Emerging markets are driving demand for specialist oversized and overweight project cargo handling, transport and storage services, writes Michael King.
The global financial crisis of 2008/09 hit bulk and container shipping demand almost instantly. Not so the project sector. Long lead times for most major infrastructure and exploration endeavours meant that it was only after a one- to two-year lag period that cancellations of major projects really began to bite the bottom lines of transport and storage providers.
But the recovery of demand is now showing signs of being on a far firmer footing, at least outside the troubled waters of Europe. Booming commodities markets and the need for many emerging economies to build new infrastructure to cement previous gains are driving the need for specialist handling and storage of specialist cargoes for private and public sector projects, not least in the fast-growing economies of the Middle East, Africa and Asia.
GAC, for example, reports that countries in sub-Saharan Africa and South Africa have been embarked on a number of major industrial projects recently, while the Caspian region, blessed with mineral and energy wealth, is also rapidly developing.
“The oil and gas industry also remains a key sector for us as the GAC portfolio of integrated services gives us the tools to provide energy operators with a unique package of shipping, marine and logistics solutions tailored to their needs,” said Laurance Langdon, GAC Group Projects Logistics Manager.
“Mining also remains buoyant.As more and more inland locations are explored to meet growing demand, massive investment is being ploughed into developing the infrastructure to support operations, such as for power and refining etc., as well as product exports which require roads, bridges and ports. Those developments present many opportunities for the project logistics world.”
South Korean 3PL Pantos Logistics said Indonesia’s mining and power industries had created a boom in project logistics demand and he anticipated a bullish, growing market across the archipelago for years to come. “Resources are still open to explore in many sectors such as mining, power plants and also new infrastructure projects,” he said.
In Indonesia Pantos offers customs handling, delivery, packaging, labeling and distribution of project cargoes nationwide using a range of handling and transport equipment ranging from cranes to jacking equipment, warehouses to barge transportation.
“We offer total logistics for projects,” he added.“It all depends on the condition of the route, the jetty, the location, etc.”
BDP International is another company with a strong presence across Asia which identifies Indonesia as a key market. BDP takes a non-asset approach to providing solutions for outsized or overweight shipments. Aaron Randolph Chen, Indonesia MD of the US-based logistics supplier, said this increased the company’s operational flexibility and enabled BDP to offer storage facilities of any type and in any location.
“What BDP brings to the table is our experience and technology in supply chain management which can be quickly applied to any facility anywhere that internet connections are available,” he explained.
“Depending on the location we have to work in, we normally use low-bed trailers, dropped-bed trailers, multi axle configurations of many kinds, shore cranes as the more conventional method and, for specific requirements, LCTs and barges for sites up river or near the shore.
“In some locations in Indonesia we have to use jacking instead of heavy lifting due to accessibility or lack of equipment available within reasonable proximity.”
Where weight is an issue the company has the option of bringing equipment in from Singapore if the correct gear is not available in Indonesia.
UK-based Abnormal Load Services (International) Limited said its focus was also turning to emerging markets as Europe became more of a service economy rather than one with a strong presence in manufacturing.
“We are seeing more and more opportunities in emerging markets in a range of sectors including in the construction and energy sectors,” said CEO Rene Van de Vin.
The company’s own distribution facilities are located in Belgium and the UK close to major roads, international ports and airports. In Vilvoorde, Belgium, ALS’s 20,000m2 distribution centre comprises a warehouse including 20 dock shelters and floor capacity of 5,000kg/m2. In Hull, in the UK, the company’s 3,000m2 of hard standing can take loads of up to 10 tonnes per metre. Jacks, skates and overhead gantry cranes provide the handling capacity.
ALS’s own facilities are supplemented on a global basis by the lease of third party warehousing plus support for clients requiring specialist solutions from the firm’s in-house specialists in agency, cargo handling, chartering and marine warranty.
“We can source and arrange alternative warehousing and storage solutions globally dependent on our clients’ needs and requirements,” said Jillian Peacock, group marketing manager.
Most companies offering specialist transport storage and handling for project cargoes use, like ALS, a variety of in-house and third party capacity.
DHL is a case in point. It claims it can supply clients with whatever facility and associated manpower they might require anywhere in the world. The 3PL global giant offers project logistics solutions to industrial clients both as standalone, one-off shipment services, and as part of more complicated all-in contracts which can cover thousands of shipments of various sizes and spread over a number of years.
“We are only restrained by physical dimensions and availability of suitable storage,” said Richard Jones vice president of global business development in the Industrial Projects division of DHL Global Forwarding. “It can be difficult to find a suitable warehouse that is safe and secure and measures up to DHL’s stringent HSSE policies. Additionally, warehouses are often required where the jobsite is and this could be in a remote location. Very often, therefore, we or the client purpose build a warehouse for a project.
“We also have strategic agreements with all the major heavy lift ship owners, barge owners and heavy hauliers.” GAC has waterside facilities and warehousing with full
packing capability in a number of key locations, including Rotterdam, Aberdeen, Singapore, Houston, and throughout the Middle East. This enables the company to consolidate multiple cargoes, pack and prepare for export at low costs for movement and handling, and provide sophisticated tailored services.
“Every project is viewed as a unique challenge to be analysed and understood in order to provide the best-suited solutions for each case,” said Langdon.
The size limit on a single shipment is usually restricted only by vessel size, and equipment and infrastructure limitations. “While design engineers are constantly pushing the boundaries of size to achieve greater economies of scale, sourcing the equipment required to move, lift and fit large cargoes can prove problematic,” he admitted.
“In some cases, a unique design decision may be made, to create a new type of rail wagon to handle extra weight, manufacture special cranes, engineer special landing jetties, etc. But of course, such a decision ultimately comes down to cost and risk.”
Cranes and multi-axle hydraulic trainers are the most common equipment deployed by GAC, although Langdon insisted that skilled personnel were the most important part of any successfully completed contract.
Storage of cargo can also be customized in cases where pieces are too large to fit into an existing facility. If the necessary storage capacity does not exist then it can be created if the cost structure of the project allows. “Planning is vital in this respect,” said Langdon. “The project logistics company should be engaged at the design stages of a project, in order to provide valuable advice on potential problems and the solutions available.”