ISSUE 3 2011


NORTH EAST FEATURE Region is ready for its


second industrial revolution From shipbuilding to semiconductors, from coal to fine chemicals – no region of the UK has undergone such a fundamental transformation as Teesside and Tyneside. And the local freight industry is having to change with it.


Boro’ challenges Liverpool for top spot


of this year, at around 13-14%. “It’s still a pretty strong market,” Robinson says. This made Teesport the second


biggest north of England box port after Liverpool, surpassing Grangemouth and Hull. The port is on the cusp of its next major expansion phase, with the redeveloped container terminal practically ready to go into operation


with


Middlesbrough’s Teesport is officially the North of England’s second-biggest box port – and other business is looking good too, says PD Ports’ boss. Teesport has had a good year


and is looking forward to even better things to come, says David Robinson, group chief executive officer at owners, PD Ports (above). “We achieved 35 to 36m


tonnes in the latest financial year. While that’s still a decline from what it was, that was because of the closure of the Corus steel plant. But the fact that the Corus assets have been acquired by SSI is fantastic news.” Revival of steel-making on


Teesside by the Asian company will immediately inject 5-6m tonnes of iron ore imports into Teesport and around 3.5m t of steel slab exports. “That will probably be better for us to the tune of around 500,000t than the old Corus plant, because a portion of their export production was consumed in the UK rather than being exported.” Looking


beyond the raw


tonnage figures, even more significant perhaps is the fact that container volumes grew by 45% to 270,000teu. Growth has continued into the first quarter


reachstackers


in early April. RTGs and new systems will be in place by the end of the year, probably after this year’s Christmas rush is out if the way. “We expect the other phases to kick in pretty quickly,” Robinson continues – “more RTGs


has taken place not in the port itself but around ten miles away. Teesport has made a name for itself as one of the leading proponents of Port Centric Logistics – the idea of companies running distribution operations from or close to the port itself rather than trucking everything hundreds of miles to inland distribution centres. Companies such as Tesco, Asda and Taylors of Harrogate have enthusiastically signed up to the concept, setting up DCs within the dock estate. Now, garment logistics specialists the Clipper Group has opened a huge 350,000sq ft


(650,000sq ft including


“We do still have a bit of land within the dock estate,” Robinson points out, “but we are probably only one or two deals away from filling it. Therefore we are talking to landowners about further acquisitions. There’s still a lot more we can do in this area and we are targeting small and medium sized shippers, similar to Taylors of Harrogate.” Tea and coffee firm Taylors awarded PD Ports a one year trial for 50% of their business, predicting 350 containers in the first year, but actually handled 465, adds PD Ports’ development director Paul Barker. “PD Ports is not just a landlord for companies


itself is getting relatively full – something that would have been hard to credit only a few years ago – there is plenty of land in the general area and the local authority is generally receptive to industrial development. “We don’t have too many problems with nimbys in Middlesbrough,” as David Robinson puts it. Paul Barker told a seminar at the Mulltmodal exhibition on 7 April that Teesport was also considering setting up off-dock shared user facilities aimed at smaller users taking perhaps 1500-2000 sq ft.


and another quay crane.” The extension will increase capacity to around 400,000teu a year. MSC and CMA CGM have increased the size of their feeder ships to 1600-1800teu and, in all, there are 20 or containership calls every week. The 7-8 multi- user feeder services have brought many deepsea lines into Teesport, not necessarily with massive numbers of boxes but it could be the seedcorn from which bigger business could grow, Robinson argues. “Also, Maersk is talking about European networks and I hope we’ll be a part of that.” However, one of the most significant recent developments


mezzanine flooring) at Newton Aycliffe, just down the road near Darlington. There wasn’t quite enough space inside the Teesport estate for the size of facility Clipper required, but David Robinson says the port centric concept can apply to slightly off- port operations. “What it actually does is extend our footprint over a 15-mile radius and increases the amount of port centric space from 1.7m to over 2m sq ft - but there is the potential for it to go to 4m sq ft.”


The new Clipper facility further extends the relationship between Teesport and Asda’s ‘George’ clothing range.


such as Taylors,” he explains. “We have adapted warehouses for their specific needs and also run dedicated logistics services carrying the tea and coffee from the port to their production facilities at Harrogate. “Now all Taylors’ UK inbound volume comes into Teesport as we can provide the cost-effective and environmentally-friendly services they need.” PD Ports operates two ‘mirror’ warehouses for Taylors so that if there was a problem in one, there would always be a supply of any individual tea or coffee needed for a particular blend. While the Teesport dock estate


The Northern Gateway scheme to create a new deepsea terminal in Teesport has not gone away, either. “It’s definitely in our sights,” says Robinson. It’s on our agenda for the next three years and we might even do some of the preliminary work before then – and we have got all the permissions we need.” Offshore energy is the other big business on Teesside and while Hull may have stolen the


limelight with its MoU


with Siemens to establish a construction site for the offshore wind industry, PD Ports – which owns both Teesport and the smaller port of Hartlepool just up the coast – fully expects to secure one or two major deals of its own. “There’s 120,000 acres of spare land there, and even if and when the Siemens deal goes ahead it still leaves plenty for us to go for,” is Robinson’s verdict. JDR, which makes undersea cables for the offshore wind industry has recently expanded its Hartlepool premises and indeed Robinson likes the idea of having a spread of smaller companies rather than


one massive one, pointing out also that Hull currently only has an MoU with Siemens, not a firm contract yet. Another offshore company established


in Hartlepool is


Hereema, which makes structures for the oil and gas industry. These very specialist operators also fit the port centric model, argued Paul Barker.


Brookfield Investments, the Canadian company that owns PD Ports, is itself keen to expand its presence in the ports sector, Robinson continues. “They are keen to buy businesses – it’s high on their agenda.” There is no specific shopping list, but with Trust port privatisation likely over the next few years or trust and other ports running short of investment capital, there will be opportunities, he believes. It could be complete ports, or terminals and other operations within ports. “We haven’t really begun to leverage our Port Centric model yet elsewhere but it is possible that we could do it in other ports. In fact we do already have a small but growing logistics solutions business offering warehousing, forwarding and trucking, so it needn’t necessarily be about whole ports.”


There could also be opportunities in Ireland, where the recession has starved many ports of capital investment. “Two or three years ago, all this was off the radar, but now we have a shareholder with $120 billion worth of assets. I’m not saying they’re going to be a global player like Hutchinson but Brookfield is certainly in the up, and they are serious about ports.”


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