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Issue 6 2019 - Freight Business Journal


be unsustainable in the long term, as


could


lead to significant economic, legal and biosecurity risks. Moreover, increased prices of


food and fuel could lead to street protests across the country, in turn stretching police and other resources. Predictably, the Government


played down the significance of the report, saying that it was taking steps to mitigate the worst- case situation. However, the Freight Transport


Association warned that the Yellowhammer


document


showed that “there is still much that could go wrong and still has to be done to keep Britain trading effectively.” It added that many apparently


trivial details were “crucial to the successful protection and continuation of the UK’s supply chain”. Businesses can only prepare for and implement new processes once and still need confirmation of what they are to adopt in the way of new practices, it said. FTA is still very concerned by


the risk to fuel supplies. The British Ports Association


pointed out that it had consistently said that a no-deal scenario will cause disruption at some ports. It added: “It is critical that in any scenario, the Government prioritises the flow of port traffic so that it remains fluid and does not introduce any additional checks at the frontier. If necessary, any new checks at


ro ro ports should be facilitated inland.”


Tim Harding, customs and tax manager and forwarder and logistics company Gefco UK said: “The Yellowhammer document paints a vivid picture of a worst- case scenario should a no-deal Brexit occur on 31 October, but we need to frame this in a sensible context. The industry has had plenty of practice for unstable situations, from bad weather delaying crossings for days at a time to ferry breakdowns. Of course, the scale of this kind of scenario is unprecedented and would undoubtedly lead to issues in the first week - and first day in particular – but preparation and in-built flexibility, combined with a belt-and-braces attitude, will be invaluable and we should quickly see a levelling out towards normality.”


Container shipping needs an Easyjet – or an Amazon - say shippers


Where is the Easyjet of the


container shipping world that can cut through the Gordian Knot of surcharges, demurrage charges, CAFs and BAfs, asked Sean Van Dort and James Hookham of the Global Shippers’ Forum following a meeting of the organisation in London on 19 September. Shippers are under siege from a


tide of surcharges and additional fees, and the problem is probably going to get worse before it gets better, they say. Hookham, who is GSF secretary


general, says that the low sulphur surcharge in particular is a “symptom of a diseased market”. It is the result of the shipping industry’s need to fill expensive mega ships at any costs. What has happened, he believes, is that


lines have slashed basic ocean rates in order to fill capacity, but to compensate have then loaded on ever more surcharges– with the result that shippers are paying more ocean freight than ever before, he suggests. What he also finds hard to


accept is the fact that shippers are being asked to “pay for other peoples’ problems” such as port congestion. In the passenger travel industry, if a plane is late through the fault of the airline industry, the customer can expect financial reimbursement, at least in Europe. But in shipping, the opposite applies – customers are being asked to pay for problems that are not of their making. What is worse, says Sean Van Dort, GSF chair, is that the burden


of surcharges falls unfairly in different parts of the world. They are less of a problem in the developed world, where shippers’ groups have been able to push back against the lines, but are common in places where shippers are least able to afford it, notably Africa and most parts of Asia. He says: “The Central Bank


of Nigeria calculated that the country was paying out £95m in surcharges in a six-month period. For a developing country that is a serious drain on foreign exchange resources.” (Van Dort points out however


that Sri Lanka and Bangladesh have passed legislation outlawing surcharges.) Competition in liner shipping has been eroded by the growth


///NEWS


in the size and scope of container consortia, the GSF laments. There are few truly independent container lines now that operate outside the scope of one or other of the big global groupings, although an EU ruling on their legality is expected very shortly. Dort and Hookham also


question why, in the age of the Internet, with consumers expecting to be able to make purchases easily, online liner shipping charges are becoming more, not less complex. Retail giant Amazon has startled the airline industry by buying its own airfreight capacity. Why then have the online retailers not considered doing something similar in shipping? The cost of doing so wouldn’t


necessarily be an obstacle, but perhaps there are other barriers to entry that have prevented them from doing so – at least so far.


Belfast Harbour pledged to become “the best regional port in the world” when it announced its Strategic Plan at its annual stakeholder meeting on 12 September, together with an outlook to 2035. Long-term proposals include


schemes to deepen the port’s shipping channel to accommodate larger vessels and new deep-water quays, along with completion of the City Quays development and a science and technology hub. As part of the plan, the port


has committed £254 million of investment to deliver new marine and estate infrastructure which, according to research by Ulster University’s Economic Policy Centre will generate 7,000 new jobs and support a further 3,500 construction jobs, generating £500 million for the Northern Ireland economy and an additional £300 million in wages and £4 million in rates to the city each year. Speaking at the meeting, Belfast Harbour chairman, David


Dobbin, said: “We want to become the world’s best regional port and create an iconic waterfront district for Belfast which will be an attractive place to live, work, visit and invest in. This will bring huge benefits for our customers, the regional economy and all our citizens. We can’t deliver our ambitious plans by ourselves which is why a partnership approach is a key part of our strategy. If Northern Ireland is going to be competitive on the


global stage then we need to work together, collaborate more and invest in key infrastructure. “Over the next five years Belfast


Harbour intends to invest £254 million in new port and estate infrastructure and facilities. This major investment programme is really only possible because of our Trust Port status which allows us to reinvest every penny of our net earnings back into the business.” In the shorter term (2019-23)


the port plans to upgrade its cranes and materials handling equipment, installing new ramps to accommodate larger vessels and new storage facilities. Work will also begin on digital ‘Smart Port’ initiatives to provide greater automation and a new unified system to coordinate cargo and shipping communications. A number of real estate projects


will also be completed, including City Quays 4, Pierpont Plaza, a five- storey office facility, film studios, a media hub and new public space. Belfast harbour chief executive


Joe O’Neill, said: “These plans are among the most ambitious to be put forward in the port’s history, but the challenges and opportunities of the future demand a new approach. Over the coming months we are looking forward


to launching joint initiatives that will support the development of new trade, tourism and tradeable services opportunities. “Belfast City Council’s aim is


to accommodate 66,000 new residents, create 46,000 additional jobs, and develop 550,000sq m of employment floor space by 2035. Belfast Harbour’s proposals will be pivotal in helping meet those targets. “Our strategy, however, is not


just about physical infrastructure; we want to use our resources and expertise to develop partnership initiatives that build Northern Ireland’s capacity for economic growth. These will include projects to target new port trades, skills programmes to support employers, a Global Innovation Institute to encourage R&D and an accelerator programme to stimulate innovative business.” Belfast Harbour has also set


out plans to be one of the world’s most


sustainable ports with


new technologies to improve air quality, reduce fuel consumption and emissions. It will decarbonise its energy usage by providing shore-side power for vessels and creating a green micro-energy grid throughout Belfast Harbour Estate.


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