APRIL 2020 VOL 1020 ISSUE 3 portstrategy.com
Sabah ambitions | Sanctions: the risk picture | Scanning system innovation | Banana: a slippery road
COVID-19: IMPACT & ADVICE 5 Market Analysis 5 Ports: Practical Advice EU PORTS REGULATION CYBER CRIME SAFEGUARDS
PORTSTRATEGY INSIGHT FOR PORT EXECUTIVES
The international magazine for senior port & terminal executives EDITORIAL & CONTENT Editorial Director: Mike Mundy mmundy@portstrategy.com Guest Editor: Mike Mundy mmundy@portstrategy.com News Reporter: Rebecca Jeffrey rjeffrey@mercatormedia.com
VIEWPOINT MIKE MUNDY
Second quarter: no let up yet
‘‘
Falling demand in the US, Europe and elsewhere is the next ‘big hit’ from the coronavirus with significant challenges resulting during the second quarter
The second big hit is now manifest – falling demand in Europe, the US and elsewhere. This follows on from the havoc caused to manufacturing outlets and supply chains in China after being impacted by the coronavirus. While recovery is underway in China, with manufacturers steadily ramping up production and truck driver availability climbing, attention now turns to the world’s major demand centres where COVID-19 is now strongly exerting its negative influence and will, as diverse analysts point out, be responsible for a substantial fall in demand. Denmark-based Sea Intelligence is sticking to its earlier estimate of a 10% decline in global container shipments equating to 17 million TEU transported by shipping lines and 80 million TEU handled in the world’s container ports. The analyst has also recently estimated a potential fall in US output in the second quarter of this year that could be as high as 24% due to a combination of the coronavirus and an oil price war. Clearly, such a scenario will impact demand and lead to a reduction in freight volumes. The Economist Intelligence Unit (EIU) also makes a poignant statement when it says: “The coronavirus epidemic represents a severe threat to global growth. Prior to the outbreak we expected global real GDP growth to be lacklustre this year, at 2.3% (at market exchange rates). The emergence of the epidemic in China is a game changer, and we now expect global growth of 1% this year—the slowest rate since the global financial crisis of 2008. The negative effect on growth will come via both demand and supply channels. On the one hand, quarantine measures, illness, and negative consumer and business sentiment will suppress demand. At the same time, the closure of some factories and disruption to supply chains will create supply bottlenecks.” Specifically, in terms of regions the EIU also makes the following interesting observations with regard to Europe and Asia: Europe: “We expect economic uncertainty to persist until at least June, dampening business sentiment, household consumption of non-essential goods, and travel and tourism activity.” Asia: “The coronavirus outbreak will affect every economy in Asia in 2020.” It particularly cites the negative impact of a downturn in tourism with a downturn in Chinese tourism at the forefront of this. Equally, it notes as a major negative disruption to industrial supply chains with the economies with the greatest exposure to this being Hong Kong, Taiwan, South Korea, the Philippines and Thailand. The simple fact is that according to a significant body of informed opinion the worst may not be behind us but ahead – and certainly in the second quarter of the year. After that we can hope for a ‘bounce back’ but nothing is assured yet.
For the latest news and analysis go to www.portstrategy.com/news101
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APRIL 2020 | 3
CONTENTS
APRIL 2020
15 NEWS
8
28 Moin Tariffs Renegotiation
Moin Container Terminal has made a strong start to operations since commencing, but government in Costa Rica now wants to renegotiate tariffs
10 B angladesh Looks to Develop Deepwater Port
The government of Bangladesh is planning to approve development of the first deep-sea port in the country, with high priority status to the project
13 C MA CGM Upbeat But May Need Cash
A net loss in 2019 and the impact of COVID-19 is not deterring CMA CGM from feeling upbeat for 2020, including the role of CEVA Logistics
Cover Picture: Nathan Dumlap
Online portstrategy.com 5 Latest news 5 Comment & analysis 5 Industry database 5 Events Weekly E-News Sign up for FREE at: www.portstrategy.com/enews
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16
REGULARS
15 Ports Face Key Strategy Choices
Cruise ships have become pariahs and indicative of how ports are struggling in a difficult environment at present
15 That ‘C’ Word Again and What Can Be Done About It?
There is no definitive answer yet to how far the virus will spread, but the industry, governments and businesses should all be ensuring they are prepared for the fight ahead
16 Lasting Effect of Coronavirus on Ports?
COVID-19 underlines the case for more resilience in supply-chains, as a longer-term impact on ports is considered
For the latest news and analysis go to www.portstrategy.com/news101
FEATURES
18
18 COVID-19: Impact and Advice
Coronavirus market impact and practical advice for ports
23 Sabah Ports Ambitions
A regional role is seen for Sapangar Bay Container Port (SBCP)
27 Musical Chairs in Buenos Aires It’s all change once again as the political musical chairs in Argentina obliterates the plan for one new “Super terminal” at Puerto Nuevo, in Buenos Aires
38 On Cyber Crime Alert
A regional role is seen for Sapangar Bay Educating staff to counter the threat of cyber -crime is essential
41 Scan and Deliver
Nothing can be taken at face value when receiving containerised cargo, but modern container scanning systems mean cargo inspection is streamlined, faster and safer
54 Banana: a Slippery Road
DP World’s Banana port project is experiencing pushback from the current DR Congo government
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APRIL 2020 | 5
NEWS REVIEW
BRIEFS BPA virus note One useful source of information for the port industry that highlights good steps to take to reduce the impact of the coronavirus can be found via a specific Guidance Note that has been published by the British Ports Association. For more information, it can be accessed via the group’s website at https://www. britishports.org.uk/news/ wuhan-coronavirus-itspotentialimplications-onthe-uk-portssector
Restoring financial sustainability in NZ A NZ$79.4 million investment in Opotiki Harbour and NZ$8.5 million investment in West Coast South Island ports has been announced by the New Zealand Government. The new harbour is expected to stimulate significant aquaculture initiatives in the region, including mussel farming, and serve as a catalyst for private investment in marine-related industries, wharves and a residential development. Restoring financial sustainability of ports is another key aim.
JV speeds inland port development A 50/50 joint-venture partnership signed between Tainui Group Holdings (TGH) and Port of Tauranga is expected to bring the 192-hectare Ruakura Inland Port to fruition within two years. “This agreement brings clarity and certainty to the development of Ruakura Inland Port and signals we are open for business,” says TGH chief executive Chris Joblin, explaining that both parties retain a strategic interest.
6 | APRIL 2020
BETTER ROAD AND RAIL ON IA LIST Australian ports are being tipped for better road and rail access in the near future, according to the 2020 Infrastructure Priority List just released by Infrastructure Australia (IA). Industry groups have welcomed a focus on freight and rail in IA’s latest output. Key projects highlighted include completing the Port Botany freight rail line duplication, preserving a corridor for a dedicated freight rail connection to the Port of Brisbane and making the Sydney Gateway project a High Priority Initiative to allow port traffic to avoid local arterial roads. The list serves as an infrastructure investment guide for the Commonwealth and state governments and has included the National Freight and Supply Chain Strategy since 2016, which is seen as an important step in progressing the freight and logistics industry’s wish list into reality. Australian Logistics Council CEO Kirk Coningham says it is especially pleasing to see a high degree of alignment between projects and initiatives contained on the list and priorities reflected in the National Action Plan associated with the freight strategy.
“Experience has shown that inclusion on the Infrastructure Priority List can be a catalyst for securing investment in critical projects and progressing initiatives vital to Australia’s economic interests and enhancing the liveability of our communities. “IA’s rigorous, independent assessment process means governments, investors and the wider community can have confidence that investing in the projects and initiatives contained on the list will address genuine economic and social needs.” Port of Newcastle CEO Craig Carmody says the list also supports the prioritisation of
8 Port of Newcastle hopes inclusion on the Infrastructure Priority List can be a catalyst for securing investment
developing suitable east coast deep-water container ports. Mr Carmody said IA had correctly identified a major deficiency in the nation’s preparedness for ever-larger ships. “The data is clear – shipping lines around the world have stopped building the ships that Australia’s ports are designed to accommodate,” he said. Newcastle is mounting a strong campaign to be allowed to develop a container port.
PUSHING CHINA-MYANMAR CORRIDOR Myanmar is targeting development of the Kyuakphyu Port and Special Economic Zone, it announced during the recent visit of Chinese President Xi Jingping. China is picking much of the cost of the project. Both countries have agreed to “push the China-Myanmar Economic Corridor (CMEC) from concept to transit, sketching into concrete development…. namely the Kyauk Phyu Special Economic Zone,” an official Myanmar communiqué said. The two countries agreed back in 2015 to develop the facility but since then there has been little progress – hence the reference to concrete development. Kyaukpyu has a number of attractions, especially for a China keen to ease its reliance on the Straits of Malacca. Myanmar is an
ally keen to build infrastructure for its own development, although there is some resistance to Beijing’s involvement. The project will give China a Bay of Bengal base, which neither India nor Bangladesh off and the water depth at some points at the port is said to be as much as 45m, meaning no limits on the ships that could use it. A Chinese consortium led by the government-owned Citic Group inked a framework agreement with the Kyaukpyu Special Economic Zone Management Committee during Xi’s visit. Crude oil and gas pipelines which have their head at the port are already supplying China, although it is still undecided what else could be developed. Complicating matters are
environmental social impact assessments which are still to be done. Local media reports have said the initial phase of the project will include two berths with a total investment price tag of $1.3 billion. A joint-venture partnership will be set up to construct and operate the port, according to one report. Initially, the project was to be 85% funded by the Chinese consortium but, after its election, the new Myanmar government asked for a reduction in the Chinese companies’ stake in the project to 70 percent. The key issue is whether the Kyaukpyu SEZ will increase Myanmar’s growing public debt and if Myanmar is unable to provide the financing it will most likely seek Chinese loans.
For the latest news and analysis go to www.portstrategy.com/news101
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NEWS REVIEW
BRIEFS Maputo reports 8% rise in 2019 traffic In 2019, the Angolan Port of Maputo handled 19.5 million tonnes, up 8% on 2018. Most of the gain was down to increased chromium and container traffic. Chromium now accounts for 30% of all cargo, with some 6.4 million tonnes of exports. Containers grew by 53% to 162,000TEU, following the expansion of the box terminal. Phase I dredging and quay upgrades are due in May, with Phase II in July.
New Santos concessionaire
The Brazilian government has signed the concession contract for STS20 terminal at Santos. It is now held by the Hidrovias do Brasil SA consortium, which was officially awarded it in August 2019. The 25-year concession covers an area of 29,000m2 and operation of three warehouses dedicated to fertiliser and salt traffic. This adds to its existing grain and fertiliser businesses in northern Brazil, as well as inland waterway operations on the Uruguay, Paraguay and Paraná rivers.
Six new Brazilian port concessions Brazil’s Council for Investment Partnerships Program (CPPI) has identified 22 public assets to be put out to concession, including six port terminals. These are at Porto Aratu (BA), Port of Maceió (AL), Porto de Santana (AP), Port of Paranaguá (PR); and Port of Vila do Conde (PA). The privatisation programme will also see the sales of several state-owned port companies, including the Espirito Santo Dock Company (Codesa), due to be auctioned off in Q2 2021.
8 | APRIL 2020
MOIN TARIFFS RENEGOTIATION? Moin Container Terminal (MCT), which is part of APM Terminals, has been summoned to the Costa Rican Ministry of Public Works and Transport of Costa Rica. Minister Rodolfo Méndez Mata and the technical secretary of the National Concessions Council, José Manuel Sáenz, have initiated discussions on how to renegotiate rates charged for container handling and also on the terminal’s overall capacity. Mr Méndez says he is reacting to concerns put forward by producers and exporters as to the cost of tariffs levied in the terminal’s first few months of operations. The managing director of APM Terminals in Costa Rica, Mr Hartmut Goeritz, says that the company is absolutely willing to participate in the process, which the government estimates will last around three months. Technical and legal advice is during the process is also being provided by the Inter-American Development Bank (IDB). Tariffs charged by TCM have been in the headlines throughout the terminal’s first full year of operations. Although users acknowledge that overall efficiency of cargo handling has
notably increased, they are also adamant that existing rates charged are too high and should be reduced. However, it was not until December 2019 that the Chamber of Costa Rica Exporters (Cadexco) persuaded the Alvarado government to commence talks with APMT with a view to potentially lowering tariffs charged for container handling. Laura Bonilla, the current president of Cadexco noted recently, “We have insisted that it is necessary to renegotiate that rate. I think that [in this situation] we are business partners where we [can] both win and it is extremely necessary that the
8 MCT has made a strong start to operations, but government wants to renegotiate tariffs
President of the Republic meets with senior leaders of APM and a consensus rate is reached.” Public comments made by APM Terminals insist that the terminal operator remains open to any proposal put forward by the government and that changes remain within the scope of the concession contract signed by Moín Container Terminal. MCT was inaugurated in February 2019 and in its first full year of operations, APM Terminals confirmed that the new facility serviced around 1,100 ships and handled approximately 1.2 million TEU.
COVID-19 IMPACTING KIWI PORTS RESULTS Ports in New Zealand are already seeing COVID-19 impact interim financial results. Ports of Auckland returned a comparable 30% dip in net after-tax profit to NZ$17.2 million and relatively flat revenue of NZ$123.2 million for the six months to December 31, 2019. Container volumes fell 2% to 475,173 TEU and both car and total general cargo volumes remained relatively flat, at 124,295 units and 3.297 million tonnes, respectively. The port is currently in the midst of delivering a major investment programme targeted at increasing capacity, efficiency and returns, as well as meet sustainability goals. Port of Tauranga reported a comparable 1.4% drop in net after-tax profit to NZ$48.3 million
and a 1.2% rise in revenue to NZ$154.8 million for the interim. Container volumes were up 3.4% to 642,209 TEU, but log exports fell 8.4% to 3.4 million tonnes. Also, dairy exports increased 6.3% to 1.2 million tonnes while total trade decreased 4.2% to 13.3 million tonnes. The port has warned that its trade outlook for the remainder of the financial year is uncertain due to the ramifications of the coronavirus, especially on log exports. Port Taranaki has returned a comparable 34% increase in net after-tax profit to NZ$5.31 million and 5% rise in revenue to NZ$25 million for the period. Bulk liquid trade increased 11% to 1.76 million tonnes, log demand was down 5% to 437,000 tonnes
and total dry bulk activity dropped 8.7% to 346,310 tonnes. Although export log volumes are forecast to further slow, the port is predicting a strong outlook based on improving bulk liquids volume, increased offshore support work and further trade diversification. Port Otago reported a comparable 16% drop in profit to NZ$7 million and 2% rise in revenue to NZ$47.16 million for the interim. Container throughput fell 4% to 89,000 TEU, export log volumes reduced 5% to 528,000 tonnes and total bulk cargo volumes dipped 1% to 860,000 tonnes. Forecasting a “challenging” second half year due to COVID-19, the port is nonetheless predicting it will deliver a stable full result.
For the latest news and analysis go to www.portstrategy.com/news101
NEWS REVIEW The Port of Santos aims to increase its overall capacity to 240.6 million tonnes by 2040, a rise of 49% compared to existing capacity. In the next 20 years, it is expected that demand for the port’s services will go up 58% to 214.94 million tonnes. The projection for growth is part of the new Development and Zoning Plan (PDZ), which has been issued by Santos Port Authority (SPA). To reach its new goal, the port authority will have to expand its rail intermodal facilities as well as completely reorganise how terminals operate through the creation of so-called cargo clusters, resulting in similar commodities handled in the same area. The PDZ actually envisages large increases across all traffic bases, with containers expected to rise by 64%, with capacity expanded from 5.3 million TEU to 8.7 million TEU. Agribulk capacity is predicted to rise from almost 70 million to 95 million tonnes by 2040, while cellulose capacity is expected to rise by 50% to 10.5 million tonnes per year. According to Casemiro Tércio Carvalho, president of SPA, although there is no mention of possible privatisation in the PDZ, this will play a potentially key role in implementing the plan when details are released in 2021 as to how the government intends to proceed. Mr Carvalho insists that the PDZ could well be the best way to create value for the port before offering it to the private sector.
Work to start at Puerto Williams
Chile’s state Comptroller has given the Ministry of Public Works (MOP) go ahead to commence work on the construction of the multipurpose dock at Puerto Williams, in the country’s Magallanes region. The initial phase investment is $23 million, with work taking an estimated 720 days. Once open in 2022, the port will have an additional 150m of berth.
SANTOS AIM IS DOUBLE CAPACITY 8 Santos wants to double capacity, but new planning details exclude privatisation
As part of the cluster idea, it may well be that containers are grouped in the port’s Saboó zone,
which is where Brasil Terminal Portuário (BTP) is to be found today. Adjacent properties
either have expired concessions or are experiencing problems, which could see them re-offered as concessions. Privatisation has also delayed the proposed access channel concession programme, which is viewed as ultimately essential in the port’s eventual restructuring. In the March 2020 edition of Port Strategy, the possibility of capacity being developed offshore after 2050 was highlighted, which links to current facilities being maximised in the period until this date.
MAJOR US PORTS DOWNGRADING FORECASTS Ports in the US are already outlining the expected impact of COVID-19, with a drop in throughput activity in Q1 2020, followed by some hope of a rebound in from Q2 2020. Almost all of the major US ports are reporting similar forecast downgrades. New York/New Jersey has said that there were 12 blank sailings in January and February 2020, with ships that are arriving generally bringing lower volumes. Although the exact decline in activity is yet to be confirmed, the port is probably expecting to see a drop of around 10% compared to Q1 2019. This figure is similar to other major facilities with a high share of Asian (and Chinese) imports. The Los Angeles and Long Beach
complex is expecting to see a decrease of between 10% and 15% in Q1 2020, due to around 40 cancelled sailings across the Transpacific. On the East Coast, the same trend is being reported. Virginia Port Authority is already planning for a drop equivalent to 11% in Q1 2020 compared to Q1 2019, with Charleston anticipating up to 15% fewer containers to be handled this year in Q1, compared to the same period of 2019. East Coast ports will be concerned that COVID-19 will now slow the momentum gained in 2019, while the West Coast ports will likely be noting that attempts to make-up the lost volumes seen in 2019 due to the potential US-China trade issues may not
now be recovered in 2020. It is reasonable to expect some rebound to occur as the year progresses, with the ports and all supply-chain partners hoping that it occurs in Q2 and potentially into Q3. Though, of course, that too could bring the next concern – too much cargo too soon and the threat of congestion. There are already reports that MSC is planning to redeploy vessels in the 23,500+ TEU size range, including the MSC Mia at 23,756 TEU (jointly the largest container vessel), onto the Transpacific trades.Transpacific trades to get additional empty containers back to Asia, especially China.
Valparaiso Terminal 2 re-tender
Coatzacoalcos upgrades
New Paraguay port
The Chilean Minister of Transport & Telecommunications, Gloria Hutt, has confirmed that the issue of a new tender for the extension of Valparaiso’s Terminal 2. She revealed that the project is currently going through an environmental impact assessment and, once approved, it will go out. The original operator, TCVAL, handed back its concession due to environmental delays.
For the latest news and analysis go to www.portstrategy.com/news101
Coatzacoalcos, in Mexico, has undertaken work in Laguna de Pajaritos costing $33 million as part of the Tehuantepec Isthmus Interoceanic Corridor (CIIT) project. Work completed includes the initial phase of an 80-metre quay extension and a phase II 50-metre extension. Phase II a road access project has been completed (cost of $1.8 million), with a new rail bridge due.
BRIEFS The new port of Villeta, in Paraguay, is due to begin operations at the end of 2020. It is being built to the same standards as the existing Port of Caacupe-mi, in Asunción and will also be fitted with the Navis N4 terminal operating system. The port will additionally incorporate a logistics park. As part of its initial phase of development, the facility will also be equipped with a state-of-the-art warehouse.
APRIL 2020 | 9
NEWS REVIEW
Traffic down at Montevideo
The Port of Montevideo saw reduced cargo Xxxxx handling activity last year, especially transhipment. Grain and containers were particularly badly hit, with some cargo switching to nearby ports in Argentina. Box throughput declined 6% to 453,974TEU. Nueva Palmira did better, reporting an 8.6% rise to 2.3 million tonnes. It is now handling traffic generated by the Paraná-Paraguay inland waterway and much of the country’s soybean exports. Fray Bentos handled 314,633 tonnes, 30% down.
APMT wants more Gijón space
APM Terminals Gijón has sought permission from Gijón port authority to expand its operating area. It requires a further 597.37 m² to build a new structure of warehouses, offices, and workshops, plus a further 12.37 m² for an oil tank. It currently operates a four hectare site with capacity of 113,846 TEU. Overall traffic at the port fell 12% last year, with dry bulk especially badly hit. It handled 1.8 million tonnes
DPW finalises Fraser Surrey Docks
DP World has finalised its acquisition of the Fraser Surrey Docks (FSD) facility in the Pacific Gateway of Canada. In 2019, FSD handled around 350,000 TEU, along with other products, including steel. The operation is limited to container ships of around 5,000 TEU calling, so will only have a niche role to play in serving Transpacific shipping activities but offers some respite in Vancouver and allows DPW to expand its Centerm terminal.
10 | APRIL 2020
BANGLADESH LOOKS TO DEVELOP DEEPWATER PORT Bangladesh currently has two major seaports, Chittagong and Mongla. Both ports are limited in terms of infrastructure, especially regarding the ability of receiving larger ships because maximum water depth is just 9.5m. This means that the largest container vessels able to call regularly are only around 2,000 TEU. This position could be set to change wit the news that the country’s government is planning to approve development of the first deep-sea port in Bangladesh. However, it will not be in Sonadia, near Cox’s Bazar, as had originally been reported. That project would have offered 16m of water depth and wanted to accommodate 8,000 TEU ships, with the aim of reducing Bangladesh’s reliance on feeder ships to instead target direct calls from deep sea vessels. It was expected that China would provide funds to build this facility and feasibility studies were carried out as far back as 2009, but to this date no deal was struck with Chinese authorities. Instead the port of Matarbari will be fast-tracked – and without Chinese funding. The cost is
Source: Data supplied by Dhaka Tribune
BRIEFS XXXXX
estimated to be in the region of US$2 billion, funded by Japan International Cooperation Agency (JICA), the government of Bangladesh and Chittagong port authority, although as shown in Figure 1, JICT is expected to be meeting over 70% of the total cost. JICA is expected to provide loans at 0.01% interest, with others charged at 0.9%, but JOCA’s own feasibility report has confirmed that the project is still financially viable, according to local reports in Bangladesh. Phase I of the project is expected to provide a 460m container quay and a 300m multipurpose quay, with a
8 Figure 1: Estimated Breakdown of Costs for Matarbari Port Development
combination of ship-to-shore gantry cranes and a multipurpose unit, plus rubber-tyred gantry units and accompanying reachstackers and yard equipment. Ships up to 8,000 TEU, at least, will be catered for at the facility. The project could commence in 2020 and run through to 2026, but there is no doubt of its importance in Bangladesh. A press release issued by the shipping ministry stated, “Matarbari port is a highest priority project of the government.”
SHIBATA FENDER TEAM RELEASES THIRD WHITE PAPER Leading manufacturer of high-quality fender systems, ShibataFenderTeam (SFT), has announced the release of its latest White Paper Series. The German-headquartered specialist is generating four publications aimed at advocating more transparency in fender production to ensure quality standards that are driven by a commitment to highperformance products and a clear sense of responsibility. Paper 1 of the Series was launched in 2018 with a focus on the correlation of raw materials, their composition and the impact on the final product, followed by the preparation and mixing steps of raw materials and how they impact the performance of a rubber fender (in Paper 2). While there are guidelines and
international standards concerning the physical properties of a fender, there are no unifying procedures that dictate how to achieve a durable, high-quality piece of equipment. This is because it is still up to the manufacturer to choose the optimal production method. However, the SFT White Paper Series aims to clarify the complexity of the manufacturing process and the close relation between the steps, as well as outline best-practice examples for the procedures and equipment. The Group’s new Paper 3, Manufacturing and Curing. Advanced Perfection, takes a close look at manufacturing and curing as two of the most quality-critical steps in the fender manufacturing process, outlining optimal methods for fender type
and size. Dominique Polte, Board Member at SFT, explains further. “Not all methods result in the same quality which is why a well-versed manufacturer chooses the ideal procedure in order to achieve the highest possible product quality.” Importantly, Paper #3 also expands on the possible defects that can occur if a manufacturer does not observe the interaction of critical parameters in the process and how to avoid them. SFT has more than 50 years of experience in the fender industry and an unbiased view of what exactly makes a good fender – from source materials to every single step in the manufacturing process – remains a core interest to the Group. The fourth and final paper is due imminently.
For the latest news and analysis go to www.portstrategy.com/news101
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NEWS REVIEW
POSITIVE PERFORMANCE IN 2019 FOR ICTSI Enrique K. Razon, Jr., Chairman of ICTSI confirmed that ICTSI had “delivered a positive performance in 2019 with revenue and EBITDA increasing by 7% and 10%, respectively.” While a one-off non-cash impairment of the concession right assets of Tecplata S.A saw net income reduced from US$259.1 million to US100.4 million, it is still a strong year. Audited consolidated financial results for 2019 confirm revenue from port operations of US$1.5 billion, an increase of 7% over the US$1.4 billion reported in 2018, with EBITDA of US$830.1 million up 10% over the US$755.4 million generated in 2018. ICTSI handled consolidated volumes of almost 10.2 million TEU in 2019, up by 5% on the 9.7 million TEU recorded for 2018. This increase in container terminal traffic was mainly due to continuing ramp-up at ICTSI’s new terminals in Lae and Motukea in Papua New Guinea and the contribution of the new terminal in Rio de Janeiro in Brazil, plus improvement in trade activities in Subic, Philippines, Matadi, Democratic Republic of Congo and Basra, Iraq. In addition, new contracts with shipping lines and services were noted at Victoria International Container Terminal (VICT) in Melbourne, Australia, Baltic Container Terminal (BCT) in Gdynia Poland, Adriatic Gate Container Terminal (AGCT) in Rijeka, Croatia, Batumi International Container Terminal (BICT) in Batumi, Georgia and
Port of Savannah’s top cranes
The Port of Savannah has received three Neo-Panamax ship-to-shore cranes, bringing its total to 36, more than any other single terminal in North America according to the Georgia Port Authority. The new 22-container wide units designed by Konecranes of Finland are expected to be all fully operational by the end of June 2020.
8 ICTSI Basra is one of a number of new terminals to see volumes ramping up
Contecon Manzanillo S.A. (CMSA) in Manzanillo, Mexico. Regarding COVID-19, the company has confirmed that it
has “had an impact on volumes particularly in Asia and we are closely reviewing developments across the regions in which we
operate. Whilst we cannot be certain how long this situation will last; we are seeking to mitigate this impact through rigorous cost control and increasing market share. ICTSI is an agile business and able to act swiftly to ensure the business remains robust during these uncertain times.” ICTSI is a leading global developer, manager and operator of container terminals in the 50,000 to three million TEU/year range. ICTSI operates in six continents and continues to pursue container terminal opportunities around the world.
CMA CGM UPBEAT BUT MAY NEED CASH Major French transport group, CMA CGM, has posted a net loss of $229m for 2019, which compares to a profit of $34m for 2018. The company said that a combination of a negative impact of new accounting rules on vessel time charters of $329, plus a loss of $140 million from recentlyacquired CEVA Logistics, was the cause of the negative return. Yet there may be reasons to be upbeat for the company, even allowing for the coronavirus outbreak severely impacting Chinese container exports in the first quarter of 2020. This is because total turnover for the company was up a strong 29% in 2019, to $30.3 billion, which saw a large contribution of
$7.1 billion from CEVA Logistics. At the same time, container liftings across its fleet of 502 ships increased by a healthy 4.1%, to 21.6 million TEU. CMA CGM confirmed that this growth was attributable to strong growth in intra-Asia activity, growth in its shortsea business and organic growth across African and Latin America routes. Despite these reasons to be optimistic, overall, there was no way of avoiding the COVID-19 issue in its announcement. Here, CMA CGM said that it was expecting a return to “normal capacity” out of China by the end of Q1. Indeed, company Chairman and Chief Executive, Rodolphe Saade declared in mid-March that “80% of manufacturing units
were operational” and that the company was expecting a rebound in volumes related to restocking, as western countries look to rebuild inventories. There is no doubt that COVID-19 will result in all major shipping lines seeing their financial positions negatively impacted. For CMA CGM, it also has to deal with its ambition of making the acquisition of CEVA Logistics a positive contributor to the wider group. It is clear that CMA CGM will continue with its plans for this newly acquired business. However, a possible minority share sale of the company cannot be ruled out.
NPL nabs PDL
MSC port changes
Cash-Flow support in Australia
Neptune Pacific Line (Neptune) has confirmed that it has acquired Pacific Direct Line (PDL) from PDL’s parent company, Pacific International Lines (PIL). Neptune believes the acquisition will strengthen its combined businesses involving transport, warehousing, depots and customs clearance services 18 South Pacific ports and markets. Neptune will now have a specialised fleet of nine vessels.
For the latest news and analysis go to www.portstrategy.com/news101
Mediterranean Shipping Co (MSC) is making a series of port changes to its USECSouth America East Coast service from April 2020. A new call at Cristobal has been added, along with Paranagua and Philadelphia, with northbound ports calls at Port Everglades, Freeport (Bah) and Caucedo omitted. A fleet of eight ships of 5,500 TEU to 6,800 TEU will continue to be used.
BRIEFS Australia’s empty container depots have agreed to extended payment terms for transport operators. Payment terms are being extended from 14 to 21 days for the next three months, to offer some assistance to logistics firms dealing with COVID-19. Also, Hutchison Ports Australia is to temporarily extend payment terms from 14 to 30 days, with a review at end of financial year.
APRIL 2020 | 13
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THEECONOMIST BEN HACKETT
PORTS FACE KEY STRATEGY CHOICES Ports are facing a decline in trade and strategy choices in dealing with the Coronavirus. Ports have faced many threats in the past ranging from wars, floods, recessions and competing subsidies to name but a few. The current threat is more intangible and difficult to deal with. The new virus, Covid-19, has become a major threat to world trade and economic growth. It has brought with it an unknown disease which remains intangible and has created panic, fear and “lockdown” of cities and large geographic regions at a scale never before experienced. The mix of rational and irrational behaviour by authorities has also created further confusion. Estimates of the disruption to trade range from ten per cent and more decline in volumes to 20% or more in value terms. Supply chains have been seriously disrupted as we had become too dependent upon China and the other Asian countries hit by the virus. Thailand, Singapore, Taiwan and Hong Kong are facing the
prospect of negative GDP growth as manufacturing has been hit by lack of raw materials and labour. As more and more consumers are quarantining themselves consumption and non-essential spending are being hit badly. There are views that there will be a bounce back after the virus, whenever that will be, to lost sales. These are the tangible impacts of the virus outbreak, but what of the more intangible ones that are cropping up? We are seeing a collapse in
international travel, both voluntary as well as outright ban on international movement in countries such as China and Israel, to name but two. The impact on ports is beginning to become clearer. Australia banned vessels docking at their ports that had made a call in a Chinese port in the previous 14 days. Many other ports are insisting on medical certification that crew members are virus free prior to being allowed to dock for cargo load and discharge. Antwerp is one
8 Cruise ships are pariahs and some port access is being denied
of the practitioners of this policy. Some dockworkers are refusing to handle cargo from infected countries. Where will it end? Cruise ships have become pariahs as they have turned into breeding centres. Ports are refusing to allow them to dock after the Diamond Princess mishandling Japan. Clearly ports are struggling in a difficult environment and recession has become a real possibility.
THESTRATEGIST MIKE MUNDY
THAT ‘C’ WORD AGAIN AND WHAT CAN BE DONE ABOUT IT? I hate to mention the C word – coronavirus – (again) but it does prompt thinking about what happens post the virus? There is no definitive answer yet to how far the virus will spread or just how deadly it will be. A recent article in the Washington Post States that some epidemiology experts think that the coronavirus impact will be similar in scale to the 1957 influenza pandemic, so called Asian flu, that resulted in more than one million deaths worldwide and made a quarter of a billon people sick. SO WHAT NEXT? First point is that there is every possibility the world will in the future experience a similar
situation – coronavirus after all does follow in the wake of recent viruses such as Ebola (more localised in Sub Saharan Africa) and SARs but taking a longer look back over history we can see strong evidence of humans and viruses being at war for a long time. 5 The Black Death, 1346-1353, also known as the Great Plague and the Pestilence, killed more than 20 million people in Europe, at that time nearly a third of the continent’s population. 5 Going back even further there was the plague that killed 30 to 50 million people from 541-750AD in the Eastern Roman Empire. Overall, it is estimated to have brought death to the door of around half
For the latest news and analysis go to www.portstrategy.com/news101
the world’s population – 50 to 70 million deaths. 5 Coming back to more contemporary times, there is HIV, the human immunodeficiency virus. Often cited as the deadliest virus it may surprise readers to learn that since the since this Pandemic started in the early 1980s, 32 million people have died from it and 75 million people infected. 5 A decade or so prior to the appearance of HIV, THE Hong Kong flue pandemic of 1968-69 was responsible for approximately one million deaths worldwide. The lesson is clear – expect more to come and governments, industry representative bodies and businesses should be more alive
to this possibility and put a greater effort into preparing for the worst. It is quite surprising in this context that when looking across the range of port sector representative bodies – national and regional – there is a marked lack of practical advice as to what to do to minimise the coronavirus impact. There are some excellent sources of advice – for example the British Ports Association – but this is more the exception than the rule. Accordingly, the thought arises, is there a case for some sort of new Standard to be introduced covering preventative measures and knowledge pooling on a global basis? This may not prevent the inevitable but it would undoubtedly play a major part in being better prepared for a ‘fight’ such as the current one.
APRIL 2020 | 15
THENEWYORKER BARRY PARKER
COVID-19 – THE NEW YORK ANGLE Worldwide supply chains, and the ports that go with them, have been completely overtaken by the Coronavirus, COVID-19 issue. The role of ports as “hubs” in networks of cargo, goes further - into the human realm (which I have mentioned, previously, albeit only briefly in these articles). Maritime ports are also entry points for people, these days mainly seafarers rather than immigrants or coastal travelers. Nevertheless, moving past the TEU statistics (unfortunately, trending downward in 2020 Q1), the human aspects of port operations take on much more importance than before. There are obvious things, like frequent hand-washings with soap or sanitizer (though stores in New York have seen shelves depleted) that people-prudent folks can do. But less obvious to the “man on the street”, but bearing attention in the port community, are the newly instituted types of interactions with Federal agencies that ports need to be having. The agencies
taking the lead in such interfaces is the United States Coast Guard (USCG), where the relevant Captain of the Port (COTP) has overarching authority to decide on whether vessels can dock (versus being held offshore) and then, if the ship does indeed tie
8 Captain of the Port must interact with CBP
up, whether crew are allowed off the vessel. The ports may also need to get “creative” when it comes to logistics of routine tasks of
bunkering, resupplying “victuals” and handling minor repairs. However, in the background, the COTP must be interacting closely with Customs and Border Protection (CBP), which has a say in responses to health crises, and, as necessary with the Center for Disease Control (CDC) which is heavily involved in actual testing of possibly infected people. If things get dicey (i.e. a vessel with possibly infected crew or passengers), it is important that the chain of command be respected. In certain ways, the Federal intervention is reminiscent of the crisis following the attacks of September 11, 2001, which led to much increased Federal scrutiny of ship movements and cargo composition - and, yes, to some false positives like the ceramic tiles from the Mediterranean that showed up as radioactive. Yet trade flows survived, and at various times in economic cycles, prospered, as evidenced by dramatic increases in those TEU counts, including imports of clay tiles.
THEANALYST PETER DE LANGEN
LASTING EFFECT OF CORONAVIRUS ON PORTS? The Coronavirus clearly is having a huge global impact, most importantly through affecting the health of millions of people and the loss of human lives. The economic impact is also substantial - small businesses suffer, freelance workers lose incomes and the stock markets are plummeting, amongst others negatively affecting pension funds. The virus also has an immediate impact on ports, with volumes substantially lower (in some Chinese ports volumes in February were down >20% compared to February 2020). Is the virus also going to have a longer lasting effect on the ports industry?
16 | APRIL 2020
That question is hard to answer, but often the idea of recovery from a crisis and the return of the ‘normal’ turns out to be wrong. The port infrastructure of Kobe was rebuilt after the earthquake in 1995, but the port never recovered the central position it previously had in shipping networks. The Ceres Container Terminal in Amsterdam, after a very difficult start, attracted shipping lines in 2007 and 2008, but never recovered from the economic and financial crisis 2008-2009. So what may be lasting impacts of the Corona virus for ports and shipping? First, the mismatch between supply and demand, i.e.
too much terminal and shipping capacity, is likely to last for years, as the growth path of demand that was assumed prior to COVID-19 will not materialise. Second, the virus may accelerate the rise of e-commerce. As shops are closed, e-commerce thrives, and especially elderly that normally are lagging in the use of e-commerce turn to it to avoid busy places. Once the crisis is over, their new online habits may stay. This affects the logistics operations in ports. Third, the trend of ‘local for local’ may be re-enforced. In many cities, there are initiatives to help out struggling small local
businesses by purchasing locally. This may also have lasting effects, which may somewhat reduce international trade, for instance of food products. Finally, multinational companies may re-consider their supply chain design. The Coronavirus underlines the case for more resilience and also has made clear the dependence of many supply chains on activities carried out in or managed from China. A re-design of supply chains by definition affects international trade and thus ports. All in all, enough reason not to assume the return of business as usual once the virus has been brought under control.
For the latest news and analysis go to www.portstrategy.com/news101
THEENVIRONMENTALIST CHARLES HAINE
COVID-19 AND THE BLUE ECONOMY No one saw this coming. Apart from the UK Government’s own National Risk Register of 2017, which placed an influenza pandemic equal fourth, alongside severe weather (but much higher impact), as one of the highest likelihood risks facing society before 2022. We’re not in three months, yet here we are hovering over the Ctrl+Alt+Del keys again. Having received a massive jolt to the system, we will walk out of a battered economic landscape with a rebooted appreciation of key workers (who just weeks before were cruelly labelled unskilled), human contact and the luxuries we may no longer be able to afford. That might deliver a second deadly blow to the retailers that are hanging on. The ripples will be felt in the maritime sector for quite a while. The key factor in surviving a crisis is correct decision-making at the right time. Most authorities had already declared a state of ‘climate emergency’ so it’s at formative moments like this where we can select the best opportunities on offer. With our brains and wallets recalibrated, we can choose to support companies, services and products that truly add-value to society. Those that already embedded real sustainability performance pre-COVID-19 will be better placed than the greenwashers and those that refused to recognise natural life-support systems and pollution-avoidance in their activities. The judiciary even recognised this. In February, several courts and councils bucked the growth trend, ruling against the incongruous expansion of airports while a binding international agreement to keep global warming to within +1.5⁰C is in place. Now we have experienced systemic crash, surely, we are wider-eyed in our understanding of how important ‘quality of life’ is, what clean air smells like, and that preparedness is the best solution for breakdown. I don’t know about you, but my appetite
for a healthier lifestyle and environment has grown. Allowing the ‘blue economy’ to thrive would be a good start. Originally, 2020 was going to be an ‘ocean super year’ before the spiky virus decimated the World Ocean Summit, UN Ocean Summit, IAPH World Ports’ Conference, TOC, and the conference on the Convention on Biological Diversity. COP26 Glasgow hangs in the balance. The incredible contributions that ocean-based industries make to reducing and sequestering carbon emissions, helping communities adapt to the effects of a changing climate while providing employment that protects ocean life are the pillars in a sustainable blue economy. The well-being of small island states, fisheries and aquaculture, energy generation, shipping and port services, biotech, sea defence, dredging for aggregates, and tourism and recreation all contribute handsomely. Two-thirds of the economic value generated relies on the health of the oceans, yet UNDP quantifies unsustainable practices such as overfishing to cause economic loss of US$83
For the latest news and analysis go to www.portstrategy.com/news101
billion every year and coastal hypoxia up to around US$800 bn. Damage from invasive species weighs in at US$100 bn and damage from ocean plastics US$13 bn. Even more staggering is the impact of ocean acidification from climate change. The cost: another US$1.2 trillion – a year – by 2100. Shipping and ports are about to become interconnected with ocean-based industries such as wind power, wave/tidal energy and green fuels. The OECD puts value from the blue economy at US$3 tr and 40 million employed by 2030. There will be less of it around, so it won’t be long before we see investors sense-checking ‘ocean impact’ alongside climate, sustainability and governance factors prior to releasing their money. The global pandemic might just push us into the kind of collaboration stakeholders have been yearning for to see the breakdown of barriers and silo-thinking in the sub-sectors above. A drastically improved view of what’s going on in other people’s sectors ought to help us understand the mutual benefits that are on offer and the
8 Two-thirds of global economic value generated relies on the health of the oceans
consequences if we don’t act differently. A dearth of cash will have us sweating the assets we already have, encouraging thrift, eliminating wastage of resources and energy (commonly thought to be around 30%) and, hence, fostering sustainable approaches. The net zero GHG emissions’ journey many are now in pursuit of will help focus our minds. Funders and governors of port-cities seeking cleaner and greener living might make that happen. It would be encouraging to see retailers, naval architects, ship owners, shippers, terminal operators and logistics companies appear at collaborative events alongside port authorities. Supply chain players – including new disrupters – really will have to come together regularly to combine resources and embrace innovation to continue growth plans. Simultaneously, we will all have to improve efficiencies, to save costs, in the new world era. Companies may not hold survive in the long-term if they don’t.
APRIL 2020 | 17
CORONAVIRUS: COVID-19
COVID-19: IMPACT AND ADVICE Today’s ‘normal’ is a new normal – one dominated by COVID-19 which is progressively reaching into the lives of business worldwide with the international ports sector and supply chain as a whole at the forefront of this The good news is that things are still working, albeit under severe pressure in certain locations as the coronavirus pandemic exerts its influence. There are a lot of immediate problems to deal with along the supply chain. While the situation in China does appear to be improving it is widely forecast that recovery from the shut-down of manufacturing outlets in China will still take some months to achieve. There is also the view that things will now not entirely go back the way they were – that COVID-19 will be the trigger for substantial structural changes over and above the hopefully short-term impact factors. Notably, there is expected to be a significant reversal in foreign investment in manufacturing capacity in China, a process that had already started as a result of the recent tariff wars. This is now expected to accelerate with companies looking to establish production capacity outside of China including more local solutions. Other select short and long-term impact factors are discussed below – with particular reference to the ports sector by way of providing a cross-section of views to identify key ‘challenge factors’ for our industry. In addition to these impact highlights practical guidance is provided to the ports sector about the port related measures that can be implemented to slow the spread of the virus and to promote safe working.
8 There is good advice available to ports on measures to implement in conjunction with COVID-19
Photo: Ashkan Forouzani
HALT THE SPREAD For the time being, the main challenge is to halt the spread of the virus – we urge all PS readers to heed the advice given to them by their respective government authorities and other agencies. Together we can not only beat this pandemic but with good management, both in business and at a personal level, we can come out the other side strong and ready to adapt to the changed trading circumstances this challenging experience promises to leave in its wake. Looking to the future we should bear in mind the message from the IMF which sates on the one hand that the impact of COVID-19 will be quite severe but on the other there is confidence that a long expansionary period and high employment rates will enable the global economy to weather the shock.
Practical advice for ports Generally speaking, the major ports around the world have moved quickly around the world to put in place measures to negate the negative impact of the coronavirus, to keep trade moving and to maximise protection for all personnel involved. For all categories of port, however, there remains significant scope to learn from each other and with this in mind PS features below a range of links from select industry bodies and key organisations which detail the practical arrangements that can be made. https://www.gov.uk/government/
18 | APRIL 2020
publications/covid-19-shipping-and-seaports-guidance/guidance-for-shipping-andsea-ports-on-coronavirus-covid-19
EUROPEAN COMMISSION Transport Measures: https://ec.europa.eu/ transport/coronavirus-response_en
BRITISH PORTS ASSOCIATION Download BPA guidance note circulated to members. The latest advice for the maritime sector from officials is below. 5 Public Health England guidance for staff in the transport sector 5 Public Health England guidance for port staff 5 Advice posters for England, Scotland, Wales and Northern Ireland
INTERNATIONAL MARITIME ORGANISATION http://www.imo.org/en/MediaCentre/ HotTopics/Pages/Coronavirus.aspx WORLD HEALTH ORGANISATION Operational considerations for managing COVID-19 cases and outbreaks on board ships. Dated 24 February 2020
For the latest news and analysis go to www.portstrategy.com/news101
CORONAVIRUS: COVID-19
Key views on impact of COVID-19
5 CLIPPER DATA The epidemic has yet to run its course, but even after the spread subsides and China starts to return to normal business activity, Clipper Data underlines that it will take a long time to unwind the stresses inflicted on the world’s trading system. A return to medium and long-term trends in shipping and trade is unlikely before the second half or even fourth quarter of 2020.” 5 FREIGHTOS Freightos emphasises that there is not only cause for concern about the supply of goods from China - although there is acknowledgement that this situation is improving - but also as a result of a ‘second hit’ from falling demand in Europe, the USA and elsewhere as a result of COVID-19 hitting hard there. Commodity Focus 5 ALPHALINER – Container Market analyst Alphaliner estimated, in early February, that the Coronavirus could cut global container throughput growth in 2020 by as much as 0.7 per cent. 5 BIMCO – Dry Bulks “Chinese imports of dry bulk commodities are the main driver for the dry bulk market and with a slowdown of industrial production in the short-term, the outlook for Q1-2020 is not shaping up particularly well. Freight rates will stay low, until Chinese merchants get back into the market for the usual commodities, such as grain, coal and iron ore. “The traditional dry bulk low season is usually in Q1, and the market tends to rebound post-CNY. Yet, with the coronavirus not under control yet, the slump will inevitably be more protracted,” says BIMCO.” 5 INTERNATIONAL ENERGY AGENCY (IEA) – Energy Fuels The IEA forecasts global oil demand is expected to decline in 2020 as the impact of the new coronavirus (COVID spreads around the world, constricting travel and broader economic activity, according to the International Energy Agency’s latest oil market forecast. “The coronavirus crisis is affecting a wide range of energy markets – including coal, gas and renewables – but its impact on oil markets is particularly severe because it is stopping people and goods from moving around, dealing a heavy blow to demand for transport fuels,” says Dr Fatih Birol, the IEA’s Executive Director. “This is especially true in China, the largest energy consumer in the world, which accounted for more than 80% of global oil demand growth last year. While the repercussions of
Photo: Brittani Burns
Trade, Cost and Demand 5 UNITED NATIONS CONFERENCE FOR TRADE AND DEVELOPMENT (UNCTAD) China’s National Bureau of statistics calculates a 13.5% year-on-year decline in industrial output for the first two months of 2020, the biggest downturn on record. The overall cost of the coronavirus is put at US$2 trillion, a figure which other parties suggest will climb even higher. (Source: Braemar)
the virus are spreading to other parts of the world, what happens in China will have major implications for global energy and oil markets.”
8 The supply chain faces challenges now and is set to experience structural changes
Container Positioning/Imbalances 5 SEA INTELLIGENCE, ALPHALINER AND CONTAINER XCHANGE Sea Intelligence highlights container positioning problems as a result of cancelled sailings to China – now leaving empty containers in competition with backhaul cargo to Asia, in turn, pushing up rates for loaded backhaul container movements. In the daily indices compiled by Freightos, which tracks the price to ship 40ft container. The rate from Northern Europe to China (SONAR: FBXD. NAEC) is up 55% since Feb. 18, and the rate from the Mediterranean to China (SONAR: FBXD.MEDC) is up 70% (rates from the U.S. have not materially increased). Alphaliner also identifies a shortage of containers on the US West Coast. It points out that MSC, which as a rule deploys 13,000TEU vessels in the trans-Pacific is now scheduling the 23,756-TEU MSC Mia (the world’s largest box ship), the 23,656-TEU MSC Nela, 19,224-TEU MSCO Oscar and 19,368-TEU MSC Anna. This, Alphaliner suggests, will enable a normal service load to be carried and around an additional 6000 TEU of empty containers to America.” The container-repositioning equation is dependent on how quickly Asian manufacturing returns to normal but also by how import demand in Europe and the USA is affected by coronavirus. Container Xchange reports companies beginning to experience severe equipment shortages in several areas in the USA and in Europe. Port Actions 5 SHIPPING AUSTRALIA LIMITED The industry representative body Shipping Australia Limited reports an easing at the port of Brisbane of the 14-day ban on ships calling at Queensland ports since their departure from a previous port. The policy, implemented by Maritime Safety Queensland continues to be the subject of significant criticism – not least because it led to cancellation to vessel calls and thus, in turn, problems for importers and exporters in Queensland. While the ban has been relaxed at Brisbane by way of various exemptions it still remains in place at the other 20 Queensland ports. There have been suggestions that such a ban might be imposed elsewhere – in certain regions of China – but so far this has not materialised.
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 19
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EU REGULATION REVIEW
EU REGULATIONS REVIEWED Felicity Landon reviews a recently published manual on the EU Seaports regulation – all 1,307 pages
In introducing 25 Frequently Asked Questions relating to the EU Seaports Regulation, Professor Dr. Eric Van Hooydonk writes: “We are aware that newcomers to the field may feel uneasy about the prospect of perusing a commentary of over a thousand pages replete with legal minutiae and subtleties in order to get answers to very simple and practical questions about the daily business of running a port or a port services.” Indeed, his recently published manual on the EU Seaports Regulation – said to be the only one in existence – stretches to 1,307 pages. It’s a hefty read. When it entered into force in 2017, the regulation applied to 323 explicitly designated maritime ports or port clusters located in 23 member states of the EU. Brexit means crossing 40 off that list. In addition, in 2019 there were 21 ports in Iceland and Norway added to the regulation’s scope, as part of the European Free Trade Association and wider EEA. The regulation applies to bunkering, cargo handling, mooring, passenger services, the collecting of ship-generated waste and cargo residues, pilotage and towage, with some exceptions. Antwerp-based lawyer Dr. Hooydonk, who is port law professor at the Maritime Institute of the University of Ghent, examines the policy background, legalities, scope of application, provision of port services, financial transparency and autonomy and procedural safeguards associated with a regulation that took two decades of debate and three attempts to cross the finishing line. A DESPERATE DEBATE In his critical assessment, he says that a major merit of the regulation is that it concludes, at long last, a ‘desperate debate’. “The EU Seaports Regulation is the keystone – if not the crown jewel – of European port policy,” he says. “It submits the European seaport sector to liberalisation and charging principles which were introduced long ago for other transport and utilities sectors characterised by large-scale public intervention and special or exclusive rights, such as air transport, airports, rail transport, telecommunications, post services and energy.” MAKING COMPRISES However, many compromises were made in the route to this regulation, so that the final contents were somewhat watered down. On this, Dr Hooydonk warns: “One cannot ignore the fact that the addition of a significant dose of fuzzy give-andtake language in the course of the legislative process is likely to increase the risk of legal controversy, increasing the need to the parties to seek internal and external legal assistance, both to prevent litigation and to handle it when it has become unavoidable.” In a ‘doomsday scenario’, he says lawsuits over the correct interpretation – and/or validity – of the regulation might delay, interrupt or even bring to a full stop normal decisionmaking processes, investment and construction projects, revenue collection and daily operations.
8 Professor Dr. Eric Van Hooydonk has published a new manual on EU Seaports Regulations
RISKING LEGAL DISPUTES “This risk of legal disputes caused by the introduction of a new legal framework, set to contain, inevitably, a good measure of ambivalent compromise wording, is a serious administrative and financial impact, which the Commission seems conveniently to have overlooked in its initial analysis.” Only time will show whether Rapporteur Knut Fleckenstein was right in assuring the European Parliament that the regulation would ‘create legal certainty for the ports’ or if EU Transport Commission Violeta Bulc had a point in telling MEPs during the final debate that it would ‘end today’s unclear situation where port policy is not decided by you, the legislators, but rather by judgments of the European Court of Justice on a case-by-case basis’, says Dr Hooydonk. “At this stage, we have our doubts, not only because not all MEPs concurred with the Commissioner’s view but also because ascertaining the correct interpretation of the regulation’s imprecise provisions will inevitably require further guidance from the law courts, both at national and EU level.” ANACHRONISTIC POOL SYSTEMS Inevitably, he says, the regulation has not resolved all the issues that today’s EU ports industry is facing. For example: “The regulation does not address the negative impact of the anachronistic pool systems for port labour which still prevail in various European ports.” The resistance of trade unions was a major stumbling block for Port Packages I and II (the first and second attempts at regulation), he points out, “so it comes as no surprise that in 2013 the Commission simply preferred to shut its eyes to the issue, although it did order a study to gain better insight in the labour systems”. However, crystal-clear case law shows that dock labour monopolies are incompatible with the Treaty principles, he says. “Expectations are that the Commission will closely monitor developments and open new infringement procedures against member states that continued to refuse to abide by these principles.”
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 21
REGIONAL SURVEY: MALAYSIA
SABAH PORTS AMBITIONS Sapangar Bay Container Port (SBCT) outlined big expansion plans at the ASEAN Ports and Shipping Conference, as Michael MacKay reports
8 SBCT says it can help solve connectivity challenges for the BIMP-EAGA area
The plans are not just about expanding port facilities, but to become a key hub within the BIMP-EAGA (Brunei Indonesia Malaysia Philippines East ASEAN Growth Region) area. Sabah Ports, who own SBCT, believes increasing intra-Asian, and especially intra-ASEAN, trade will support SBCT’s expansion and reprofiling, both as a hub and longer term as a transhipment centre, which will, in-turn, help develop the region. Sabah, the northernmost province of the Malaysian part of the island of Borneo, has always lagged behind peninsula Malaysia in economic terms. The same can be said of one of the countries it borders – Indonesia - as well as the nearby Philippines. CONNECTIVITY CHALLENGE “We are putting forward Sapangar as one of the options for this connectivity challenge we are facing in this region,” Siti Noraishah Azizam, General Manager of Sabah Ports, which manages all the ports in Sabah, told the Conference. SBCT has already been endorsed for gateway status by the BIMP Economic Business Council and, to date, the Malaysian government had supported Sabah Ports’ supply driven strategy. Helping is Sapangar’s location. Nearby resources of agricultural, aquaculture and minerals are waiting to be tapped but need facilities to be moved – something that Sabah Ports sees as the start of a much bigger transshipment role. “We are strategically located at the centre of ASEAN,” said Siti, pointing out its closeness to three seas - the South China, the Celebes and the Sulu. The port itself is sheltered, with a wide access channel and a possible 25m draft, said Siti. It is also only 15 hours at 15 knots or what she termed the minimal diversion time from the international shipping lanes. There is also room to expand. “We still have ample capacity to be filled in,” Siti said. The first step of Sapanagar’s plan is to become a gateway. It is working, courtesy of a government grant, to increase its TEU capacity to 1.1 million TEU by 2023 and then to 2.43
million TEU by 2036. These are a big increase from the current container throughput of 379,000. Sabah Ports company moved 34.1 million tons in 2019, of which 16 million tons was palm oil. INLAND DRY PORT Sabah Ports is also working on developing an Inland Dry Port and a halal logistics chain whilst the government builds roads connecting all the industrial clusters in the province. Sabah Ports is open to other investors on these and other projects. “We cannot work alone,” Siti said. Yet the expansion is not just about infrastructure in Sapangar which is only the first step to serve its own immediate hinterland – Sabah Province. Second would be North Borneo before the third, being a regional transhipment centre seeing it move cargo brought in from Indonesian and Philippines ports. “We need a gateway,” Siti said. “With our capacity we hope we can have all this consolidation of cargo to tranship.” SUPPLY CHAIN VULNERABILITY Some issues still need to be tackled. One is the vulnerability of a supply side strategy, especially given political flux in the Malaysian capital Kuala Lumpur and the lack of obvious support from the Indonesian and Philippines governments. “Maybe not now” counseled Datuk Roselan Johar Mohammed, Chairman of the BIMP-EAGA Business Council who suggested pushing the start date back to 2025 given the limited intra-ASEAN trade there is currently. “We cannot jump-start the economic process,” he told the Conference. Not helping is that some of the countries in the region are sensitive about the export of what they regard as their mineral resources and have moved to limit them. AN example is Indonesia with its recent nickel export ban - a poor precedent for the ferronickel and zircon sands in Sulawesi that Sapangar could move.
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 23
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SPECIAL REPORT: SANCTIONS
LOOKING INTO THE ‘DARK’ In this first part, Ron Crean of London-based Windward, outlines what ports and terminals need to be wary of to be safe from sanctions Since 2017, a growing focus on sanctions has created a dramatic increase in the related risks faced by the maritime ecosystem. Maritime suppliers, banks, commodity traders, insurers and shipping companies are all more exposed to the risk of financial penalties and reputational damage. Those who provide services that enable trade in sanctioned goods, such as port operators, are also exposed through the parties with whom they deal and the goods they are transporting. Ignorance is no longer a viable defence; operators need to take steps to avoid handling sanctioned goods. It has been a consistent theme for regulators to increase the expectations on all parties involved in the maritime supply chain. All marine businesses must now know the counterparties they are dealing with and the history of vessels with whom they work. Ports must be able to check the background of all vessels and show bodies such as OFAC that they have the technology to screen ships for suspected sanctions evasion. This puts the burden of implementing various sanctions screening programs firmly on the back of the maritime business community, obliging organizations to analyse several million pieces of data every day. And of course, this stance by sanctioning bodies requires due diligence into past port calls and suspicious activities in high-risk areas. But the scale of the problem now requires resources and a reflex response that many ports simply don’t have at their disposal.
‘‘
Ports must be able to check the background of all vessels and show bodies such as OFAC that they have the technology to screen ships for suspected sanctions evasion Meanwhile, screening itself is not always straightforward. Analysis of the global fleet for sanctions risk over the past six months reveals some interesting insights: 5 There are twice as many vessels behaving suspiciously than those that are officially considered high-risk and appear on various sanctions lists. 5 Iran (and the broader Gulf region) are the top locations when it comes to vessels with suspicious activities. 5 ● ‘Dark’ activity, i.e. ships concealing their location and operations by turning off their AIS transmissions, is the most popular of the deceptive shipping practices described in recent U.S. (OFAC) and UN advisories. So how do port and terminal operators stay safe from sanctions? What should they be looking for? SEEING IN THE ‘DARK’ Key for anyone interested in whether vessels are behaving suspiciously is the use of tracking data from vessels’ Automatic Identification System (AIS). This means organizations can screen the movement of ships they do business with for signs of illicit activity, such as smuggling, trafficking, or sanctions evasion.
Gaps in vessels’ AIS transmissions for more than eight hours are defined by OFAC as a red flag for sanctions evasion. Analysing tracking data shows ‘dark ‘activity – when AIS is turned off – in the Gulf increased 41% in 2019 compared with 2018. In July last year, the Grace 1 became the poster child for this sort of evasion, after being detained in Gibraltar carrying Iranian oil. What’s perhaps even more troubling is that the Grace 1 is not an isolated case of oil sanctions evasion. The practice of going ‘dark’ is growing in scope. But going ‘dark’ is not in and of itself a sign of guilt; not every transmission loss should be treated as a red flag. However, there are three other simple signals to look for when screening a ship’s past periods of non-transmission: 5 ● Quality of AIS coverage 5 ● Time unaccounted for 5 ● Feasibility of ‘dark’ trade
8 Grace 1 was detained in Gibraltar with Iranian oil
QUALITY OF AIS COVERAGE The very first step is to assess the quality of AIS coverage at a particular point in time and space. AIS signals are often lost due to insufficient receiving stations or signal collision. But if no other vessels in the vicinity had an issue with their transmissions, it seems unlikely it’s a problem specific to one vessel. Since AIS coverage is usually best near ports and shores, lost events that are less than 30 nautical miles from shore are more likely to be ‘dark’. TIME UNACCOUNTED FOR Next, measure how much time cannot be accounted for. This is a bit more complicated, but the basic idea is to establish the distance between the point at which the AIS signal was lost and the point at which it was found. You then use the vessel’s known sailing speed (either regular sailing speed, speed before/after lost, or average of the two) to calculate how long it should have taken the ship to travel between the two points. If the two fail to match, then the question you need to ask is simple: what was it up to during that time? 8 This question will be answered in our May 2020 article.
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 25
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LATIN AMERICA: TERMINAL DEVELOPMENT
MUSICAL CHAIRS IN BUENOS AIRES It looks like the plans for one major terminal in Buenos Aires, Argentina may now be off the table, as Rob Ward discovers
8 T4 in Buenos Aires gains most from Maersk Line shifting
It’s all change once again as the political musical chairs in Argentina obliterates the nascent plan for one brand new “Super terminal” at Puerto Nuevo, in Buenos Aires the country’s principal entry point for containers. Instead, options are now turning towards extensions for two or three of the three concessions currently operating at Puerto Nuevo, which handled around 920,000 TEU in 2019, approximately 50% of Argentina’s entire throughput. Port Strategy outlined the grandiose $1.9 billion plan (back in October 2019) laid out by the Administración General de Puertos (AGP, or General Ports Administration for Argentina). The word from various reliable sources in the Argentine capital was that the “revolutionary transformation” of Puerto Nuevo would go ahead “no matter what happened in the Casa Rosada” - the Pink House where the Argentine president resides and governs. The argument was that Puerto Nuevo was so congested and boxed in by the City of Buenos Aires and such was the demand for the valuable land it inhabited that a planned multi-billion dollar transformation into real estate (offices, and shops in the 143,000m2 area currently occupied by Puerto Nuevo terminals 1 to 3) and concomitant building of a dedicated cruise terminal would go ahead – nudging Puerto Nuevo operators into new areas of landfill to the north but at the same time nearly doubling the container capacity from 1.4 million TEU up to 2.7 million TEU - despite the surprise change of government. Argentines voted out the centre right, market friendly Mauricio Macri and voted in the leftist, pro trade union, Peronist candidate Alberto Fernandez, backed by the ever
present Cristina Kirchner as vice president, in last October’s Presidential elections. “This urgently needed transformation [of Puerto Nuevo and downtown Buenos Aires] will go ahead because it is above politics,” said one confident port consultant, who has since been proven wrong. And he was backed up by officials at AGP during several information requests from Port Strategy. PROTECTING FUTURE EMPLOYMENT The left wing government of Fernandez and Kirchner is now keen to defend dock workers rights and so a new priority is to protect the future employment of the 600 or so dockers (1,800 in total) who work in each of the three existing terminals – APM Terminals’ Terminal 4, Terminales Rio de La Plata (TRP, majority owned by DP World in terminals 1 to 3), and BACTSA at terminal 5 (owned by Hutchison Port Holdings). The BA conurbation is also served by Exolgan (owned and operated by International Trade Logistics, which is part of MSC, along with partners PSA of Singapore, out of Dock Sur, or the South Dock), and together with the Puerto Nuevo terminals, the throughput for the four operators totalled more than 1.5 million TEU in 2019, down 13% on the year before, but still comprising more than 90% of Argentina’s entire box handling. LOOSING SHARE Although AGP has no up to date statistics and terminal operators were somewhat guarded about revealing the latest figures, Puerto Nuevo terminal managers told Port Strategy that Exolgan last year had 40% of the market (around 630,000 TEU), Terminal 4 had 21% (320,000 TEU), Bactsa 20%
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 27
LATIN AMERICA: TERMINAL DEVELOPMENT and TRP just 19%, and the struggling DP World facility now looks likely to lose even more market share. “They [the Argentine port authorities] were so close to carrying out this major revamp,” said Patricio Campbell, the long-standing President of the Centro de Navegacion , which represents shipper and shipping line interests in Argentina, “but in the end they ran out of time and now with a new government for Argentina it seems they will just maintain the status quo, possibly with three terminals merging into two.” Dockers employment issues have been brought right to the forefront of the debate when, just as we were going to press, it was announced that Maersk Line was shifting its north Europe to East Coast South America (ECSA) service from TRP to AP Moeller Terminal/Maersk’s Terminal 4 operation, ripping out the final deep-sea service at TRP, which used to be the biggest operator in the BA conurbation, until Exolgan took over that mantle. Maersk Line switched a number of its Hamburg Sud brand services from TRP to Terminal 4 two years and not it is moving the north Europe service “in house”, from mid May. With only a couple of cabotage (Maruba and Patagonia Shipping Lines) services, as well as Mercosur trade bloc (independent Brazilian carrier Log In and CMA CGM’s Mercosul Line) services remaining, it is thought that it may have to fold in the near future. NO EXODUS, YET However, reliable sources in Buenos Aires are telling Port Strategy that the exodus is “not the done deal that Maersk Line thinks it is”. High level talks between Maersk Line, TRP (DP World) and key government figures and leading dockers’ union leaders may lead to “a major re-think as the dockers are mobilising” and they averted strike action at all three Puerto Nuevo terminals, just as we went to press. The new government has just appointed Jose Berni as General Manager of AGP and Leonardo Cabrera has been “nominated” as undersecretary of ports but his final approval to take over has not quite been officially approved. As the AGP web page has not been updated since before Christmas it is difficult to get clarifying official information. The, now frozen, “major revamp” would have consisted of doubling the size of Puerto Nuevo’s capacity from 1.4 million TEU up to 2.8 million TEU and given the port enough space and infrastructure to serve BA for the next 15 to 20 years which will reduce congestions in downtown BA. According to various sources the River Plate “landfill project” – using rubble from the improvements to the Avenida Costanera Obligado, the main port highway running to the north – has been suspended “for now”, until such time as the government makes a decision on the continuation of the Puerto Nuevo “Super Terminal” project, or not! When contacted in late November and early December various managers at the AGP maintained the line that “the tender process for the $1.9 billion new Puerto Nuevo will go ahead” but that there “would be some minor delays until the New Year”. Port Strategy also sent emails and made phone calls to try and contact Captain Flavio Galanis, who was the planning director for AGP who had outlined the concession plan in detail to us throughout last year, but he was never available. REPLACEMENTS AT AGP When the New Year came, however, it became very difficult to contact anyone at the AGP and now it turns out they are all being replaced, including Galanis. Such is the way that politics and port strategies intertwine in Argentina and, indeed, in South America as a whole.
28 | APRIL 2020
Until the “shock” news of the Maersk Line Northern Europe service switch from TRP, the talk was of “concession extensions” possibly for another five years or so and of struggling Terminal 5 (BACTSA), combining with Terminal 4, which is operated by Maersk Line subsidiary APM Terminals. However, the seemingly more likely outcome is now on TRP disappearing and BACTSA probably surviving, unless the powerful Argentine trade unions can force a major change from Maersk Line. “If not TRP will be left in a very precarious position,” said one BA shipping agent. “MSC, dominates at Exolgan and Maersk Line and its various brands [Hamburg Sud, Alianca and CSAV] are very dominant now in Buenos Aires, with more than 65% of the market between them. Independent port operators like TRP/DP World and BACTSA/Hutchison Ports are gradually being side-lined as the mega carriers congregate their cargoes in their own port facilities.” Campbell believes that the messy turmoil that has beset Puerto Nuevo, located in the central downtown area of Buenos Aires, will bolster its various rivals vying for their share of the lucrative Buenos Aires containerized cargo business. Exolgan, which operates out of Dock Sul, a separate port entity some 20 km from Puerto Nuev and Terminal Zarate (based some 90 km northwest of Buenos Aires) already have a 40% and 10% market share of the overall BA conurbation containerized cargoes, and are likely to increase that share in the future. (See The Exolgan Story, in panel).
8 Maersk Line shifted north Europe to East Coast South America (ECSA) service from TRP to AP Moeller Terminal/ Maersk’s Terminal 4 operation
TECPLATA BEST-PLACED However, Campbell opines that TecPlata, the newest box facility in Argentina, which is owned and operated by International Container Terminal Services Inc (ICTSI) of the Philippines is best placed to take the greatest advantage from Puerto Nuevo’s declining fortunes. “La Plata is trying to take some advantages from these difficult scenarios for Puerto Nuevo,” explained Campbell, who has also been the President of Ocean Network Express (ONE) Argentina since it was formed from the merger of three Japanese carriers, adding, “And I think they have the opportunity to secure themselves as a viable alternative to Buenos Aires. Already they are looking to bring in international players with their deep-sea calls with Evergreen taking out slots on Log-In Logistica Gran Cabotage (Mercosur) services and there is talk that they and other carriers are considering regular calls.”
For the latest news and analysis go to www.portstrategy.com/news101
LATIN AMERICA: TERMINAL DEVELOPMENT
He expands on the local position further. “Tec Plata’s management is getting closer and closer to persuading a shipping line with deep-sea services to move to its terminal. Already Evergreen is taking out regular slots with Log-In Logistica [the Brazilian flag cabotage and Mercosur coastal operator] which is transhipping its import and export cargoes via Brazilian ports.” Another two sources in BA also said that Evergreen was “talking seriously” about having its own ships calling at Tec Plata on a regular basis. One experienced Buenos Aires based consultant said that the best way forward now for Puerto Nuevo is to keep the status quo more or less as it is now, and give the existing concession holders an extension of between five and eight years. “I personally think these extensions should be given and forget about the ‘mega projects’ and concentrate instead on using TecPlata and Exolgan and Zarate to take any possible future throughput increases,” the veteran consultant, who used to work for a major European shipping line, told Port Strategy. “I also think the three current Puerto Nuevo operators should be left to decide themselves which of the two or three entities should go forward into the next five to eight years.”
8 Evergreen is already taking out regular slots with Log-In Logistica and is a target for Tec Plata”
‘‘
.....extensions to existing operators should be given and let’s forget about the ‘mega projects’ and concentrate instead on using TecPlata and Exolgan and Zarate to take any possible future throughput increases... PRIORITIES Priorities for the Fernandez/Kirchner government right now are the raging inflation and the bid to get an agreement – a probably “financial debt haircut” - from the International Monetary Fund and resolving the social issues emanating from a failing economy. To some extent, the travails of Puerto Nuevo are not a huge priority for this left-wing government – although assuaging the labour force is quite important – and that is why a short-term five to eight year remedy is almost inevitable.
The Exolgan Story Although Puerto Nuevo’s three terminals together still handle the majority of Buenos Aires’ container movement – 60% - the biggest single terminal in the country today is Exolgan, operating out of Dock Sur (South Dock), some 15 miles to the south of the longer established Puerto Nuevo. Last year Exolgan handled 630,000 TEU, down 13% on 2018, and it is the terminal of choice for South America’s box super carriers Maersk Line (with various brands including Hamburg Sud) and MSC Line. In fact, MSC Line has an interest in the Dock Sur terminal via its stevedoring arm Terminal Investment Limited (TIL), who, along with PSA International, are the joint owner/operators. After its inception, back in the mid-1990s, Exolgan was assisted by Hamburg er Hafen Und Logistik AG (HHLA) and the German connection meant that Hamburg Sud was its
headline client for many years. Now, since Maersk Line took over the German outfit, some of those services have migrated to Terminal 4, operated by AP Moller Maersk subsidiary, APM Terminals. For many years Exolgan was the second biggest box terminal in Argentina for volumes handled but, following the demise of DP World’s TRP, it has been in first position for some years. Even so the volumes it handled in 2019 are barely above the 600,000 TEU it handled in 2010, when TRP throughput was 630,000 TEU, Terminal 4 was 230,000 TEU and BACTSSA was at 270,000 TEU. Some port commentators in Buenos Aires believe the Puerto Nuevo expansion will not be needed for years to come because Exolgan has an annual capacity of 960,000 TEU and Puerto Nuevo 1.4million TEU. So, with volumes less now than they were 15
For the latest news and analysis go to www.portstrategy.com/news101
years ago – owing to Argentina’s perennial economic crises – any expansion in capacity is not an urgent priority. Both Terminal Zarate (90 miles north of Puerto Nuevo) and La Plata (40 miles south) can also easily expand their present day capacities, of 200,000 TEU and 450,000 TEU, respectively. Today TZ handles around 130,000 TEU and the recently opened Tech Plata, handled about 30,000 TEU during its first year. Just to keep its busy facility rolling though, Exolgan has invested in four new Hybrid RTGs from Kalmar (handling boxes one over five high and lifting capacity of 40 tonnes under the spreader) with two delivered last year and two more due for delivery during late 2020. It already operates 10 Ship-to-Shore Gantry cranes (seven Super Post Panamax and Post Panamax, plus three Panamax units) along a 1.2 km quay and offers 1,300 reefer plugs.
APRIL 2020 | 29
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LATIN AMERICA: TERMINAL DEVELOPMENT
ITAJAI BACK ON TRACK
Photo source/credit: Rob Ward
After several years of ups and downs and funding setbacks, the Brazilian port of Itajai may finally be fully back on track. Rob Ward investigates
Itajai is finally entering a new era with a deeper draft and expanded turning basin that will allow the berthing of the largest of vessels currently plying their trade along the East Coast of South America of between 12,000 and 14,500 TEU. The Itajai Port Complex – which includes AP Moller Terminal Itajai on the right bank and Portonave (backed by MSC), on the left bank – is Brazil’s second largest for containers, after Santos, but has been in danger of losing that ranking due to various draft restrictions and a narrow channel allowing vessels only with a maximum length of 303m while other ports can handle ships of more than 335m LOA. Having faced periodical setbacks due to heavy flooding and raging currents (in 1983 and 1984, in 2008 and then again in 2011), the port community has come through it all with a positive result and can now look forward to also cementing its role as “Chicken Export Capital of the world”, which it shares - on and off over the years - with nearby rival Paranagua, located some 70 nautical miles away. It will also hope to add to the 1.23 million TEU it handled last year (up 10% over the 2018 figure). FINAL, FINAL TESTS Marcelo Salles, the commercial director for the Itajai Port Authority (IPA), told Port Strategy, that the pilots in the port are carrying out the “final, final tests” on the Reais170 million ($33.35 million) turning basin during the month of March and by mid-April it will be “all systems go” for vessels as large as 12,000 TEU to start calling at the Itajai Port Complex (IPC), whereas the largest, fully loaded, today are just 8,000 TEU. With phase one completing in April, or early May at the latest, vessels of up to 336m long will be able to berth and in the future Phase Two, and an even wider turning basin and draft, will allow vessels of up to 366m LOA to call. April 30,
8 APMT Itajai has 2 ship-to-shore cranes, but by 2022 will have to buy and install at least another six units according to the Itajai Port Authority
plus May 7, 13 and 20 have already been set by for ships of up to 336m LOA to berth at Itajai, marking a historic ramp up of the port’s capacity. “It is a dream come true for all those connected with the port of Itajai,” enthused Salles, who has been with the IPA, on and off, for more than 25 years, before explaining further. “Despite all the setbacks and all the delays [since extensive dredging was promised by the federal government almost a decade ago], we are once again back in the game of attracting the biggest vessels now calling ECSA, and therefore even more services. With our new turning basin and increased draft of 14m at high tide, we can increase maximum capacity by 50% and this is a massive improvement for our operations.” PREPARING AN OPEN TENDER At the same time, Salles and his team at the IPA have now completed the construction of a new berth adjacent to the APMT Itajai facility (leased to APMT/Maersk Line from the port authority) and so are preparing an open tender for that 70,000m2 area as well as a huge 230,000m2 adjacent public port area that has been used in recent years as an overflow outlet. The APMT Itajai lease runs out in the next year and the new tender will be for a 1.8 million TEU per annum capacity terminal (treble the existing capacity of 600,000 TEU per annum because it combines the two areas mentioned above) with more than 1 km of quay, consisting of 2 x 500m, which can simultaneously handle two large container ships of up to 400m in length, or four smaller units. The winner of any new tender will have to commit to spend an extra Reais1billion ($198 million ) on new equipment and infrastructure over the
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 31
LATIN AMERICA: TERMINAL DEVELOPMENT course of the first 35-year concession contract. There will be options to renew for another 35 years. Salles said he “really hopes” that APMT Itajai will renew its concession (along with the addition of the new extension) but if not, there is no shortage of willing bidders with DP World, China Merchants Port Holding Company (CMPort) and Terminal Link (which is itself a joint venture between CMA CGM and CMPort). It is still not known whether or not Portonave - which is now 100% owned by TIL after it bought out start-up partner Triunfo three years ago - will be allowed to bid. The Brazilian government watchdog, the Tribunal de Contas de Uniao (TCU), will have to decide whether or not TIL, which is the terminal company part of MSC, and already has outlets in Santos and Rio de Janeiro in Brazil will be allowed to bid. It will first need to have a close look at the competition in the region which includes Porto Itapoa, TRP in Paranagua, Imbituba, in the south of Santa Catarina and the Wilson, Sons operation in Rio Grande do Sul.
MRS Greifer GmbH_MRS Greifer 30/11/2017 10:45 Page 1
8 Floods of 2011 damaged quay now repaired and is part of 1km of uninterrupted berthing
Good Time to Invest Now is a good time to invest in the port of Itajai, argues Salles and others, because throughput is on the rise, especially at the APMT Itajai facility (from 397,774 TEU in 2018 up 23% to 489,202 TEU in 2019), and it handles lucrative refrigerated cargoes. Salles said that several regular services have returned to APMT Itajai in recent years and that the volumes have increased “by 150%” over the past three years. Last year APMT Itajai handled around 100,000 TEU of reefer cargo and Portonave around 120,000 TEU.
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32 | APRIL 2020
For the latest news and analysis go to www.portstrategy.com/news101
LATIN AMERICA: TERMINAL DEVELOPMENT The latest IPA figures show that in January 2020, chicken exports were up by 13.3% to 180 million tonnes compared to 2019, and pork was up by a substantial 60%, to 113.7 million tonnes thanks to huge demand from China which has been suffering from Swine Flu. Brazil exports around 5 million tons of chicken every year and has been the world’s leading exporter of the white meat since 2004. Due to the swine flu in China, Brazilian pork exports are expected to grow by at least 15% this year, up to 850,000 tons,
with the vast majority passing through Itajai and Navegantes. Three of the world’s largest white meat exporters – BRF, JBS and Aurora – ship produce through the IPC. The IPA executive added that Itajai port complex has “a $3 trillion dollar economy” as its hinterland including, the three wealthy southern states of Rio Grande do Sul and Parana as well as Santa Catarina, and its extensive reefer warehousing units (with more than 10,000 plugs) is the “best and most extensive in the world”.
Grit and Resilience of Itajai Robert Grantham, a director with the Solve Shipping consultancy based in Navegantes (on the left bank of the IPC) considers the new turning basin as a “historic” moment for Itajai and displays the “grit and resilience” of the local port community. “The new ships sailing on the Brazilian coast are now 336m so something urgently had to be done, or the port will be would have been out of the game,” asserted Grantham, who was himself commercial director for IPA between January 2009 and January 2012 and was also country manager for China Shipping between 2005 and 2008.
“Indeed January 16, 2020 will be recorded in the history of this port as another mark in its long history of success and overcoming adversity,” declared Mr Grantham. “On this date, the first experimental manoeuvre of the new turning basin, located very close to the entrance of the river, was carried out. “When I joined the Board of the Port Authority of Itajai between 2009 and 2012, we received the visit of the Director for the Americas of APM Terminals and at the time he was very emphatic, either the port was preparing to receive the new ships that were entering the traffic in South America or we would be out of the game.
“The warning of this executive and others was understood by the port community and, as usual, a movement of political, economic and social forces began in order to enable the construction of a new Turning Basin that would allow Itajai to handle the bigger vessels, in a first phase of development, of ships up to 336m in length and in a second phase (still to come) for the operation of ships with 366m.” And, as they say, the rest is history, and now Itajai has bigger volumes, more options for shippers and an expanded box terminal on its right bank – possibly with APM Terminal Itajai running it – to look forward to.
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For the latest news and analysis go to www.portstrategy.com/news101
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APRIL 2020 | 33
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PORT DEVELOPMENT: INDIA
TICKING BOXES AT MANGALORE India’s New Mangalore Port (NMP) is building a new deep draft berth for containers and bulks, but what else does it offer, asks Gordon Feller New Mangalore Port was declared as the country’s ninth “Major Port” on May 4, 1974. It is located on the West Coast of India. Of India’s 12 “Major Ports” it is the only one located in the state of Karnataka. There are 15 berths, with the maximum draft available at some quays of 14m. The port is approached through a 7.5km-long channel, with water depths in the outer channel being 15.4m and 15.1m for the inner channels. The Port has a total land area of approximately 822 hectares and a water area of 120 hectares. The Port’s chairman, M.T. Krishna Babu, announced that the new structure, Berth No. 17, would be built by the Port Trust at a cost of 2 billion rupees to compensate for the loss of Berth No. 14, which was for multi-purpose cargo. In his announcement, Babu said that both berths would be commissioned within three years. INTEREST FROM FIVE BIDDERS CLAIMED Although not named, five bidders have qualified to submit request for proposal of PPP to equip Berth No. 14 - as approved by the Tariff Authority for Major Ports (TAMP), which operates under the national government’s Shipping Ministry. The winning bidder will install gantry cranes of higher capacity to speedily handle containers. With a proposed investment of 2.8 billion rupees, mechanisation of the berth would add 6.02 million tons of capacity at the port. The total number of containers handled at the port would increase from the present 150,000 TEU to 200,000 TEU under first phase and 350,000 TEU in the second phase, Mr. Babu claimed.
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The port is planning a large-scale dredging programme to maintain year-round, uniform draft of 14m inside the port’s channel. At present, the draft varies depending upon the season Mr. Babu said the port is planning a large-scale dredging programme to maintain year-round, uniform draft of 14m inside the port’s channel. At present, the draft varies depending upon the season. Mr. Babu and his team have concluded that a uniform draft would certainly help the port to attract bulk cargo vessels throughout the year. The port has entrusted Indian Institute of Technology, in the Indian city of Chennai, to work out the economic feasibility of increasing the draft to 16.5m in order to attract Capesize vessels. The average size of a capesize bulker is around 156,000 DWT, although larger ships (and especially those which are normally dedicated to ore transportation) have been built, with weights up to 400,000 DWT.
port-led development, whereby Indian ports become a major contributor to the country’s GDP. Sagarmala envisages transforming existing ports into modern world-class ports and efficiently integrate ports with industrial clusters, the hinterland and the evacuation systems, through road, rail, inland and coastal waterways.
8 NMP is to develop a new container berth and five bidders are reportedly interested
The port is connected with three National Highways: 5 NH 66 from Kochi to Mumbai, is a four-lane road and part of the stretch is two lane roads which are being widened to four lanes with a provision to expand to six lanes to accommodate future expansions. 5 NH 75 connects directly Mangalore to Bangalore via Hassan, linking eastern and southern Karnataka. The road is being widened and upgraded to a four-lane highway. 5 NH 50 connects Mangalore to Sholapur, is a two-lane highway currently being to four lanes. New Mangalore Port is also connected to the Indian Railway Network through Southern Railway, South Western Railway and Konkan Railway. The Railway Marshalling Yard at Panambur, inside the New Mangalore Port, is a part of the Southern Railway. This is connected to the Konkan rail network at Thokur providing access to Mumbai via Coastal Karnataka and Goa and to the South Western railway at Kankanady providing access to the Karnataka heartland and Bangalore and Mysore via Hassan and to Kerala through the southern railway. 8 Large-scale dredging to maintain year-round, uniform draft of 14m inside the port’s channel.
ENGAGING WITH SAGARMALA NMT is engaged with India’s Sagarmala Initiative, which is one key part the national government’s program, driven by strategic imperatives, to realise India’s economic aspirations. The overall objective of the project is to evolve a model of
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 35
MARITIME SECURITY: CYBER CRIME
PORTS ON CYBER CRIME ALERT Port authorities and staff are increasingly in the sight of cyber criminals aiming to find vulnerabilities. Dave MacIntyre investigates
8 Cyber-crime is here – a typical image that can appear on IT systems
Cyber criminals have already struck. When Maersk Line found itself infected with the NotPetya ransomware virus in 2017, it took ten days to rebuild its network of 4000 servers and 45,000 PCs. The outage cost about US$300 million. Just this February, Australian 3PL Toll Group’s IT platform was temporarily crippled by a ransomware attack. Other instances include attempts to steal cargo from the terminal or disrupt terminal systems unless a ransom is paid, or to commandeer ships in port waters, to block approaches or berths, for political purposes. Ports are showing increased awareness as a result. The Port of Melbourne has helped establish a Port Cyber Security Forum, with experts advising port users on pro-active cooperation to address cyber security risks. Governments too are recognising the threat to ports. The UK government has published an updated version of its “Ports and port systems: cyber security code of practice” document, which aims to provide guidance for companies with responsibility for protecting technical systems at port facilities and vessels docked in ports. It offers advice on developing a cyber security assessment and how to plan for protecting important assets, processes and potential vulnerabilities. NEED FOR SAFEGUARDS The need to educate staff on how to recognise risks has led Singapore-based Stapleton International to develop a specialist course that has been endorsed by the Maritime and Port Authority of Singapore and recognised by Inmarsat along
36 | APRIL 2020
with the Institute of Maritime Engineering, Science and Technology and the University of Sunderland in the UK. Stapleton chief executive Dr. Mick Thurlbeck says data transfer is at unprecedented levels and the multiplicity of systems in use in ports and on board vessels could prove to be a huge opportunity for cyber-crime. He says that 95% of cyber breaches are a result of personal error by staff and this can happen at any level within the port organisation or on the ships in port. “There has been a marked shift of attacks from corporate systems to target individuals. Almost every company has the latest security software and firewalls in place so many presume that the IT department will keep everything safe and intact. But human error is the weakest link. “C-level staff are no exception, just as management are also generally prone to attack. The methods used by cyber criminals – phishing, social engineering, ransomware etc –are not targeted at any particular level. All they look for is someone to make the mistake and the consequences can be alarming. Once the hackers have breached, you are then under their control.” LEGAL IMPLICATIONS The legal implications for a port authority whose cyber defences have been breached will depend 8 Dr. Mick Thurlock says human error is still the weakest link
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MARITIME SECURITY: CYBER CRIME upon the country within which the port is situated, says Toby Stephens, partner of international legal firm HFW. “The primary concern is that a port’s security is sufficient to prevent criminals from operating within it, misdirecting cargo, or allowing contraband to pass through it. This may have implications for the port’s concession with the state or other authorities. “Ports may be exposed to third-party claims arising from breach of contract and/or breaches of duty and negligence if for example, cargo is lost or stolen as a result of a cyberattack. Given the sophistication and novelty in cyber-attacks, imposing a duty of care in tort claims will be driven by the facts of each case, but the more widely the problem and the better the information, the higher the standard that the port will be held to. “There is also a reputational issue, which has a knock-on commercial impact. For example, the safe port warranty is fundamental to charter parties and, arguably, a port might be considered legally ‘unsafe’ if it suffers cyber-attacks due to poor cyber security. “Claims may also be brought under the data privacy legislation.” Defences available depend upon the circumstances of any case. A deliberate criminal act by another person or persons is usually a good starting point for any defence. However, if the claim is being made by a contractual counter-party it will depend upon the contractual terms, says Stephens. “The contract may specify the level of security the port should maintain. Alternatively, the contract may just imply that the port will take reasonable care of goods in its custody. This suggests that the port will have adequate systems in place based on the known or anticipated threats. ‘Systems’ in this context isn’t just computer systems, but also procedures and training which help an organisation cope with the threat.” Stephens says businesses are susceptible to any kind of a cyber-crime and ports and terminals are no exception. This can range from a GPS spoofing, phishing emails, doctored fraudulent payment instructions, a denial of service attack, a malware attack, ransomware or even honey-traps. Political and economic motives may also spur an attack. “Phishing and malware are the most common types of attacks and could be catastrophic for a port or terminal
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There has been a marked shift of attacks from corporate systems to target individuals. Almost every company has the latest security software and firewalls in place so many presume that the IT department will keep everything safe and intact. But human error is the weakest link operator. Most cyber criminals are looking for a way to earn money, but ports and terminals may attract those seeking to steal cargo. However, given the nature of ports and terminals, they are more likely to attract the attention of organised crime seeking to smuggle contraband or, even worse, terrorist organisations seeking to cause maximum chaos.” He confirms that with diverse infrastructure systems in a company, every individual in the hierarchy can be a potential target for cyber terrorists – “A cyber event on the whole is a failure of an organisation or private person’s IT systems, which can either be caused by a malicious actor (for example a cyber-attacker) or a technical failure. It is all the more important to have robust systems and regular training in place for all personnel.” Stephens says there is very little consistency in how ports are responding to cyber threats. “This is the most critical issue – many people think that cyber security is simply an IT issue. It isn’t. You can spend as much as you can afford on IT and in a year or two it will need updating. Companies need to have proper procedures in place to deal with an attack before it happens, and they need to have a system of regular training in place for all personnel.” As a final thought from a lawyer’s perspective he adds, “Review your contracts to understand your exposure to your counter-parties. It may be that much of the exposure can be mitigated or transferred if it is given proper thought.”
Ransomware attacks the most problematic Michael Yarwood, the TT Club’s Managing Director – Loss Prevention, says that arguably the most problematic subject for the port authority is the ransomware-type attack. This may, for instance, result in the port authority not being able to access key IT infrastructure and, as a consequence, not being able to fully operate or serve its customers. The TT Club’s messaging has been focused on practical strategies of prevention, thereafter, developing systems to detect and identify, contain, eradicate and recover. In terms of prevention, layers of defence need to be established starting with the outermost layer of physical security, followed by management-level procedures and policies, firewalls and architecture, computer policies, account management, security updates and antivirus solutions.
Information and access should be limited to a need-to-know basis. Legacy systems should be reviewed, and networkhardening measures embraced, ensuring patch management is adequate and proactively reviewed. All USBs should be encrypted and tested for viruses prior to being used with other devices. Frequent awareness briefings and training programmes should educate all employees on best practice. Comprehensive threat assessments should determine areas of potential attack and vulnerability assessments should identify critical systems, understand the potential exposures faced by each and the impact on overall business continuity in the event of a cyber-attack. “Risk assessment and risk treatment
For the latest news and analysis go to www.portstrategy.com/news101
options can then be reviewed and implemented to ensure a robust system is in place to prevent incidents where possible and equip employees to detect and respond in cases which could not be prevented,” says Mr. Yarwood. Vetting of third-party providers is also necessary to ensure cyber security precautions are taken. Finally, for ports considering a way forward, Stapleton’s Dr. Mick Thurlbeck says it is imperative not to adopt an attitude of “if it’s not affecting the bottom line at the moment, then we will deal with it later.” He advises: “If you have not done so already, don’t delay training any longer. If you have been free from cyber-attack it is possible that thus far you have just been lucky.”
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Transport Events HP April 2020.indd 1
17/03/2020 13:03
MARITIME SECURITY: CONTAINER SCANNING
SCAN AND DELIVER John Bensalhia takes a look at today’s container scanning system innovations and developments Welcoming the arrival of cargo at ports is complicated by the risk of potentially illegal or dangerous items. Illegally imported goods, drugs, guns, even explosive threats... ports must be ready when it comes to items that can compromise safety and security levels. Container scanning systems are solving this problem, ensuring consistent levels of safety, with the added bonus of providing high throughput and productivity rates. What used to be a time-consuming process has become faster and more efficient. Recent changes at Maher Terminals in the Port of New York/New Jersey have taken this notion on board with the introduction of a new system in July 2019 (in conjunction with US Customs & Border Protection). The new system involves a straddle carrier passing through two stacks of containers, on which a radiation portal monitor is mounted. It has the ability to scan the cargo without a pause from the vessel to the rail terminal – resulting in faster speed and creating greater space in the terminal which would have otherwise been used to scan the containers. While there have not been many new recent regulatory requirements, more ports are required to increase the scanning inspection percentage of the import and export cargo. Nuctech explains that this is because many ports in Europe are facing increasing challenges of illegal goods coming from other continents – especially drugs.
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The drive-through container scanner has increased the speed of customs inspection and enhanced the efficiency of the entire logistic chain “In addition, more customs authorities and border forces now prefer dual view scanning technology instead of single view technology,” says Nuctech. “With dual view images, the customs officers can obtain much more information and obtain more efficient assistance enabling them to identify illegal cargoes hidden in containers.” In terms of meeting different requirements for container scanning systems, APM Terminals Pipavav MD, Jakob Friis Sorensen, says that the regulatory norms are very stringent with regular safety audits and routine maintenance procedures. “Entry is restricted to only trained personnel into the radiation machine zone. In addition, there is concrete walled office building facing the scanner area, and two AERB certified radiation safety officers. All staff working with Thermoluminiscent Dosimeter (TLD) badges, radiation exclusion zone, safe zone for pedestrians, safety audits by AERB are mandatory.” “Our systems are designed to comply with applicable rules and regulations globally,” says Nuctech. “Hence, we can easily meet any regulatory requirements worldwide. We are always ready to offer customised products and services to our customers and work with them to understand their needs and develop the best possible solutions, in compliance with the applicable rules and regulations.”
One of the most popular modern container scanning innovations is the drive-through portal. The introduction of this concept has brought a number of benefits to ports, as Jakob Friis Sorensen explains. “The drive-through container scanner has increased the speed of customs inspection and enhanced the efficiency of the entire logistic chain. This has reduced the dwell time and led to quick turnaround of cargo at the port. A step towards providing a seamless experience and promoting ease of doing business.” Besides increasing security and safety of the port, Sorensen says that the container scanner enhances the terminal’s overall performance whilst reducing the service time and aid in providing a boost to the import-export process. “The drive-through scanner is capable of handling twin 20’ containers at the same time on a single trailer. Designed scanning throughput is 70 transactions per hour. The main goal is the prevention of wrong declaration, concealed smuggling, and provision of better security.” To save time and boost productivity, the drive-through container scanner is a popular choice for ports. Visakhapatnam Port recently implemented a drive-through scanner and the Indian Port Association installed four new mobile drivethrough scanners at each of the four terminals of Jawahar Lal Nehru Port. Reducing the time taken to scan the containers, the portal can scan 100 containers per hour. Nuctech says that there are significant innovations and developments regarding throughput increases and improved efficiencies. “Our company has developed the world’s first and only dual view drive-through systems, deployed in the port of Maasvlakte and operated by Dutch Customs. With a single scan, it will able to inspect 5 x 40 foot or 10 x 20 foot containers and provide high quality dual view and dual energy images to the inspectors.” In terms of hourly throughput, the dual view drive scans approximately 150 containers per hour. “This is 10 times more than traditional cargo scanners and also with an additional top view image.”
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8 Ports must be ready for items that can compromise safety and security levels
APRIL 2020 | 39
MARITIME SECURITY: CONTAINER SCANNING Increased throughput rates and system strength are chief considerations of modern container scanning at ports. In June 2019, Smiths Detection was contracted by Meridian Port Services Ltd to provide cargo inspection technology for Ghana-based Tema Port’s expansion project. The technology selected was four lots of SD HCVPZ60 scanning portals, which can keep up a throughput of up to 100 tracks per hour. The portals are also capable of penetrating steel from nine to 11.8 inches thick. Leidos systems encompass high throughput rates. The VACIS M6500 Mobile Inspection System can scan around 150 vehicles an hour – this figure applies to the automatic scans of cargo-laden driving vehicles that pass through without a pause. In the case of stationary vehicles, the M6500 can scan 60 of these per hour. The M6500 can also specifically scan cargo containers. Another Leidos offering, the IP6500 Full Scan System, is designed to scan large amounts of containers in regular traffic flow at the port gates or other checkpoints. Nuctech adds that modern AI technology also greatly assists customs inspections. “We worked on a project with China customs on developing automatic detection on the scanned image. The result is very good and nowadays, greatly assists China Customs inspections. With the help of AI, Customs Authorities save manpower and increase the inspection percentage. We are now also developing AI in our European subsidiary, Nuctech Netherlands and are looking forward to working together with Customs Authorities in Europe and worldwide in a joint effort to improve the technology and 2020_WSP create a safer27/01/2020 world.” WSP Jan-Feb 14:53 Page 1 While container scanning systems help ports achieve high
throughput and productivity levels, a chief issue is that of safety. To ensure safe use, manufacturers are coming up with low-level radiation systems. Wi-Ltd’s WG Container and Cargo X-Ray Scanning Portal features low radiation dose technology along with safety systems to ensure safe use for everyone involved in the process – drivers, operating staff, and bystanders. The Leidos VACIS M6500 uses a low radiation dose to do the job, which, while increasing throughput, enhances safety. The Leidos VACIS IP6500 Full Scan system also utilises a low radiation dose while detecting the presence of heavily shielded Special Nuclear Material. In September 2019, two fixed portal X-ray machines were installed at the Port of Manila as a means of detecting the presence of smuggled goods and contraband. Installed by the Bureau of Customs and ordered from Astrophysics Inc, the machines can scan at least 120 containers per hour. However, these machines are designed to give off lower
8 A clear ability to scan a container for illicit goods
Cargo / Passenger and Recreation / Military Facilities Core Services Advisory Services Port Planning and Analysis Environmental Services Engineering Services Coastal Engineering Program Management Construction Services Asset Management
wsp.com/maritime Simon Harries Tel: +44 777 322 8338 simon.harries@wsp.com
40 | APRIL 2020
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MARITIME SECURITY: CONTAINER SCANNING radiation levels as a means of ensuring the safety of both port staff and the public present at the port. With respect to container terminal scanning safety at APM Terminals Pipavav, Jakob Friis Sorensen says that the system is of proven international standards. “The set-up is double fenced and built with robust thick concrete walls to prevent leakage. Further in-built multiple levels of safety systems to prevent accidental transmission of X-rays until the trailer cabin passes the radiation emission point include trailer speed radars, OCR, manual emergency stops, and various auto-cut-offs to prevent inadvertent emissions if safe operating procedures are not adhered.” For drive-through systems, Sorensen explains that it is highly essential that the X-rays should be energised only when the driver cabin has passed, and the container is facing the primary beam region. “To achieve this functionality, one of the safety systems is the laser gap profiler, which allows the actuation of X-rays if, and only when the vehicle carrying the container has a gap between the driver cabin and container passing through the scanning area. X-rays are energised only after the passing of the driver cabin.” “In addition to the inbuilt safety systems, the role of the trained and qualified operator is very important to prevent any potential exposure situations. Further study on design and operational aspects including human error is recommended for the accelerator-based container scanner system, which will be helpful to identify the area for improvements in the design and operation.” “From the design of the container scanner, we have comprehensively considered the safety for both operators
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The drive-through scanner is capable of handling twin 20’ containers at the same time on a single trailer. Designed scanning throughput is 70 transactions per hour and the public in the overall safety of the system and especially radiation safety,” says Nuctech. “Radiation safety is always the top item we need to ensure for the system. We always measure the operational site and use professional radiation calculation software operated by radiation experts thereby ensuring at all times compliance with the rules and regulations of all local radiation authorities.” Nothing can be taken at face value when receiving containerised cargo, but modern container scanning systems mean cargo inspection is streamlined, faster and safer. 8 Drugs hiding in the top layer of a van found in China
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IT INNOVATION: STRATEGIC TECHNOLOGY TRENDS
SHAPING THE FUTURE In the first of a two-part series, Matthew Wittemeier and Dr. Eva Savelsberg of INFORM GmbH outline strategic and emerging tech trends for 2020
8 There are four emerging technologies that are worth monitoring in 2020
In 2018, we released our first emerging technology article and kicked off 2038: A Smart Port Story Part 1 – our vision of the port and terminal industry in 20 years’ time. As our second installment of the emerging tech article from 2018, this two-part series will explore a handful of emerging technologies that are starting to shape, or have a high probability of shaping, the future of our industry in Part 1. We have also elected to go one step further this year and add in some of the strategic trends that are also impacting the adoption of technology in Part 2. EMERGING TECHNOLOGIES There are four emerging technologies that are worth monitoring in 2020, namely 5G, gamification blockchain, and artificial intelligence (AI). Like in 2018, let’s define each and then look at a usage example within the ports and terminals industry. 5G Fifth-generation wireless, or “5G,” as it is commonly known, is the next generation of mobile technology. 5G utilises a broader spectrum of frequencies moving into the infrared range allowing for much lower latency (faster data exchange) and more simultaneous connections. The application of these improvements is well documented and, notably for maritime, they include machine-to-machine (M2M) communication, improved autonomous vehicle-to-vehicle (V2V) communications and coordination, and improved wireless network connectivity over traditional wireless networking protocols and standards.
While there is currently a lot of hype about 5G, the reality is that the standards that will ultimately govern the technology are not yet fully in place globally. We are expecting this year to be a big one for 5G as these standards start to come into effect and an increasing number of manufacturers include this as a standard in their equipment. In short, stay tuned. GAMIFICATION Gamification is defined as the application of typical elements of game-playing (e.g., point-scoring, competition with others, rules of play, etc.) to other types of activity. Gamification is not a new concept. No, it’s been around since the early 2010s, but it is on this list because 2019 is the first year we have seen applications within the terminal industry. The extent that gamification is a product or by-product of society set aside, since 2010, this is something that has become increasingly common in software design as a means to improve user engagement and productivity. In 2038, we hypothesised that the terminal operator of the future would use gamification to encourage improved performance and reward human operators. These were obvious, “low-hanging” fruit. We also took it a step further and outlined that, when interconnected with a machine learning algorithm, a gamification system could be used as a tool to assess human behavioral patterns. Combined, these two applications of gamification could become a powerful tool in any terminal operator’s bag of operational resources for improving efficiency and learning new ways to deal with familiar and unfamiliar process challenges.
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APRIL 2020 | 43
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INSIGHT FOR MARINE TECHNOLOGY PROFESSIONALS
IT INNOVATION: STRATEGIC TECHNOLOGY TRENDS BLOCKCHAIN Blockchain was on the list for 2018, so the definition we applied previously still applies. Blockchain is a technology platform that provides a secure, digital ledger in which transactions are recorded in chronological order and made public across multiple nodes that hold a shared copy of the ledger. Blockchain, as a technology solution to broader digitisation challenges, is the technology of choice for 2019. Yet we have to admit, we are really surprised by this position. Blockchain keeps being sold as the secure and trusted database solution. Hold on. Were we the only ones to read the MIT paper released in early 2019 outlining the security vulnerabilities of blockchain as a technology? It is worth reading on its own, but here’s the short version: it outlines multiple ways, the once unhackable blockchain, is now being cracked more often than you might think. At the time the article was published, hackers had managed to steal nearly US$2 billion worth of cryptocurrency. When you take away the security of blockchain and add in the environmental impact of the technology (some blockchain applications consume as much energy to mine as that of nations like Ireland), and we really need to ask if we’re just jumping on the bandwagon because we like the buzzword. ARTIFICIAL INTELLIGENCE (AI) AI was on our list in 2018, but it has a deserving spot again. As a broad term to describe a lot of individual technologies, artificial intelligence is an area of computer science that’s concerned with building systems that demonstrate intelligent behavior. Most people find it difficult to agree on a precise definition of intelligence, and so different people’s view of what artificial intelligence means also tends to diverge. For most people, when they hear the term artificial intelligence or AI, they think of a General AI, or human-level AI, that can mimic all aspects of human intelligence. The simple truth, however, is that today, AI is far beyond this. Instead, AI vendors have succeeded in building niche or so-called Narrow AI systems that know how to do reasonably specific things very well. Examples of Narrow AI are playing chess, translating between languages, understanding natural language or driving autonomous vehicles. It is these Narrow AI systems that are now making their way into our industry at a rapid pace as part of the “Fourth Industrial Revolution.” In 2018, INFORM was nominated as “…one of the 20 mostpromising artificial intelligence companies globally.” From a technology sense, the line between the Operations Research (OR) algorithms and what many would describe as AI, is very blurred. In this sense, we’ve been providing niche AI systems to the terminal space through our Optimization Modules for some 20 years. Practically speaking, these add-on modules allow terminal operators to add intelligent decision-making to support specific aspects of the terminal operations – from train load optimisation through to vehicle optimisation – and many applications in between. MACHINE LEARNING (ML) (A SUBSET OF AI) Again, machine learning was on the list in 2018 and we have seen almost all of the major maritime technology providers move the needle with respect to ML last year with real promise for 2020. In contrast with General AI’s goal of mimicking human intelligence, machine learning tools use algorithms to iteratively learn from and adapt to data, enabling computers to discover previously unknown insights. A beginner’s example for this can be found in your email
8 Where a port terminal has data, a solution provider with the experience to leverage that data can help them convert it into know-how
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Most people find it difficult to agree on a precise definition of intelligence, and so different people’s view of what artificial intelligence means also tends to diverge inbox: spam filters. Simple, rule-based filters are not very effective against spam since spammers can quickly update their messages to work around them. Instead, ML-enhanced spam filters continuously learn from a variety of signals and tailor themselves to the email needs of the individual user. ML is already making its way into terminals around the globe as a means to mine data to improve processes. INFORM has authored two technical papers on the application of machine learning in terminal operations. They are available via our website in the download section. With practical applications that can be implemented today, including predicting crane execution times, container dwell times, outbound mode of transport, and equipment maintenance schedules, INFORM already has a broad range of proven ML insights. That said, the reality is these only scratch the surface of what machine learning can achieve. Where a port terminal has data, a solution provider with the experience to leverage that data can help them convert it into know-how. Yet it must be considered that machine learning is only one-half of the equation that leads to better terminal operations. ML can help understand what has been completed in the past and glean insights therein, but in doing so, it will only ever be as good as it has been to date. The second half of the equation includes pairing AI and Operations Research algorithms that are good at assessing future possibilities and coming up with acceptable solutions to unknown future problems. TO BE CONTINUED As noted at the start of this paper, this is a two-part series with the second part due next month. In Part 2 we will be delving further into some of the strategic trends that are also impacting the adoption of technology in the maritime sector. We will show that this is the more important half of any technology conversation – stay tuned. 8 INFORM GmbH is headquartered in Aachen, Germany. More than 1,000 companies in more than 40 countries run INFORM software systems
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APRIL 2020 | 45
IT INNOVATION: INTERNATIONAL PORT COMMUNITY SYSTEMS
IPCSA GOING GLOBAL The International Port Community Systems Association reaches its tenth anniversary next year. Felicity Landon reports on its rapid growth and growing status When the International Port Community Systems Association (IPCSA) started life in 2011, it was as a European association with six founding members – SOGET in France, MCP in the UK, Portic in Spain, Portbase in the Netherlands, and dbh and DAKOSY in Germany. Today, IPCSA has 43 members, including Port Community System (PCS) and Cargo Community System (CCS) operators, Single Window operators, and seaport and airport authorities, drawn from all regions of the world. It is also a recognised NGO with consultative status at UNECOSOC and IMO. INTEGRATING PROTECT Towards the end of 2019, the standards specialist group PROTECT was integrated into IPCSA as a working group, focusing on standardised and harmonised electronic information exchange. “When we had our first conference and formally launched what was EPCSA, it was to support and provide a voice for PCSs related to Europe’s Maritime Single Window proposals,” says Richard Morton, secretary general of IPCSA. “Very quickly we were joined by new members from Belgium, Spain, Israel and then Ukraine. The association broadened out and honestly it became more like a family than an association.” He explained the rationale further. “We found that everybody was having similar types of issues – but they were willing to share and exchange their knowledge and experience on how they solved issues.” IPCSA GOES INTERNATIONAL There were new members from within the EU and then members joined from Israel, Ukraine and Australia. The association became international, IPCSA, in 2014. “Our members engage with the whole community and as such we are well placed to provide our expertise and knowledge of what is happening on the ground,” says Morton. “We were first able to help the EC – our initial focus – to understand more of what the trade was doing. Then it became clear that Single Window operators faced many similar challenges to PCSs, because it is all about the exchange of data.” IPCSA soon began working with standards organisations such as UN/CEFACT, the World Customs Organization and ISO. By mirroring the five regions of the UN, IPCSA is able to engage at local level with agencies in each region “and we continue to share and exchange like a family”, he adds. “If one of our members has a problem, they will either go directly and talk to other members or go through us and ask our advice on who to speak to and how to solve the issue. Our members tend to focus on the specific – for example, at our 2019 meeting in Bilbao the focus was on gate in/ gate out. We had 15 members sharing their processes and experiences with each other, and members were able to pick up tips and hints. “Our other emphasis is on constantly changing and adapting. We are pushing forward with initiatives such as our blockchain Bill of Lading and we will shortly be launching our new Network of Trusted Networks.”
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8 We can criticise, and we can lobby, but we want to provide advice and practical suggestions, says Uwe Liebschner
BESPOKE BUT SHARING The IPCSA Community is a bespoke, private social media network for members, where they increasingly share information. “We see this coming into its own as more of us will be doing remote working – it will help to manage the challenges we face in the world at the moment, due to the coronavirus.” Uwe Liebschner, customs and foreign trade consultant at dbh in Bremen, is chairman of IPCSA’s customs committee. “I was recently told that as an organisation we are respected for ‘keeping discussion alive’ but also for actually doing things, not just talking about them,” he says. “Other organisations are impressed because we make real progress in our businesses and are not spending months discussing the theoretical steps in how to set up a structure for the next working group. “Of course, we can criticise, and we can lobby, but at the end of the day we want to sit down together, share our real expertise and experience, and provide advice and real, practical suggestions. We have various customs services and other institutions coming to us and asking for our ideas and support. I am a fan of open discussion, sharing challenges and solving problems together – that is how IPCSA works, and it does surprise many.” Being global has its challenges – “we have to be aware of political sensitivities”, says Richard Morton. “But we will keep moving and adapting to the needs of our members while maintaining our core value – a neutral community which through lobbying, practical initiatives and projects as well as engagement with the global, regional and national logistics communities and relevant public bodies act in the common interest of all of our members.”
8 We have to be aware of political sensitivities, says Richard Morton
For the latest news and analysis go to www.portstrategy.com/news101
ENVIRONMENTAL MANAGEMENT
8 Good ideas also need practical experience
TAKING OUT THE TRASH Waterborne plastic pollution grabs public attention - manual cleaning is, however, time-consuming and labour intensive. Stevie Knight asks if unmanned systems can help? “There are a lot of good ideas out there, but you need practical experience,” says Bård Haug of SpillTech, a company that’s turning from oil incident mitigation to trash clean up. If a system is going to be sitting out there for extended periods, there are the various stressors of current, wind and waves “and you also want to know what happens to your technology when it’s exposed to UV and saltwater” he points out. A couple of companies have hit on practical ‘bin’ solutions. The Portbin has been designed for those nasty patches that keep turning up in sheltered corners. It sits neatly with just an upper hoop showing on the waterline and moves with the tide, an impeller drawing the flotsam into the collecting basket below. It also presents fairly a low entry bar for investment: you’ll probably get change from US$10,000 on the standard model. In a similar fashion, the Seabin relies on a water pump to suck the floating trash into a mesh bag. Founder Pete Ceglinski says that cigarette butts, packaging and – tellingly – microplastic particles are the most common items caught but larger items, including a banana tree and an office chair, have been found trapped by the inflow. Interestingly, Seabin is involved in a reverse crossover, it is to start mopping up small patches of oil using an inexpensive absorbing pad. Although these are fairly economical, low-power units, they will likely require a straightforward electrical connection.
Solar panels might seem an obvious pairing but Haug explains that the PortBin’s 900W draw would probably demand a sizeable photovoltaic installation. Therefore, SpillTech is also looking at a passive device for off-grid deployment. Again, this takes advantage of local conditions – instead of reaching across the whole breadth of the fairway, a boom is positioned so that the current shunts the greater part of the flotsam along to the basket. However, while the smaller ‘bin’ designs can be emptied by hand, the XL sizes will likely need a crane or winch. This is an often underappreciated detail: although the volume of material may not account for much, “if bottles or containers are partly filled with water, or there are a lot of autumn leaves, the weight in a 1,000-litre basket can reach half a tonne”, explains Haug. The TRASH system, developed by New Naval Ltd (another oil spill crossover), goes some way to answering the issue. This combines channelling booms with subsurface skirts, directing the garbage to a multi-tiered, removable steel mesh collection cage sitting on a floating base. Efficient, low-power onboard pumps switch layers as they fill “but it also gives the top storage levels a chance to evaporate or drain off some of the water before collection”, explains designer Alexandros Panagopoulos, adding that the prototype cage can be lifted off and tilted which further lightens the load “assisting the recycling company with the final processing”. TESTING IN PIRAEUS The full scale model, tested in Piraeus last year, features a 6m long, 3m wide and 4.7m high three-level cage capable of holding nearly 900kg of rubbish before emptying by truck or barge-mounted crane.
For the latest news and analysis go to www.portstrategy.com/news101
APRIL 2020 | 47
ENVIRONMENTAL MANAGEMENT However, it’s both scalable and configurable for the location: for example, adding an impeller could increase flow into the cage. Further, the Piraeus prototype ran from batteries paired with solar panels “but you could also use wind or wave power for other off-grid installations” says Panagopoulos. Interestingly, remote online video monitoring, information and activation can take place by PC or even smartphone app. There is another, even larger solution for plastic-heavy waterways. The Interceptor, developed by the Ocean Cleanup team, still relies on a current to shift the trash along a collection boom to the collection vessel. But at this point the process becomes very high tech: a permeable conveyor belt lifts the flotsam upwards onto an automated shuttle which distributes the waste into bins sitting on a barge between the hulls. Oversized debris is taken care of by a passive deflection function, conveyor jams trigger an automatic shut down. Once a filled barge is taken to a local waste management facility, the shuttle will act as a buffer, continuing the trash collection. Though designed for 24/7 autonomous operation, the power demands can be covered by the 5.6kW photovoltaic cells paired with a 20kWh lithium-ion battery. An internet-connected onboard computer monitors the system’s performance, energy usage and component health. It is effective, capable of dealing with 50,000kg of trash a day – even 100,000kg under ideal conditions, claims the team. Obviously, this would require intensive discharge operations but the automatic bin filling means there is no tricky, manual loading. Again, it’s a step up in price. The first pilots in Jakarta, Klang, the Mekong Delta and Santa Domingo cost around US$750,000, but once it is in series production, expect the price to drop, say the Ocean Cleanup team. Other trash collectors are swimming over the horizon: SpillTech, for example, has been developing a battery-driven robo-cleaner. The stable, double hull and twin thruster design has no rudder to foul - and it has enough onboard power for a normal, eight-hour shift.
“It has a shark’s wide mouth, and behind that is a big mesh bag ‘stomach’ that can be swapped out when it’s full,” describes Haug, adding that the idea is to make that automatic. With a beam of just 240cm it’s small enough to be transported on a jet-ski trailer: “It could be taken from place to place, hoover up the rubbish, and then be packed off for the next location,” he explains, which means that it could be useful for share agreements or rental. While Haug says the prototype “is already out there, doing small jobs... and looking very efficient”, SpillTech is looking to enlarge the 200Ah battery capacity and get it to move little faster than its present 2 to 3 knots: “We’re also experimenting with a docking station design, which would automatically empty and recharge the robot cleaner at the same time,” he adds.
8 Equipment has to deal with over 50,000kg of trash a day
The Approach in Canada Some regions suffer far more than others: “There are places around ports where you cannot see the water for plastic,” says Radé Svorcan, of Canadian developer, Technika Engineering. It is a real issue - not just for the wildlife which gets strangled or choked by it, but even for critical infrastructure such as pumping stations.” The problem is, if there’s no current to bring the trash to you, a powered device is necessary – and ideally one able to carry on working without crew. At the same time the sheer volume of rubbish militates against the simple evolution of existing, manned sweeper designs into remote or autonomous operation. Firstly, “these have a high power demand as the vessel is working hard against drag and the volume of water trapped between the booms”, explains Svorcan. Secondly, and arguably the biggest problem, “is the tendency to clog”. Therefore, the DeltaSea device takes a completely different approach. A pair of
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helicoidal ‘arms’ don’t fight the water or garbage, but instead continue turning their way through the floating trash: their screw action yields a steady, 1m per second pace and delivers the debris to the collection basket at the rear. Onboard is the appropriate signalling, communication and monitoring tech to operate it remotely (in busy locations) or even autonomously out in the open sea; those utilised in high traffic areas will have additional cameras - and ideally be integrated with the port’s VTS. It may be novel, but recent trials in Vancouver have demonstrated the DeltaSea’s effectiveness: “It can cover up to 0.5km2 of water surface area during a 24-hour period,” says Svorcan. While the first units will run on batteries recharged at the quay, the idea is that later devices will be able to pick up solar and wave energy, yielding a longer range. Most importantly, there is also the option of adapting the craft’s rear to connect with a
8 Port water cannot be seen for plastic
conveyor and barge to accept larger quantities of debris prior to transfer to shore. Further, the DeltaSea isn’t limited to plastics: it can also clean up oil and chemical spills in a pollution incident. The initial design (with a price nominally starting around US$150,000) has 6.5m booms with an 8.5m spread which, usefully, can be altered or closed up entirely for stowage and transport. However, Svorcan adds that as it can scale up easily, other, higher-throughput sizes “are available”.
For the latest news and analysis go to www.portstrategy.com/news101
PRODUCTS & SERVICES DIRECTORY
Taylor Machine Works designs, engineers, and manufactures more than 100 models of industrial lift equipment with lift capacities from 6,000-lbs. to 125,000-lbs. YOU CAN DEPEND ON BIG RED!
3690 N Church Avenue Fårtoftvej 22 Louisville, MS 39339 USA 7700 Thisted, Denmark +1 662 773 3421 Tel: 0045 72 42 24 00 Neuroholding@cimbria.com Directory Jan-Feb 2020_Neuero contactus@taylorbigred.com 29/ www.cimbria.com www.taylorbigred.com
Email: neuero@neuero.de Tel: +49 5422 9 50 30 neuero.de/en/
Over a century of port industry experience. A strategic group of ‘best in breed’ people, partners and solutions, capable of delivering holistic, turn-key, advanced port-centric solutions for any brown and greenfield terminal around the world.
To advertise in the
LASE Industrielle Lasertechnik GmbH
Port Strategy Directory
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
Contact Tim Hills or Hannah Bolland
DEME Directory Jan 2020_DEME Directo
+44 1329 825335 www.portstrategy.com
igus® GmbH Spicher Str. 1a D-51147 Köln, Germany Tel. +49-2203-9649-0 info@igus.eu igus.eu/P4.1
For the latest news and analysis go to www.portstrategy.com/news101
G-SERIES
Dellner Dampers is an innovative Swedish company that supplies solutions to mitigate vibrations and absorb kinetic energy. Standard and customised buffers and dampers for port side applications such as cranes, spreaders and more. All designed and produced in Sweden. Tel: : +46-(0)157-45 43 40 Fax: +39 049 8848006 Email: info@dellnerdampers.se Web: dellnerdampers.se
DEME is a world leader in the highly specialised fields of dredging, marine engineering and environmental remediation. The company can build on more than 140 years of know-how and experience and has fostered a pioneering approach throughout its history, being a frontrunner in innovation and new technologies.
Scheldedijk 30, Haven 1025 2070 Zwijndrecht, Belgium +32 3 250 52 11 info.deme@deme-group.com Staubli directory 40x58_Stäubli 29/01/20 www.deme-group.com
E LECTRIFICATION SOLUTIONS
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.
When experience really does matter!
Tel: +65 9186 6846 jon.arnup@trent-global.com www.trent-global.com/
C RANE COMPONENTS
Gemini House Cambridgeshire Business Park, 1 Bartholomew’s Walk, Ely Cambridgeshire CB7 4EA England, United Kingdom (UK) Tel: +44 1353 665001 Fax: +44 1353 666734 sales@samson-mh.com www.samson-mh.com
C OMPONENTS
SAMSON Materials Handling Ltd specialises in the design and manufacture of mobile bulk materials handling equipment for surface installation across multiple industrial segments. Designed for rapid onsite set-up and continuous high performance SAMSON equipment provides an excellent return on investment.
HPC is an internationally renowned consulting firm with profound experience in the global port, transport and logistics sector and a clear operations/owner’s perspective. Container Terminal Altenwerder, Am Ballinkai 1 21129 Hamburg, Germany
D REDGING EQUIPMENT
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 SYSTEMS
NEUERO Industrietechnik GmbH
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 WASA Dredring Directory_Wasa Director www.rohde-nielsen.dk
T: +49 (0)40 74008-0 info@hpc-hamburg.de www.hpc-hamburg.de
C ONSULTING ENGINEERS
Taylor Machine Works, Inc.
HPC Hamburg Port Consulting GmbH
D REDGING
• Portable pneumatic conveyors or grain pumps; • Pneumatic continuous barge and ship unloaders; • Mechanical continuous ship unloaders; • Mechanical loaders; Complete turnkey projects for port terminals
VIGAN Engineering s.a. Rue de l’Industrie, 16 1400 Nivelles (Belgium) Tél.: +32 67 89 50 41 www.vigan.com info@vigan.com
C ARGO HANDLING EQUIPMENT
A/S Cimbria Cimbria design, develop, manufacture and install custom-built solutions, from processing lines to large turnkey projects. We possess in-depth specialist knowledge in every field of crops and products with project engineering and process control as particularly demanding fields of competence.
VIGAN manufactures dry agribulk materials handling systems:
C ONSULTANTS
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
B ULK HANDLING
B ULK HANDLING
Bedeschi S.p.A
As one of the leading manufacturers of quick connector systems, Stäubli covers connection needs for all types of fluids, gases and electrical power. +41 61 306 55 55 ec-ch@staubli.com www.staubli.com/en-ch/ connectors/
APRIL 2020 | 49
PRODUCTS & SERVICES DIRECTORY
Verstegen is worlds leading manufacturer of rope operated mechanical grabs for the dry bulk industry. Stevedoring companies and ports are using our grabs for handling all kinds of bulk materials. Marconibaan 20 Nieuwegein Netherlands 3439 MS Tel: +31-30-6062222 Fax: +31-30-6060657 info@verstegen.net www.verstegen.net
Westicker Str. 52, 59174 Kamen, Germany
Email: port-technology@vahle.de Web: www.vahle.com
BLOK cuts Shipping Line pollution: increases safety and productivity in Port • BLOK Spreader – lifts 4x40’ empties • BLOK Rig – automatic twistlocking • BLOK Trailer – 8 teu
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. 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
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Gerbestr. 15, 6971 Hard, Austria T: +43 5574 6883 0 sales@kuenz.com www.kuenz.com
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
ShibataFenderTeam Group ShibataFenderTeam is one of the leading fender manufacturers with 50+ years of group experience and an extensive global network. As a specialist for customized fender solutions, they focus on vertical integration with in-house manufacturing and full scale testing, offering high quality products at competitive prices. SFT offers the full range of marine fender products. info@shibata-fender.team www.shibata-fender.team
P OWER TRANSMISSION
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.
I T PORT AUTOMATION
G RABS MRS Greifer GmbH
Orts GMBH Maschinenfabrik
90 Fenchurch St London • EC3M 4ST Tel: +44 207 204 2635 london@ttclub.com www.ttclub.com
Tel: 00441926611700 enquiries@blokcontainersystems.com www.blokcontainersystems.com
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
The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services. TT Club specialises in the insurance of liabilities and equipment for multi-modal operators.
VISY Oy VISY takes pride in solving operational problems, specialising in gate automation and access control solutions in ports and terminals. Their solutions streamline processes resulting in saving money and increasing productivity. Tel: +358 3 211 0403 Email: sales@visy.fi Web: www.visy.fi/
M ARINE FENDERS
info@alimak.com www.alimak.com
BLOK Container Systems Ltd
SANY offers reliable quality container handling trucks. Benefit from the experience of over 4,000 reach stackers build over the last 12 years, with up to five year full machine warranty. Sany Allee1 D-50181 Bedburg Tel: +49 2272 90531 100 Email: info@sanyeurope.com www.sanyeurope.com
I NSURANCE
Alimak, the leading manufacturer of rack and pinion elevators, have been successfully servicing ports since the early 1970s with close to 3,000 elevators installed, providing easy access for crane drivers, which enhances productivity and profit. Today, the company’s crane elevators are installed in almost 100 countries around the world.
H ANDLING EQUIPMENT
E LEVATORS
Alimak Group Sweden AB
Sany Europe GmbH
I T PORT AUTOMATION
Verstegen Grijpers BV
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.
H ANDLING EQUIPMENT
G RABS
E LECTRIFICATION SOLUTIONS
VAHLE PORT TECHNOLOGY
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
Liebherr-MCCtec Rostock GmbH Liebherr provides advanced maritime cargo handling solutions with a focus on quality, innovation and performance. With more than 50 years’ experience in vessel handling and container stacking, Liebherr supplies premium port equipment for highly efficient port operations across the globe. Liebherrstraße 1, 18147 Rostock Rostock, Germany +49 381 6006 5020 maritime.cranes@liebherr.com www.liebherr.com
CERTUS provides Automatic Container Recognition systems in ports and terminals all across the globe. Our systems have consistently demonstrated high reliability and overall high OCR accuracy, streamlining customer operations. Check out our Mobile OCR! www.certus port automation.com +31 78 6815196 The Netherlands
To advertise in the
Port Strategy Directory Contact Tim Hills or Hannah Bolland +44 1329 825335 www.portstrategy.com
For the latest news and analysis go to www.portstrategy.com/news101
PRODUCTS & SERVICES DIRECTORY
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. 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
Port Strategy Directory Contact Tim Hills or Hannah Bolland +44 1329 825335 www.portstrategy.com
For the latest news and analysis go to www.portstrategy.com/news
Refurbishments & Upgrades – Maintenance – Training – Inspections & Audits – Safety Lashing Cages – Spares & Service Support www.wcs-grp.com/ info@wcs-grp.com T: +971-4-8838980
Port Strategy Directory
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
Contact Tim Hills or Hannah Bolland +44 1329 825335 www.portstrategy.com T RACTORS
To advertise in the
Providing complete solutions for your container cranes
To advertise in the
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
T ERMINAL OPERATIONS SUPPORT
Bromma is the industry’s most experienced spreader manufacturer, known worldwide for crane spreaders of exceptional reliability. Today you find Bromma spreaders operating in 97 out of the top 100 ports worldwide. Malaxgatan 7 , P.O. Box 1133 SE-164 22 Kista, Sweden Tel: +46 8 620 09 00 Fax: +46 8 739 37 86 sales@bromma.com spareparts@bromma.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
S PREADERS
Bromma Conquip
T ERMINAL OPERATIONS SYSTEMS
S PARE PARTS
TVH PARTS NV TVH supplies every part you need for heavy forklifts, reach stackers, container handlers, spreaders and terminal tractors. As a one-stop shop, the company offers a full service in spare parts and accessories for container handling equipment, with a guaranteed fast delivery at a competitive price. Brabantstraat 15 BE-8790 Waregem Tel: +32 56 43 42 11 Fax: +32 56 43 44 88 info@tvh.com www.tvh.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
MAFI Transport-Systeme GmbH 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
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DECEMBER 2019| 53 DECEMBER APRIL 2019 2020 | 53 51
POSTSCRIPT
‘‘
DP World’s Banana port project is experiencing pushback from the current government which is seeking major revisions to the original contract forged with the previous administration. No physical work has been done so far on implementing the project to date – some observers suggesting as a result that it might be a project that the developer had hoped to reserve to implement ‘down the road’ when the prospect of a sensible return on investment became more viable
BANANA: A SLIPPERY ROAD It was the source of some controversy as a result of the actions of a whistle-blower and now DP World (DPW) is again experiencing troubled times with its plan to establish a deep-water multi-purpose port at Banana port located on the north bank of the Congo River’s mouth. The DR Congo’s President, Felix Tshisekedi, who came into power in January 2019, is actively working to revise the terms of the contract with DPW, with the objective of removing what it sees as elements that work against the national interest and to open up the project to other investors. Under the revised terms, DPW would be eligible to continue with its proposed container terminal development, should it choose to do so, and other parties be invited to develop and operate oil, grain, mineral and other terminals. It has been reported there is a belief in Tshisekedi’s team that there is scope for a larger port project overall, although this does not appear to be a point of view substantiated by demand studies. Indeed, this issue of accurately matching supply to demand is one that has come up on several occasions in conjunction with the proposed Banana container terminal – is it really needed given current and foreseeable container traffic growth levels and factoring in the realities that overland transport costs from Banana to Kinshasa, the capital city and main demand centre, are much higher than those from Matadi, located 92 miles upstream on the left bank of the Congo River? Here modern container terminal facilities are operated by International Container Terminal Services Inc. (ICTSI) with these currently undergoing a second phase expansion. Further, the idea of transhipment traffic finding a home at Banana and contributing to a positive return on investment also does not appear realistic. Capacity for this activity along the West African coast has recently climbed significantly, including at the port of Pointe-Noire in The Congo, located just 71 nautical miles away. CONTRACT PROBLEMS A number of structural problems are identified by the current DRC Government with the Banana contract
52 | APRIL 2020
8 Banana port, DRC a development target for DP World but the current government wants to revise the terms of the concession contract
forged with DPW by the former administration headed up by President Joseph Kabila. As reported by Africa Intelligence they include: 5 A government equity stake in the project which at 30% is seen to be too low. There are concerns about the right of veto – that this level of equity participation is too low to be able to exercise a veto. 5 Also seen as a negative is the fact that while DPW’s shares are transferable the DRC’s shares are not. There are concerns that DPW may be playing a speculative game and that DRC would be the loser in the event of any subsequent sale by DPW. 5 Sovereignty is another issue. A clause that bars the National Assembly from legislating against DPW’s interest for the full term of the 30-year concession is seen as onerous. So too are the contract clauses that establish an exclusive access zone 80km around the Banana port site and grant the company police powers across the whole area. The suggestion is also levelled that DPW may have tried to get around public procurement rules that necessitate projects costing over a billion dollars to be put out to competitive tender. The initial investment scheduled by DPW is said to be in the region of US$350/USD400 million with this rising to over US$1 billion once phase one profitability is assured. DEADLINE LOOMS There is a clause in the contract with DPW that states the deal will be terminated on the 23 March 2020 – two years on from the signing – if no state agent has been appointed to the concession company by that time. No such appointment has been made. It is this ‘leverage’ that Tshisekedi’s team has been employing to enter renegotiation talks with DPW. There is no news yet on these but for sure the outcome promises to be interesting, not least because in the eyes of various informed observers the Banana project is a high risk one where cargo volume and thus returns are not assured.
For the latest news and analysis go to www.portstrategy.com/news101
25NOV Port of Antwerp 2020 Belgium 26 TO
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BALANCING ENVIRONMENTAL CHALLENGES WITH ECONOMIC DEMANDS