Despite the economic downturn in most of Europe, coal imports and exports around the Baltic seem to be almost immune to market influences.
Murmansk, situated some 2,000km north of Moscow on the Kola Peninsula, is Russia’s largest ice free port. In terms of dry bulk traffic, two commodities predominate: coal and apatite.
Harbour master assistant, Alexander Bengert, notes that 80% of the coal handled by the port is exported, to mainland Europe, the British Isles and to the Baltic region for use in power generation. With draught of 15.5 metres on the berths, bulk carriers of up to 150,000dwt can be accommodated and are the mainstay of this trade.
“Practically 100% of the coal that we handle comes overland by rail from Siberia, on a journey that takes the best part of a week,” Alexander says.
From the rail wagons, coal is discharged directly into the ships’ holds. However, a full range of value added services is available on shore, consisting of screening, washing and grading.
“Murmansk is warmed by the Gulf stream throughout the winter, so we remain ice free, which means coal can be loaded all year round. We don’t yet have axle heaters for the rail wagons, but we are planning to introduce these in the near future,” he says.
Apatite, which is used to make fertilizer, is sourced much closer to home, and brought in by rail over distances of around 150km. Grab cranes are not used on this traffic, which is loaded at two dedicated berths using elevators. Vessels sizes of between 3,000dwt and 40,000dwt are more modest, although countries importing this material are similar to those consuming Russian coal.
Overall, Murmansk has a capacity of around 20mt (million tonnes), although, on average, it handles 11mt of coal and approximately 4mt of other cargoes (such as apatite, iron ore, general cargoes etc.). Last year, notes Alexander, traffic rose slightly, despite a decrease in the amount of coal extracted in Siberia, which meant that fewer ships called.
“Overall, both coal and apatite traffic remain relatively stable, so for 2012, we are once again expecting to handle around 11mt of the former and 2mt of the latter,” says Alexander.
Asked about regional competition, he says that on the Kola Peninsula, there are just two other ports.Vitino is an oil handling facility, while Kandalaksha, which is on the south side, also has significant coal traffic, handling approximately 1mt annually.
Murmansk, nevertheless, remains the regional power house and is currently advancing plans to build an entirely new harbour area on the east and west of the peninsula, which will bring 60mt of new capacity to the port, half of which will be taken up by coal traffic and the other half by oil. This will become operational in 2020, having been jointly promoted by both the government and private sector in equal proportions.
The development of the so called Murmansk Transport Hub is one of the biggest ever port infrastructure projects in Russia. It aims to modernize existing facilities and also build new ones, focused on the transshipment of cargo. The decision to develop Murmansk in this way was due to a number of important advantages it possesses.
Firstly, it has open access to the sea, requiring little in the way of diversion from international shipping lanes. Furthermore, it remains ice-fee and has good storm protection. In addition, the eastern shore of Kola Bay already has in place well developed infrastructure, while the undeveloped areas on the western coast are also ideal for the construction of new terminals.
Existing, reliable transport links with the developed industrial regions of Russia were also key, particularly as the port lies at the end of a freight corridor linking Asia to Europe and America.
Finally, the proximity to already explored oil and gas deposits weighed heavily.
The main element of the project is to create an all-year- round deep-water hub, capable of handling containers, oil, coal and mineral fertilizers. The new infrastructure will allow bulk carriers of up to 300,000dwt to dock.
An electrified railway line will have to be built from Vihodnoy
to Lavna and a 20mt capacity coal terminal constructed on the western shore of Kola Bay, where the main investor will be Commercial Sea Port Lavna, Ltd. Rail sidings for the coal terminal are also planned, with the project being taken forward by Lavnatrans, Ltd.
This is in addition to a 35mt oil terminal, also on the west coast and a one million TEU container terminal on the east coast.
In the meantime, the existing coal terminal on the eastern shores of Kola Bay will be upgraded, with the cost bankrolled by Murmansk Commercial Sea Port.
A special port economic zone is also to be built around Murmansk as a means of keeping construction costs low for the new port terminals and also expedite project implementation, as well as acting as a means of attracting investors.
Russian coal producer and trading company,TALTEK, has the ability to produce around 3mt of coal each year, although plans to increase this to 6mt by 2015. Around 80% of the coal it produces is exported, to countries including Bulgaria, Finland, Great Britain, Germany, Greece, Italy, Latvia, the Netherlands, Poland, Romania and Turkey.
In addition to land shipments, coal is also transported to Western Europe through the Russian Port of Kandalaksha, while for Southern Europe and North Africa, shipments are made via the port of Mariupol.
Kandalaksha is located in the north- western part of the White Sea, on the Kola Peninsula. Its initial development took place during the Soviet era, with the main flow of both general and bulk cargoes shipped via inland waterways and via the Arctic sea route.
In 2004, the port was sold to private investors. It became part of the investment company Yukas Holding — the consolidated company of the TALTEK group — as of 2007. Since then, overall traffic has continued to rise. In 2007, volumes handled amounted to 671,600 tonnes, rising to 981,900 tonnes in 2008 and 1.2mt in 2009.
Development plans envisage raising capacity from between six and 11mt, depending on demand.
According to TALTEK spokesperson,Vladislav Lozin, Kandalaksha is still something of a “traditional” port, although it is being modernized. It has a maximum draught of 9.8 metres, which means that Handysize vessels can be accommodated, with the average bulk carrier currently being in the order of 25,000dwt. However,TALTEK does have plans to deepen the draught to 11m-12m in nearest future.
“Total capacity is in the order of 2mt, although in 2010 and 2011 throughput averaged 1mt and we expect to export the same amount in 2012. This is steam coal and it has been the mainstay of the port for the last four years,” he says, adding that no major dry bulk is imported through Kandalaksha at present.
Unlike nearby Murmansk, Kandalaksha, along with the whole of the White Sea, has problems with ice from the beginning of February to the middle of May. The port therefore contracts ice breaking services from RosMorPort in this period every year allowing access to be maintained year round.
Asked whether Kandalaksha competes with Murmansk for Siberian coal traffic, Lozin says that it doesn’t. “Murmansk is used by the bigger coal players, such as SUEK, whereas we deal with output from TALTEK’s own mines. Unlike Murmansk, we aren’t active in the apatite market, either.”
The port is equipped with modern high-powered equipment that, among other things, can clean the coal of metal impurities. Rail wagons discharge directly onto conveyor belts, which feed some 16 grab cranes on the quayside, although customers can also ask for coal to be crushed prior to despatch.
The existing rail terminal is absolutely enormous and can handle up to 11mt of goods a year, which is considerably higher compared to Kandalaksha port’s current capacity.
There are a total of five available berths, although not all are used for coal traffic. However, berthing dolphins are invariably used when handling vessels in the 20,000–30,000dwt range to take advantage of a slightly deeper draught.
Loading rates of 7,000 tonnes are claimed for coal.
The company also delivers coal to customers in Southern Europe, mainly using the Black Sea port of Mariupol, with the odd use also made of Izmail and Kerch.
Mariupol, which is located in the north-western part of the Taganrog gulf, in the Azov Sea, can handle ships of up to 240 metres in length, drawing up to eight metres of water. The port, which offers the mechanical cleaning of the coal, handles in the region of 500,000–600,000 tonnes, with consignments sent to Slovenia, Italy, Croatia, Bulgaria, Romania,Turkey, Greece, and countries in North Africa.
“It should be noted that our company has long-term partnerships with all these ports, which allows us to fulfil all our commitments to our clients,” says Lozin.
St Petersburg Big Port reported total traffic last year of 59.9mt, which was an increase of 3.3% over 2010. Two of its most important exports are wood and mineral fertilizer, of which 90% is handled by Baltic Bulk Terminal, which is owned by Uralki. Fertilizer traffic at the port increased just slightly, while grain exports grew by 67%, as the previous embargo on exporting Russian cereals was lifted last autumn.
Significantly, coal and coke exports fell by 87% and those of minerals by 93% as the Fourth Stevedoring Company concentrated purely on container traffic as the expense of dry bulk. Instead, coal and minerals traffic moved to another UCL Holding company, the Universal Handling Complex at the Port of Ust-Luga.
Here, overall traffic almost doubled to 22.73mt, while the number of rail wagons handled, at 340,043, was twice as high as in 2010, as they brought in much of the coal displaced from St Petersburg.
The Port of Vysotsk, which also specializes in handling coal exports, had something of a banner year too, seeing volumes passing through its terminals grow by 40% to 4.5mt. On the whole, this was the result of dredging work and quay re- construction to allow much larger vessels to call. With its terminals regularly accommodating 45,000dwt bulk carriers, Vysotsk was able to despatch coal much further afield than it had been originally. So, from a core market encompassing Germany, Finland and Poland, it now also serves the UK and the Netherlands.
The port complex of Szczecin and Swinoujscie is the largest bulk cargo centre on the Polish sea coast. It handles the majority of the country’s coal imports and, until now, it has handled nearly 100% of its imported maritime iron ore shipments. Beside coal and coke, the other main dry bulk cargo handled in the two ports are grain and grain products, iron ore, fertilizer, chemicals and construction aggregates. The vast majority of these are imports, notes one of the port’s marketing specialists, Karolina Bierdzinska.
Last year, the twin ports handled a total of 10.4mt of dry bulk, compared to 11.1mt in 2010. Reasons for the slight dip are explained by a decrease in coal and grain/grain products, although the ‘other bulks’ category rose by 66% mainly because of huge quantities of imported building materials being received for building operations related to the construction of a new breakwater in the new outer harbour at Swinoujscie.
“For 2012, we forecast handling around 9.5mt of dry bulk cargo, which will be down to an additional slight decrease in coal traffic and also a fall off in imported building materials, since construction of the outer harbour at Swinoujscie is due to be completed by the end of the year,” says Bierdzinska, who also concedes that problems in the Eurozone could also result in a reduction of coking coal imported by the steel industry.
Export coal, for a long time the mainstay of both Szczecin and Swinoujscie, has decreased in importance in the last few years, replaced in part by imported consignments. At present the proportion is about 40% exported and 60% imported.
“Another dry bulk commodity making news is the rapid growth of biomass, which began last year and is forecast to keep increasing over the next few years. In both ports, there are facilities in place to handle imports and exports. We can also store this in concrete yards or in covered warehouses,” says Bierdzinska.
At present, neither port suffers from capacity issues, plus there is enough development area to enable capacity to be boosted if necessary.
In regard of investment in the dry bulk sector, this divides between money being spent by the port authority and that spent by private operators.
In respect of the former, investment is being made on rebuilding both road and railway infrastructure at Szczecin and Swinoujscie ports. Interior-port roads totalling some 5,794.78m are being rebuilt at Szczecin, while similar work on 2,883.47m is being undertaken at the port of Swinoujscie, where additional parking space for trucks and passenger vehicles is also being built. As for rail, which handles the majority of dry bulk movements (along with inland waterways) 35,927m of sidings and 134 points will be subject to restructuring and modernization.
Apart from the Port Authority, last year, private operators invested in two new flat warehouses for grain and grain product storage dedicated mainly to imported soyabean meal. Each
warehouse can hold up to 50,000 tonnes.
“Investment made by the operators tend to reflect current market conditions. In the port of Swinoujscie, for example, the company handling and storing coal has recently converted facilities previously given over to export coal to allow them to be used for imported coal,” says Bierdzinska.
However, she sees the port authority’s biggest challenge as that of the construction of the outer harbour at Swinoujscie, where the western part of this new port will be dedicated to a variety of cargo handling, including that of dry bulk.
“The extra space will allow us to decisively increase the transshipment capacity of both ports. It will also create a chance to accommodate larger vessels,” she says.