Recent developments and business news updates from the international trade sector. This month: Road freight industry faces upheaval; improved outlook for air cargo; Stena and Mann link up; universal supply chain aide mémoire; CEE logistics on the move; West African ports on alert for Ebola; industry's future to go on show; BIFA set for airport capacity talks; new logistics hubs open; buffers; Menlo finds the perfect spot...

December 2014

Road freight industry “to face upheaval”

The European road freight sector endured another year of weak growth and anaemic profits in 2013, according to a recently published market report from Transport Intelligence.

Overall, the industry experienced growth of just 1%, weighed down by the impact of stagnation in the Eurozone. Only markets in Central and Eastern Europe prospered, with Poland, the largest market in the region growing by 5.8%. The UK was the best performing of the larger markets in Western Europe, with growth of 2%, mostly derived from its economic recovery.

Across Europe operating margins remained low, hampered by poor volumes which, says analysis contained in the report, are the biggest single influence on profitability. Across a snapshot of markets, UK hauliers had the best margins but at 2.5% “they were hardly exciting”.

However, according to one of the report’s authors, Transport Intelligence analyst David Buckby, low market growth and profits have served only to detract from a looming upheaval in the industry. The report identifies a number of political, environmental and technological drivers that, it says, will fundamentally change the structure of the sector over the next 10 years.

“For example, increasing automation of trucks, liberalisation of cabotage and environmental legislation will create new challenges and opportunities for the industry. However, many labour organisations and road freight operators are already opposing some of these changes, which they believe are unfair and will make the industry even more competitive.

“New technologies and increased access to domestic markets by lower-cost operators, especially those based in Central and Eastern Europe, will result in a root-and-branch change to the road freight market environment. Vested interests will try to delay the onset of these changes, but it is inevitable that the road freight market of the future will change out of all recognition, even in the short-to-medium term.”

Improved outlook for air cargo

Global air freight volumes are expected to increase at a compound annual growth rate of 4.1% over the next five years, according to the International Air Transport Association (IATA) in its report entitled Airline Industry Forecast 2014–2018. It adds that emerging economies, particularly in the Middle East and Africa, will be the fastest-growing markets.

"Air cargo remains as vital to the global economic system as ever,” says Tony Tyler, IATA’s director general and CEO. “In 2014, more than $6.8 trillion worth of goods, equivalent to 35% of total world trade by value, will be transported around the world by air.

“Now it is good to see a forecast for a return to growth for the air cargo sector after several years in the doldrums. An average of more than 4% growth for the next five years would be a marked improvement on the performance of recent years. Since 2011, for example, growth in freight tonnes has averaged just 0.63% a year.

"Nevertheless, despite the positive picture, the overall risks to the economic outlook, and, therefore, to air freight, remain towards the downside. Trade protectionism is a constant danger. According to the World Trade Organization (WTO), between November 2013 and May 2014 alone, 112 new trade-restrictive measures were enacted by G20 governments.

“Geopolitical concerns, volatility of oil prices, and competition from rail and sea could also affect this forecast. The air cargo industry certainly cannot afford to be complacent."

Among “forecast highlights” were the following.

  • By 2018, the 10 largest international freight markets will be:

    • the USA (10,054,000 tonnes)

    • China (5,639,000)

    • the UAE (4,974,000)

    • Germany (4,763,000)

    • Hong Kong (4,648,000)

    • Republic of Korea (3,487,000)

    • Japan (3,480,000)

    • the UK (2,808,000)

    • Taiwan (2,350,000)

    • India (2,223,000).

  • Iran is expected to be the fastest growing country (of nations with more than 100,000 tonnes of cargo per year) for air freight volumes over the forecasting horizon with a growth of 7% per annum. However, it is growing from a low base so it will add just 44,000 tonnes of freight by 2018.

  • The second fastest-growing market, India, will experience a growth rate of 6.8% to add 622,000 extra tonnes. Bangladesh (339,000 total freight tonnes), Ethiopia (319,000) and Nigeria (276,000) make up the remainder of the top 5.

Stena and Mann link up

A new co-operation is now in place between the ferry company Stena Line and the shipping, logistics and forwarding company Mann Lines. Their goal “is to offer added value to customers within the area of logistics services via our extensive joint route network in the North Sea and Baltics”.

Universal supply chain aide mémoire

The British Standards Institution (BSI), has now launched PAS 7000, a universally applicable supply chain information standard for organisations of all sizes around the globe.

It says that the PAS 7000 helps answer three key questions relating to any company's supply chain partners: Who are they? Where are they? Can they be relied upon?

“The standard draws on the collective expertise of 240 professionals drawn from global industry associations and organisations, and it addresses product, process and behavioural criteria for supplier pre-qualification,” says BSI.

Howard Kerr, BSI's chief executive, said, “Today’s consumers and employees demand integrity from the organisations they deal with. Acting with integrity requires confidence in all those involved in delivering a service; anything else risks brand reputation. The benefit of this new standard is that it helps brands to align their supply chain with their corporate values by adopting an internationally defined framework of good practice for supplier pre-qualification.”

CEE logistics on the move

Romania's largest privately owned contract logistics specialist, Tibbett Logistics — part of the UK-based Keswick Enterprises Group — reports that it has seen a significant increase in intermodal freight movements across Central and Eastern Europe (CEE) in 2014.

As the operator of BIRFT (Bucharest International Rail Freight Terminal) since its inauguration in 2011, Tibbett believes that it is in an excellent position to monitor freight trends across the region.

It also believes that there is a greater increase to come within the sector. CEO David Goldsborough said, “Given the strategic location of BIRFT relative to the region's rail infrastructure, the terminal is perfectly positioned as a transit point to the Black Sea and Turkey — an area that has been identified for substantial growth."

Ebola: West African ports on alert

Ebola is to be on the agenda at the forthcoming TOC market briefing on West Africa due to take place in Tenerife from 10–11 December.

However, the organisers make it clear that “the outbreak has so far not had any significant impact on container shipping in West Africa. The main challenges in the region continue to be congestion and poor infrastructure that hampers hinterland connectivity.

“But given the significance of this epidemic, West Africa’s ports will have to remain on high alert over the coming months”.

They added that a number of ports in the region “have instigated special screening measures for vessel calls, although this can be limited by the ability of port health officers to process more than a handful of vessels in a given period”.

Industry's future to go on show

Exhibitors at the Digital Factory Trade Fair (to be staged under the umbrella of the Hannover Messe in April) are planning to “demonstrate what industry needs for its next evolutionary phase, how product development and manufacturing processes will be co-ordinated in the future, and what the integration of information technology and automation can look like in action”.

“Since its premiere in 2003, Digital Factory has successfully established itself as the world’s leading trade fair for integrated processes and IT manufacturing solutions, covering everything from product development on up to actual manufacturing, thereby providing very fertile soil for the technology needed for industry,” said Oliver Frese, senior vice-president in charge of Hannover Messe.

BIFA set for airport capacity talks

The trade association for UK freight forwarders and logistics service providers has welcomed the opportunity to take part in further consultations regarding the future of air transport and airport capacity in the UK.

Robert Keen, director general of the British International Freight Association (BIFA), said, “The Airports Commission has announced a major consultation exercise following the publication of its initial assessment of proposals for additional runway capacity at Gatwick and Heathrow airports.

“As part of that, BIFA will continue to submit its thoughts to the commission relative to the constraints imposed by capacity limitations, UK global connectivity, the importance of air freight and the key facilitative role played by the freight forwarder.

“It is our view that an expanded Heathrow Airport will enable airlines to provide wider access to developing markets and hence increase UK trade. Any further delay in providing the UK with a world-class hub airport can only damage the UK economy.

“We can only hope that after the general election in May 2015, the welter of evidence as presented will be such that there will be cross-party consensus and politicians will give the green light and adopt the Airports Commission’s recommendations in full and finally get things started on a much overdue expansion of UK aviation hub capacity.”

New logistics hubs open

Geodis Wilson, the global freight management and logistics provider, has announced the expansion of its operating hubs dedicated to the oil and gas sector. In addition to those at Houston and Vitrolles, near Marseille, the company has just opened a third one in Singapore with a further two, in Antwerp and Dubai, in the pipeline and two more planned for later in 2015.

Not any old buffer!

After two years of research and development, and an investment in excess of £1.5 million, world-leading UK energy absorption technology company Oleo International has had its new HSL 115 and HSL 72 high-speed elevator buffers certified to recognised industry standards.

“This means that the buffers, an enabling technology for the installation of high-speed elevators into ultra-high-rise buildings that are now moving towards heights of 1km, are now readily available worldwide,” said a company spokesman.

He added, “We have already received orders worth more than £1 million for these products together with significant new enquiries.”

Menlo finds the perfect spot...

Menlo Logistics, the global logistics and supply chain management unit of Con-way Inc., has opened a warehouse in Genk, Belgium, “having paid particular attention to both its proximity to European markets and the availability of multimodal transport options”.

A spokesman said, “It is close to the Dutch/German border to the east and to significant concentrations of industrial activity in Belgium and The Netherlands to the west and north, giving us distinct advantages when it comes to efficient product distribution.”

November 2014

“Eurozone pick-up” forecast

Although the Eurozone faces what is described as an exceptionally slow recovery, risk analyst Coface forecasts that in 2014 growth in GDP will be positive, possibly 0.9% after a contraction of -0.4% in 2013.

It says, “This trend is illustrated by a first improvement in the assessment of sector risk that has long been considered “very high”, ie the automotive and metal industries.

“Ten consecutive months of rising car sales have benefitted parts manufacturers, and the market has become more dynamic in Germany, the UK and Spain. This recovery benefits the metal industry, where the sales and profitability of companies have greatly improved.”

Coface also assessed 12 other Western Europe sectors, which, it says, continue to post a "high" or "medium" risk. It found that “despite the stabilisation in the automotive and metal industries no European sector has yet reached a risk level that can be considered as 'moderate'."

Openings for more apprentices

Davies Turner has for the fifth year in succession recruited youngsters for its national apprenticeship and trainee programme.

The new intake of 10 recruits will be based at the company’s main hubs throughout the UK, and will undertake an 18-month long course with the leading independent forwarding and logistics provider, followed by an accredited in-house multimodal training course delivered by the British International Freight Association (BIFA).

Group chairman Philip Stephenson said, "These trainees have excellent A level grades and degrees. They will be joining us at an exciting time as global recovery powers the freight industry, and we are preparing to expand further our portfolio of services for British exporters and importers, as well as making major investments both in our network of purpose-built warehouses throughout the UK and Ireland, and in our IT infrastructure."

Future brightens for the UAE

The UAE economy is growing stronger thanks to an effective diversification policy, according to risk analyst Coface, which expects the emirates’ GDP to grow by around 5% in 2014.

It says, “The UAE economy remains solid, supported by both the oil and gas sector and non-oil sector. The country’s diversification policy constitutes an important pillar of its economic performance as it reduces its dependence on oil and supports the 'real economy'.

“Also, the business environment is improving and the actions taken to increase transparency within the economy have been crucial to reducing risks in the corporate sector.”

Deep Sea Mooring anchors in Australia

A leading provider of mooring solutions for the offshore industry is expanding its international footprint with the opening of a new office in Perth, Australia. The facility will provide sales and technical support to Deep Sea Mooring customers across Australasia.

A spokesman said that the company had confidence in Australia’s future as a key global player in the offshore oil and gas industry.

“The number and size of developments offshore in Australia has created a steady market for drilling rigs,” he explained. “And with the local industry’s increasingly stringent standards we believe there’s now a strong foundation for long-term growth and success.

“Companies operating in Australia understand the benefits of quality mooring equipment, smarter mooring solutions and performing pre-laying in order to maximise uptime. This fits our profile and our offer is tailored to meet that market demand head on.”

Shearer to head fund for entrepreneurs

David Shearer, a strategic advisor to listed and private equity backed businesses, has agreed to chair the £5.5 million Scottish Edge Fund.

Shearer, who up until only recently was co-chairman of Martin Currie (Holdings) Ltd until its successful sale, also chairs Aberdeen New Dawn Investment Trust plc and is on the board of STV Group plc.

He said, “This is a great opportunity to give something back to the entrepreneurial community in Scotland, which I’m delighted to do. Through our board we will build more, better, faster and sustainable businesses in Scotland in an inclusive way, joining up all the entrepreneurial support dots.” is a £5.55 million fund established to support early-stage businesses with a 50/50 loan and prize combination funded by Royal Bank of Scotland plc, The Hunter Foundation and the Scottish Government.

Menlo Logistics expands in Amsterdam

Significant increased demand for additional services from a key hi-tech customer has persuaded Menlo Logistics to open a third facility in Amsterdam, at Westpoort.

New horizon for Jokowi?

The election of Joko Widodo, popularly known as “Jokowi”, as Indonesia’s new president presents the ideal opportunity for the country to implement the reforms necessary to revitalise its upstream oil and gas sector by attracting foreign capital and expertise, says an analyst with research and consulting firm GlobalData.

Jonathan Libre, GlobalData’s upstream analyst covering the Asia-Pacific Region, says that while the newly-elected administration has published proposals to increase infrastructure investment, streamline the regulatory process, and offer more flexible fiscal terms under a new production sharing contract, more efforts are needed to increase the total estimated post-2014 capex expenditures of $5.8 billion, as projected by GlobalData.

He said, “Indonesia needs to make substantive legislative reforms, including an upheaval of the 2001 Oil and Gas Law and a reduction in the ambiguity of contracts regarding cost recovery and domestic sales obligations.

“Jokowi’s government should act now to address recent project delays, corruption scandals and the continual decline in national crude oil production, which prompted the country’s exit from the Organisation of Petroleum Exporting Countries in 2009...

“Recent years have seen a number of disappointing licensing rounds, and a lack of exploration activity has left many areas under-exploited particularly in Eastern Indonesia.”

The analyst concluded that liberalisation of the oil industry would face staunch political opposition, “but it is vital that Indonesia builds a more favourable and stable investment climate to secure the long-term success of its energy sector”.

Exploration go-ahead for Brazil

Brazil has been awarded a 15-year grant of mineral exploitation rights in an area known as the Rio Grande Rise deep beneath the South Atlantic Ocean.

It thereby became the first South American nation to receive such an approval from the International Seabed Authority. It followed studies by the country's state geological research agency, the Companhia de Pesquisa de Recursos Minerais, which concluded that among the minerals to be found were cobalt, copper, nickel, niobium and tantalum.

The ocean floor is considered “the last true frontier on the planet” and scientists have described the extraction of mineral wealth from “the deep ocean” as, perhaps, the greatest challenge of the 21st century.

Another milestone for Dachser in Belgium

With its move to a new and larger operations centre in Willebroek, Belgium, international logistics provider Dachser is boosting its presence in the Benelux region.

The company considers this yet another milestone in its development in Belgium. “We have maintained a presence in the Belgian market since 1975 and, since then, we have significantly expanded our network,” said a spokesman. “By dovetailing overland freight services with air and sea transport, we can provide our customers with seamless access to international markets.”

Closing date for port bids

Property consultancy Bidwells has set a closing date for expressions of interest in Perth Harbour in Scotland. Stage one of the marketing process will end at noon on 24 November. Interested parties have been asked to outline their business case and “explain how investment will be made to maximise the use of the harbour as an economic asset”.

Davies Turner steps up UK investment

Davies Turner, said to be the UK’s leading independent freight forwarder, is continuing to reinvest at its main regional freight hubs across the UK and Ireland.

“Our aim is as ever to offer customers the complete supply chain management package, together with our global network of consolidation services,” said chairman Philip Stephenson.

Earlier this year the company started operations at its third warehouse in Avonmouth; and at Cumbernauld, its main overland and ocean freight hub in Scotland’s Central Belt, the company has bought the freehold of its existing premises, plus another 1.5 acres of adjacent land that can be used to increase the size of the existing warehouse when required.

Meanwhile, at its Heathrow HQ, Davies Turner Air Cargo has built additional office space as well as a new temperature-controlled storage facility geared to handle the company’s increasing involvement in pharma-logistics.

These more recent developments follow the expansion at the company’s Hams Hall freight hub in the Midlands over the past two years.

Global air cargo set to double

Boeing has projected that air cargo traffic will grow at an annual rate of 4.7% over the next 20 years, and is expected to more than double by 2033.

The company recently released its biennial World Air Cargo Forecast at the International Air Cargo Forum and Exhibition.

"We see strong signs of a recovery as air freight traffic levels continue to strengthen after several years of stagnation," said Randy Tinseth, vice-president of marketing, Boeing Commercial Airplanes.

The new Boeing forecast shows Asia–North America and Europe–Asia will continue to be the dominant world air cargo markets with the most traffic volume. But “intra-Asia, domestic China and Asia-North America markets are expected to have the fastest rates of growth over the next 20 years”.

Driver shortage hits forwarders

The trade association that represents companies responsible for handling much of the UK’s visible trade is warning that a severe shortage of HGV drivers could wreak havoc with deliveries in the lead up to the Christmas peak.

While members of the British International Freight Association (BIFA) tend to be truck hirers, rather than operators, they report that the difficulties being caused by the shortage of HGV drivers is being compounded by an earlier-then-expected peak season with higher-than-forecast volumes of container and trailer imports.

BIFA also says that implementation of new HGV driver regulations in early September — the Driver Certificate of Professional Competence (CPC) — has contributed to the driver shortage “caused by a lack of new entrants”.

Rhenus links up with Transdanubia

Rhenus Logistics, one of Britain’s leading freight forwarders, has announced a new partnership with Austrian logistics giant Transdanubia. The deal will see the former expand its longstanding market presence in Austria by working with the latter to provide an improved logistics service across central Europe.

Transdanubia handles more than 500,000 shipments a year, distributing a wide range of products, including hazardous goods and automotive parts, throughout central Europe. It has an impressive client portfolio, including some of Austria’s leading organisations such as Schöller Foods.

Gary Dodsworth, director at Rhenus, said: “We’re delighted to add to our growing blue-chip and market-leading client base with Transdanubia. We’re pleased to be working with an organisation that shares our values and vision for the future of European logistics and look forward to increasing our market share in Europe. Transdanubia is a first-rate partner when it comes to difficult or unusual transport solutions. Through its use of the very latest in logistics technical equipment, we can jointly guarantee a specialised solution, whatever the load.”

September 2014

Airline surcharge protest

The trade association for UK freight forwarders and logistics service providers is encouraging its members to object to a Paper Air Waybill (AWB) surcharge that, it says, airlines are planning for export AWBs that are not filed electronically.

Robert Keen, director general of BIFA, the British International Freight Association, said, “We support e-Commerce and e-Air Waybill implementation in the air cargo supply chain.

“However, we believe that it should create value for forwarders and airlines alike, and the latter need to recognise the costs that the originator of the information incurs to enter and transmit data.

“Through our international body FIATA, we will be voicing our objection to carriers that seek to apply yet another surcharge, and create yet another revenue stream under the guise of supporting the airline industry body IATA’s e-Freight initiative, which aims to implement e-Freight worldwide.”

BIFA is asking its members to join in the stand against the introduction of the surcharge by completing an online survey.

Skills shortage hampers productivity

A shortage of skills is having a direct effect on productivity within the manufacturing and engineering sector, according to a recent survey conducted by Festo Training and Consulting and Works Management.

A spokesman said, “61% believe that skills shortages have affected productivity and 25% of these say it is a frequent occurrence. This is up 17% from a similar survey carried out in 2013.

“Some respondents cited restricted growth due to recruitment slowdown, poor efficiencies, and excessive downtime due to lack of fault-finding skills. One respondent said that in the last year back orders had increased from £36k to £280k, perhaps a sign of growth in the order book, but also a sign that manufacturers are struggling to keep up with growth in the economy.

“The skills shortage within this sector shows little sign of abating. Eighty-two per cent of companies are suffering from this, which is up 7% from 2013, and 86% of them say this is likely to stay the same or get worse.

“The shortage is most prevalent for experienced engineers (61%), skilled shop-floor workers (57%) and multi-skilled engineers (40%). The biggest rise is in a shortfall of experienced engineers, which has increased by 44% since 2013.”

The survey also found that a lack of skilled staff had a knock-on effect on morale. It commented that, perhaps, those most affected by skills shortages and low morale were “middle managers, who are having to roll their sleeves up to support under-staffed areas and who are also spending half of their time with disengaged employees”.

Among other key findings from the survey were:

  • 61% experience some reduced profitability as a result of skills shortages, up 44% from 2013

  • maintaining morale is the biggest issue in the workplace (62%)

  • 43% of companies have a formal management training programme

  • 29% of managers learn on the job

  • 34% of managers have experienced stress due to workplace conflict

  • 25% say that their biggest stress is due to inadequate resources

  • 25% are looking to leave their jobs in the next year, 15% of whom say they would leave because they did not like their bosses.

Doubts over Romanian GDP growth

Romania’s economic performance in 2013 made it one of the leaders in Europe’s recovery, according to risk analysts Coface.

Its growth during that year “exceeded expectations, with GDP rising by 3.5%, with significant contributions coming from the agricultural and industrial sectors, in particular from car production supplying mainly foreign customers”.

However, Coface added, “Romania will not continue this pace of growth in 2014, although the outlook remains positive.”

Grzegorz Sielewicz, Coface's economist for Central Europe, said, “The main contributors to this positive performance were the good agricultural harvest and a high level of exports. But neither of these can be considered as sustainable factors. However, the recovery of advanced economies will be beneficial to Romania’s external trade, especially its automotive sector, although the country’s internal situation continues to be a constraint.“

U-Freight expands in Hong Kong

The U-Freight Group is expanding the operations of its logistics subsidiary in Hong Kong and has brought the operations of its airfreight import and export departments into one location in the Special Administrative Region.

Honours for India

India has just been designated the official Partner Country at Hannover Messe 2015, putting itself in the spotlight at what is said to be the world’s leading industrial exhibition.

“India is an emerging economic giant that is going to open up enormous sales potential for our international exhibitors,” commented Dr Jochen Köckler, a member of the Deutsche Messe managing board.

“At the same time, we will be offering even more exhibitors from India access to new global markets. Ultimately, all our exhibitors and visitors as well as the trade fair venue of Hannover will benefit equally from the participation of this attractive Partner Country.”

More space in Thailand

Menlo Logistics, the global logistics subsidiary of Con-way Inc. has opened a new, state-of-the-art, multi-client warehouse facility in Ladkrabang, Thailand.

The company says that the new facility adds 9747 square metres of space, increasing the total to 32,528 square metres.

Brazilian business “looks lacklustre”

Activity in Brazil remains lacklustre, inflation above targets and interest rates are among the highest in the world, according to risk analysts Coface.

It says, “Various indexes show that confidence in Brazil remains down, while the low investment ratio continues to deteriorate.”

“Independently of who wins the presidential elections, 2015 will probably be marked by a series of adjustments to the economy,” says Patricia Krause, Coface economist for the Latin America region.

“Interest rates may be raised again to compensate for higher pressure over prices arising from the repositioning of oil costs and energy tariffs. The country’s infrastructure needs to improve in 2015 in order to increase activity in the medium term, while the economy is likely to remain in slow mode.”

DACHSER's further investments in Asia

International logistics provider DACHSER continues to expand its Asia operations, taking over its partner’s shares in three countries. As a result, the family-owned company is now the sole shareholder in its ventures in India and Thailand, and a majority shareholder of a joint venture in Bangladesh.

New cargo partnership

IAG Cargo, the freight operation of the International Airlines Group, has agreed a major new partnership with the logistics network IFLN.

Under the terms of the agreement, IFLN has become a preferred global forwarder partner to IAG Cargo and will have access to the carrier’s network of more than 350 global destinations. IAG Cargo, meanwhile, is set to benefit from the opportunities for business growth provided by access to IFLN’s freight forwarder network.

September 2014

BIFA welcomes airport decision

The Airports Commission’s decision not to include the inner Thames estuary airport proposal in its shortlist of options for the provision of new airport capacity by 2030 has been welcomed by the trade association for UK freight forwarders and logistics service providers.

The British International Freight Association (BIFA) Director General, Robert Keen, commented: “Our members hope that this decision will allow the commission to focus on the three most appropriate and sustainable solutions in the lead up to its final report in the summer of 2015.

“Between now and then, BIFA will continue to submit its thoughts to the commission relative to the constraints imposed by capacity limitations, UK global connectivity, the importance of air freight and the key facilitative role played by the freight forwarder.

“We can only hope that after the general election in May 2015, the welter of evidence as presented will be such that politicians will give the green light and finally get things started on a much overdue expansion of UK aviation hub capacity.”

Consolidations breakthrough

The U-Freight Group has welcomed Taiwan's decision to allow the country’s freight forwarders to operate multi-destination export consolidations as against just single ones.

A company spokesman said: “The new law will make Taiwan one of the most competitive logistics hub in the world.
Consolidating goods in Taiwan and re-exporting them to Europe and America should increase efficiency and reduce costs.”

Strategic step for Dentressangle

Norbert Dentressangle has acquired logistics provider Jacobson Companies from Oak Hill Capital Partners. Headquartered in Des Moines, Jacobson is one of the largest value-added warehousing providers in North America with integrated domestic transportation management capabilities.

Hervé Montjotin, Chief Executive Officer of Norbert Dentressangle, said: “This will enable us to begin integrating Jacobson into the Norbert Dentressangle Group and to begin a new step in our development in the US, a strategic market for us.”

Maritime buying exhibition – 17-18 September, London

The International Maritime Purchasing Association (IMPA) annual exhibition will take place at The Queen Elizabeth II Conference Centre in London from 17-18 September.

IMPA represents the interests of the purchasing profession within shipping, promoting close co-operation and understanding between buyers and suppliers. The gathering in London is seen as a flagship event at which exhibitors from all sectors of the industry provide product launches, presentations and the latest market information and innovations.

New owner for F.S. Mackenzie

F.S. Mackenzie Ltd has been bought by the Singapore Post Limited (commonly known as SingPost), through its subsidiary Famous Holdings Pte.

Originally established in 1951, F.S. Mackenzie is a UK-based freight forwarder and non-vessel operating common carrier (NVOCC) focusing primarily on sea, air and road freight forwarding, together with customs clearance for inbound and outbound shipments from Britain. Headquartered in Basildon, it has four other operational centres across the UK.

SingPost says that the acquisition will help it to establish an entry point into the Western European freight market and strengthen its ability to provide customers with integrated e-commerce logistics solutions that complement its existing postal and parcel networks.

Alfred Stienen, who remains group chairman of F.S. Mackenzie, says that the sale will allow Mackenzie to broaden its freight network through the support of a financially strong parent company.

“We have worked in partnership with Famous Holdings, which was acquired by Singapore Post in 2013, for more than 20 years and this represents a great opportunity to build on that relationship.”

Television journalist to host BIFA awards

Financial journalist and regular BBC Breakfast presenter, Naga Munchetty, will host the British International Freight Association (BIFA) 2014 Freight Service Awards ceremony at The Brewery in Chiswell Street, London, on 22 January 2015.

The deadline for entering the competition is 5pm on 26 September.

Freighting: how to help West Africa

While increased investment in new port infrastructure bodes well for West Africa, other less tangible barriers must be tackled as an equal priority if the region is to achieve its trade potential, according to a TOC briefing paper that will be outlined at a meeting of the organisation to take place in Tenerife on 10 and 11 December.

A spokesman said: “Excessive and inefficient Customs and inspection processes, trade bureaucracy and documentation are hampering supply chain efficiency and costing West Africa dearly. How to improve the situation will be one of the key topics under discussion.

“The conference will also look in-depth at port congestion, hinterland transport, security and other key issues impacting containerised trade in West Africa.

“On average, it takes a West African country 27 days to export and 32 days to import one TEU via its closest port, compared to 10 and 11 days respectively for OECD member countries, according to research from Deutsche Bank. Of the average 32 days taken to import a container to West African countries, 19 days are spent on document assembly and procedures, and five on Customs and technical control ... Landlocked countries are the worst affected by these delays in trade, and that is bad news for a continent that has 104 bilateral borders. Deutsche Bank says these delays are primarily caused by inefficiencies in managing the flow of information related to maritime cargoes moving across international borders to and from landlocked countries.”

According to Leonard Ebute, supply chain boss for Kimberley Clarke in West Africa, who will be speaking at the event: “With a population of about 340 million, West African governments and their people can certainly use some help – help that could come from gleaning the efficiencies that could arise from improved intra-regional trade practices.

“We hope to identify these trade enhancers, plug them into a cohesive supply chain model, and, hopefully, present an action plan and, thereafter, contribute to a push to execute the necessary actions.”

Social network for shippers

Brokers, owners, crews, agents and others in the shipping industry previously “confined to Google to locate businesses, services and people within their sector now have something to get excited about”, according to Eirik Fosse, CEO and founder of Norwegian-developed social network Shippingcluster.

“This is a social network exclusively for the global shipping industry, eliminating all unrelated elements, making people and business easy to find and to be found,” he says.

He added that the service was free and members would collaborate to keep it highly relevant for those in the shipping business.

“We are a specialist industry with our own terminology and specific networking criteria. Industry know-how is, therefore, crucial in order to succeed within an industry-specific social media.”

As it grows, Shippingcluster – which already has more than 1000 members from 250 companies in more than 40 countries - will add new information “such as CO2 reporting, vessel performance, benchmarking and port calls”.

August 2014

British SMEs predict growth

Western Union Business Solutions, a leader in global payment services, recently announced the latest findings of its quarterly economic confidence survey conducted amongst 670 British SMEs engaged in international trade.

It confirmed that the economic recovery is underway, with 70% of respondents predicting growth as follows.

  • 24% expect to grow more than 10%.

  • 25% expect growth of between 5% and 10%.

  • 21% expect to grow up to 5%.

Furthermore, 23% reported that they had grown by more than 10% in the past 12 months.

The positive growth forecast is further supported by SME plans to recruit and invest in their companies over the next year.

  • 42% intend to recruit more people — the highest number on record — indicating that recent falls in the UK unemployment rate may continue.

  • 64% said they planned to invest more in their business, with the majority of them planning to put money into technology, process improvement and plants/equipment.

Despite positive growth expectations, though, SMEs have been hit by rising costs.

  • 56% of companies surveyed reported an increase in operating costs over the past 12 months.

  • However, 55% said they would maintain their prices at the same level in the coming 6–12 months to keep costs to customers down.

  • Only 1 in 3 will be increasing prices.

  • 4% will be lowering them.

Cash flow remains a key issue for SMEs, with 44% citing late payment as the number one challenge.

Christina Hamilton, UK Managing Director of Western Union Business Solutions, said: “These results are a strong indication that the UK domestic recovery is here and the reported growth expectations are an important sign that British SMEs have turned a corner. In previous quarters SMEs were focused on survival; now they are investing more and planning to grow.

“This type of investment in people and process improvement is a clear sign that SMEs that trade internationally are investing for the long term, which, after several years of decline and difficult trading conditions, is very positive news for the wider UK economy.

“However, the reluctance of SMEs to raise their prices and pass on their increased costs to customers shows that they still believe the recovery is fragile and are more concerned with being competitive.

“Also, late payments continue to plague businesses and their cash flow. For an SME, late payments can mean the difference between paying staff on time, paying suppliers and, in extreme cases, staying afloat. Reduced cash flow has a knock-on effect and can hold SMEs back from growth.”

Free trial offer for inventory system

Pentant has announced the offer of a free trial of its CusLink Inventory System. Its objective is to “encourage port, airport, wharf or TSO facilities to experience the undoubted efficiency benefits of inventory systems before incurring any costs”.

It believes that its systems provide simplified control and effective management for handling a wide range of unitised and break-bulk cargoes. “This”, it says, “significantly improves control and efficiency of freight operations, from receipt of goods to final shipment or delivery.

“CusLink is specifically designed to meet the varying needs of a wide range of port, wharf, inland and airport freight facilities...and is now well established in a wide range of operations across the UK. These include Dover, Portland, Poole, Plymouth, London City Airport and Brise Norton.”

Customers who sign up now for the system will be offered a free trial, including full help-desk support, until next April.

Boost for UK-India business

The UK India Business Council (UKIBC) has expanded its “market entry platform” for British companies in India by launching a second business centre in Bangalore, which will include a “tech-hub”, and announcing its aim to have a total of six centres in operation by 2017.

The Bangalore opening was attended by Ian Felton, British Deputy High Commissioner, an array of leading UK and Indian business figures, and was broadcast live to delegates attending the India Market event at the International Festival of Business in Liverpool.

Felton said: “Bangalore is one of the future faces of India — hi-tech, cosmopolitan and global in outlook. It is a great place for British-Indian collaboration in science, innovation, trade and cultural relations. This opening is testimony to the strong leadership in business shown by this state, and the UK government welcomes and supports the centre.”

The creation of the centre is part of UKIBC's expansion strategy to connect UK companies active in, or wanting to enter, Bangalore and South India to local businesses keen to work with them.

Speaking from Bangalore, Patricia Hewitt, Chairwoman of UKIBC, said: “This is a great city in which many British companies are already thriving, particularly those that are technology focused…This is an incredibly interesting and positive time to be in India, and UK businesses share the fresh optimism among Indian corporates. With the new government there are high hopes for a truly investment-friendly business environment.

We are opening our second centre in the right place, and at the right time, to cater to the rise in interest, especially among UK-based SMEs, wanting to explore the Indian market.”

“Export freight vehicles” record for Dover

A record number of freight vehicles departed on services through the Port of Dover, recently reaching numbers not seen since before the recession.

A total of 5337 vehicles left for Calais and Dunkirk from Europe’s busiest ferry port, beating the previous daily record of 5322 set in 2008.

It was also the third busiest day ever for total numbers, with 10,134 freight vehicles handled. The busiest day was in 2008, when the port handled 10,584 vehicles following the Eurotunnel fire in September of that year.

Tim Waggott, Chief Executive, Port of Dover, said: “This shows just what reliance there is on the port as a gateway for UK business. We have — and continue to develop — the infrastructure and facilities to provide the services that British exporters need.”

Blow for Brazil

Brazil failed to take advantage of the buoyant economy of the past to undertake the reforms needed to modernise its infrastructure and improve the country’s business climate, according to the risk analysts Coface.

It said: “In terms of market efficiency the country is weak, despite its potential in terms of market size. Local industry has been facing pressured margins due to high transportation and energy costs and wages. Competing with imported products has also been a major challenge for companies from many sectors.

“We expect a considerable slowdown of GDP in 2014 (at +1.3%, down from +2.5% in 2013) due to household consumption growing at a slower pace, investments losing momentum and a weak trade balance. However, 2015 should be a turning point, boosting GDP in the medium term.”

“Gold star” for steel company

Barrett Steel has put itself alongside the stars of British industry by winning a place on a league table of private companies with the fastest growing international sales, according to the annual Sunday Times/HSBC International Track 200 league table published recently.

Andy Warcup, Group Financial Director, said: “Barrett Steel is one of only 22 companies in the North East and Yorkshire to be ranked in the league table. It is an acknowledgement of its significant contribution to the UK and regional economy over the past two years.

“Our annual international sales have grown by 45% over the past couple of years, and we now have a facility in Houston, Texas, which serves the oil and gas industry in the Gulf of Mexico and Brazil.”

“Interest rate rise could be positive”

Leading freight forwarder Rhenus UK believes that a carefully managed interest rate rise by the Bank of England could further enhance the UK’s economic growth, rather than choke off recovery, by sending a vote of confidence to the international market.

Despite recent calls from the British Chambers of Commerce for bank governor Mark Carney to exercise caution before moving rates upward, David Williams, Managing Director of Rhenus UK, believes that such a move could send a positive signal to the market about the UK’s consistent emergence from recession.

He said: “While interest rates are a factor in business decision making, some analysts are overestimating their importance in the complex mix of market economics. Granted, a significant, short-term rise in rates would be most unwelcome, but a carefully managed increase of, perhaps, an eighth or quarter of one per cent later this year would be seen as a prudent move by many commentators.”

Dachser's new look in South Korea

Dachser is now doing business in South Korea as Dachser Korea Inc, having previously maintained a presence there as MGI & Dachser. It recently acquired the other 50% of the joint venture and has now moved into new offices in Seoul, although it also has another operation in Busan, where it conducts its sea freight business, and a warehouse for air freight handling at Incheon.

July 2014

Five top tips for exporters

With the announcement this year by Chancellor George Osborne that Britain will be doubling export finance funding to £3 billion, the Government has confirmed its clear intent to support UK manufacturing, according to David Williams, Managing Director of logistics giant Rhenus UK.

“However,” he said, “despite the fact that the 2014 Budget is encouraging for the UK economy, in our experience we have found that businesses will continue to face the same challenges in organising their logistics to take full advantage of the export market: whatever the fiscal sweetness, goods still need to be delivered to the right person, in the right place at the right time and for the right price.

“With EU export figures for the UK in 2013 reaching in excess of £150 billion, exporting provides an obvious opportunity for SMEs to increase profits. But there remain a number of potential issues that are critical to avoid in order to take full advantage of the opportunities associated with exporting.

“There are a range of different elements that all businesses need to consider when entering the world of global logistics, but the most important five are as follows.”


“There are a number of issues that revolve around insurance, but for any SME looking to take advantage of the export market, ensuring that goods are properly insured is one of the most critical. In our experience, too many companies pay little heed to insuring stock, despite the significant financial losses that can be sustained. Companies need to ensure that the insurance that they purchase covers against loss or damage to goods in transit and also to cover any political or economic instability throughout the supply chain.”

Control and visibility

“When looking to export goods, it can be very difficult to maintain quality via a fragmented supply chain. One of the critical considerations is that the freight forwarder selected for the task is able to provide visibility across the entire supply chain to ensure that exporters are able to keep track of their goods from the moment that they leave the warehouse to arrival at the customer’s premises.”


“Perhaps the biggest concern amongst many UK-based SMEs revolves around payment. When an SME starts to trade internationally, it is critical that it takes advice regarding the UK Export Credit Guarantee Scheme, and also protection against exchange rate risk, thereby ensuring the payment process runs as smoothly as possible. A good freight forwarder will be able to provide initial advice in these areas.”


“The role that freight forwarders play in dealing with disputes and how issues can be resolved quickly is often over-looked. Inevitably, there may be disputes between the SME and its customers, but a reputable logistics company with a strong network can help mediate, control the flow of goods and assist in ensuring that the parties come to an amicable conclusion to ensure the business’s partnership is maintained.”

Local knowledge

“War, natural disaster, political unrest, import restrictions or a change in the law in the country of destination can all have a significant impact on the success of SME exports. It is, therefore, critical to choose a supply chain partner with a sound understanding of regional markets, taxes and customs, and which can be on the ground if any problems arise.

“The choice of logistics partner is hugely important, as businesses can come up against a lot of barriers that they didn't know were there, exposing themselves to unnecessary risk. Rhenus has a global network and knows the market inside out, from the forms that need to be filled in, to which taxes and duties are due and how the whole process of getting goods from the UK to customer sites across the globe needs to be managed. Finding the correct freight forwarding partner will allow SMEs to export with confidence.”

No surprise over US climbdown on scanning

It was “hardly surprising” to hear recently that the USA had delayed new rules requiring all cargo containers entering the country to be security scanned prior to departure, according to Peter Quantrill, Director General of the British International Freight Association (BIFA).

He commented: “As BIFA has said repeatedly, the Department of Homeland Security (DHS) has consistently underestimated the enormity of the task in hand relative to the costs both to the US government and foreign governments, as well as, importantly, the limited ability of contemporary screening technology to penetrate dense cargo, or large quantities of cargo in shipping containers.

“Media reports suggest that the US government now doubts whether it would be able to implement the mandate of 100% scanning, even in the long term, and it would appear that it now shares BIFA’s long-standing opinion that it is not the best use of taxpayer resources to meet the US' port security and homeland security needs

“We have always said that expanding screening with available technology would slow the flow of commerce and drive up costs to consumers without bringing significant security benefits. Whilst the latest news of a two-year delay appears to be a healthy dose of common sense at the DHS, BIFA still believes that the US government ought to take an even bolder step and repeal the original legislation.”

Hybrid approach advocated for flexible supply chains

A carefully planned combination of automation and more conventional logistics processes is the ideal supply chain solution, according to Dermot Connolly, Director, Business Development Sales and Marketing, DSV Solutions Ireland.

“That is the best way to ensure that clients’ supply chains have maximum flexibility and maximum cost efficiency,” he told delegates at the recent End2End Supply Chain Conference in Dublin.

DSV Solutions is part of the DSV Group, the sixth largest logistics provider in the world. Together with DSV Road and DSV Air & Sea, it employs 22,000 staff in more than 70 countries and offers global supply chain services.

New logistics centre opens

Dachser has opened its new, €26 million integrated logistics centre in Northampton, which, according to CEO Bernhard Simon, “is a great example of how we have grown in the UK in tandem with our customers”.

He added: “With this new centre, we will satisfy the demands for global integrated supply chains. We are continuing our growth and, over the long term, we can enlarge the new transit terminal when we identify new potential.”

Located on the Brackmills industrial estate to the south of Northampton, the new facility houses the logistics centre for the Northampton branch as well as the UK head office. It comprises a 5948m2 transit terminal, a 10,560m2 contract logistics warehouse which can accommodate up to 20,000 racked pallet positions, and a 1954m2 two-storey office building.

A spokesman said: “The solid growth of Dachser’s UK country organisation, and in Northampton especially the flourishing European export business as well as contract logistics and value-added services, made the new investment an essential strategic step for the organisation.”

Nick Lowe, Managing Director, Dachser UK, said: “With this new construction, the Northampton location is evolving into an important hub within Dachser’s European network.”

Geodis sets out its stall in China

Geodis, one of the world’s leading transport and logistics companies, was out in force at the recent Transport Logistics China exhibition in Shanghai.

The company was one of the first international logistics companies to establish operations in China and India, and has been operating in the region for more than 30 years. A spokesman said: “At Transport Logistics China, Geodis showcased its market expertise as well as some of the group’s recently established logistics solutions, including initiatives in contract logistics and extended cross-border trucking services.”

Transport Logistics China welcomed more than 500 exhibitors from more than 40 countries, “making it the most important logistics event in the Asian region”, according to the organisers.

Geodis Wilson has formed a joint venture partnership with the regional warehousing and distribution specialist the Banz Group in Bahrain. It will be based in Juffair with administrative operations run from an 8000m2 warehouse facility. One of the largest of its type in the region, it will operate under state-of-the-art safety and security standards and include ambient, chilled and frozen storage space.

Many routes to Russia

Norbert Dentressangle’s fast-growing freight forwarding division (Norbert Dentressangle Overseas) has announced the launch of new services from the UK to Russia.

The company has now secured a significant presence in the Russian market, employing more than 100 people in three offices in Moscow, Ekaterinburg and Saint Petersburg. Now it is offering daily express and weekly consolidated air freight services, along with consolidated and full-load ocean freight/road service options.

Thanks to Russia's economic modernisation and infrastructure development agenda, along with recent reductions in tariffs on imported goods, the country is now said to be the UK’s fastest-growing major export market and consumers there are said to have the highest disposable income among the BRIC nations.

Norbert Dentressangle has been named as the UK’s 18th largest foreign employer in the Inward Investment Track 50 sponsored by the PA Consulting Group and supported by UK Trade & Investment. It is compiled by Fast Track, the Oxford-based research and networking events company.

Benchmark moment for Dover

A key milestone is said to have arrived with the recent submission by Dover Harbour Board of a Harbour Revision Order to the Government “in order to increase its powers and deliver on its firm commitment to play a major role in the regeneration of both port and town”.

Tim Waggott, Chief Executive of the Port of Dover, said: “This is a great moment for the port and for Dover. It represents a clear sign of our commitment to both deliver our flagship Dover Western Docks Revival Project, currently being so positively received and supported, and, crucially, to be able to further support our community with charitable donations through a new fund. It is a major step forward in delivering the shared vision that we are developing with our customers and the community.”

The exporter's “update ally”

AEB, one of Europe’s leading providers of global trade and supply chain management solutions, has overhauled its compliance software. Compliance & Risk Management 4.0 now offers a new design, better security, functional enhancements, an intuitive user interface and a series of other simplifications.

The system ensures that exporters comply with all export bans and licensing requirements, and all changes in export control regulations are immediately implanted into the software by AEB in-house experts.

Rallying call to shippers

Shipping professionals have been urged by speakers at the WISTA-UK Liverpool Forum debate to become more passionate about promoting their industry.

“It is time to stand up and shout about the enormous benefits that the shipping industry brings to the UK and to international trade,” panelists declared in the course of a debate at the WISTA-UK Liverpool Forum, a day-long event during the International Festival for Business on Merseyside.

Speakers declared that executives and supporters of the industry must inject more passion into their arguments “for clearer recognition of the benefits of ocean transport, for fairer reporting of casualties and other maritime issues, for improved welfare for seafarers, and for a more intense drive to recruit new talent — because it is forecast that by 2020 the UK will be 5000 seafarers short”.

Ewen Macdonald, Director of Sea Vision UK, said: “The necessary commitment and passion has been lacking. We are one of the world’s best kept secrets. Our companies operate ‘behind fences’ for security and for health and safety reasons. Their contribution is not just unknown by young people, it is not acknowledged by their parents or teachers.

“Our industry used to be ‘people rich’. You would see people coming out of dockyards, from ships and from manufacturing and they went back into the community and spread the word. We do not have that now. But we, the sector, are our own worst enemies. We have a great story to tell; it is about time we got ourselves into gear and told it.”

Captain Jessica Tyson, a marine consultant surveyor with CF Spencer & Co, Bristol, said that the only time the merchant navy or marine industry was visible to the general public was “for the wrong reasons”.

She then censured the mainstream press for its reporting. “The Costa Concordia (cruise ship casualty) was a media dream. But 3500 people were got off the ship safely, and fewer than 1% of those who had been on board died.”

Captain Kuba Szymanski, Secretary-General of the ship management trade association Intermanager, criticised the industry for being conservative in its approach to social media. The public had to be told of the contribution made by the maritime industry despite the problems it faced, including piracy.

Bridget Hogan, Director of Publishing and Marketing at the Nautical Institute and secretary of WISTA-UK, said: “Let’s get some passion into things … and lobby our MPs. We all meet people from different walks of life: we have to think about the debate that is going to move people. We can change from within, open ourselves more and be proud to do so.”

Russia: transcontinental transit looking up

Prospects are bright for trans-Russia continental transport in terms of competing with deep sea Asia-Europe shipping, according to the head of one of Russia’s largest transport and logistics groups.

Ruslan Alikhanov, President and CEO of FESCO, told delegates at the TOC CSC Europe conference that Asia–Europe trade was experiencing a shift from the deep sea route to transcontinental transit through Russia.

He said that the continental transit route was already twice as fast as deep sea transport and a number of improvements would further boost its competitiveness in coming years.

These included the reconstruction of the Trans-Siberian railway and the Baikal–Amur railway, which would double their throughput capacity; a freeze in railway tariffs; and the introduction of technology optimisation for customs clearance and port processes, reducing cargo time in port.

Geodis Wilson “Airfreight Forwarder of the Year”

Geodis Wilson, the international freight management and logistics provider, has been awarded the Airfreight Forwarder of the Year 2014 title at the global World Air Cargo Awards Ceremony in Shanghai.

This was the company's third win, having also taken the top spot in 2010 and 2011. The key criteria on which those voting were asked to rate entrants were “global network coverage, customer service focus and performance, and commitment to developing new technology”.

May 2014

Bid to bolster maritime safety

Maritime and offshore services giant DNV GL has acquired Marine Cybernetics, said to be the leading company for third-party testing of computer control systems.

“The decision to invest in Marine Cybernetics was driven by the increasing importance of software-dependent systems in ensuring safe, reliable and efficient operations, and we have now come to a point where we cannot rely only on testing and verifying hardware,” says Remi Eriksen, DNV GL Group Executive Vice-President and Chief Operating Officer.

“We see that an increasing number of incidents, many of them severe, are caused by software-related issues. There’s a weak spot in the way the offshore and marine industries work to ensure total system quality. That weak spot is getting bigger every day, but we’re going to rectify this.

“Marine Cybernetics has unique technology and processes for the third-party testing and verification of computer-based control systems. This will be a game-changing platform to enhance safety and increase operational efficiency in the offshore and maritime industries.”

New freight centre opens

Dachser UK, the British subsidiary of one of Europe’s leading global logistics companies, has opened its new integrated logistics centre and UK headquarters at Brackmills Business Park, Northampton.

The 16-acre site includes a 178,000 sq ft purpose-built facility and has been designed to help Dachser “achieve optimum service efficiency for its European and UK freight distribution services”.

Geodis Wilson task force expands

Global multimodal service provider Geodis Wilson has strengthened its oil and gas operations with an expanded task force, it announced at this year's Offshore Technology Conference in Houston, Texas, where it showcased its tailor-made, global logistics solutions.

In particular, it broke the news of its global contract with National Oilwell Varco, a world leader in the design, manufacture and sales of oil and gas mechanical equipment and components.

This was awarded to Geodis because of its expertise in the project logistics field and the fact that it has a network covering more than 60 countries. Steen Christensen, global head of the oil and gas division, said: “I’m very proud of our team across our whole network; this accomplishment confirms our aptitude and expertise in the oil and gas sector.”

High fuel costs hinder British companies

The UK has the highest petrol pump prices of any major world economy, hitting businesses hard as they struggle to pull out of recession, according to a new study by the accountancy group UHY Hacker Young.

The company says that the UK levies taxes of 59% on diesel, which is the highest in any major economy, and 60% on petrol, the third highest. “This is considerably more than other major developed economies such as the United States, Canada and Australia,” says the study.

In comparison, both of the world’s largest economies, the USA and China, have extremely low fuel taxes. The USA levies just 13% on petrol and 12% on diesel, whereas China levies no taxes at all on either fuel.

The study adds that as diesel is used in the majority of commercial vehicles, “this heavy burden is borne primarily by businesses”.

Furthermore, it says: “Even for Liquefied Petroleum Gas, a more environmentally friendly alternative to petrol or diesel, the UK still levies taxes of 60%, the highest tax on LPG in the developed world by some distance.”

Roy Maugham, tax partner at UHY Hacker Young, says: “Taxes on fuel are an area in which the UK is placing a bigger burden on businesses than in many other countries, which could act as a brake on the speed of recovery from the recession.

“Naturally, the UK wants to sustain its record on reducing carbon emissions, but fuel taxes are not the only way to achieve that — measures such as more attractive capital allowances for energy efficient technologies are a positive way to incentivise businesses to reduce their carbon output.

“While the British Government’s cuts to corporation tax are certainly popular with businesses, the 60% tax on petrol is still a considerable burden for them to carry, particularly as reclaiming the VAT element can be complex, especially for smaller businesses.”

Maugham adds: “The United States is already quite a distance ahead of the UK in its economic recovery, and its lower levels of taxation in areas such as fuel may well be helping to stimulate growth … Reduced taxes on diesel would be particularly advantageous for fast-growing small and medium businesses that run fleets of commercial vehicles, especially in sectors such as distribution and retail. These businesses can be key drivers of economic recovery.”

Major challenge for shipping industry

With more than 100 vessels of 10,000 TEU and above due for delivery this year and next, and more orders in the pipeline, it is said that the global liner shipping industry has an enormous challenge on its hands to manage the process of change.

“Operational alliances and vessel-sharing agreements will increase out of necessity on all trade routes and the day of the independent operator is over,” according to Drewry, one of the key industry analysts joining major shippers, logistics providers and ports at TOC Europe in London between 24–26 June “to assess the supply chain fallout from the huge-scale change in container shipping”.

“The combination of economic uncertainty and oversupply of capacity means that the container shipping market will remain unstable and freight rates very volatile for the foreseeable future,” says Martin Dixon, Director and head of research products at Drewry, who will be one of the speakers on the opening day of the conference.

While mega-alliances are designed to bring stability to the market by improving tonnage management, analysts are sceptical about their immediate ability to counteract the current and forecast overcapacity. As a result, cargo owners “can anticipate a prolonged period of low freight rates”, says Andrew Penfold of OCS, who is to be another opening speaker.

However, the impact of mega-ships and alliances will, perhaps, be felt most keenly by ports and land-side transport. “Larger ships are challenging ports, with fewer vessel calls but many more container moves per call, with the potential for land-side congestion both within terminals and for hinterland transport,” says Martin Dixon.

“Alliances will shake up European port dynamics and no-one knows yet where the sticks will land,” adds Andrew Penfold. “Terminal consolidation and size limitations of existing capacity are already shifting the current market positions of terminal operators in Antwerp, Zeebrugge, Rotterdam and this wave will hit many other ports soon,” agrees Paul Jakob Bins, Managing Director Benelux and France for the Euroports group, who will speak on day two of the conference, focusing on inland logistics flows and connectivity.

Insolvencies rise in CEE region

Companies in Central and Eastern Europe (CEE) faced a tough time in 2013, according to risk analysts Coface.

It said: “The already weak economic situation deteriorated and household consumption decreased due to fiscal measures designed to tackle rising budget deficits. Access to credit was further constrained in line with reduced supply and demand for new loans.

“This situation affected companies directly and forced them to lower their sales targets. Moreover, exports — that had been expected to contribute to GDP growth — suffered from the eurozone slowdown, where Central and Eastern European economies traditionally conduct most of their foreign trade.

“The result was that nearly 70,000 companies in the region were insolvent in 2013, an increase of more than 5% compared with the previous year. Bulgaria recorded the highest increase in insolvencies at 39%, with 834 cases.

“Excluding Hungary, where a drop in insolvencies was due to a change in legislation, Latvia is the bright spot in the CEE region, with a reduction of 7% in the number of insolvencies. This positive result mirrors GDP growth of an estimated 4.6% and rising private consumption.”

However, the outlook in the CEE is not all bleak. In terms of overall economic outlook, the first quarter of 2014 appears more positive.

Coface anticipates that the average growth rate in the region will nearly double, increasing from 1.1% in 2013 to 2% by the end of 2014.

It says: “The drivers of this improvement will continue to be the Baltic states, with Latvia and Lithuania at the top and forecast to grow 4.% and 3.4% respectively.

“The main source of growth will be increased exports and private consumption. In this improving environment, overseas companies should feel more comfortable with their business transactions and investments.”

Call for greater cargo handling safety

New international legislation to improve the safety of workers using ships' lifting appliances is being called for by ICHCA International, the NGO association dedicated to improving safety, security, sustainability and productivity across the global cargo handling chain.

Speaking recently at a joint informal meeting of key industry bodies, ICHCA’s technical director, Richard Brough, addressed the hazards of ships’ lifting appliances and ICHCA’s ongoing campaign to amend the Safety of Life at Sea Convention to include mandatory classification of ships' lifting appliances.

He said that, currently, there was no internationally recognised and universally applied legal requirement for ships' lifting appliances and only some 3% were voluntarily included by ship owners.

“The International Labour Organisation's Convention 152 recommends routine inspection, examination and re-test routines for equipment but has been ratified by only a small number of states,” he added.

Bigger vessels drive huge investments

The impact of big vessels on global and regional container supply chains dominated discussion at the 18th TOC Container Supply Chain Asia Conference in Singapore.

In a keynote speech, Tan Chong Meng, Group Chief Executive Officer of PSA International, outlined the principal trends affecting container logistics at a global level. Bigger vessels such as the giant container ships now coming into service, together with the move to create more effective carrier alliances, are driving massive investments in container terminal design, construction and technology, he told delegates.

March 2014

Air Charter take-off in Turkey

Leading broker Air Charter Service has established a presence in Turkey, based in Istanbul. A spokesman said: “For the moment, the operation will be offering cargo charters only, but we will be looking to add a passenger department in the near future.”

Emirates enhances flights to Spain and Nigeria

Emirates has launched a daily A380 service to Barcelona, replacing the Boeing 777 previously operated on the route. The airline is also is set to expand its presence in Nigeria, with the start of a daily linked service to Abuja and Kano from 1 August. The announcement followed Emirates’ recent milestone of 10 years of operating to Lagos, to which the airline flies twice daily.

Air New Zealand moves to new cargo centre

Air New Zealand Cargo has moved its Heathrow operations to the new Dnata City at Heathrow. It has moved into Unit Three of the purpose-built cargo logistics centre after 17 years at its previous handling unit.

“Being the launch customer for this state-of-the-art facility shows we are really moving with the times,” said Finlay McArthur, Regional Cargo Manager UK & Europe.

Dachser expands in Switzerland

Logistics provider Dachser is growing its presence in Switzerland with the planned September opening of a new site in the Bern region. This will be its ninth Swiss site and will occupy an area of 12,200m2.

“The new site will enable us to develop our operations in the Bern region and, at the same time, to relieve the pressure on Birsfelden,” explained Country Manager Urs Häner. “Additionally, the proximity to western Switzerland will shorten runtimes there by as much as an entire day.”

Cautious optimism among SMEs

There has been a rise in SME confidence in the UK, according to the global payment services company Western Union, which recently released findings from its quarterly economic survey of more than 650 UK small and medium-sized businesses engaged in international trade.

It found that SME confidence grew in the final quarter of 2013, with more than 77% of companies expressing optimism in the UK economy. “This figure represents the fifth consecutive quarterly rise and the highest number yet recorded,” said a spokesman.

“However, confidence in the return to growth was tempered by a significant increase in concerns about customer and order loss, credit availability and political influence.”

Kerry Agiasotis, Global Managing Director, Western Union Business Solutions, said: “SME confidence in the UK recovery remains on track. The year 2013 ended with a string of positive economic data; what we are seeing now is faith in the strength of the British economy translating into action as more small and medium-sized businesses look to increase investment in their companies.

“But, despite the positive outlook for international trade, global market worries and currency volatility dampened SME export activity in Q3 and Q4. The competitiveness of British goods is not what it was 12 months ago; this was demonstrated by the dip in trade with all major export locations and serves as a stark wake-up call about the difficult conditions many small and medium-sized businesses still face.”

New role for Vels

AMI — said to be the world’s largest trade-only airfreight and express wholesaler — has appointed Rinaldo Vels to the newly created position of Vice-President Continental Europe.

Moderate growth for air cargo in 2013

The International Air Transport Association (IATA) has released figures showing a 1.4% expansion in global freight in 2013 compared to 2012.

Regional performance varied, with Middle Eastern and Latin American carriers reporting the strongest growth in demand (12.8% and 2.4% respectively). Asia-Pacific carriers, which have nearly 40% of the global air freight market, saw cargo activities shrink by 1% over the year.

"2013 was a tough year for cargo,” said Tony Tyler, IATA’s Director General and CEO. “While we saw some improvement in demand from the second half of the year, we can still expect that 2014 will be a challenging year. Trade itself is suffering from increasing protectionist measures by governments. And the relative good fortunes of passenger markets compared to cargo make it difficult for airlines to match capacity to demand."

Last reviewed 8 December 2014