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Issue 7 2015 - Freight Business Journal


Singing the praises of the ‘blue economy’


The Irish government wants to encourage the maritime sector to make a larger contribution to national GDP. Liam Lacey, director of the Irish


Maritime Development Office, says the maritime industry, taking into account finance, legal and advisory services, shipbuilding and offshore development as well as shipping and port services, makes up just 1% of Ireland’s economy. Lacey says the global average is 2.4% and in the best- performing countries the figure is as high as 4 or 5%. The ‘Blue economy’ currently contributes an estimated €1.4bn


to Irish GDP. The Department of Agriculture, Food and the Marine set up a Marine Coordination Group in 2012 to help address Ireland’s apparent under- performance in this regard and now runs an annual conference, Harnessing Our Ocean Wealth, to bring together interested parties. Delegates at this year’s Ocean


Wealth conference, held at Cork in July, heard of exciting plans to establish an International Shipping Services Centre (ISSC) in Dublin. It is claimed that this could capture 5% of the global shipping finance market, creating more than 3,000 jobs and putting


Ireland on a par with established maritime hubs such as London, Hamburg and Singapore. The vision is to replicate in


shipping Ireland’s success in international aviation leasing. The country has established a dominant role in that business thanks partly to an ultra- competitive corporate tax rate of just 12.5%. Half the world’s commercial


leased aircraſt, valued at more than €80bn, are reckoned to be managed from Ireland, and nine of the 10 biggest global leasing companies have operations in Dublin.


Cronus cuts road miles


The pick-up in construction activity in Ireland is welcome news for Cronus Logistics, which transports plasterboard into Warrenpoint for leading Bristol- based manufacturer Siniat. Cronus operates a lo-lo service


up to four times a week between Bristol and Warrenpoint using its own pair of 320teu vessels. The company was formed two years ago and has moved products for Siniat since its early days. “The inbound market


into southern Ireland is buoyant


despite the challenge of the exchange rate, while Northern Ireland is slightly soſter,” say Cronus MD Nicola Walker. “We


offer Siniat a 48-hour transit that allows us to collect on day one and deliver in Ireland on day three, an ideal solution for many of the major construction clients it has there.” Cronus’s core southbound


volume to the UK mainland comprises horticultural products. “We manage distribution to the southern half of the country, selling a door-to-door and not just a shipping service,” Walker explains. “What we then look to do is backfill 45ſt containers out of Bristol. The vessels are configured for that, but can also accommodate 20ſt and 40ſt boxes.”


This aspect is useful because of


the frequency Cronus offers. If an Irish exporter misses a scheduled feeder service, the company can take their deep sea box to Bristol and transfer it to Southampton so they don’t have to make a road journey all the way or wait a week for the next feeder. Cronus can similarly collect a customer’s freight


at Southampton and


deliver to its final Irish destination. “It’s a useful supplement that


we didn’t really anticipate,” Walker says. “It plays into our idea that we can make supply chains greener by reducing road miles and breaking the mould of the traditional container lines.”


Gulf giants close in on home carrier


The new world order in air cargo is accurately reflected in the volumes flown out of Ireland in the rolling year to July 2015, with Emirates and Etihad in clear second and third place behind Aer Lingus. CASS figures show the


national carrier holding a market share of almost 21%, liſting 10,765 tonnes - an increase of more than 10% year on year. Emirates liſted 8,488 tonnes (16% share, +24% on the year)


and Etihad 4,077 tonnes (7%, -2%), putting the Gulf carriers well ahead of British Airways (2,817 tonnes) and American Airlines (2,730 tonnes). Emirates, operating double-


daily B777s to Dubai, will have twice the capacity of Etihad during the winter season. Ian McCool, managing director of the latter’s Irish GSA, International Airline Marketing (IAM), explains that Etihad has been running one B777 and one


A330 daily from Dublin to its Abu Dhabi hub but has scaled back to two A330s,


reducing


capacity from 160 to 100 tonnes per week. This will change again, to a single 777, from January to June. The downside of all the extra


capacity over the Middle East towards Asia and Australasia, McCool points out, is that Ireland has not seen a commensurate growth in its air freight exports. So the cake is being shared


///IRELAND


Steel back on menu at Shannon Foynes


Dry bulk shipments through Shannon Foynes were up 10% over 2014 levels at 7.3 million tonnes in the year to August. Animal agrifeed volumes were lower, with less silage required following Ireland’s good harvest last year, but other dry bulks were well ahead and the construction industry has also come back to life. “We recently saw our first


steel ship in six years, bringing in road-building supplies,” reports Martin Morrissey, commercial manager for Shannon Foynes Port Co (SFPC). The port has completed


the first phase of its planned expansion and improvement by filling in the area behind a jetty at Foynes, which strengthens the quay as well as increasing the cargo set-down area. SFPC had already begun the


work before €2.2 million worth of EU funding was confirmed at the end of July, representing 20% of the total cost of the project. In the next stage, Morrissey explains, the east and west jetties at Foynes will be joined, creating 1km of new berth by 2018-19. The redeveloped quay will


allow


40,000-tonne vessels to berth directly alongside, speeding up turnaround times. The EU also approved a second


application for grant aid under the Trans European Transport Network (TEN-T) programme for transport infrastructure projects, providing SPFC with €800,000 or 50% of the cost of a feasibility


among more players, with the inevitable impact on rates. Although still plagued by


overcapacity, the westbound transatlantic picture is a little different. American Airlines, another IAM principal, flew 80% more cargo from Ireland to the US between August 2014 and July 2015 but a lot of this growth followed its merger with rival US Airways. This resulted


Shannon Foynes chairman Michael Collins, leſt, and chief executive Pat Keating, right, with Ireland’s transport minister Pascal Donohoe at the announcement earlier this year of a €50 million capital investment programme at Foynes


study into the regeneration of the rail link between the port and the city of Limerick. “New track and signalling will


be needed and the scheme also involves multiple crossings and two bridges,” Morrissey explains. “The funding covers detailed engineering evaluation and design, including site surveys of 83 structures along the 40km route.” The rail link could be restored


by early 2018 but with a project cost now estimated at more than €20 million, he adds that SPFC may be forced to look for a joint venture partner. The projects are just two


components of the Vision 2041 master plan which sets out how SPFC intends to capitalise on the unrivalled deep water of the Shannon Estuary. At a later stage, a disused oil


terminal on Foynes Island, 200 metres out into the estuary,


in three wide-body services per week from Dublin, one each to Chicago, Charlotte and Philadelphia. “We’ve seen a big increase in


pharma traffic aſter AA opened its dedicated healthcare hub in Philadelphia,” McCool says. The carrier’s passenger


volumes are highly seasonal, however. It is running no wide-bodies from Ireland this


could be resurrected and the island connected by causeway to the shore. This would allow yet larger bulk vessels to berth at Foynes, as the terminal boasts 17 metres of water, compared with 10.5 metres alongside the present East Jetty. A mine in the west of Ireland


has put on ice plans to export lead and zinc via Shannon Foynes, due to the slump in global commodity prices, but there is plenty of other activity along the estuary. CPL Fuels is investing €30 million in a smokeless fuel production. And with Ireland set to go entirely smokeless, Bord na Mona, the semi-state owned company that still harvests peat in the Irish Midlands for electricity generation, is looking to follow suit. Leading animal feed suppliers


and molasses importers are also upgrading their facilities at Shannon Foynes, Morrissey says.


November or from January to March 2016. Air Canada, also represented


by IAM, sees a similar winter slowdown. Aſter operating its busiest ever summer schedule out of Ireland with 11 departures per week, AC saw its cargo upliſt more than double in the year to July, but it is now down to a daily service and will reduce this further to three per week.


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