38 B


Issue 6 2011


New lines boost Boston’s business


oston has made significant advances in a tough and fiercely


competitive market, adding capacity and extending its capabilities – as well as attracting significant new liner services, says port director for the Massachusetts Port Authority, Mike Leone. “We are adding two new cranes as part of a significant expansion that has increased out capacity by 35% in the past few years,” he told FBJ. The two new cranes – plus four rubber tyred gantry yard cranes from the Port of Oakland in California. - were purchased for a total of $15 million and were expected to arrive in Boston by mid-September, and will increase the total number of dockside cranes at Conley Terminal to six and rubber tyred gantry cranes to 12. They will put the port in a good


position to accept the new larger ships that are expected to call in Boston from around 2014 following completion of improvements to the Panama Canal, says Mike Leone. He continued: “We’ve also


purchased an adjacent 30-acre site – a former oil terminal – which we plan to incorporate into our container facility. And we’re currently in the process of building a more direct route into the terminal, which will allow trucks to avoid the city streets.”


New Jersey leads the way for SBS Worldwide


S


teve Walker, group chairman at forwarder SBS Worldwide, says


that in general, its US operation is booming, “but we’re experiencing particularly strong growth from our New Jersey and Chicago offices. New Jersey has become a hub for us as it was our first office in the US and it tends to benefit from general growth in the company. Over the years we have built a great team of people and our customers really appreciate the service we give them.” Walker adds that there has also been an increase in the number of shipping lines offering services directly from Asia to the US east coast via the Suez Canal over


the last couple of years at the expense of land-bridge services from the west cost to east coast. This is because the increasing size of vessels, which offer greater economies of scale and lower transport cost per container, has resulted in shipping lines looking for alternatives to the Panama Canal where vessel sizes are currently limited. However, SBS expects


direct


Asia-US east coast volumes to increase even further when work is completed on expanding the Panama Canal to allow larger vessels to pass through. Many US cities suffer from road congestion from time to time, but


SBS Worldwide does have a couple of advantages, Walker continues. “Firstly, our office is based in New Jersey, close to New Jersey Edison Airport and the roads around there are no where near as congested as JFK New York Airport. This has also helped boost our US north east volumes.” Secondly, earlier this year SBS


Worldwide launched a supply chain consultancy Virtualized Logistics and find where time and cost savings can be made. While trucks might on occasions


become stuck in traffic, SBS’s IT systems plan routes to keep this disruption to a minimum. Walker adds: “We can speed the whole


supply chain process and almost create a DC bypass to more than make up for time lost in traffic. Advance shipping notices


sent


to destination DCs also make the whole warehouse receipt process a lot slicker and more cost effective. When we build a supply chain, we analyse the complete process and not just one link in the chain. SBS Worldwide is big in the book


business, and this sector has been affected like no other with the rise of Amazon.com and, lately, the emergence of electronic ‘e-books’, read on an electronic reader rather than produced in paper form – and nowhere more so than in the US. SBS Worldwide has clients that


Boston has in the past handled


ships of up to 6,700teu and currently hosts 5,500teu vessels on the new Suez service operated by Cosco and its partners, giving Boston a direct link to the key hub of Singapore as well as other south-east ports. Other direct destinations


never before offered from Conley Container Terminal include Hong Kong, Taiwan and Vietnam. The new AWE-5 service is a consortium of the


Bostons box business is back on track


COSCO, Yang Ming Marine Transport of Taiwan, Hanjin and Hyundai. For the future, Mike Leone is


eyeing reinstatement of the link with Central-South America via the Caribbean – a link that was provided by CMA CGM before its recent restructuring. Even bigger ships of around


8,000teu could come in future with berth and channel dredging – due to be authorised in the not


too distant future - along with new designs of low-profile cranes. This isn’t the easiest climate


in which to invest large sums of capital, but the US Government recognises that ports are the engines of economic growth and one of the best bets for achieving a healthy economy, says Mike Leone. “We have a very good bond rating with our significant commercial development and diversified


///NORTH-EAST USA


revenue streams,” he explains. The port’s


growth seems to


be back on track, with overall container volume up by around 10% in the 12 months ending July 2011 and, in the first seven months of the year, it peaked at around 20%, spurred on by the introduction of the new Suez service. Another major new


development for Boston on the service front was the New England-Halifax Shuttle operated by American Feeder Lines


to


link Boston with the important Canadian east coast port. This, says Mike Leone, “allows us to tap into services not calling direct in Boston” and also, by catering for more localised flows, will help get


trucks off the road. He adds that logistics thinking is


shiſting in the US towards a model in which shipping operators try to deliver or collect cargoes as close as possible to destination or origin in order to minimise truck miles. Not only are there environmental concerns, but - the recession notwithstanding - the trucking industry is facing a driver shortage, as well as sharply increased costs as a result of tougher hours rules. It is this factor above all others


that has allowed Boston to make headway in a market where it faces heavy competition, not least from the port of New York and New Jersey which is a mere – by North American standards – 200 miles down the road.


supply Amazon but it doesn’t work directly for the online giant, Walker says. “We like to be able to offer clients the complete supply chain package. This means we can go in and show them the savings we can make by operating their complete supply chains, rather than just taking charge of one leg of the journey. Retailers, such as Amazon, tend to have an in-house member of staff managing the complete supply chain.” E-books have also had a big


impact on publishing and while this might be expected to have had a negative impact on SBS’s publishing volumes, it has actually had the reverse effect. “E-books have opened up books to a whole new market, rather than take one


away. When people in that


new market read an e-book they like, they quite oſten go out and buy a paper copy, which benefits publishers and therefore, us.” There is a huge variety within


the publishing sector. Training and educational manuals have a different supply chain requirement to the latest John Grisham. Religious literature is also a significant global supply chain challenge which brings its own complexities. One of SBS Worldwide’s


particular areas of expertise is in transporting


sensitive preview


copies of books prior to launch, which need a highly secure environment to ensure no copies are leaked before release. Air capacity is tight on the


main trade routes for a couple of reasons, Walker says. “Firstly we are approaching the peak season and secondly airlines have been removing capacity to try and drive up load factors. At times like this our customers value the 28 years of consistent, reliable service we bring them. Our airline partners also value our long term commitment to support them and treat us accordingly.”


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