News / Onwards and upwards as port-centric operations continue to grow in the UK

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The continued growth of the port-centric concept in the UK means shipping lines are no longer tied to the traditional one-port operation, delegates at Multimodal 2014 heard yesterday.

Ocean carriers that want to differentiate themselves from competitors in “same-ship” alliances are offering customers connection options via several regional ports.

A What Next for Port-centric Solutions? session, chaired by The Loadstar editor Gavin van Marle, debated the benefits to the UK supply chain of port-centric operations and what needed to be done by stakeholders to improve the offer.

Panellist Stephen Carr, head of commercial strategy & planning at Peel Ports, Liverpool, told delegates that port-centric logistics was, in fact, nothing new, and gave the examples of oil refining and storage of dry bulk cargo.

Mr Carr explained that the advent of containerisation in the second half of the 20^th century had made it easy to handle and transport goods from ports to all parts of the UK. However, with journeys by road often hit by congestion and fuel prices having risen dramatically over the past 20 years, demand for port-centric alternatives are on the increase.

In short, the port warehouse has become an extension of the ship at sea, but is no longer used for storage but as a quayside distribution centre, he said.

PD Ports at Teesport is considered the first operator to deliver on the port-centric concept in the UK; able to encourage and attract major retailers such as Tesco and ASDA to open distribution centres at its facility.

Geoff Lippitt, its business development director, said that following the lead of these mega-retailers, others had followed and the project had expanded and “moved on”.

Mr Lippitt and Mr Carr, with fellow panellist Peter Ward, cargo supply chain commercial director at DP World London Gateway, agreed that further development of port-centric operations could only be achieved with the co-operation of local councils, in terms of planning agreements for using both brown and greenfield sites.

Port-centric operations must “be nimble” to succeed and be innovative, they said – which would bring the interesting prospect of the future growth of 3PLs at regional ports.

Feeder services are very much the key to the port-centric concept – as the spokes to the hub – but there are also opportunities for the strings of some ocean carriers to call direct, as is evidenced by the “regional focus” of MSC.

It is the policy of the Geneva-headquartered carrier to operate from a range of ports in the UK, unlike many of its peers, thereby helping to reduce customers’ road miles and carbon footprint. It was a strategy that proved its value in the latter part of 2013-early 2014, when storms battered many ports to a standstill in the south of the UK, culminating in week-long waits for berths and substantial delays to landside operations.

Mr van Marle posed a provocative question to the panel of port operators: “What comes first, the shipper or the carrier?”

The response was unanimous: “The shipper, always.”

However, there was general agreement from the panel that although port-centric operations are set to increase in the future, they are “just another tool in eliminating inefficiencies from supply chains”.