RLL Container Report - 23 July 2014
From: John Keir, Ross Learmont Ltd Email: john.keir@telia.com Date: 23 July 2014
Centrifugal forces at work.
Currently, Moscow rail terminals handle 84.3 million tons per annum but forecasts indicate this figure is likely to reach 115.1 million tons by 2020. At the same time, RZD is preparing to close many freight terminals within the Moscow Ring Road, resulting in a flight from the cramped city-centre facilities to large, modern terminals in the outer regions, where there is space for future expansion.
One of the first to move beyond the narrow confines of the Moscow Ring was Ecodor, which upped sticks from the delightful setting of Botanicheski Sad to move to Podolsk. Since the move, Ecodor has seen its box traffic grow every year and in June of this year throughput rose by 6% on its May figure to record a monthly 22,357 teu. Ruscon took and even bigger step to the MANP Terminal in Lvovo, from where it has just launched a weekly block train service. The train, which has a capacity of 154 teu, departs each Saturday for Khabarovsk. After discharging its laden units, the train picks up empty containers and travels on to Vladivostok, where it is loaded with import containers bound for the Moscow Region.
Following hard on Ruscon’s heels, Fesco proposes to construct a large facility at Usady. It is as if a mighty centrifugal force is at work casting container operations ever further away from the geographical centre of major population centres. Fesco’s new facilities offer greater space and a more relaxed attitude to round-the-clock freight operations. However, the main factor encouraging these moves is simply cost. Property, even in industrial areas of large cities, has rocketed in price. This, in turn, has encouraged terminal owners to sell up and move their main business to peripheral sites with more room for expansion and with better connections to both rail and the fast-expanding road network. VTB plans to trump all other projects by announcing the construction of two logistics centres at Stupino and Mozhaisk with a throughput of up to 12 million tons per annum. Investment in the former site is estimated at Rouble 21 Billion and Rouble 28 Billion in the latter.
There is a similar picture emerging in the North-West Region, where, the best results came at the ports furthest away from the city centre. Ust-Luga recorded a 240% rise in throughput for the first half of the year. Of course, the title of the most peripheral of all the peripheral container terminals goes to Kaliningrad, which notched up a 17.2% rise in box traffic to record 179,800 teu for the first half of the year. Kaliningrad best exemplifies how, in transport terms at least, a location can quickly change from being out in the boondocks to finding itself at the centre of world attention. In four years’ time at the start of the 2018 World Cup, hundreds of thousands of football fans will use the Baltic port as their gateway to Russia. Once these fans have trekked the 3,000 kms to matches in Ekaterinburg or Sochi, they will really appreciate just how close the Baltic Enclave is to the heart of Europe.
It is not only in Russia, where these mighty centrifugal forces are at play. On the other side of the Atlantic, the US rail operator, McKay TransiCold opened a new reefer rail service in a terminal located no less than 60 kilometres to the south-west of its prime market in Chicago. The regular rail reefer train will transport vegetable and dairy produce between California and the Illinois metropolis. McKay claim that by using rail they can not only match truck transport in transit times but can also under-cut road haulage costs by 5 to 15%.
In London, permission was granted for the building of a rail freight terminal at Radlett, which lies just within the M25 circular motorway, which in turn defines the new perimeter of the Greater London area. However, traditionalists will note that Radlett lies to the north of Watford, which native Londoners always considered to be ”terra incognita”. London taxi drivers would never accept a fare located this far north of the city centre. And to the north of Radlett lies another product of these centrifugal forces.
Daventry International Freight Terminal was originally built in the 1990s to serve both the London and Birmingham conurbations. Over the years, it has developed phase-by-phase into a highly complex distribution centre connected by road and rail not only to the main population centres in Britain but also to similar giant hubs in continental Europe. To keep pace with growing intermodal traffic, the British government has approved a Euro 1.25 Billion extension covering 345 hectares. In addition to doubling the size of the initial project, the extension will include modern warehousing and a new rail interchange.
The same centrifugal forces are at work in Southern Europe, where the Spanish port of Algeciras has risen to prominence as the busiest box terminal in the Mediterranean Sea. The port is strategically located on the axis of major trade routes from Asia to Europe, Europe to Africa and from Asia to the US East Coast by way of the Suez Canal and the Straits of Gibraltar. Algeciras has invested USD 73 million in upgrading its four existing cranes to accommodate increasing numbers of the Very Large Container Carriers operating out of Asia to Europe and to the Eastern seaboard of the USA. In 2013, Algeciras processed 4.33 million teu, which represents a rise of 6.6% over the previous year. In the process, Algeciras has overtaken the northern ports of Valencia and Barcelona as Spain’s busiest container port.
John Keir, Ross Learmont Ltd.
23 July 2014
Copyright ©, 2014, John Keir