medaports16 | gianfranco francello

NEW TRENDS IN THE MEDITERRANEAN PORT INDUSTRY

9th MEDA Ports Summit

9th MEDA Ports Summit – Barcelona, 8th June 2016

Speaker: Gianfranco Fancello

CIREM, University of Cagliari, Italy

10 ISSUES FOR THE FUTURE OF THE MEDITERRANEAN

PORT INDUSTRY

9h MEDA Ports Summit – Barcelona, 8 June 2016 Gianfranco Fancello, CIREM 2


10 ISSUES FOR THE MEDITERRANEAN PORT INDUSTRY

• The Mediterranean port industry is constantly evolving and striving for increased innovation

• During the last decades globalisation and containerisation have reshaped the maritime and port industry and still continue to present challenging changes

• Looking at the Mediterranean port industry, 10 main issues can be identified:



1. BIGGER AND BIGGER VESSELS

Ships have been getting bigger and bigger over the past decades

A continuing trend: every year new plans are created to increase the current fleet available.

2015 - MSC OSCAR: 19.224 TEUs

2007 – EDITH MAERSK: 15.500 TEUs

1997 – SOVEREIGN MAERSK: 8.100 TEUs

FAST GROWTH DRIVEN TO VERY LARGE CONTAINER VESSELS (VLCV)



2. NEW NETWORK LAYOUTS

IMPACTS ON THE SHIPPING NETWORK OF THE USE OF VLCS:

• longer roundtrips;•reduction in the number of ports called in a roundtrip service;•need to use additional vessels to maintain service frequency. •optimized network respect to final destinations



3. NEW ALLIANCES AND MERGES

• During 2016 Drewry has assessed losses for 10 billion of US $ for container market, caused by increase of oil cost, low freight rates for ships and high capital investments

• 2M (Maersk and MSC), Ocean Alliance (CMA CGM, COSCO Container Lines, Evergreen Line and OOCL ) Grand Alliance (Hapag-Lloyd, Nippon Yusen Kaisha and Orient Overseas Container Line) and New World Alliance (APL, Hyundai Merchant Marine, and Mitsui O.S.K Lines).

1. APM-Maersk 2,931,661 TEU (15.5%)2. Mediterranean Shg Co 2,555,444 TEU (13.5%)3. CMA CGM Group 1,657,053 TEU (8.8%)4. Hapag-Lloyd 974,602 TEU (5.2%) 5. Evergreen Line 955,174 TEU (5.1%) 6. COSCO Container L. 824,702 TEU (4.4%) 7. CSCL 676,564 TEU (3.6%) 8. MOL 609,708 TEU (3.2%) 9. Hanjin Shipping 608,459 TEU (3.2%)10. APL 562,346 TEU (3.0%)

IN 2015 THE 10 TOP CONTAINER OPERATORS CONTROL MORE THAN

65% OF THE MARKET

In the Asia-Europe lane, Maersk, MSC and CMA-CGM control around 60% of the capacity



4. MORE SPECIALISED VESSELS

Until a few years ago, container seemed to be the only way of transporting cargo

Today several shipping companies are investing in specialised ship types, mostly in the heavy lifting industry and transportation of chemicals.

Extremely specialised ships have been constructed, pushing the crew to new levels of specialised knowledge about their ships and trade.

NOT ONLY CONTAINER

SPECIALISED SHIP ABLE TO ONLY TRANSPORT PARTS OF OFFSHORE WIND-MILLS



5. INNOVATIVE PORTS

INNOVATIVE AND EFFICIENT CONTAINER TERMINALS

• Automation of port operations • High-speed operations

• Space-efficient terminals • Maintenance as strategy to improve productivity

• Safety, training and simulation BEST TERMINAL – BARCELONASEMI-AUTOMATED TERMINAL



6. PORT COMMUNITY SYSTEMS

FLEXIBLE AND FAST EXCHANGE OF INFORMATION AS A KEY FACTOR TO IMPROVE EFFICIENCY OF PORT OPERATION

Port Community System widespread in Med Area (not only big ports)

ICT and network relations are increase between transport operators

Port Gate automation

Smart Port



7. EVOLUTION OF THE PORT CONCEPT

PORTS ARE CHANGING

From interface between maritime transport and land transport to LOGISTICS INDUSTRIAL ZONES

able to provide:

• Integrated logistics services

• Value-added logistics services

• IT infrastructures

ADVANTAGES OF LOGISTICS INDUSTRIAL ZONES

• New opportunities of economic growth for territories

• Greater attractiveness and bargaining power of the port

[IAPH – International Association of Ports and Harbors]



8. INCREASING FOCUS ON A GREEN IMAGE

ENVIRONMENTAL AWARENESS

Innovations are made in order to reduce the environmental footprint of port operations.

On-shore power supply

Innovative system to provide electricity from the local grid

to ships to meet their power demand: ships’ operations

can proceed uninterrupted, while eliminating negative

side effects.‐ LNG (Liquefied Natural Gas)

Some seagoing vessels are already fueled by LNG and new

engines are being developed.



9. PORT PRIVATISATION

WITH THE EXPANSION OF THE PORT INDUSTRY, THE STRUCTURE OF THE PORT SECTOR HAS CHANGED

Three main typologies of container terminal operators:

1.Port authorities that directly operate their terminals;

2.Private port terminal operating companies. The main operators have expanded their activities

outside of their ports of origin, associating themselves with large stevedoring groups (e.g. PSA

Corporation, Hutchinson, ECT, P&O Ports, and SSA);

3. Shipping lines that decide to directly control and manage their own terminals for economic and

strategic reason (direct control of port operations).



10. NEW EMERGING ROUTES

THE EXPANSION OF THE PANAMA CANAL

THE AFRICAN ROUTE

THE NORTHERN SEA ROUTE

EXTERNAL FACTORS AT MED AREA (THREATS)

New maritime transportation routes will open up in the Arctic due

to the melting of sea ice.

Potential benefits: ship routes between North Europe and Far East

would be about 30% shorter. Sea routes between North America

and Far East would also become shorter.


9th MEDA Ports Summit

9th MEDA Ports Summit – Barcelona, 8th June 2016

THANK YOU FOR YOUR ATTENTION

Gianfranco Fancello University of Cagliari (Italy)

[email protected]

medaports16 | gianfranco francello

Economy & Finance