently added 100 acres of terminal space, in July 2021, for new container yards at the Bayport Container Terminal, explains Roger Guenther, Executive Director, Port of Houston. He also points out that in February 2022 three cranes were installed on a new berth at the Bayport complex, while the Barbours Cut Terminal has seen new truck gates increasing inbound lane capacity from 15 to 29.

Despite this investment, however, the port remains dependent on the access canal and it will still not be adequate for the largest new Panamax vessels. Potentially this could impact Houston’s ‘must-call’ status, especially if another truly deepwater facility is developed elsewhere on the US Gulf.

)#-

‘‘

There is strong demand for US Gulf port container capacity and diverse development plans are underway

8 Figure 2: Container Volumes at US Gulf Ports 2000-2021, in ‘000 TEU

CLEAR DEMAND There is a clear demand for cargo owners and shipping lines to utilise the existing ports on the US Gulf, with each facility responding in kind with various plans to keep pace with demand. While Houston, NOLA and Mobile continue to focus on their respective hinterlands, the new Louisiana Gulf Gateway Terminal (LGGT) at Plaquemines Parish looks to be a game changer. It too will service the local hinterland but it also has a major focus on exploiting the Mississippi river system to serve key markets such as St Louis, Memphis etc. (see p35). Its plans encompass partnering with a specialist vessel provider to achieve this to provide access at a highly competitive cost.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 33

IT’S YOUR MOVE. www.tideworks.com +1.206.382.4470

PORT DEVELOPMENT: US GULF

NEW SUPPLY CHAIN PLAYBOOK The existing container ports on the US Gulf Coast, and further afield in the US, look set to be challenged by a new facility with potential to change the status quo. A J Keyes reports

INFANCY ON THE MISSISSIPPI Container barging remains in its infancy on the Mississippi, but as Port Strategy Editor, Mike Mundy, reported in September 2021, there are favourable cost structures to support new activities, with investment interest in an environmentally friendly transport option that can serve import and export demand.

With continued US port congestion in Southern California this new project at Plaquemines Parish can offer beneficial cargo owners an alternate routing, especially for serving such key locations as Memphis and St. Louis. Coupled with this, opportunities have been identified for export opportunities for manufacturing and dry bulks. There is potentially wide market coverage extending over some of the major regional consumer markets in the South and on to the US Midwest.

The planned Plaquemines facility will be located on the lower Mississippi River, 50 nautical miles from the Gulf of Mexico. The site benefits from a water depth of 50ft and 8200ft of waterside frontage offering the potential for container ships of up to 22,000TEU at a site which has a land bank of up to 1000 acres.

The terminals developers, LA23 Devco, note the terminal will be environmentally-friendly, with power provided by a combination of natural gas and electricity, clearly targeting a robust “green” footprint for its operation. Also highlighted, is the application of modern infrastructure technology and engineering to provide protection against storm surges and wind damage – certainly needed for a port located in the US Gulf.

COMPELLING COST RATIONALE To many industry stakeholders, the Mississippi and its tributaries represent an under-used opportunity for container distribution. The Plaquemines project offers a compelling transport cost rationale, with use of new-Panamax deepsea container vessels (14,000 TEU+) and relatively low-cost stevedoring combined with specialist inland vessel

Source: Dataand.com

The make-up of the US Gulf container port market looks set to change. Houston, New Orleans and Mobile all play an integral role in serving localised markets, but, now plans are also afoot to serve the massive US Midwest markets via a new gateway port on a highly cost competitive basis.

So, what is changing the status quo? The Plaquemines Port Harbour and Terminal District will be home to a new terminal, the Louisiana Gulf Gateway Terminal (LGGT) at Plaquemines Parish, located 20 miles south of the Port of New Orleans at the mouth of the Mississippi River, which is actively targeting the US Midwest markets and exploiting the Mississippi River.

APM Terminals North America, has expressed strong interest in the project and Wim Lagaay, the company’s CEO notes: “We see tremendous opportunity to write a new supply chain playbook for US exporters and importers with this location.”

Specialist barge operator, American Patriot Holdings (APH), is also an interested party in this project and is keen to target US Midwest grain and agriculture exports (and consumer imports) with a barge service hubbing at the Plaquemines site.

operations, indicating a cost saving of at least US$400 per 40ft container for imports into the Memphis and St. Louis markets versus use of West Coast terminals. This is a real key driver for demand.

Transit times to Plaquemines may be longer than via West Coast ports but given the ongoing situation in Los Angeles/ Long Beach, and the East Coast potentially seeing similar issues, this may not be quite the factor it was in the past. For the US Gulf and the wider US container port market, the status quo may be set to change.

8 Figure 1: Traditional Hinterland Reach of US Gulf Container Ports – highlighted by the coloured zones

REDUCTION IN FLOOD RISK The fact that the port and connecting infrastructure will be built 16ft above sea level is further recognition of the appealing geographic location.

Moreover, to reduce the risk of flooding of the terminal site and surrounding area, the US Army Corps of Engineers (USACE) is building a new Federal levee system. This will raise the existing flood protection from a 4ft height to a new height of 14ft and will tie back into the Mississippi River levees at a height of 15ft.

All this means that once completed, the planned system will be able to protect the site from devastating storm surges of the type experienced in the past. Construction of this flood protection profile is scheduled for completion in the spring of 2023.

As mentioned above, another party involved in the process is APH, the exclusive marine transportation service provider between PPHTD and an inland network that includes St. Louis, Memphis, Joliet, Kansas City, Cairo, and Western Arkansas.

APH is planning to introduce new LNG-fuelled ‘Hybrid’ vessels, with initially four ships most likely needed to provide a weekly service covering key inland locations and linking to the new Plaquemines terminal. Further vessels will be introduced in line with a projected ramp up in traffic. Current indications are that the APH vessels will offer a capacity of 1800TEU.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 35

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PORT OPERATIONS : FLORIDA

FLORIDA’S MILLIONAIRES CLUB Florida is home to three large container ports that each handle over one million TEU annually.

AJ Keyes assesses how these ports are keeping pace with demand

8 JAXPORT says it can be a solution to congestion at other US ports

The economy in Florida has been more dynamic in the recent past than in the US as a whole. It has been less impacted by COVID-19 and maintained stronger GDP and employment.

This has benefitted major container ports in the state, notably Port Everglades and Miami, while Jacksonville has taken advantage of general port congestion and supply chain disruption in the US South Atlantic area by its ability to reach markets such as Atlanta through intermodal rail connectivity.

These three ports are now each handling over one million TEU per annum and collectively around 3.6 million TEU in 2021 – an increase of 2.7 per cent per annum since 2010.

So, what is driving demand for each port and what is being done to accommodate growth and enhance efficiency?

JACKSONVILLE OFFERS BANDWIDTH In its last fiscal year, which runs from October 1 through to September 30, the Jacksonville Port Authority (JAXPORT) reported that container volumes were 1.4 million TEU, equal to an annual increase of around 9.6 per cent. The first six months of the new fiscal year has also started positively, with almost 638,000TEU handled, with the stronger US peak season still to come.

Volumes in the port’s two key trade lanes were the driving force, with Puerto Rico activity up by 19 per cent and Asia rising by 18 per cent, factors not lost on Eric Green, CEO, JAXPORT, who comments: “Achieving a container record and strong vehicle volumes while maintaining our efficiencies — all in the middle of a pandemic — speaks to the resiliency and capability of Jacksonville’s maritime community.” He goes on to claim how: “JAXPORT is a solution to the nation’s port congestion problem” pointing out that throughout the pandemic it has had no vessels waiting at anchorage to enter the Jacksonville harbour. Further that, “the port offers available berth and terminal capacity to easily accommodate vessels displaced by congestion at other US ports.”

With JAXPORT seeing Federal support to deepen the Jacksonville shipping channel from 40ft to 47ft, due for completion by Q3 2022 and US$200 million of berth enhancements ongoing at Blount Island, the port will be able to simultaneously handle two new post-Panamax container vessels. This will make JAXPORT a more viable option to compete for all-water services from Asia via the Panama Canal.

In a separate move, Ceres Terminals has commenced operating the TraPac container terminal at the port, signing a

20-year deal to take over from Mitsui OSK Lines of Japan. The Dames Point Marine Terminal has two 1200ft berths and six post-Panamax cranes and in the Q4 2021-Q1 2022 period secured calls from Hapag-Lloyd’s AL3 European service due to congestion at other regional ports. JAXPORT will be hoping that the new operator is able to entice new liner services moving forward.

Ceres Terminals represents a logical choice here because it already operates the intermodal rail yard in Jacksonville that services both Dames Point and the Blount Island Marine Terminal.

BREAD-AND-BUTTER FOR PORT EVERGLADES Port Everglades also handled 1 million TEU during its fiscal year period ending September 30, 2021, returning the port back to its pre-COVID-19 level. For the first half of its 2022 fiscal year, the port handled 555,315TEU, up by 7.9 per cent on the H1 2021 fiscal year, with demand driven by the Central America/Caribbean region, which provides 74 per cent of all containers handled.

Jonathan Daniels, Chief Executive and Port Director, Port Everglades, comments: “Our bread-and-butter trade partners, Latin America and the Caribbean, are rebounding as they return to manufacturing and open their borders for trade and tourism….Florida ports, including Port Everglades, are poised to handle larger container volumes and may be able to help alleviate congestion that other ports are experiencing,” he concludes.

MIAMI MAGIC The Port of Miami handled 1.25 million TEU in its fiscal year period ending September 30, 2021, reflecting a strong increase of 17.6 per cent over the comparable 12-month period. The calendar year was described by the port as its “busiest in history” with expectations for the trend to continue in 2022 Trade with the Caribbean and Latin America is dominant for Miami, accounting for 52 per cent of container traffic.

Based on the port’s geographic location, this is not going to change and its location in Miami-Dade county, which generates almost 15 per cent of total Florida state GDP, confirms a solid local market to serve.

The Port of Miami said it continues to operate without delays to vessels, with all cargo flowing in spite of the wider disruptions to the supply-chain across North America and the rebound from the COVID-19 pandemic.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 37

SPECIAL SUPPLEMENT 14-16 June 2022 Ahoy Rotterdam The Netherlands

tocevents-europe.com Supported by

Get ready for the BIG RETURN of the AGM for Port & Terminal Professionals After a two-year absence, TOC Europe finally returns for the largest gathering of global container supply chain professionals, all in the hub of European container logistics – Rotterdam, and for the first time ever, is completely FREE to attend!

Last attracting over 4000 attendees in 2019, thousands of port professionals will be re-connecting in June in the way it’s done best – face-to-face, all in one place.

Here’s a taster of what you can expect at this year’s show from 14-16 June: Discover the World’s Leading Showcase of Port & Terminal Products & Solutions TOC Europe is the home of cutting-edge port tech and services, where product launches take place year-on-year, and this is your chance to see, touch and try out the latest solutions in-person from 200 leading suppliers, including both well-established and more specialist names.

On the exhibition floor itself will also be thousands of decision-makers and influencers strolling around to network, discover and soak up the very latest innovations and developments. Expect the unexpected across a diverse array of stands, including the brand new ‘TT Club Safety Village,’ in partnership with ICHCA international.

Confirmed exhibitors include: Kalmar, Konecranes, Liebherr, ZPMC, Siemens, ABB, Kuenz, and Cavotec Discover a Powerful Programme TOC Europe’s two-track programme brings together over 100 world-class specialist speakers, including representation from the Ports of Rotterdam & Amsterdam, the European Commission, TiL and IKEA, to focus on the present challenges that lay ahead for

the maritime and logistics sector as part of both its renowned Container Supply Chain (CSC) Conference, as well as its TECH TOC programme that focuses on the latest innovations in in the market, and how these are revolutionising the industry.

Whether your focus is on adapting to the unpredictable economic climate, embracing today’s game-changing new technologies, or learning more about the green strategies that will define future sustainability efforts and in turn drive profitability, here is the place to supercharge your strategies.

Each day will have a special focus, allowing attendees to customise their programme and build their own bitesized agenda in the way that suits them, enabling maximum time for learning and networking opportunities: 5 Day 1: Business Intelligence Day 5 Day 2: Sustainable Day 5 Day 3: Digital Day Sessions covered will include: Market Intelligence & Volatility, Considerations for Automation at Container Terminals, Digital Advantage and Digital Levelling Up, as well as the ‘Fit for 55 Package’ for Maritime & Logistics session (Focused on energy transition).

providing this much missed opportunity to learn, debate and network in-person once again.

Visitors arriving in Rotterdam can expect a busy and productive week, with almost 200 exhibitors and 100 speakers confirmed. Our high quality content programme will ensure the days spent away from the office will be extremely valuable. This is a people business, and the demand for this event has been incredible.

This will also be the most sustainable TOC Europe event ever. Running an event with an international audience gives us lots of opportunities to improve our impacts environmentally, socially and economically and we aim to provide a global platform for the industry to share sustainability best practices – it is therefore our duty to provide the sector with a sustainable TOC Europe.”

There’s never been a more crucial time to attend – secure your FREE pass today With the current geopolitical uncertainty demonstrating the need for even greater innovation and collaborative partnerships, TOC Europe provides a welcome chance to re-connect, network, learn and trade once again with thousands of like-minded professionals in a COVID-safe environment.

You can enjoy exclusive post-event access to all recorded sessions and speaker presentations, and catch up with any content you might have missed at any time post event.

8 For more information about our exhibitors, the full agenda, networking reception attendance and to register for your FREE pass, visit tocevents-europe.com

3 days – 2 shows – 1 event – 0 cost!

A Rejuvenated Social Scene After such a long period of enforced isolation, meeting colleagues and contacts again will be a key highlight and TOC Europe as a result will be hosting an official networking reception for key attendees to facilitate further networking in a relaxed and informal setting. Expect an inclusive community and fun atmosphere, enabling you further to get back to business!

Witness the Most Sustainable TOC Europe Ever Paul Holloway, TOC Event Director, stated: “Our goal, as ever, is to support the industry by

38 | JUNE 2022

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TERMINAL OPERATIONS: BRAZIL

ICTSI RIO RENAISSANCE Pursuing new cargo streams and investing in inland cargo logistics is breathing new life into ICTSI Rio despite a challenging marketplace. Rob Ward reports

8 ICTSI Rio is targeting new container business and building breakbulk volumes

From close to zero five years ago, ICTSI Rio now handles around 35 to 40 per cent of the break bulk volumes passing through the port of Rio de Janeiro, with rival MultiRio still handling the majority share. And thanks to that re-alignment in its cargo mix and improved financial management, ICTSI Rio posted a revenue improvement of 25 per cent in 2021 when compared to 2020.

The decent financial result was despite container volumes falling in recent years, from a peak of 240,000TEU back in 2013, to just 160,000TEU in 2021, when the UCLA service of Maersk and MSC (to the US Gulf) transferred over to neighbouring MultiRio, where MSC participates in the shareholding structure.

This trend of box terminals diversifying to alternative cargoes – such as break-bulk, cellulose and ro-ro – has been a common thread in Brazil in recent years as facilities, such as Ecoporto and DP World in Santos, as well as ICTSI Rio endeavour to counter the “Verticalisation” manoeuvres of the major carriers. Notably in the latter respect, Maersk and MSC with their BTP joint venture in Santos, Maersk (APMTerminals) in Itajai and Pecem, and MSC in Portonave/Itajai and Rio. “Despite the Covid situation and losing one of our main Services [the UCLA service of Maersk and MSC] 2021 was not bad year from our perspective,” says Roberto Lopes, CEO, ICTSI Rio 1: “We lost container volume in 2021 – down to 160,000TEU for the year from 181,000TEU in 2020 – but we made significant progress in terms of break-bulk cargoes.

“On top of that we brought down costs, improved our pricing structure and began attracting more breakbulk operations. We have improved our mix of cargoes and widened our portfolio, to include even more project cargoes.

“Since 2017 when I came back here [when it was Libra Rio, prior to the ICTSI buyout] we have been chasing the breakbulk market and our first call came in 2018.”

CALL PATTERN “In 2021,” elaborates Lopes, “we handled 12 calls for breakbulk, all lift-on lift-off and no ro-ro, and it’s improving again so far this year and our forecast for 2022 is now for at least 15 vessels, so that would be another 25 per cent

40 | JUNE 2022

increase. Today MultiRio has between 60 and 65 per cent of breakbulk but they used to be close to 100 per cent.”

Among the regular calls at ICTSI Rio 1 are breakbulk perennials BBC Chartering and Intermarine and “we sometimes have tramp vessels calling, often bringing in fertilisers from Russia”, adds Lopes, who has also worked for Libra in Santos for long periods and had a spell with LogZ (who set up Porto Itapoa in Santa Catarina, the 500,000TEU per annum facility in which Maersk has a sizeable share) from 2013 to 17, during a long career in the Brazilian port sector.

In terms of breakbulk cargoes, equipment for Rio de Janeiro’s once again flourishing oil and gas industry (especially since the Russian war in Ukraine broke out) tops the list.

Additionally, however, ICTSI Rio also handles large structures for industrial installations, including car manufacturers, such as Nissan and Fiat.

When it comes to containerised cargo, as indicated above, ICTSI Rio has been particularly challenged by its rival, MultiRio, owing to the latter’s very close relationship and “Special Agreement” with TIL that is the terminal arm of global carrier MSC and its “Verticalization” strategies in Brazil. White Flag (neutral) operators in Brazil feel they are losing out to the socalled “Verticalists” who direct cargo to their own facilities.

Regular calls at ICTSI Rio are: Tango (to USEC) with Hamburg Sud/Maersk and Hapag Lloyd; ESA 1 (to Asia) with CMA CGM, Evergreen, Yang Ming and Cosco; Abac/Conosur (ECSA to WCSA) with Hamburg Sud/Maersk and Hapag Lloyd; Brazex (to US Gulf and Caribbean) of CMA CGM and Cosco as well as several Brazilian coastal and shuttle services.

ICTSI, with its HQ in the Philippines, took over in Rio from Libra Terminais (which had long-standing financial problems mostly caused by its operations in Santos at Terminals 35 and 37), in July 2019 for US$195.4m. Libra had already renewed its 25 plus 25-year concession in 2011, so it now runs until 2048.

Part of that extended concession commitment involves building a Reais130m 85m extension to the current pier which “should be ready by December 2023,” notes Lopes.

“Today, with four SSGs and 16 RTGs (of which 12 are electric), we have a capacity of between 580,000 to 600,000TEU per annum,” he explains, “but as we are currently

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TERMINAL OPERATIONS: BRAZIL

8 ICTSI Rio is boosting its hinterland reach with the long-term lease of the Floriano Intermodal Terminal in Barra Mansa, Rio de Janeiro and acquiring at least 40 trucks this year

operating at less than 30 per cent capacity it could take a few years to get near that. If we do attract a Far East service, which we are working on, and possibly others, then we will reconsider ordering more equipment.”

IMPROVED CONNECTIVITY Just before Lopes came back for his second stint at the Rio Libra/ICTSI terminal, Rio de Janeiro hosted the Rio Olympic Games (2016) and several games of the Brazilian World Cup (2014). One “major legacy for the City of Rio from the Olympic games” is the new access road into the port of Rio de Janeiro, and also a “much improved” road connection from the port to the major highway, the Dutra, linking the city to Sao Paulo, which finally fully opened last year.

“By truck from ICTSI Rio it used to take two hours to the Dutra freeway but now it is only 30 minutes,” enthuses Lopes, “and that is a massive improvement for all our logistics companies.”

The Dutra is around 20km away and 4km in that direction

is a rapidly growing logistics area, just northwest of the ICTSI Caju site. Here ICTSI Rio is setting up a base for its new logistics company IRB Logistica (ICTSI Rio Brasil).

“We are working now to improve our logistics options outside the port and so we are developing a facility in the logistics park, along with a number of other companies,” Lopes advises. He adds that ICTSI Rio “will buy at least 40 trucks this year” for IRB, from VW, which has a manufacturing base in Resende (Rio state). A truck now takes only two hours to Resende (instead of three and a half) and five to Belo Horizonte (it was six and a half).

There is also expansion on the railroad side, with the longterm lease of Floriano Intermodal Terminal, in Barra Mansa, an industrial cluster around 150km from the port of Rio. IRB Logistica will operate the facility which is offering “cargo handling, transport and storage services to the economic, industrial and production centres in Rio, Minas Gerais [including Belo Horizonte] and Sao Paulo”, asserts Lopes.

Verticalisation Driving Diversification ICTSI Rio 1 is one of several terminals in Brazil diversifying in the face of what is dubbed locally as verticalization – liner companies extending their activities along the supply chain.

There is a broad-based drive for breakbulk and for some the handling of specialised commodities such as cellulose and project cargoes – ICTSI Rio being involved in both areas and DP World with cellulose in Santos.

Ecoporto Santos is also making a good fist of diversification in Santos – with regular calls from Grimaldi and BBC Chartering among others – plus Santos Brasil has always had its ro-ro terminal (TEV), to counter-balance the comings and goings of major liner services. EcoRodovias bought

Ecoporto [then called Tecondi] back in May 2012 for Reais1billion, when it was handling around 500,000TEU annually. Now it is down to a few hundred boxes, as BTP (a joint venture between Maersk and MSC) dominates Santos, South America’s largest port for containers.

“The Verticalist companies have taken all our container business so we have to find alternatives,” said Luis Araujo, the CEO for Ecoporto Santos, which faces losing its operation and 175,000 sq m site when the STS10 tender is completed next year. “We are consolidating cargo and then trucking it to other terminals, and we are increasing our ro-ro and project cargoes, just to survive.”

Two port managers, one in Rio and one in

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Santos, point out that because of severe congestion at BTP in Santos, MSC switched one of its coastal shuttle services, from Vitoria to Rio instead, where it has an arrangement with MultiRio, including a prioritised berth.

“There is plenty of space in Santos at DP World, Ecoporto and Santos Brasil for these coastal calls but they switched them to Rio where they have an interest and Maersk employs the same tactic displacing White Flag calls with calls that benefit their own port terminals in Itapoa, Itajai, Rio, etc. Not so much, however, in Pecem, which doesn’t hold many alternatives due to its geographic isolation,” said one of the managers, who requested anonymity.

JUNE 2022 | 41

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TERMINAL OPERATIONS: BRAZIL

MSC PROPELS MULTI-RIO Rio de Janeiro terminal operator MultiRio is reaping the benefits of its “special relationship” with MSC but recovery in the ro-ro sector has stalled. Rob Ward reports

8 MultiRio handled 436,000TEU in 2021, up 88 per cent over 2020 throughput of 232,000TEU – new equipment acquisition is on the agenda to facilitate further advances

MultiRio (part of the Multiterminais logistics group), has just posted record throughput and almost doubled its handling over the past year in the container sector.

The company handled 436,000TEU in 2021, up 88 per cent over the 232,000TEU it registered in 2020 and more than 200 per cent higher than the 2019 figure of 215,000TEU. Now on track towards its capacity of 600,000TEU per annum, the company is considering ordering more equipment, including Ship to Shore Gantry Cranes (SSGCs).

The driving force behind MultiRio’s box boost has been the switch of the MSC UCLA service (to the US Gulf) from ICTSI Rio to its terminal, in mid-2020. This includes the switch of several coastal services from MSC’s recently acquired coastal operator, Log-In Logistica, which now calls in Rio as well as Santos or instead of Santos with certain services.

Luiz Henrique Carneiro, CEO, MultiRio, notes that the “special relationship similar to a joint venture” that his company has with MSC and its stevedoring arm Terminal Investment Limited (TIL), has been paying off in diverse ways but principally in a sharp uptick in boxes handled.

“In May and June of 2020 MSC decided to move several transshipment services from Vitoria to us, ones that used to go to Santos,” Carneiro explains. “Vitoria has a very narrow turning basin and so the bigger vessels currently trading along the East Coast of South America (ECSA) cannot enter so they need to transship to another port…”

These vessels used to be operated by the last surviving Brazilian container ship carrier, Log-In Logistica, but when the majority shares were bought by MSC the Swiss headquartered carrier decided to favour more calls at MultiRio. MultiRio now holds 63 per cent of the entire Rio de Janeiro conurbation market for boxes, while ICTSI Rio has 24 per cent and Sepetiba Tecon, just 13 per cent. Five years ago those shares were 50, 30 and 20 per cent but there have been many structural changes since then.

RO-RO CHALLENGES As reported in the preceding article, while ICTSI Rio has been gaining ground in terms of break-bulk cargoes, MultiRio has the lion’s share of container traffic and also ro-ro, although this latter area of activity has faced difficulties for several years now. The beginnings of a recovery in ro-ro – MultiCar, its sister company, handles Fiat from Minas Gerais and Peugeot Citroen and Nissan from upstate Rio - were visible from last year “until the Russia-Ukraine war started to bite,” according to Carneiro.

“We have seen a huge drop in car imports and exports since 2018 but that is because 2019 saw the Argentine crisis really start to bite and as Argentina makes up around 80 per cent of our imports and exports that had a huge impact on our business,” underlines Carneiro. “And then, of course, came Covid in 2020.”

The numbers reflect the damage: 2018 saw 117, 684 vehicles, 2019 68,500, 2020 50,441 and 2021 the first rise in five years with 81,200 units, up 61 per cent year on year.

“Our budget forecast for this year is for a 10 per cent rise but with the war between Ukraine and Russia we don’t think that is possible now,” states Carneiro. “Some component parts come from Ukraine and there is also a gas that comes from there which is used for making the chips that power the electronics in many cars.

“The first two months of this year,” he continues, “were an anomaly and gave us twice as many vehicles as last year, 20,208 compared to 8,700, but from March the numbers fell dramatically and we are no longer optimistic for increases for the rest of this year in this sector but containers continue to grow.” He points out that there is a chance of adding an Asian service to the roster and if that occurs MultiRio will open a bid for more equipment, including SSGCs. It is currently in the process of adding another 10 Terminal Tractors to the 27 it already deploys.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 43

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SOUTH AMERICAN NEWS

PARANA RIVER SYSTEM DREDGING: A “VERY COMPLEX SITUATION” The Argentine government has “effectively” granted Belgian dredging outfit Jan de Nul a “quasi indefinite extension” to their “very strategic” contract to dredge the Parana River system, to the relief of port users throughout the River Plate region.

Argentina is one of the world’s leading corn, soya oil and wheat exporters and key ports such as Rosario are hugely dependent on regular maintenance dredging to keep up the size of vessels that can reach that far upriver.

Because of this cargo owners were fearful that the conclusion last year of several long-term contracts with Jan de Nul and their Argentine signalisation partner Emepa might lead to a hiatus in regular dredging.

The port of Buenos Aires (BA), which handles around 1.5 million TEU per annum (more than 90 per cent of all Argentina’s containers), is also greatly beholden to regular dredging to keep a draft of around 10m and prevent too severe draft restrictions for carriers at the “end of the ocean port stop”.

Now an interim solution whereby AGP, the BA port authority, takes over, “in theory”, the running of the dredging has led to a short-term contract being awarded to Jan de Nul to carry on the work until there is a completed bid for a new 10-year contract. Sources say each extra year is worth US$30m to the contractors.

Alfonso Jozami, General Manager, Centro de Navegacion in BA, which represents the interests of shipping agents and the shipping community as a whole, told Port Strategy that the The Ponta do Felix port facility in Antonina, part of the Paranagua port area (APPA port authority), will next month (July) open up six new silos for storing malt, barley and wheat, adding 40,000 tons of static storage capacity at a cost of Reais45million (US$9m).

Petropolis Brewery, based in the city of Petropolis (north of Rio de Janeiro), which produces the popular Petra and Itaipava beer

BRIEFS Suape Rail

The northeast Brazilian port of Suape is finally catching up with its Master Plan of 2011 by initiating in-depth studies to build a rail link from the port to the Sertão Railway.

TPF Engenharia and B&C Engenheiros Consultores Ltd, have won the project’s Reais5.3million contract which should lead rapidly to a 9.7km Suape link to the railway and pave the way for a new iron ore terminal in the port complex.

TCBUEN Buy -In

situation is “very complex” since the original dredging contract for Hidrovia SA – a joint venture between Jan de Nul and Emepa – came to an end in June of 2021.

“The way I interpret the situation is that the extended contract, given last year, was for one year or until a new long-term concession agreement is signed,” he says. “And as that is unlikely to happen until some months after the next Presidential elections [in October of 2023], it could run for quite some time to come. It is very important for a port to have its draft clearly defined for carriers to carry out their future planning, and even more so for ports on the Parana today with the series of serious droughts we have been suffering from in recent years,” Hidrovia SA was set up in May 1995 with a rolling 10-year

8 After completing a 25-year maintenance dredging agreement of the Parana River system in 2021, Jan de Nul is now undertaking the work on a short-term basis – before a new long-term tender for the work is issued

contract. That contract came under the spotlight in August 2018 when an Emepa director was accused of bribing then President of Argentina, Cristina Kirchner, to get a contract extension back in 2010. Jan de Nul has made it clear that it had no involvement with the latter action and issued a public statement to this effect when the accusations first surfaced.

Jan de Nul has been deploying up to four hopper dredgers on the four key sections of the Parana Waterway and would be favourite to win any future bid, given they have several dredgers already deployed in Argentina.

A HUB FOR BEER PRODUCERS brands at plants around the country, and the Uruguayan Barley malthouse have already committed themselves to 10-year contracts to use the port, and other breweries and malthouses are also being lined up, according to Gilberto Birkhan, President, Ponta do Felix.

“We hope to turn our facility

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into a hub for beer producers,” says Birkhan. ““Our investments are focused on equipment, with the installation of concrete silos, leading to less impact of the external temperature on the quality of the stored products. In this way, we promote the integrity of the products and improve quality overall.”

Colombia Infrastructure Equity Fund, a fund managed by Colombia Infrastructure Partners, acquired 32.1 per cent of the Terminal de Contenedores de Buenaventura (TCBUEN) and 50 per cent of the Terminal Logístico de Buenaventura, two port terminals in Buenaventura, Colombia, for an undisclosed sum.

The precise origin of the purchased shares is not known but prior to the transaction TCBUEN SA enjoyed the status of a public limited company, with around 60 per cent of the shares held by APM Terminals and 26 per cent

by Grupo Empresarial del Pacífico (GEPSA). The remaining shares were held by the CVC, Gobernación del Valle, the Municipality of Buenaventura and more than 900 local shareholders.

Malha Central

Malha Central Brazilian rail and multimodal operator Brado is about to start operating the “Malha Central”, a rail connection owned by Rumo, another rail company, from the inland states of Tocantins, Goias and Minas Gerais to the port of Santos in Sao Paulo state. Brado is forecasting it will handle 472,500TEU by the end of this year, significantly up on the 350,000TEU in 2021.

JUNE 2022 | 45

Visit us at TOC Europe at stand C10

SUPPLY CHAIN ANALYSIS

THE DOMINO EFFECT A new report from the Royal Bank of Canada assesses the impact of current challenges to the global supply chain and considers what the likely outcome will be. A J Keyes presents the highlights

8 The Royal Bank of Canada (RBC), in a supply chain focused report, contends things will get worse before they get better

According to a new study from Royal Bank of Canada (RBC), the current global supply chain problems negatively impacting international container trade are going to worsen. The reasons? China’s COVID-19 lockdowns, Russia’s unprovoked attack on Ukraine and rising fuel costs for shipping.

The report makes a somewhat startling, though not entirely unreasonable, claim that currently around 20 per cent of the global container ship fleet was embroiled in congestion issues at ports worldwide.

ALARMING – BUT TRUE Statistics produced in the report are alarming, but true. For example, at the time of report preparation in Q1 2022, a total of 344 ships were awaiting a berth at the Port of Shanghai (a 34 per cent increase, it rightly claims), while a shipment from a warehouse in China to a similar facility in the US took an additional 74 days compared to normal service.

This clearly highlights the extent of the ongoing problems, with delays in getting containers onto ships in China compounded by issues related to their unloading at US ports. Subsequent to this, the report points to the slow performance of the landside supply chain and then more delays at warehouses due to a combination of lack of space and workforce issues including COVID-19 illness.

However, the report underlines that these issues are not occurring just in the Transpacific trades and serving the US. Ships arriving at ports in Europe from China are recorded as being an average of four days late. Europe has also seen a lack of empty containers being available to load goods for export with the Transatlantic particularly subject to this.

Michael Tran, Head of Digital Intelligence Strategy, RBC, along with colleague, Jack Evans, succinctly explains the issues faced. “Global port congestion is worsening and becoming increasingly widespread….it is hard to say when things will improve,” before adding that the ongoing issues are creating a “domino-like negative compounding effect across various markets”.

It is clear and fully understood across the port and shipping

industry that there is a need for ships and containers to be available at the right time and place to ensure the most efficient operation. The greater the mis-match the lower the utilisation of vessel capacity leading to impaired service.

PUTIN ACTIONS PUSH UP INSURANCE PREMIUMS The Putin-led Russian invasion of Ukraine is having a negative effect on shipping insurance, the report underlines, citing how the impact on shipping activity in the Black Sea has seen insurers pushing up premiums substantially. Indeed, pre-war levels were 0.25 per cent of the value of the ship but are now running at between one per cent and five per cent.

These are costs which will, no doubt, have to be passed on to consumers. As if that is not bad enough, then another major cost that will hurt end-users is rising fuel prices. The RBC report states that marine fuel prices in Singapore have increased by 66 per cent over the past year.

The report summarises the current position by stating: “Many market participants thought that supply chains would be untangled by now, but this scenario has failed to materialise.”

A CAUTIOUS TONE Moving forward, RBC strikes a cautious tone. It accepts that vessel delays are improving slowly but there is still some way to go. For example, the average global delay for a ship’s arrival is traditionally 4.5 days, but in March 2022 the figure was 7.26 days.

There are delays in many of the key gateways, the report notes. It classifies vessels queuing based on ‘Time of Turnaround’ (ToT) and cites examples in the US West Coast ports of Los Angeles and Long Beach with an average wait of 6.9 days, while in Europe ships were queuing above their fiveyear typical averages – Rotterdam up by eight per cent, Antwerp at 30 per cent and Hamburg at 21 per cent.

Here, RBC offers a sobering conclusion: “Significant compression of ToT times is required before we can confidently suggest a path toward normalising shipping costs.

The problem? Things are getting worse”.

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 47

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Join us at TOC Europe, Stand E40.

ENERGY: THE PROPANE OPTION

PROPANE: GAME ON?* Propane as a power source is getting more attention in the USA but the road ahead still has to meet the challenge of propane being regarded as a clean fuel but not a zero emissions one

8 Engine provider Cummins has developed a propane option in its B6.7 range

US ports have the potential to shift more of their energy consumption to propane, and it’s a trend which appears to be gaining acceptance.

Generally, users of propane embrace it because it has three unimpeachable virtues: it’s affordable, clean and produced entirely in the US. There is a long list of applications which could see increased usage by ports and terminals: powering forklifts; terminal tractors, back-up power generation, cold ironing, barge power and so on. Additionally, there is a long list of applications where propane has the potential to extend its reach with this including diverse cargo handling equipment and horizontal transport applications.

A key incentive to take up the propane option is that it helps improve air quality. When measured, propane does better than gasoline(1) on greenhouse gas (GHG) emissions, for example, 12 per cent(2) less with terminal tractors and light duty vehicles.

2 Author: Gordon Feller. Gordon was appointed by the Obama/Biden White House to serve on the Federal Comm’ created by the US Congress to look at emerging energy solutions. He is currently completing a project for the US government’s National Inst. of Standards and Technology and serves as a Global Fellow at The Smithsonian Institution

Propane is already being used to fuel resilient, low-NOx generators for backup and in prime power for cold ironing, charging and other large industrial applications.

Another factor working in propane’s favour is that it can be produced from organic and renewable sources. It is nontoxic, does not contaminate air, soil, or water resources.

Specifically, attractive environmental benefits in a port environment are lower Particulate Matter (PM), reduced nitrogen oxides (NOx) emissions and lower sulfur oxides (SOx) emissions. Forklifts powered by propane emit 76 per cent less SOx than electricity drawn from the grid.

With the onslaught of climate change, the choice has become clearer, especially when the facts about propane emissions are compared with the total emissions generated by diesel, or by gasoline, or by electric power that is generated in a coal-fired or gas-fired power plant.

There are also economic benefits. When compared with gasoline-powered vehicles or diesel-powered vehicles, propane delivers a lower total cost of ownership. This is made possible by a menu of advantages: a low-cost refuelling infrastructure; competitive upfront costs, low maintenance and operating costs.

Propane-powered ultra-low NOx engines for medium duty levels are now commercially available, thanks to a major move by Cummins Engine Corp. Introduced earlier this year,

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 49

VISIT ALIMAK AT: TOC EUROPE – STAND #B68

ENHANCE CRANE EFFICIENCY The majority of all container cranes in the world are equipped with an Alimak elevator. We have been successfully servicing the maritime industry since the 1970’s. Over 3,000 elevators have been supplied for port cranes since our first delivery in 1971, providing reliable and easy access for the crane driver, which reduces crane downtime and enhances productivity and safety. Today, Alimak elevators are installed in ports in more than 90 countries around the world.

ENERGY: THE PROPANE OPTION

‘‘

There are now at least three manufacturers of terminal tractors looking at propane powered units the Cummins B6.7 propane auto gas engine is said to offer high performance with low carbon characteristics.

On-site refueling at ports can be achieved competitively plus propane itself typically costs less than conventional and other alternative fuels. Construction cost estimates for a 1000 to 3000 gallon propane tank station are US$30,000US$50,000. This budget includes crash posts, seismic engineering and installation. An 18,000-30,000-gallon propane tank station costs US$100,000-US$150,000. This kind of infrastructure budget is reported to be less than other alternative fuel sources. Plus, propane has an additional advantage: a minimal footprint within a facility, with no utility service upgrades.

According to Tucker Perkins, President/CEO of the Propane Education & Research Council (PERC), the “propane engines of today have near zero emissions. This,” he says, “is a unique opportunity for our equipment partners to decarbonise ports infrastructure. PERC, he points out, “is ready to support the ports, the equipment manufacturers, and our marketers who serve this important growing market segment.”

Interestingly, Joe Calhoun, Director Business Development, PERC, has also been cited in recent media coverage as noting that there are now at least three manufacturers of terminal tractors looking at propane powered units one of which is South Carolina based TICO, the tractor and trailer system manufacturer. He goes on to enthusiastically highlight the potential for propane use with other items of cargo handling equipment and at a wider level.

The recent Infrastructure Investment and Jobs Act of 2021 (IJIA), which President Biden signed into law on November 15, 2021, is also seen to present opportunities for ports and terminals to take up the propane power option.

IJIA authorises more than US$1.2 trillion designed to improve US infrastructure. Furthermore, the law creates an unprecedented opportunity for propane and other lowemission fuels to power on-road and off-road fleets that have historically operated on diesel and gasoline.

IJIA includes over US$9 billion in funding for refuelling infrastructure and clean vehicles, including propane, which is identified in the IJIA as an emerging alternative fuel.

8 Typical applications cited for propane include: FLTs, terminal tractors, shore power and light and medium duty vehicles

Aeras introduces alternative to Shore Power AERAS Technologies is introducing its solution to meet the demanding requirements of a CARB Approved Emission Control Strategy (CAECS) for vessels in port.

The system, the first of its kind, will go into service in the Port of Long Beach and is designed to provide an alternative to shore power when this is not economically or technically viable.

The California Air Resources Board (CARB) regulation: the “Airborne Toxic Control Measure for Auxiliary Diesel Engines Operated on Ocean-Going Vessels At-Berth in a California Port” (aka the At-Berth Regulation) requires that vessel operators connect to electric power from the shore or, when this is impossible, reduce emissions by using a “CARB Approved Emission Control Strategy” (CAECS). A CAECS system, in addition to demonstrating reductions in defined air pollutants, must achieve compliance with the GHG emission provisions of the Regulation, CCR Section 93130.5(d)(1) which states that strategies approved after 2020 must be grid-neutral

8 The configuration of the AERAS system – can simultaneously extract emissions from multiple vessel engines and boilers

using the grid emission rate for the year the technology is granted.

In effect, a CAECS system is an alternative system to shore power when this option is not feasible. One such system, developed by AERAS Technologies, is now under

For the latest news and analysis go to www.portstrategy.com/news

construction in the port of Long Beach and will go into service there during 2022.

The AERAS system is designed to “nearly eliminate” particulate, NOx, and reactive organic gas emissions from vessel engines.

The company states: “the system represents a proprietary marine integration of proven emission control technology that is already the standard for stationary sources such as power plants.”

The company further points out that its systems have the capacity to treat the flue gas of a diverse range of vessel engines ranging from 250KW to 2200KW engines. A single AERAS system can simultaneously extract emissions from multiple engines and boilers.

Greg Alexander, SVP-Engineering & Compliance, AERAS Technologies, explains that its systems are mounted on barges and attach directly to the exhaust stacks of vessels, with a system of flexible ductwork mounted on a tower with an articulating arm, and that no shipboard modifications are needed.

JUNE 2022 | 51

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CLEAN FUEL TERMINAL TRACTORS

FUTURE FUEL PROOF Interest in clean fuel terminal tractors is building fast. New designs, ongoing R&D and extensive testing are all part of the picture as John Bensalhia reports

8 The Cummins PowerDrive 8000 terminal tractor EV powertrain system will go into production in 2023 – tests have been conducted with Kalmar

“We believe there must be alternatives as even if the technology in electrification is in place, there are still operations, locations and situations that need alternatives without compromising eco-friendliness.”

Niclas Samuelsson, Product Manager, Terminal Tractors, Kalmar, explains that Kalmar’s offering roadmap always looks ahead. At the present time, the company is preparing terminal tractor concepts in several areas spanning from natural gas solutions, alternative lower CO2 traditional fuels as well as fuel cell technology.

Kalmar’s clean fuel ethos is one example of modern manufacturers providing environmentally-friendly terminal tractor alternatives to conventional fuel.

Kalmar Terminal Tractors have been providing clean fuel alternatives for a number of years. Following on from the first-generation electric terminal tractor, launched in 2018, in 2021 the second generation was introduced with several improvements.

“Prior to the fully electric alternatives, we had different offerings including natural gas alternatives,” notes Samuelsson.

“In addition to this, we offer competitive fuel guarantees to our existing heavy range classic diesel-powered units.”

The growing popularity of zero emission electric vehicle choices is further highlighted in Gaussin’s ATM 38T model.

This recently passed the one-million-kilometre milestone since its launch. It is reportedly particularly seeing increased usage in European and American locations.

The engine supplier sector is also ‘putting its shoulder to the wheel.’

Cummins Inc. has recently unveiled its PowerDrive 8000 terminal tractor EV powertrain system, which will go into production in early 2023.

“We introduced this product in December 2021, and we’re working diligently with OEMs to bring it to market,” says Katie Zarich, Director, On-Highway Communications, Cummins Inc.

Cummins has also begun demonstrating a field test unit with Kalmar, and reports that field testing with TICO will begin soon. “The purpose of these tests is to verify that our power systems are working reliably and are capable of handling the duty cycles and demands of the terminal tractor application,” underlines Zarich.

CLIMATE GOALS Terminal operator Hamburger Hafen und Logistik AG (HHLA), is a prime example of a cargo handling business that aims to achieve climate neutrality.

HHLA has set itself the target of achieving this by 2040 and is pursuing the introduction of a number of new generation equipment designs as part of this. In the terminal tractor sector the company is to take delivery of a Hyster design later this year powered by Nuvera fuel cells. This will run on hydrogen fuel produced locally at the HHLA Hamburg Green Hydrogen Hub. Georg Böttner, Head Executive Board Projects, HHLA, explains that the results of the Clean Port and Logistics Programme (a joint initiative of HHLA and other European companies) will be the basis for a possible scaling up of further zero-emission hydrogen-powered port equipment.

“This is a part of our ‘H2Load’ project that was selected by the German government as one of the Important Projects of Common European Interest. This initiative is a further step as we help lay the foundation for a strong hydrogen economy not only in Hamburg, but elsewhere in Germany and Europe,” explains Bottner.

No less enthusiasm is shown for the modern alternative of the electrified powered platform by Cummins “EV powertrains have zero-emissions and instantly reduce the carbon footprint in busy port, terminal and distribution sites against their diesel counterparts,” says Zarich. “EVs are also significantly quieter, enhancing driver comfort and

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 53

If all STS cranes were replaced with Bromma all-electric spreaders, it would save CO2 emissions equal to

14 000 GASOLINE DRIVEN

CARS DOING A TRIP AROUND

THE WORLD - EVERY YEAR.

Bromma all-electric spreader More than 7000 spreaders are currently used in quay cranes around the world. 99% of these spreaders are driven by a hydraulic system. Now, imagine if all STS spreaders in the world were all-electric! This would imply CO2 emission savings corresponding to 14 000 gasoline driven cars (modern) doing a trip around the world - every year.

It is Bromma’s mission to help our customers meet their environmental goals. That’s why we are developing environmental solutions that do not compromise productivity.

CLEAN FUEL TERMINAL TRACTORS reducing noise in busy environments and localities where people work and live,” she points out.

In terms of efficiency, the EV has immediate power and instant torque compared to a traditional engine transmission.

“This combination gives operators the ability to move loads/ get work done faster.”

“Terminal tractors spend a significant portion of their time engine idling, which is mostly wasting fuel. An electrified powertrain will make the vehicle more energy-efficient.”

The Kalmar fully electric battery powered terminal tractor is a direct drive solution with no gearbox. Samuelsson points out that this means considerably fewer moving parts and allied maintenance.

“With one robust electric motor in the electric powertrain, we cover most existing duty cycles and applications without compromising productivity or performance. With two different charging solutions available, with charging capacities of 24180kW (152kWh or 184kWh batteries), we can optimise the charge pattern to meet the customer’s needs. With the DC fast charge system, there is also the opportunity for really fast charging to not interfere with daily routines.

“The maintenance cost is lower and productivity the same, while improving the driver comfort with silent and clean operations.”

EXTENSIVE TESTING Modern day clean fuel tractors are being put through their paces in extensive trials. Terberg, for example, has trialled its hydrogen-powered terminal tractor at both the Ports of Rotterdam (October 2020) and Antwerp (May 2021). Rob van Hove, Managing Director, Terberg Benschop, notes that the ultimate goal is to “offer excellent performance for heavy duty applications combined with favourable Total Cost Of Ownership (TCO).”

“We want to support our customers in achieving their sustainability goals. Our strategy is focused on providing flexibility to our customers, so they can adapt to their changing market environment,” he adds.

Gaussin’s first hydrogen-powered heavy-duty tractor, the APM H2 75T was tested at the Montoir-based Multipurpose Cargo and Container Terminal (MCCT) in Spring 2022.

“Our mastery of hydrogen technology enables us to tow 75 tons of goods while consuming about 10kg of hydrogen per day, for the first time in France,” notes Christophe Gaussin, CEO, Gaussin. “We are proud,” he adds, “to carry out this test with Terminal du Grand Ouest, which is emblematic of French port activities, and we look forward to rapidly deploying this technology on a large scale.”

From a cost perspective it is widely acknowledged that the first cost of clean-fuel terminal tractors is higher than existing diesel solutions. Against this reality, however, Samuelsson makes the point that lower maintenance and running costs are major attributes of the new clean fuel alternatives that go a long way towards compensating for the higher initial investment. Further, this reality prevails while the machines generate zero emissions over their respective lifetimes. “With next generation technology,” elaborates Samuelsson, “this equation will be even more beneficial.”

Kalmar suggests its second generation of electrically powered terminal tractors represents a step forward in terms of helping improve the eco-efficiency of their customers’ operations while maintaining the highest levels of productivity and safety.” In addition to the strong eco-benefits a range of other improvements have been made to the second generation for example charging time is cut in half. “Our first big change has been to incorporate a DC FastCharge System, which has allowed us to cut charging time in half,” elaborates Samuelsson.

8 Charging – the Kalmar Ottawa electric terminal tractor T2E – fast charging is available

“We have also removed the transmission from the driveline, moving to a direct drive solution where the electric motor powers the drive axle, reducing the complexity of the driveline” Also highlighted is the ability to operate in extreme temperatures. “We have included an Active Thermal Management System, which will allow your electric terminal tractor to operate optimally at full power in extreme temperatures.”

Cummins, from its perspective as an engine producer, speaks in a similar vein. It states it is well-positioned to enable OEMs and fleets to enter the EV space with reliable, competitive EV powertrain solutions. And Zarich points out: “Our EV powertrains for terminal tractors will allow end users to take advantage of vehicle purchase incentives, reducing the initial purchase price gap between conventional (diesel, ICE) and EV solutions. Furthermore, our EV powertrains operate more efficiently and require less maintenance over time compared to traditional ICE solutions, resulting in lower operating costs.”

AUTOMATION INTEGRATION In an interesting initiative, Hyster has recently teamed up with Capacity Trucks in order to work on terminal tractors that not only run on electricity and hydrogen, but additionally are automation-ready. Prototypes of these were trialled in 2021.

Willem Nieuwland, Big Truck Program Manager, Hyster, notes that the company has been working on unique zeroemissions container handling equipment for ports that incorporate lithium-ion battery and fuel cell technology.

“However, we are now ‘extending the family’ and bringing these benefits to more equipment types to support total green operations from ship to store.”

The introduction in December 2021 of the Kalmar Robotic Portfolio is similarly seeing the progressive roll-out of a future range of intelligent, flexible and autonomous mobile equipment solutions designed to improve safety and ecoefficiency without compromising productivity.

“One of the products included in the portfolio is Kalmar RoboTractor - an autonomous terminal tractor,” explains Samuelsson. “Kalmar is developing the RoboTractor solution in partnership with Coast Autonomous, an autonomous driving technology start-up based in California, USA. “Our ambition is to develop safe and autonomous, selfdriven solutions that can operate in mixed traffic where it is not always possible to segregate the working area with fences. The portfolio will eventually be available for different customer segments including ports and terminals, industrial sites and distribution centres. All the above will be integrated into the existing clean fuel terminal tractor designs, as we see a clear benefit combining, for example, electric powertrains with remote control or automated operations.”

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 55

ENVIRONMENTAL MANAGEMENT

TIME TO ADDRESS BALLAST WATER Mark Riggio, Head of Marine at Filtersafe*, highlights the tightening regulatory picture regarding ballast water management, the implications for ports and the need to participate in the push for compliance Ballast water management has always been a multifaceted challenge.

The Ballast Water Management Convention (BWMC) took twelve years to ratify, about three times longer than expected, and now various operational issues, alongside the impacts of COVID-19 and supply chain disruption, are causing more uncertainty.

DYNAMIC REGULATIONS Following some leniency in the height of the global pandemic, regulators are now set to properly enforce their respective regulations. In particular, the U.S. Coast Guard’s (USCG) ‘Final Rule for Ballast Water Treatment’ is already being more stringently enforced.

From a port operations perspective, it is important to remember port state control entities always have an expectation of cooperation, understanding of regulations, and require that a vessel’s paperwork is in order. In the past, this has been enough.

New enforcement of the BWMC, together with the expectation that a ballast water management system (BWMS) is functioning and discharging water that is compliant with the BWMC, is bringing an entirely new focus on vessel operations and threatens to impact the way that vessels interact with shoreside services.

Compliance is further complicated for ship owners by regional nuances and the ever-changing regulatory landscape. For example, Canada has recently indicated that it may be more-lax with enforcement in the Great Lakes, while the United States has no potential avenue to follow suit, giving vessels little option when trading across a largely confined but very small geographic area.

Knowing that systems must perform every day, whatever the conditions a port may be facing, creates significant challenges for operators. The most efficient solution is to ensure ship operators have an appropriate BWMS and filter onboard and to encourage them to treat their ballast water to the highest standards possible. This is particularly relevant for ports with what the IMO calls ‘challenging water conditions.’

SEDIMENT-RICH WATERS One of the most common features of a port with ‘challenging water conditions’ is a high level of total suspended solids (TSS). While current IMO testing standards require a BWMS and filter to function at 50 mg/L TSS, ports such as Shanghai have TSS levels exceeding 1000 mg/L. A filter remains at the very heart of a BWMS and is fundamental to operational success. Using an inappropriate filter will often lead to BWMS clogging issues and delays in these ports. Using no filter at all may cause significant build-up of sediments that trap organisms and provide protection from in-tank treatments.

MEPC 77 agreed to progress work on guidance for ships that need to conduct ballast water management in ports *Filtersafe is a world leader in automatic water filtration, specializing in self-cleaning, high-capacity fine-mesh filters

with challenging water, with the view toward finalisation at MEPC 78 or beyond. With no firm guidance, IMO has reinforced the status quo and there are currently no mechanisms for granting exceptions or bypassing of systems for ships operating in challenging waters. It is, therefore, critically important that ports with sediment-rich waters such as Shanghai, Rotterdam, Mississippi or Hamburg are aware that effective ballast water treatment is expected of vessels in their waters.

Ship owners and operators may ask ports for case-bycase exemptions but ports should be wary of handing these out. Exemptions would allow low-quality systems to be bypassed in less-than-ideal ballasting conditions. This is not a long-term solution and port operators’ time will be wasted negotiating with ship operators on current water quality and whether they are compliant or not.

There is also no real basis for exemptions. They would be contrary to the environmental aims of the BWMC and is against the UN Sustainable Development Goal 14 Life Below Water. If ports are regularly found to be providing unfounded exemptions, especially for the same vessels repeatedly, there is a high risk that they would be in breach of their regulatory responsibilities, resulting in fines and damage to reputations.

Operational issues such as slower ballast flow rates and clogging are a reality of current ballast water treatment, particularly in sediment-rich waters and, unfortunately, a vessel experiencing clogging issues may cause port delays

For the latest news and analysis go to www.portstrategy.com/news

8 Mark Riggio: “Ballast water management is a critical environmental consideration, to all shipowners, operators and ports alike, and should form a central element of ESG responsibilities”

JUNE 2022 | 57

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ENVIRONMENTAL MANAGEMENT

8 The final date when all vessels must comply with the D-2 standard for the implementation of the IMO’s Ballast Water Management Convention is September 8, 2024

due to increased time at the pier or slower cargo loading rates. However, there is sufficient technology and equipment available on the market today to meet the operational challenges posed by high sediment areas. Ports should be encouraging ship operators to use an appropriate BWMS and filter for their waters in order to improve port efficiency, reduce regulatory risk, and meet environmental responsibilities.

COMPLIANCE DEADLINE The final date when all vessels must comply with the D-2 standard for the implementation of the IMO’s BWMC is September 8, 2024. The standard includes specific details on the number of organisms per cubic meter of water, and the minimum dimensions of these organisms. But the bottom line for shipowners and operators is that there are about 28 months to install a BWMS. While this may feel like a long time, according to class society data, only about one-third of the existing fleet has a BWMS fitted. So, why does this matter to ports?

With a last minute rush to retrofit systems highly likely, there will be bottlenecks in shipyards and demand for spaces will far outstrip shipyard capacity. It’s likely that this will spill over and impact ports. Some vessels may be waiting outside shipyards and ports for dry dock spaces, leading to costly unforeseen port scheduling conflicts. Meanwhile others may miss the installation deadline and be in breach of regulations yet still wish to trade in the port. There is a concern that this will disrupt port operations and have a ripple effect on supply chains. It is important that suppliers, shipyards, ports, ship owners and ship operators work together to manage these BWMS installations and avoid this scenario.

‘‘

It is critically important that ports with sediment-rich waters such as Shanghai, Rotterdam and Hamburg are aware that effective ballast water treatment is expected of vessels in their waters central element of ESG responsibilities. From regulatory enforcement to operational issues such as clogging, there are many factors that ports should be aware of and indeed prepared to help solve.

In an ideal world, every ship calling at a port would use an appropriate BWMS and filter and would be seamlessly compliant with all regulations, causing zero impact on the efficiency of port operations and helping you halt the spread of invasive aquatic species in line with ESG targets. This can become a reality but only if all ballast water management stakeholders, including ports, incentivise ship operators to make it so.

8 Filter technology to solve ballast water issues is proven

IN SUMMARY To summarise, in the early 21st century the United Nations described the proliferation of invasive aquatic species as the second biggest environmental concern after greenhouse gas emissions. Ballast water management is much more than a tick box exercise, and while appropriately a lot of focus is being concentrated on reducing shipping’s GHG emissions, ballast water management must not fall too far into its shadow. It remains a critical environmental consideration to all shipowners, operators and ports alike, and should form a

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 59

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MARINE TECHNOLOGY

PRODUCTS & SERVICES DIRECTORY

Email: neuero@neuero.de Tel: +49 5422 9 50 30 neuero.de/en/

C ONNECTION SOLUTIONS

Specialist for pneumatic ship unloaders and mechanical ship loader. NEUERO follows the MADE IN GERMANY quality tradition.

Now with more than100 years of tradition in the manufacture of reliable and high-quality conveyor systems worldwide.

C ARGO HANDLING EQUIPMENT

B ULK HANDLING

A UTOMATION TECHNOLOGY

ifm electronic gmbh ifm is one of the world’s leading sensor companies in the automation of measurement and control, optimizing technical processes in almost all industries. +49 201 24 22 0 info@ifm.com www.ifm.com

NEUERO Industrietechnik GmbH

Over 60 years supporting Container Terminals in port operations: we create strategic ǁëŒƪėɆëŝĐɆļŝĉƎėëƖėɆƋƎŨǘƢëĈļŒļƢLjɆ ƢķƎŨƪİķɆƖŨŒļĐɆëŝĐɆƎėŒļëĈŒėɆ STS Portainer® and RTG Transtainer® cranes, services & Advanced Port Technologies.

PACECO® CORP. World Headquarters 25503 Whitesell Street Hayward, CA 94545 Tel (510) 264-9288 email@pacecocorp.com www.pacecocorp.com

As one of the leading manufacturers of quick connector systems,Stäubli covers connection needs for all types of fluids, gases and electrical power.

Tel: +33 4 50 65 61 97 connectors.sales@staubli.com www.staubli.com/en-de/ connectors/

B ULK HANDLING

Staubli_Directory Mar 2021.indd 1

Bedeschi S.p.A For more than a century, Bedeschi is providing effective and reliable solutions in a wide variety of industries (bulk handling, marine logistics and mining), capitalizing on synergies and cross competences.

Via Praimbole 38, 35010 Limena (PD) – Italy Tel: : +39 049 7663100 Fax: +39 049 8848006 Email: sales@bedeschi.com Web: www.bedeschi.com

Tel.: +49 2521 240 E-mail: info@beumer.com Web: www.beumer.com

YOU CAN DEPEND ON BIG RED!

Tel: +44 (0)2882 251100 Email: sales@telestack.com www.telestack.comw #WeHaveTonnesToTellYouAbout

– Portable grains pumps – Pneumatics continuous barge and ship unloaders 100-1200 tph – Simporter twin-belt unloader up to 2500 tph – Loaders up to 2500 tph Complete turnkey projects VIGAN Engineering S.A. Belgium Tél.: +32 67 89 50 41 www.vigan.com/info@vigan.com

P4.1 e-chain® Energy chain with optional intelligent wear monitoring for double the service life, travels of up to 1.000 m, speeds of up to 10 m/s and fill weights of up to 50 kg/m. igus® GmbH Spicher Str. 1a D-51147 Köln, Germany Tel. +49-2203-9649-0 info@igus.eu igus.eu/P4.1

Rohde Nielsen A/S Specialising in capital and maintenance dredging, land reclamation, coast protection, Port Development, Filling of Caissons, Sand and Gravel, Offshore trenching and backfilling Nyhavn 20 Copenhagen K. DK-1051 Denmark +45 33 91 25 07 mail@rohde-nielsen.dk www.rohde-nielsen.dk

LASE offers innovative and productive solutions for ports by combining state-of-the-art laser scanner devices and sophisticated software applications. We are specialised in the fully automated handling of containers, cranes or trucks.

Rudolf-Diesel-Str 111 D-46485 Wesel, Germany Tel: +49 (0) 281 - 9 59 90 - 0 info@lase.de www.lase.de

26/05/2021 12:20

DRY AGRIBULK MATERIALS HANDLING SYSTEMS :

Vigan ID.indd 1

LASE Industrielle Lasertechnik GmbH

E LECTRIFICATION SOLUTIONS

27/01/2021 11:29 Telestack Directory June 2021.indd 1

C OMPONENTS

Beumer Directory Jan 2021.indd 1

Contact Tim Hills +44 1329 825335 www.portstrategy.com

3690 N Church Avenue Louisville, MS 39339 USA +1 662 773 3421 CONTACT?SALES TAYLORBIGRED COM www.taylorbigred.com

D REDGING

Overland Conveyor Pipe Conveyor Stacker & Reclaimer Shiploader

Port Strategy Directory

Taylor Machine Works designs, engineers, and manufactures more than 100 models of industrial lift equipment with lift capacities from ,000-lbs. to 125,000-lbs.

excellent returnCambridgeshire on investment.

Gemini House Business Park, Gemini House Cambridgeshire 1 Bartholomew’s Walk, Ely Business Park, Cambridgeshire 4EAEly 1 Bartholomew’sCB7 Walk, England, United Kingdom (UK) Cambridgeshire CB7 4EA Tel: United +44 1353 665001 (UK) England, Kingdom Fax:+44 +44 1353 1353 666734 Tel: 665001 sales@samson-mh.com sales@samson-mh.com www.samson-mh.com www.samson-mh.com

Telestack are a leading global manufacturer of equipment for the bulk material handling industry including Ship Loaders/Unloaders, Hopper Feeders, Truck Unloaders, Bulk Reception Feeders, Stockpiling Conveyors, Link Conveyors and Telescopic Stackers.

25/02/2021 15:49

To advertise in the Taylor Machine Works, Inc.

C ARGO HANDLING SYSTEMS

The BEUMER Group is an international leader in the manufacture of bulk material handling systems:

SAMSON Materials Handling Ltd specialises SAMSON Materials Handling Ltd in the design andin manufacture mobile specialises the designofand bulk materialsofhandling for manufacture mobile equipment bulk materials surface installation across handling equipment for multiple surface industrial segments.

Designedindustrial for rapid installation across multiple onsite set-up and continuous segments.

Designed for rapidhigh onsite performance SAMSON equipment set-up and continuous high performance provides an excellent return on investment.

SAMSON equipment provides an

VAHLE PORT TECHNOLOGY VAHLE is the leading specialist for mobile power and data transmission VAHLE provides the solutions to reduce the carbon footprint while increasing the productivity.

RTGC electrification including positioning and data transmission making RTGC ready for Automation.

Westicker Str. 52, 59174 Kamen, Germany

Email: port-technology@vahle.de Web: www.vahle.com

25/01/2022 12:03

For the latest news and analysis go to www.portstrategy.com/news

JUNE 2022 | 61

PRODUCTS & SERVICES DIRECTORY

Port Strategy Directory Contact Tim Hills +44 1329 825335 www.portstrategy.com

With products ranging from Marine fenders, Offshore installation aids to products for the Foundation of offshore wind.

Phone : +919727738429 E-mail : Info@irmome.com Website : www.irmome.com

P OWER TRANSMISSION

H ANDLING EQUIPMENT

G RABS

MRS Greifer GmbH

IRMOME is the world’s most preferred offshore and marine rubber engineering products manufacturing company.

IRM Directory July-Aug 2021.indd 1 30/06/2021 14:24

01/02/2021 13:12

Grabs of MRS Greifer are in use all over the world. They are working reliably and extremely solid. All our grabs will be made customized.

Besides the production of rope operated mechanical grabs, motor grabs and hydraulic grabs we supply an excellent after sales service.

Talweg 15-17, Helmstadt-Bargen 74921, Germany Tel: +49 (0)7263 - 91 29 0 Fax: +49 (0)7263 - 91 29 12 info@mrs-greifer.de www.mrs-greifer.de

CAMCO Technologies NV Visual- and Micro Location- assisted process automation solutions for container, ro-ro and rail terminals worldwide. Accurate crane, gate & rail OCR systems and Gate Operating System software helping terminals accelerate terminal and gate activity.

Technologielaan 13 Leuven, Belgium +32-16-38-9272 +32-16-38 9274 info@camco.be www.camco.be

MARINE FENDERS

To advertise in the

Tel: +46 470 77 22 00 info@fogmaker.com www.fogmaker.com

Fogmaker Directory.indd 1

I T PORT AUTOMATION

F IRE SUPPRESSION SYSTEMS

Fogmaker develops, manufactures, and markets fire suppression systems for engine compartments with high pressure water mist. Fogmaker is a market leader for automated fire suppression systems with 200,000 installations in more than 50 countries since 1995.

Camco ID June 2021.indd 1

19/05/2021 14:16

Künz GmbH Founded in 1932, Künz is now the market leader in intermodal rail-mounted gantry cranes in Europe and North America, offering innovative and efficient solutions for container handling in intermodal operation and automated stacking cranes for port and railyard operations.

Gerbestr. 15, 6971 Hard, Austria T: +43 5574 6883 0 sales@kuenz.com www.kuenz.com

Conductix-Wampfler The world specialist in Power and Data Transfer Systems, Mobile Electrification, and Crane Electrification Solutions.

We Keep Your Vital Business Moving!

Rheinstrasse 27 + 33 Weil am Rhein 79576 Germany Tel: +49 (0) 7621 662 0 Fax: +49 (0) 7621 662 144 info.de@conductix.com www.conductix.com

Orts GMBH Maschinenfabrik Over 40 years experience constructing and manufacturing a wide range of grabs, including electro-hydraulic grabs (with the necessary crane equipment) radio controlled diesel hydraulic grabs, 4, 2 and single rope grabs all suitable for bulk cargo.

SANY Europe GmbH offers a broad spectrum of high-performance mobile port machines such as Reach Stacker, Empty Container Handler, Heavy Duty Forklift Trucks and Material Handler

Schwartauer Str. 99 D-23611 Sereetz • Germany Tel:+49 451 398 850 Fax: +49 451 392 374 soj@orts-gmbh.de www.orts-grabs.de

Sany SanyAllee Allee11 50181 Bedburg, Germany D-50181 Bedburg Tel: 100 Tel:+49 +49 2272 2272 90531 90531 100 Email: info@sanyeurope.com info@sanyeurope.com Email: www.sanyeurope.com www.sanyeurope.com

25/01/2022 11:42

To advertise in the

Contact Tim Hills +44 1329 825335 www.portstrategy.com

TT Club Directory March 2021.indd 1

Contact Tim Hills +44 1329 825335 www.portstrategy.com

Tel: +358 3 211 0403 Email: sales@visy.fi Web: www.visy.fi/

Port Strategy Directory

62 | JUNE 2022

Port Strategy Directory

01/03/2021 14:40 For

S IDELIFTER/SIDELOADER

I NSURANCE

Sany ID.indd 1

To advertise in the Visy systems reduce VISY Oy expenses, optimize safety & security, and VISY takes pride incapacity solving via increase throughput operational problems,Our specialising process automation. singlein gate automation and system access platform gate operating control solutions in ports and and OCR solutions manage all terminals.

Their solutions cargo, assets & personnel streamline processes resulting movements via quay, rail or road in saving money and to keep operations moving. increasing productivity.

Hammar Maskin AB Hammar Maskin AB is developing, manufacturing and marketing Sideloaders, also known as Sidelifters, Swinglifters or Self loading trailers, under the brand name HAMMAR™.

Buagärde 36, Olsfors 517 95 Sweden Tel: +46-33 29 00 00 Fax: +46-33 29 00 01 info@hammar.eu www.hammar.eu

the latest news and analysis go to www.portstrategy.com/news

PRODUCTS & SERVICES DIRECTORY

Solvo’s software solutions such as TOS or WMS help container and general cargo terminals take full care of their cargo handling processes and make sure the clients expectations are exceeded.

Prinses Margrietplantsoen 33, 2595AM, The Hague, The Netherlands Tel: +31 (0) 702-051-709 Email: sales@solvosys.com www.sovosys.com

TGI Maritime Software is a Terminal Operating System editor and integrator specialized in the support of Small to Medium Terminals. Its expertise is built on 34 years of experience within the maritime sector. TGI provides comprehensive services to its customers all along their projects. OSCAR TOS and CARROL TOS have already been successfully handled by 40 container and RoRo terminals worldwide.

Tel : +33 (0)3 28 65 81 91 contact@tgims.com www.tgims.com

T RACTORS

Navis understands that as ships get larger and operational processes become more complex - efficiency, collaboration and productivity are essential. As a trusted technology partner, Navis offers the tools and personnel necessary to meet the requirements of a new, and ever-evolving, global supply chain.

World Headquarters 55 Harrison Street Suite 600 Oakland CA 94607 United States Tel: +1 510 267 5000 Fax:+1 510 267 5100 Web: www.navis.com

Solvo Europe B.V.

T ERMINAL OPERATIONS SYSTEMS

S PREADERS

ELME Spreader AB ELME Spreader, world’s leading independent spreader manufacturer supports companies worldwide with container handling solutions that makes work easier and more profitable. Over 21,000 spreaders have been attached to lift trucks, reach stackers, straddle carriers and cranes.

Stalgatan 6 , PO Box 174 SE 343 22, Almhult, Sweden Tel: +46 47655800 Fax: +46 476 55899 sales@elme.com www.elme.com

The Brain of Logistics With more than 30 years experience in IT Solutions and Business Operation Consultancy DSP offers a large portfolio of professional services and products to support terminal operations processes and system.

DSP Data and System Planning SA Via Cantonale 38 6928 Manno, Switzerland Tel: +41 91 230 27 20 Fax: +41 91 230 27 31 info@dspservices.ch www.dspservices.ch

T ERMINAL OPERATIONS SYSTEMS

Tel: +44 2476 585 000 sales.team.uk@tvh.com www.tvh.com

T ERMINAL OPERATIONS SYSTEMS

S PARE PARTS

TVH is a global player in the field of spare parts and accessories for heavy forklifts, reach stackers, container handlers, spreaders and terminal tractors.

With over 96,000 references in stock and more than 644,000 known references, TVH offers quality replacement parts for many brands and makes, including the hard-to-find ones.

MAFI Transport-Systeme GmbH Tideworks Technology provides comprehensive terminal operating system solutions for marine and intermodal terminal operations worldwide. Tideworks works at every step of terminal operations to maximize productivity and customer service. info@tideworks.com +1 206 382 4470 www.tideworks.com

Specialised in the development and production of heavy-duty equipment for transporting containers, semi-trailers, cargo/roll trailers and special container chassis in ports and industry.

Hochhäuser Str 18 97941 Tauberbischofsheim, Germany Tel: +49 9341 8990 sales@mafi.de www.mafi.de

POSTSCRIPT TICKING TIMEBOMB

‘‘

“Millions of people will die because these ports are blocked,” David Beasley, UN World Food Programme

64 | JUNE 2022

The blockade of Ukraine’s grain export ports represents a ticking timebomb for some of the poorest nations in the world cut-off from the supply of essential foodstuffs.

The human cost of the Russian invasion of Ukraine is mounting on a daily basis – but the final tally promises to extend well beyond the tragic fatalities and wounds caused as a direct result of battle.

This is directly linked to the Russian imposed closure of Ukraine’s principal ports, Mariupol and Odessa, traditional gateways for the export of Ukraine’s agricultural products which play a major part in ‘feeding the world.’ The closure of these ports, through blockade as a result of Russian naval superiority, will have an impact far beyond the parameters of the physical conflict and one which may ultimately, if the current direction of travel doesn’t change, end up as the keynote of Vladamir Putin’s legacy – the death of hundreds of thousands, even millions, of citizens in the emerging world that are deprived of access to food supplies.

The World Food Program estimates that Russia’s invasion has catapulted the number of hungry people in the world to 323 million from the previous level of 276 million – a near 50 million uplift.

Ironically, with the Ukraine registering regular successes in the on-the-ground war, despite its success in sinking The Moskava, the Russian flagship vessel, it is not in ascendancy with regard to the maritime war zone. The bottom-line reality is that even if Ukraine was to achieve naval superiority Russia could still enforce a blockade of Ukrainian ports via missile and aviation coverage.

Putting Ukraine’s grain and other agri-products back into the supply chain cannot be achieved on a large scale by using alternative ports, both within Ukraine and those of neighbouring countries. As highlighted in the news pages of this issue, use is being made of Ukraine’s river Danube ports, Izmail and Reni, to move grain by barge to Constanta for export but the volumes concerned are relatively small. In addition to Constanta other export gateways are being looked at, Klaipeda, Lithuania for example, but getting product there by truck is problematic – there are damaged roads and bridges in the Ukraine and border crossings are not straightforward.

Rail is another alternative that is being looked at to access new port gateways. The EU has come up with a plan but this too has its pitfalls, notably severe bottlenecks at the borders with Ukraine’s EU neighbours due to the use of different rail gauges.

The problems are also about to get larger.

While Ukrainian Farmers only expect to be able to harvest four million hectares of the 6.5 million hectares of the 2022 harvest due to the war conditions, this new crop will join much of the last harvest which is still in storage. Equally, this new harvest and those of Romanian, Bulgarian and other farmers will place added pressure on the limited available port capacity.

8 Various solutions have been proposed to get Ukrainian grain moving but so far very little real progress has been made

THE OPTIMUM SOLUTION Experts agree that by far the best solution to getting Ukrainian agri-products moving again is the creation of a protected maritime zone enforced by international interests. Various methods of achieving this have been put forward but one that seems to enjoy particular favour is the establishment of a humanitarian navigation corridor policed by NATO vessels and aircraft. A variation on this is to have a coalition of participating countries to serve the same purpose.

This type of thinking is not a new concept it has been implemented before, a prime example being the UN-mandated naval escorts that protected merchant vessels from pirate attack off Somalia.

There are still problems, however, the Montreux convention which regulates shipping through the Turkish straits limits warships from non-littoral states to being in the Black Sea to no more than 21 days.

Thus, to maintain an effective convoy system would necessitate a very large western fleet stationed in the Mediterranean to rotate through the Black Sea. There are also concerns that a NATO policed convoy system may, inadvertently even, bring NATO vessels into conflict with the Russian navy and thus spark a wider level of conflict – an argument that has shades of the thinking behind not providing air cover to Ukrainian forces.

There are other issues. While Russia has faced severe setbacks with its war on land it is the dominant force at sea – Ukraine’s navy compared to Russia’s navy is tiny, a lot of its ships being lost in Russia’s earlier annexation of Crimea. Against this background, why would Russia want to back down from the dominant position it holds, a positive that the Kremlin can play to the Russian people?

Overall, the situation remains very problematic – around 20 million tonnes of grain and other agri-products remain ‘locked up’ in Ukraine. New harvests will add to the problem compounding shortfalls in delivery of essential foodstuffs to some of the poorest nations in the world. With prices rising there are no easy substitute sources of supply and as a result there is a real prospect of famine and starvation leading to millions of deaths. To say the least, not a pleasant scenario!

For the latest news and analysis go to www.portstrategy.com/news

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Stand B20

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