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Issue 3 2015 - Freight Business Journal


Tilbury and NFT to build on-dock chilled site


Forth Ports and NFT Distribution are to build a £20million tempera ture-co ntro lled distribution centre at the Port of Tilbury. The centre, planned to open


in late 2015, will be a port centric distribution centre and one of the largest refrigerated quayside facilities in Europe, expected to create 500 new jobs. Its 230,000sq ſt area will have a capacity of 25,000 pallets and it will be able to handle more than 2.5 million cases per week. It will have over 1,400 reefer points and on-site examination services for customs clearance. Forth Ports says the investment


will take the port centric concept to another level with NFT’s major customers benefiting from a complete integration with the wider port operations at Tilbury and the adjacent London Container Terminal (LCT).


Pictured: Perry Glading, port of Tilbury; David Frankish, NFT; and Charles Hammond, Forth Ports


LCT also benefits from a mix


of global deep sea and European feedering and short sea links which already carry a multitude of chilled goods through the terminal. Forth Ports chief executive


Charles Hammond said: “Being located at London’s major port at Tilbury, this new distribution centre will be at the heart of the logistics process and support NFT’s goal to ensure a seamless experience


for their major


customers in the UK.” And NFT chief executive,


David Frankish, added: “This port centric extension to NFT’s offering and substantial expansion to our chilled warehousing capacity in the South East will be a further step in defining our future development and growth as a key innovator of logistics services for the UK and global food industry. We deliver £11 billion worth of food products (at retail value) to UK retailers and manufacturers each year and NFT has experienced major success borne of its ability to provide integrated solutions to complex logistical challenges.”


FedEx-TNT: A third force >> 1 T h e


Netherlands would be the


site of the combined company’s European headquarters while the global headquarters would remain in Memphis in the US. The merger would create a


company able to compete with DHL and UPS on their own terms, effectively creating a ‘third force’ in the global express industry, said Gunning and Bronczek. Far from reducing


completion, it


could actually increase customer choice, they argued, by creating a third company capable of offering customers a full portfolio of global services. The takeover, Bronczek suggested, “would increase competition in Europe by creating a third strong competitor” that “would benefit customers over the long term.” Although FedEx’s €8 a share


offer is lower than the €9.5 UPS would have been prepared to pay in 2013, Bronczek is not anticipating a rival bid. The Dutch post office – owner of a 14.7% stake in TNT – and other key shareholders had indicated that they were happy with the bid. Nor was serious opposition


expected from competition authorities outside Europe – although the Chinese authorities’ scuppering


of P3 container the shipping


proposed alliance


between Maersk, MSC and CMA


///NEWS Pioneers of port centric distribution NFT executive board member for sales and


marketing, Dale Fiddy told FBJ: “This is our first investment in a port side warehouse and it brings us into a new market – temperature-controlled imports.” In fact, Fiddy believes that NFT is a pioneer


in setting up a ‘port centric’ operation in the temperature-controlled sector – at least


in the


modern era. NFT is one of the UK’s leading distributors of chilled


food and, having carried out a study of the market, it became apparent that there was a massive amount of food coming into the UK abroad. “In fact, the UK is not all that self-sufficient – we import around 40% of what we eat,” said Fiddy. And with the country’s population still increasing,


food is a growing market, he points out. Having decided that a port-side facility was the


best way of capturing a growing market, NFT then decided on Tilbury as the best location for its new south-eastern gateway. However, Fiddy stresses that the new facility would not only take product passing through the port itself – it will be fed by all the southern ports including Southampton, London Gateway and Felixstowe, as well as traffic coming off the ferries and shuttles in Dover and Folkestone. Other ports, such as Sheerness, were ruled


out because there has been a move out of bulk refrigerated ships to temperature controlled containers, Fiddy added. Ultimately it boiled down to a choice between


Tilbury and London Gateway, but the former is better located for Dover, Fiddy considers. Having a key distribution point in the south-east


will help cut food miles and emissions, because traffic for London and the south-east – which accounts for 30% of NFT’s volume nationally – will no longer have to be trucked to the Midlands, only for it to be sent down south again. “There’s no longer any need to take the goods somewhere they need to go to,” as Fiddy puts it. He adds: “If this concept works in Tilbury, we could


potentially apply it to other ports of entry; in fact, it’s probably a question of when, not if.” NFT does a lot of work in the North of England


(though its initials have never, as is commonly supposed, stood for Northern Food Transport, although the company was originally owned by Northern Foods.) That could bring the soon to be enlarged enlarged port of Liverpool into the frame, or a north-eastern gateway. Fiddy concludes: “There is certain logic in shipping northern-destined goods through northern ports.”


David Bronczek: Strong competitor will benefit customers


CGM might give pause for thought. Another potential fly in the


ointment is that a court case by UPS against the EU regulators’ blocking of its takeover in 2013 is still running, although Gunning said he did not think it would derail the FedEx deal. No one though is expecting


a quick outcome. Although the offer is expected to be launched in the second quarter of 2015, the transaction is not expected to be complete until the first half of 2016, as government and regulatory authorities take their time over their deliberations, said Gunning. Transport Intelligence analyst


Cathy Roberson saw TNT as mainly a


strategic acquisition.


Keen not to be leſt behind in the race between the ‘Big Three’ to become a truly global provide “the possession of TNT would transform its position altogether”


Tex Gunning: Ground network will be the envy of the industry


as it would enable the carrier to construct a global network linking Europe, China and markets in the Middle East, India and beyond. It was this, rather than prospect of quick returns that was likely to be the attraction, she suggested. Fellow Ti analyst Thomas


Cullen was not too surprised at the emergence of a FedEx bid following the failure of UPS’s attempt. The move


could also strengthen


FedEx’s position in Latin and South America where TNT has made a couple of key acquisitions, he said. In Brazil, TNT acquired nationwide and regional transport operator Aracatuba and Chilean domestic express provider LIT. Mexico


is slightly more


problematic as FedEx has made major investments itself there while TNT has a long standing partnership with local operator Redpack.


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