Cascade Effects in Container Shipping    Implication for Regional and Feeder Ports                                        ...
What we do Portek is both a provider of equipment, services  and solutions to ports worldwide,  & an operator of medium si...
What we do• As provider to ports:  – Modernize Port Equipment – upgrading    equipment from PX to PPX, turnkey  – Quick de...
What we do• As port operator:  – T009 & T300 (Jakarta, Indonesia)  – Bejaia Mediterranean Terminal    (Algeria)  – Valetta...
PORTEKCreating Global Footprints
Background
The Trend                                 12,500                        7,200            4,500  3,000 1980      1990      ...
The Trend• By end of 2007, there were 188  Vessels of greater than 10 000  TEUs on order• By 2011, Post Panamax Vessels  w...
Definitions• Mid Panamax MPX ~ 2000 – 3500 TEUs• Large Panamax LPX ~ 3500+ – 4500 TEUs• Post Panamax PPX ~ 4500+ – 6000 TE...
Cascade Effect
Cascade Effects• Cascade effect: big ships  displacing small ships across  all ship sizes
World Container FleetSupply• Order book of 6.9 million TEU with  an average ship size of 4,500 TEU.• Existing world fleet ...
LPPX/ SPPX                 7,000 – 12,500TEUsDisplacing              LPX/ SPX              4,000 – 6,000TEUsDisplacing    ...
Cascade Patterns (1)        Deployment of Megaships
Cascade Patterns (2)          Routes for LPX/PPX
Cascade Patterns (2)    New (Shuttle) Services for LPX/PPX
Cascade Patterns (3)    Routes for MPX
Shipping EconomicsAnd Implications for regional and feeder shipping
Shipping Economics• Shipping Economics :  driven by need to fill the  vessel to achieve low unit  slot cost
What are the implications?• More consolidation, M&A in the regional  and feeder trades?• Slot sharing, gradual exit of sma...
Impact on PortsImplications for regional and feeder ports
Regional Ports & FeederPorts• Regional ports are ports serving  Intra-continent of Intra-regional  trades such as Intra-As...
Challenges for Regional andFeeder Ports• Questions confronting regional and  feeder ports:  – Are the (displaced) big ship...
The Future of Regional Ports2,500 TEU ships       5,000 TEU shipsSome regional ports may emerge asthe regional hubs, and a...
The Future of Feeder Ports600 – 1,200 TEU ships        2,500 TEU ships  Feeder ports who cannot service larger  ships will...
Advantage = US$ 8 / TEU / day savings in slot cost          = US$ 48 for a voyage of 6 days
Winners and Losers• For South East Asia:  – Tg Priok (Jakarta)?  – Manila, Laem Chabang?  – Port Klang?  – Cai Mep Port? W...
River Ports VS. Sea Ports• Cascade effect will tilt the  balance in favour of sea ports:  – Ho Chi Minh VS. Cai Mep  – Ban...
Winners and Losers• For Indian subcontinent/ Arabian  Sea:  – Will Nhava Sheva emerge as a    major port of calls for Post...
ChallengesWhat can regional and feeder ports do?
Challenges• Insufficient cargo volume for new size  of ships• Physical infrastructural constraints• Equipment constraints•...
Cargo Volume Constraints• There must be sufficient cargo or  load factor for the ship to justify  making a call.• Regional...
Round TRIPSimulationSystem
Physical InfrastructuralConstraints• Draft:  – Regional ports : 13 – 15 m  – Feeder ports : 10 – 12 m• Sufficient turning ...
Physical InfrastructuralConstraints• Yard space:  – The more usual constraint  – A lot of yard space needed for    an exch...
Equipment Constraints• Panamax Quay Crane  – Lift Height (26 m  30 – 32 m)  – Outreach (12 – 13 rows    14 – 15    rows)  ...
Equipment Constraints• Panamax Quay Crane  – Drive change – improve reliability,    parts absolescence  – General refurbis...
Quay cranemodification & drivechange in Penang,Malaysia
Boom extensionin Tuticorin,India
QC Drive change in PSA,             Singapore
RTG speed increase in    Penang, Malaysia
Equipment Constraints• Yard Equipment  – RTG height of 1 over 4 (or 1 over 3) to    1over 5 or 1over 6  – Yard space is at...
Portek T300 Terminal
IT & CommunicationSystems• The port IT system must be able  to cope with an exchange of  3,000 to 4,000 moves per ship  wi...
Upgrading of CTMS
Review of Operational          procedures
Radio Data    Terminals foraccurate real time      information
GPS Satellites                                              Fixed GPS                                              (refere...
Optical Character                   Recognition                       SystemsCYLU4236936
Administrative Issues• Streamlining customs procedure and  documentation flow – many ports in  developing countries have t...
Administrative Issues• Dealing with Bureaucracy - state owned  ports slow to respond to customer needs,  cumbersome procur...
Conclusions
Conclusion: Mega Hub andRegional Port• Big ships reinforce the hub and  spoke pattern of shipping, favoring  mega hub port...
Conclusion: Feeder Portsand Feeder Shipping• Feeder ports face pressure as feeder  vessels scale up. Failure to cope means...
Thank YouQuestions?enquiry@portek.com
Cascade Effects in Container Shipping: Implication for Regional and Feeder Ports
Cascade Effects in Container Shipping: Implication for Regional and Feeder Ports
Cascade Effects in Container Shipping: Implication for Regional and Feeder Ports
Upcoming SlideShare
Loading in …5
×

Cascade Effects in Container Shipping: Implication for Regional and Feeder Ports

1,871 views

Published on

A presentation by Portek's Chairman Mr. Larry Lam

Published in: Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
1,871
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
74
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Cascade Effects in Container Shipping: Implication for Regional and Feeder Ports

  1. 1. Cascade Effects in Container Shipping Implication for Regional and Feeder Ports Portek International Limited Larry Lam, ChairmanThe contents of this document are copyrighted and proprietary, and may not be reproduced without the permission of Portek International Limited
  2. 2. What we do Portek is both a provider of equipment, services and solutions to ports worldwide, & an operator of medium sized ports.
  3. 3. What we do• As provider to ports: – Modernize Port Equipment – upgrading equipment from PX to PPX, turnkey – Quick deployment of cranes to meet surge in traffic; sale or lease – Crane accidents recovery & repairs – Port IT & Automation modules – Traffic studies, marketing program to attract traffic, simulations
  4. 4. What we do• As port operator: – T009 & T300 (Jakarta, Indonesia) – Bejaia Mediterranean Terminal (Algeria) – Valetta Gateway Terminal (Malta) – Port of Libreville & Port Gentil ( Gabon)
  5. 5. PORTEKCreating Global Footprints
  6. 6. Background
  7. 7. The Trend 12,500 7,200 4,500 3,000 1980 1990 2000 2006 Maximum Vessel Size
  8. 8. The Trend• By end of 2007, there were 188 Vessels of greater than 10 000 TEUs on order• By 2011, Post Panamax Vessels will contribute 50% of all container slots
  9. 9. Definitions• Mid Panamax MPX ~ 2000 – 3500 TEUs• Large Panamax LPX ~ 3500+ – 4500 TEUs• Post Panamax PPX ~ 4500+ – 6000 TEUs• Large Post Panamax LPPX ~ 6000+ – 8000 TEUs• Super Post Panamax SPPX (Mega Ships) ~ 8000+ – 12500 TEUs
  10. 10. Cascade Effect
  11. 11. Cascade Effects• Cascade effect: big ships displacing small ships across all ship sizes
  12. 12. World Container FleetSupply• Order book of 6.9 million TEU with an average ship size of 4,500 TEU.• Existing world fleet is only 11.8 TEU, with an average ship size of less than 3,000 TEU.
  13. 13. LPPX/ SPPX 7,000 – 12,500TEUsDisplacing LPX/ SPX 4,000 – 6,000TEUsDisplacing Small Vessels 2,000 – 4,000TEUsDisplacing Smaller Vessels 1,000 – 2,000TEUs
  14. 14. Cascade Patterns (1) Deployment of Megaships
  15. 15. Cascade Patterns (2) Routes for LPX/PPX
  16. 16. Cascade Patterns (2) New (Shuttle) Services for LPX/PPX
  17. 17. Cascade Patterns (3) Routes for MPX
  18. 18. Shipping EconomicsAnd Implications for regional and feeder shipping
  19. 19. Shipping Economics• Shipping Economics : driven by need to fill the vessel to achieve low unit slot cost
  20. 20. What are the implications?• More consolidation, M&A in the regional and feeder trades?• Slot sharing, gradual exit of smaller ships?• Increase in fuel cost will further accentuate the cost difference• Ship call frequency decrease due to larger ships and bigger loads• Reduced port calls, as port with low load factor will be dropped out
  21. 21. Impact on PortsImplications for regional and feeder ports
  22. 22. Regional Ports & FeederPorts• Regional ports are ports serving Intra-continent of Intra-regional trades such as Intra-Asia trades, SE Asia Trades• Feeder ports are mainly those that feed or receive cargo to and from a regional port or a major hub port
  23. 23. Challenges for Regional andFeeder Ports• Questions confronting regional and feeder ports: – Are the (displaced) big ships coming to your port? – Are you pushed further into the feeder trades? – Which ports can be winners and which may be bypassed?
  24. 24. The Future of Regional Ports2,500 TEU ships 5,000 TEU shipsSome regional ports may emerge asthe regional hubs, and attract moretransshipment traffic
  25. 25. The Future of Feeder Ports600 – 1,200 TEU ships 2,500 TEU ships Feeder ports who cannot service larger ships will be marginalized, they may dropped as a port of call, will see reduced frequency, and connectivity
  26. 26. Advantage = US$ 8 / TEU / day savings in slot cost = US$ 48 for a voyage of 6 days
  27. 27. Winners and Losers• For South East Asia: – Tg Priok (Jakarta)? – Manila, Laem Chabang? – Port Klang? – Cai Mep Port? With throughput in Vietnam growing at 25% a year, will Cai Mep be a winner?
  28. 28. River Ports VS. Sea Ports• Cascade effect will tilt the balance in favour of sea ports: – Ho Chi Minh VS. Cai Mep – Bangkok VS. Laem Chabang – Ports along Yangtze VS. coastal ports (Yangshan, Ningbo, etc.)
  29. 29. Winners and Losers• For Indian subcontinent/ Arabian Sea: – Will Nhava Sheva emerge as a major port of calls for Post Panamax vessels? – Karachi, Bandar Abbas
  30. 30. ChallengesWhat can regional and feeder ports do?
  31. 31. Challenges• Insufficient cargo volume for new size of ships• Physical infrastructural constraints• Equipment constraints• IT & communication system constraints• Administrative issues – bureaucratic red tape, labour management issues, custom inspection, adopt best practices
  32. 32. Cargo Volume Constraints• There must be sufficient cargo or load factor for the ship to justify making a call.• Regional Ports must: – Expand its hinterland; seize initiatives to be a gateway port for the country, and neighboring countries. – Attracting transshipment traffic – Stimulate a more balanced trade
  33. 33. Round TRIPSimulationSystem
  34. 34. Physical InfrastructuralConstraints• Draft: – Regional ports : 13 – 15 m – Feeder ports : 10 – 12 m• Sufficient turning radius• Berth Length: – Regional ports: 300 – 330 m – Feeder ports : 200 – 250 m
  35. 35. Physical InfrastructuralConstraints• Yard space: – The more usual constraint – A lot of yard space needed for an exchange of 2,000 to 3,000 boxes
  36. 36. Equipment Constraints• Panamax Quay Crane – Lift Height (26 m 30 – 32 m) – Outreach (12 – 13 rows 14 – 15 rows) – Crane speeds – possible to increase incrementally
  37. 37. Equipment Constraints• Panamax Quay Crane – Drive change – improve reliability, parts absolescence – General refurbishment – better cabin ergonomics, greater safety as in braking systems, etc. – Twin lift 2 X 20’ can be incorporated without major change in operating procedures
  38. 38. Quay cranemodification & drivechange in Penang,Malaysia
  39. 39. Boom extensionin Tuticorin,India
  40. 40. QC Drive change in PSA, Singapore
  41. 41. RTG speed increase in Penang, Malaysia
  42. 42. Equipment Constraints• Yard Equipment – RTG height of 1 over 4 (or 1 over 3) to 1over 5 or 1over 6 – Yard space is at a premium – Straddle carriers of 1 over 2 configuration are being phased out in favour of 1 over 3
  43. 43. Portek T300 Terminal
  44. 44. IT & CommunicationSystems• The port IT system must be able to cope with an exchange of 3,000 to 4,000 moves per ship within a 24 hour period
  45. 45. Upgrading of CTMS
  46. 46. Review of Operational procedures
  47. 47. Radio Data Terminals foraccurate real time information
  48. 48. GPS Satellites Fixed GPS (reference) Send Error Correction Data Mobile GPS Position Determination Systems
  49. 49. Optical Character Recognition SystemsCYLU4236936
  50. 50. Administrative Issues• Streamlining customs procedure and documentation flow – many ports in developing countries have time consuming custom inspection, and complicated documentation, resulting in a dwell time of containers
  51. 51. Administrative Issues• Dealing with Bureaucracy - state owned ports slow to respond to customer needs, cumbersome procurement process, not able to gear up quickly to handle increased traffic• Labour issues - Some unionized labour force continuing with outdated work practices, resist changes and new technology
  52. 52. Conclusions
  53. 53. Conclusion: Mega Hub andRegional Port• Big ships reinforce the hub and spoke pattern of shipping, favoring mega hub ports• Some regional ports will be winners and emerge as regional hubs. Many will be bypassed
  54. 54. Conclusion: Feeder Portsand Feeder Shipping• Feeder ports face pressure as feeder vessels scale up. Failure to cope means: high freight costs, low connectivity and becoming less relevant• Further shake-out in regional and feeder shipping through mergers and acquisitions. Smaller ships of less than 1000 TEU size will retreat to marginal or niche routes or to domestic, inter-island routes
  55. 55. Thank YouQuestions?enquiry@portek.com

×