Interview: Staying ahead of the Game

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As more and more cargo arrives to one of Europe’s leading ports, the Port of Hamburg, the port authorities have recorded an above average growth compared to their neigbouring competitors, especially in the container traffic.

6.6 % growth

seaborne cargo handling in 1H

Various factors have contributed to the growth, including considerable investment projects aimed at streamlining the existing cargo handling operations and those to be brought by even larger ships.

Keeping up with the trend of being able to welcome ever bigger ships is an arduous task,  as various challenges arise in terms of logistics, planning and operational capacity.

World Maritime News staff wanted to find out more about how the port is staying competitive despite congestion issues and delays and hear about the future plans for the port, so we spoke with Mr Axel Mattern, Chef Executive Officer at the Port of Hamburg and Mr Benght van Beuningen, Head of Communication and Information at the port.

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WMN: Recently you published the results for the first six months of 2014. What factors attributed to the record-breaking volumes of seaborne cargo?

Axel Mattern, Chief Executive Officer at Port of Hamburg: “Basically, on the one side it is the development of break bulk cargoes, mainly agricultural products originating from central European markets. Of course, container figures are the main contributing factor to the growth. And then, this is followed by import and export, and normal continental cargo going via Hamburg into the European markets including transit cargo, transshipmentargo,  feeder cargo being shipped via Hamburg to the Baltic Sea heading for Russia, Poland etc. Poland has for us been the most interesting country for the last few years, since it is the fastest growing country in our hinterland. The biggest growing figure in Hamburg pertains to feeder shipping to Poland (33% increase from last year). This is believed to be the case because container ship transport prices are a little bit cheaper that that of trucks and rail.”

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WMN: What is the next step for the port, both in terms of investment and infrastructural capacity?

Bengt van Beuningen, Head of Communications & Information at the Port of Hamburg: “Port of Hamburg, together with the State of Hamburg and the Federal Government of Germany has already invested heavily in the infrastructure of the port commencing with the start of the economic crisis. Now we already have better infrastructure at the port so we can invest in an intelligent way. We have already restructured the port’s rail system since 2007 with an investment of 300 million Euros.

The port’s rail system is owned by the State of Hamburg and spans on around 330 km of rail tracks in the port, making Hamburg the biggest rail port in Europe.”

Mattern: “In terms of investment, we are targeting more IT solutions and networks so that we have the possibility to utilize all the different information from different means of transportation in order to better organize our resources and prepare things in advance and anticipate the needs of handling the cargo. However, this is a very complex topic to solve.

Nevertheless, Hamburg is quite far in developing this and we are very eager to show the world what the future of ports will be, so we are  hosting the 29th IAPH World Ports Conference next June.”

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WMN:  The port recently inaugurated the berth at Container Terminal Burchardkai capable of handling 18,000 TEU container ships. Has the port berthed any of these mega-ships so far, and how will the introduction of this berth affect your 2H results?

Bengt van Beuningen: “The biggest ship to berth at the terminal so far has been CMA CGM’s 16 000 TEU ship.”

Mattern: “In terms of influence of these bigger ships, the fact is that all of the ports, including Rotterdam and Antwerp will have to cope with this size of ships. The more difficult part from navigating these ships into the harbour is the operational segment. To handle these ships at the terminals is not a problem, but an issue that arises is: how fast do we get these volumes of containers offloaded? We are talking about 8,000-10, ooo moves per ship and that is unbelievable.

Burchardkai has eight berths for these big ships and in the worst situation you have four or five of these ships simultaneously at the terminal. Hence, handling of each ship in Hamburg includes on average a great deal more moves than in any other port.

What is interesting is that we in Hamburg have the same import and export percentage. Big container liner companies can discharge and load again in Hamburg fairly the same volumes. This on the other hand makes it extremely difficult for the Hamburg terminal operators because they have these huge volumes of containers to handle.

And, if you get caught up in a situation that you have two ships at the same terminal at the same time undergoing the same operation then you have to “get rid” of the containers from the terminal as fast as possible sending them to truck, trains and feeder barges. Therefore, as we receive more and more of these bigger ships the challenge is getting bigger for the terminals.”Staying ahead of the Game 11

WMN: How would you describe the current situation with respect to congestion issues and delays at the port? What have been the main reasons behind this trend? 

Mattern: “The congestion issues started before Christmas last year. Liner ships were clocking up delay days due to various reasons including slow steaming, bad weather in the Indian ocean, the Mediterranean etc.

Presently, liner ship companies don’t have the power or the possibility to steam a little bit more knots because it is more expensive for them and they won’t do it. On the other hand, the shippers were delivering containers to the ports on schedule.

As a result, all the liner companies are caught up in longer delays.

Currently, the average delay of all the liner ships is seven days compared to their respective schedules. 

As a way of dealing with the delays, liners used to charter in additional ships into the system just to be able to  get the cargo from the terminals on schedule. Now they cannot do that, as it costs more money, so they continue as it is, as nobody has extra money to spare.”

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Speaking of when the port could to restore to normal operation, our interlocutors said that this is very hard to predict, however van Beuningen explained that one way to do so could be “a better logistics information and planning. So, if you are a carrier and you know that your ship is delayed for two days, a solution would be to inform the shipper early on not to export any more export cargo  to the terminal.”

Mattern: “Hence, steps need to be taken to make available this kind of information to shippers, truckers etc. We need a system to reach truckers coming from Belarus, Romania so as to enable them to organize their work better.

Because, it doesn’t make sense to have truck traffic stuck somewhere in the port. If a truck driver knows that he can deliver a container tomorrow he could easily wait outside the port and avoid these traffic jams.

As a ways to combat these issues, we have started work on trucker apps, also, we have public information in and outside of the port with displays showing traffic situation at the terminals.”

WMN: You mentioned Russia as one of cargo destinations. Are the recent sanctions imposed on Russia going to affect your projections of 145 million tonnes of handled cargo?

Mattern: “The Russian market is very important for Hamburg, we are a hub port of a kind for Russia, seeing that they do not have the capability to receive big ships directly.

The sanctions have not been really affecting the figures for the time being. The European trade to Russia is being affected, but that trade is not necessarily going via ports. If the sanctions were applied to cargoes coming from South America or China, the cargo figures in the Port of Hamburg would be affected.

 We have identified 40,000 TEUs which theoretically could be affected by the sanctions, mainly cargo such as food, but we expect that such cargo which was thus far coming from the EU will now be coming from China and South America.

We are observing the situation very closely, we have an office in St. Petersburg with our two colleagues monitoring the situation, but in general, the situation is very unpredictable, seeing that even the mood in Russia is affecting trade figures.”

WMN: Speaking of St. Petersburg and the latest reception hosted by the Port of Hamburg there on the topic of Germany-Russia business ties, what is to be expected when it comes to the trade relations between Russia and the Port of Hamburg specifically?

Mattern: “The conclusions reached at the reception are that we as the Port of Hamburg community are a little bit different in our view of the matter compared to the official stand of our Federal Government of Germany. From our perspective, we are trying to do business as usual, there is no politics there.

The main message of the reception is that both sides will try to keep the attitude of business as usual.”

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WMN: What procedures have you established to deal with the Ebola outbreak?

Mattern:  “The trade between the Port of Hamburg and West Africa constitutes a rather small percentage overall, seeing that our main trading areas are Northern and Southern Africa. What we heard from our members and partners is that they had to change some liner service schedules, and to change port calls in these countries, in order to take the Ebola affected countries out of rotation, and to call at their ports separately.

However, the issue is not really affecting the Port of Hamburg right now. I am sure that in the end we will see cargo handling in these countries drop, but our total figures will be unaffected by the drop.”

WMN: What have been  your latest projects at the Port?

Mattern: “One major project is the river Elbe dredging from the open sea to Hamburg. It is of utmost importance for the Port to get the draught of the river Elbe dredged for an additional one meter. We do not have to dredge the entire river, just a few parts. We have been planning this project for 12 years now, and along the way we have faced so many different protests, activities, as well as new regulations from the EU. We had our court case hearing  in June, and we expect the final decision on the matter on October 2.”

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WMN: What would be the consequences of having this dredging project denied by court?

Mattern: “The consequences of not doing the project would be that the port operations will remain as they are now. That would be unfortunate, but I do not think the world would crumble if the project was denied.

The deepening of the river would allow us to handle the increasing amounts of cargo that have been coming from Rotterdam and Antwerp in the recent years.  It would ease operating and navigating ships into the port.

However, the depth is not the biggest issue for Hamburg, because  we are a turning point for liner services, and the ships do not really need the depth in Hamburg. On the other hand, we need the breadth for the river navigation because the amount of ships calling at the port is rising, and in order to accommodate these ships, we need to widen the river Elbe.

Our river pilots and our IT systems are already at a stage where they could be more effective than they are right now.

When you look at the order books of major shipyards, the number of big ships being built matches the current number of big ships in service, and seeing that Rotterdam, Antwerp and Hamburg are the only ports handling these big ships, we have to cope with that and therefore we need these widenings.

If we don’t get the approval for the river Elbe dredging project, then we will lose the cargo to Rotterdam, which I do not mind, but the fact is that Rotterdam is not so well connected to the rail system as Hamburg, thus we will have more cargo on the road. I do not think that would be the best solution for the European transportation system.”

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Speaking of the future, Mattern said: “I believe that ports of the future are those which are optimally linked to the hinterland transport systems, because that is what the client needs, the client needs the cargo in Prague, Vienna, etc.; and at the end of the day, it does not really matter if that cargo came from Hamburg, as long as we have the best possible transport solution in place.

For us, it is really the question of European partnership, we all need the ports, we need the transportation systems, otherwise we would not be able to handle the cargo volumes.

When you look at all these projections saying the cargo volumes will be increasing, bringing even more challenges, we need appropriate infrastructure, the example being the Kiel Canal, which is very important for the whole Baltic waterway traffic.

More ships traverse through the Kiel Canal than through the Suez and Panama Canal put together. The overall transportation infrastructure in Germany is an acute problem, seeing that the system is underfinanced by 7 billion Euros each year.”

[mappress]
World Maritime News Staff, September 15, 2014