New trends on MODERN Shipping & Transhipment Port (eng) danny diep to (f)

D D T © C o p y r i g h t P a g e 1 | 32
NEW TRENDS ON MODERN SHIPPING
& TRANSHIPMENT PORT
© Danny DiepTo, MBA
diepto.pro@gmail.com
CONTENTS
PART 1: NEW TRENDS
1. “MEGA” TRENDS
A.MEGA ALLIANCE
B.MEGA SHIP
C.MEGA HUB PORT
D.MEGA HANDLING EQUIPMENT
2. “AUTO” TRENDS (UNMANNED)
A.AUTO PILOT SHIP
B.AUTO PORT FACILITIES (AGV)
C.AUTO CONTAINER YARD (ASC)
3. “I” TRENDS (INTELLIGENCE)
A. INTELLIGENT CONTAINER (RFID-CONTAINER)
B. INTELLIENT SEAL (SMART SEAL, E-SEAL)
4. “E” TRENDS (ELECTRONIC)
A. “E-PORT”
B. “E-CUSTOMS” (E-CLEARANCE)
C. “E-DOCUMENT”
5. “LOW COST” TRENDS
6. “SHORTCUT” TRENDS
A. ARCTIC SHIPPING ROUTE (NORTHERN SEA ROUTE-NSR)
B. THAI KRA CANAL ROUTE
PART 2: TRANSHIPMENT PORT
1. REQUIREMENTS FOR A TRANSHIPMENT PORT
2. PROBLEMS TRANSHIPMENT PORTS FACE
3. MAXIMIZE SYSTEM EFFICIENCY
PART 1: NEW TRENDS
1. “MEGA” TRENDS
A.MEGA ALLIANCE
Mega alliances have formed in order to extend economies of scale, scope and network,
through strategies such as the integrating of individual service networks, vessel sharing,
slotchartering, joint ownership and/or utilization of equipment and terminals and similar
endeavors on better harmonization of operations.
Liner carrier alliances are developing at least two different types:
(1) core alliances with a set of global partners;
(2) multiconsortia networks of slot exchanges covering individual traders.
Through this kind of global alliance arrangement, a lot of scale benefits can be achieved: more
frequent service, shorter transit times, wider port coverage, lower slot costs and a stronger
bargaining position in negotiating with terminal operators, container depots and inland/feeder
transportation carriers.

Liner alliances operational cooperation are summarized as follows:
(1) Joint terminals or terminalcontracts;
(2) Joint mainline services;
(3) Joint feeder services;
(4) Joint purchase or ownership of ships;
(5) Joint purchase and usage of containers;
(6) Joint intermodal, rail or trucking operations;
(7) Joint container depots;
(8) Jointlymanaged pools of containers and equipments;
(9) Joint EDI systems;
(10) Joint bunker purchase, and
(11) Interchange of empty containers.
Alliances, mergers and acquisitions (M&A) have been seen as elements of an industrywide
strategy to return to profitability via cost cutting and rationalization. While intense
competition and low profitability have encouraged rationalization, the preferred method of
achieving the objective has changed over time.
As of 18 July 2016, the world’s shipping alliances include:
(1) the 2M alliance (Maersk and MSC),
(2) the Ocean Three alliance (CMA CGM, UASC, COSCO Shipping),
(3) the G6 alliance (NYK Line, OOCL, APL, MOL, HapagLloydand HMM) (The Alliance)
(4) the CKYHE alliance (K Line, COSCO, HANJIN, Evergreen, Yang Ming).
As of 18 July 2016, Independent top carriers include:
PIL, ZIM, Wan Hai Lines, XPress Feeders and KMTC
(1) 2M Alliance-Maersk and MSC (2014)
2MMaersk and MSC signed the 10year vesselsharing agreement on the AsiaEurope, Trans
Pacific and TransAtlantic trades.
2016, 2M will have a combined capacity of about 5.7 million TEUs, and that’s about 28% of the
overall market share in container capacity.
(2) Ocean 3 Alliance: CMA-CGM, UASC & CSCL (2015)
Ocean 3 has a capacity of about 3 million TEUs. Their combined market share of container
capacity is 14.7%.
Ocean 3 is stronger in the Asia to Europe and Europe to Asia routes. It’s weakest in the
Transatlantic route.
(3) G6 Alliance: NYK Line, Hapag-Lloyd, OOCL, APL, HMM, MOL
These six carriers have a capacity of about 3.5 million TEUs and a combined market share of
17%.
G6 is a player in each of the four major trade lanes, and is strongest especially on the
Transatlantic and Transpacific routes.
(4) CKYHE Alliance: COSCO, K Line, Yang Ming, Hanjin, Evergreen (2012)
CKYHE has a capacity of about 3.3 million TEUs and a combined market share of 16.4%.
CKYHE is strongest in the Transpacific and Asia to Europe routes, while being a very small
player in the Transatlantic route.
Hanjin Shipping filed for bankruptcy protection on Aug. 31, 2016 in Korea and Sep 2, 2016 in
the US.
After Q2 2016, Hanjin had a total debt of $4.2bn and with cash reserves of just $156.5m.
The CKYHE Alliance will cease to operate on March 2017 since Evergreen Line will join the
Ocean Alliance along with Cosco.
4 alliances and the independent carriers announced reorganizations starting from January next
year 2017.

B.MEGA SHIP
Bigger is better
To improve cost efficiency, ship sizes are constantly increasing. All ship categories suffer
bracket creep.
Dry bulk shipping’s cost efficiency improved about 33% over the last 31 years through larger,
more cost efficient ships. The average size of the fleet grew from 35.500 dwt in 1981 to 70.600
dwt in 2012.
The average container ship size has increased by 2/3 from 955 TEUs in 1980 to more than
1,600 in 1996. One of the factors contributing to this trend is the introduction of the socalled
postPanamax containerships. The first postPanamax containership was built in 1988, yet only
in 1995 did the worldwide containercarrying capacity of postPanamax vessels start to increase
significantly.
So far, postPanamax vessels are employed only on two major routes: (1) transPacific and (2)
between Europe and the Far East. The latter is sometimes part of a pendulum service that
reaches the U.S. East Coast.
Hyundai, Maersk, MitsuiOSK, NYK, OOCL and P&O Nedlloyd ordered ‘postpanamax’ tonnage
in the latter years of the 1990s. Maersk commissed several 6,0006,600teu postPanamax
vessels, while P&O Nedlloyd introduced four 6,700teu vessels and NYK five 5,700teu vessels
into EuropeAsia service. PostPanamax vessels operate exclusively on the EuropeFar East
and US West CoastAsiaEurope routes.
While the average size of container vessels employed in the major trades continued to
Introduction to Transportation and Navigation Technological developments in ship design and
construction, and the ensuing economies of scale of larger ships, have also promoted trade,
particularly that of developing nations, by making economical the transportation of goods over
long distances. Nowadays, containers are increasingly carried by specialized container ships
many of which are able to carry more than 5,000 TEUs, while designs for 8,000, 10,000, 15,000
or even 20,000 TEU ships are already on the drawing boards of naval architects.
Intense competition and economies of vessel size lie behind recent increases in the size
of container ships. Economies of vessel size arise from the technical characteristics of
container shipping: the capital cost per container slot falls as vessel size increases, while the
ratio of crew to carrying capacity and the consumption of fuel per unit of cargo carried also
decline as vessel size increases.
Larger ships and more transshipment oblige ports to incur high investments in dredging,
information technology, and gantry cranes. Simultaneously, as port productivity increases, the
time ships have to spend in port decreases, which in turn encourages more transshipment and
the use of even larger ships.
In 2011, 10 Malacca Max vesselsTriple E were ordered by the Danish A.P. MollerMaersk
Group to DSME SouthKorean shipyards, creating surprise in a context of overcapacity. Each
unit costs 190 millions US$. According to Maersk, 50% fuel and CO2 savings per container
moved are made possible, compared to industry average on AsiaEurope trade ; thanks to
increase in size (18,000 TEUs, empty containers included), but also improvements in
motorisation (twin propulsion, waste heat recovery system), space optimisation, better design of
hull and lower speed (17 to 23 knots). CO2 emitted will be 3g/t.km.
Maersk Line has an option to buy another 20 vessels. The total contract value is $5.7 billion if
the option is exercised. The vessels will be delivered from Korea’s DSME shipyard from 2013 to
2015. Maersk Line expects 5%8% growth in trade from Asia to Europe.
Called the ‘TripleE’ class for the three main purposes behind their creation — Economy of
scale, Energy efficient and Environmentally improved — these new container vessels do not just
set a new benchmark for size: they will surpass the current industry records for fuel efficiency
and CO2 emissions per container moved held by the Emma Mærsk class vessels.

400 metres long, 59 metres wide and 73 metres high, the TripleE is the largest vessel of any
type on the water today. Its 18,000 TEU (twentyfoot container) capacity is 16% greater (2,500
TEU) than today’s largest container vessel, Emma Mærsk (15,550 TEU).
The TripleE will produce 20% less CO2 per container moved compared to Emma Mærsk and
50% less than the industry average on the AsiaEurope trade lane. In addition, it will consume
approximately 35% less fuel per container than the 13,100 TEU vessels being delivered to other
container shipping lines in the next few years, also for AsiaEurope service.
The future of container ship development is promising.
C.MEGA HUB PORT
Bigger container ship requires bigger port.
Port facilities will acquire new and better standards and advanced technology in order to serve
mega ships.
Intense competition in container markets not only makes it necessary for ship owners to offer
high quality services between major trading regions but also makes it imperative for them to
optimize fleet utilization. Such pressures have led to the development of multiroute operating
patterns, notably “RoundtheWorld” and “Pendulum” services, enabling carriers to maximize
vessel employment and slot utilization.
Container lines have sought to minimize costs by limiting the number of port calls. In so doing
they have reemphasized the importance of regional hub ports, notably Singapore and Hong
Kong. Cargo to and from the region served by a hub port is handled by feeder shipping and/or
by land transport. In archipelagic South East Asia, an extensive network of regional feeder
services has evolved.
Economic forces appear to be favoring the emergence of ‘superhubs’: the changing pattern of
port calls by vessels in the EuropeFar East trade suggesting that Singapore, Hong Kong and
Shanghai are strengthening their competitive position in relation to other hubs in East Asia.
A likely longterm future scenario implies the use of container ships with 8,00015,000 TEU
capacity on the major eastwest routes, calling at just 45 mega hubs, i.e. only 1 or 2 on each
continent. These mega hubs will be almost entirely based on transshipped cargo, implying
various levels of regional and subregional transshipment centers. Containers are increasingly
transshipped, and hub ports that provide transshipment services have experienced particularly
high growth rates.
Port infrastructure expansion is easier justified in ports of projected high cargo throughput.
Accommodating bigger ships in new, strategically located ports improves a country’s cost
structure making it more cost competitive by encouraging international trade.
Hence we would expect to see further modifications to the pattern of mainline and feeder line
services, as well as changes in the absolute and relative status of regional ports, over the next
decade.
Europe Container Terminals (ECT) is the largest and most advanced container terminal
operator in Europe,handling almost 3/4 of all containers at the Port of Rotterdam.
Currently, ECT is developing a network of inland terminals to facilitate better intermodal
transport between Rotterdam and the European hinterland. In 2007, ECT handled 6.1 million
TEU.
ECT is state of the art, the world’s most advanced and highly automated container handling
facility. No straddle carriers operate here, but instead AGVs, or Automated Guided Vehicles that
move around unmanned to orders from software “Face to Face with the Giants” in the Port of
Rotterdam.

D.MEGA HANDLING EQUIPMENT
Bigger Containerships Means Bigger Gantry Cranes
In anticipation of future developments, the cranes are even ready for the mega container
vessels which currently exist on the factory.
the trend towards ever larger ships, the tempestuous growth in container traffic and shortage of
space in the ports called for a futureproof answer.
The anticipated completion of the Panama Canal improvements in 2014 will enable some of the
largest oceangoing vessels to achieve shorter passage routes between the Pacific and Atlantic
Oceans. As a result, port facilities around the world are in a tizzy to stay competitive once the
large ships are allowed to make the 48 mile journey through the newly expanded 180′ wide
locks.
Vessel terminology is a critical issue in the discussion.
Currently, the 110′ wide Miraflores locks allow “Panamax” ships to pass through. It’s a tight
squeeze considering the ships are 106′ wide. The class of vessels able to pass through the
Panama Canal once improvements are made are termed “post Panamax” or “new Panamax”
ships (between 134′160′ wide, respectively, passing through a 180′ lock).
“Post” and “New” Panamax ships are eclipsed in size by a superior grade of ships, termed
“super post Panamax.” The super post Panamax vessels, at 176′ wide, will not be able to pass
through the improved Panama canal. They are limited to oceanonly routes between ports.
A number of hub ports have been recently upgraded to handle the world’s largest container
ships.
The recent delivery of huge new containerships like CMA CGM Marco Polo with 10,000 TEU
and the 18,000 TEU Mærsk McKinney Møller, as well as the expansion of the Panama
Canal marks a new era of global container shipping, one that is requiring ports worldwide to
supersize their cranes.
Super-Post Panamax STS Quay Crane
The largest modern container cranes are classified as "SuperPost Panamax" (for vessels of
about 22 or more containers wide). A modern container crane capable of lifting two 20foot
(6.1 m) long containers at once (endtoend) under the telescopic spreader will generally have a
rated lifting capacity of 65 tonnes. Some new cranes have now been built with 120 tonne load
capacity enabling them to lift to four 20foot (6.1 m) or two 40foot (12 m) containers.
Cranes capable of lifting six 20footlong containers have also been designed. PostPanamax
cranes weigh approximately 800–900 tonnes while the newer generation SuperPostPanamax
cranes can weigh 1600–2000 tonnes.
SuperPost Panamax cranes are 273 ft. high have the capacity to serve a ship 24 containers
wide, ranking them amongst the largest in the world.
The cranes were built by the Shanghai Zhenhua Part Machinery Company (ZPMC) and arrived
fully constructed and welded to the deck of the Zhen Hua 26.
“These new superpost Panamax cranes, these enormous cranes can reach across vessels 22
containers wide and lift cargo weighing up to 65 long tons to a height of 136 feet above the
dock. Each crane weighs 1,388 tons and measures 433 feet wide and 185 feet tall
2. “AUTO” TRENDS (UNMANNED)
A.AUTO PILOT SHIP
An automatic pilot a device that will automatically steer the vessel on a predetermined
compass course is standard equipment in most ships today, and most fishing skippers will
readily admit that such an instrument is worth 2 extra men in the crew.

A good autopilot will steer a better course than any helmsman, provided the controls are
properly set, and this aid has been claimed to save as much as 20% in fuel on a long passage
as well as improving the standard of navigation.
The autopilot consists of:
 A course sensor built into the compass, which can be set to any predetermined course;
 A panel with up to four settings, depending on the sophistication of the equipment;
 A means of transmitting rudder instructions to the steering or, in a small vessel, a special
steering motor which is activated whenever the vessel deviates from that pre set course;
 A wheelhouse rudder indicator (as distinct from a helm indicator) which shows the
position of the rudder at any given moment;
 A clutch/declutch device either mechanical or electrical, to engage or release the pilot.
 All auto pilots will be different but they all have some or all of these features.
Hyundai Heavy Industries, Korea recently unveiled the world’s first remote monitoring and
controlling ship system, allowing operators to remotely control important onboard systems and
provide realtime feedback to shoreside personnel.
The key of this system is the ship monitoring and controlling system called Ship Area Network
(SAN) which integrates Advanced Control and Integration System (ACONISDS), Voyage Data
Recorder (VDR), and Bridge Maneuvering System (BMS). With SAN, ship operators can
remotely control engines, controllers, manage other important onboard systems, get realtime
feedback on the status of ships via satellite link.
The data collected, analyzed, and processed via SAN can be used for enhancing operational
efficiency and reducing management costs for shipping lines.
The first ship to be equipped with the smart system is a 4,500 TEU container ship to be
delivered to AP MollerMaersk on March 29,2011. Hyundai Heavy Industries will be installing
the smart system on and additional 20 ships ordered by AP Moller.
The stateoftheart Platinum integrated Navigation Command System (NACOS) and Platinum
automated Monitoring and Control System (MCS) assembly for the world’s largest container
vessel in 2012, CMA CGM Marco Polo, which recently began service between Europe and Asia.
The 396metrelong, 53 metre width, 16,000 TEU vessel was built by Daewoo Shipbuilding &
Marine Engineering (DMSE) in South Korea for CMA CGM of France.
NACOS Platinum navigation control system is also supporting automatic steering, track control
and voyage planning made by SAM Electronics, Germany.
B.AUTO PORT FACILITIES (AGV)
Port industry has invested a lot in order to cope with the technological requirements of
containerization. Modern container terminals equipped more efficient quay cranes have been
built, and more efficient organizational forms including privatization have been adopted in an
effort to speed up port operations. Operational practices have been streamlined, the element of
uncertainty in cargo flows largely removed, forward planning has been facilitated, port labor
regularized and customs procedures simplified. These developments took place under the firm
understanding of governments and local authorities that ports now constitute the most
important link and node in the overall doortodoor transport chain.
AGV fully automated guided vehicles are developed for groundbreaking solutions for rapid and
economical container transport between the harbor quay and the storage area, handling for 20’,
40’ and 45’ ISO containers on main hub port container terminals. AGV employs driverless
vehicles navigated and controlled by a computerized system. The available expertise on
development and manufacturing of advanced equipment and vehicles enabled to create this
high performance and environmentally friendly container carrier AGV with superior
characteristics regarding fuel efficiency, Zero CO2 emission, noise levels, reliability and
maintainability.

AGV is designed in a modular way. By having a flexible design there is no need to exchange the
complete vehicle after the technical lifetime of certain components. A retrofit of the worn item
will do. The second big advantage of the modular set up is the ability to adapt to specific
customer demands with low impact.
The investment costs for the automated terminal are 10 15% higher then those required for the
corresponding unautomated terminal. According to an analysis conducted by the European
Combined TerminalECT, the savings from low operating and maintenance costs, especially low
labor costs, and increased processing capacity more than offset the investment cost.
The promise of deploying AGVs in container terminals lies in their capability of achieving the
following benefits:
 High container throughput
 Continuous operation: 24 hours a day, 365 days a year
 High controllability and reliability
 High safety standards
 Automated and consistent container handling operation
 Reduced operational costs, especially labor costs
 High position and heading accuracy
 Automated ease of operation of whole fleet
 Fully automated, precise and rapid operation
 Carries 20, 40 and 45foot containers
 Computer control system provides exactly timed sequences according to plan
 Travel forwards, backwards and sideways
 Fully automated refuelling and fully automated battery change
 Exact control and data recording (transport jobs) through management and navigation
software and transponders embedded in the terminal road surface
 Batteryelectric drives for zero exhaust emissions in the terminal
 The steering of AGV is very accurate; this results in a minimized required area for the
movement of a container and could potentially reduce the terminal surface area.
Zero-emissions terminal
 Battery powered AGV as an alternative to a dieselelectric drive unit
 Reduced maintenance costs through simplification of the drive train
 Low energy consumption due to highly efficient batterypowered drive units
 No pollutant emissions in the terminal, low noise emission
 Recyclable leadacid batteries
 Long battery service life
 Decoupling of loading and travelling processes: Battery replacement takes place fully
automatically in about five minutes in a special batterychanging station
 Helps optimize use of mains power capacities thanks to smart charging management
system
Operating software for AGV fleet operation
 Inhouse development by Gottwal Port Technology
 Management and navigation system for the control and monitoring of AGV fleets
 Integration in higherlevel terminal management systems
Two 20’ containers can be handled independently of each other or one container of any size.
The result: shorter downtimes and increased working frequency.
General characteristics
 Drive systems Dieselelectric (Hybrid) or batterypowered
 Positioning accuracy +/ 25 mm

 Transportable container types
 1 x 20’, 1 x 40’ or 1 x45’
 2 x 20’
 1 x 30’ (optional)
 Payloads
 Max. weight of a single container 40 t
 Max. weight of 2 x 20’ containers 70 t
 Dimensions
 Length approx. 14.8 m
 Width approx. 3.0 m
 Height of load platform approx. 2.4 m
 Speeds
 Forwards/reverse max. 6 m/s
 Curvesmax. 3 m/s
 Crab steering max. 1 m/s
AGV Manufecturers:
 Gottwald Port Technology, Germany
 VDL, Netherlands
 Kőgel Kamag Transport Technic, Germany
 Mitsui Engineering & Shipbuilding Co,Ltd
 Toyota Industries Corporation
C.AUTO CONTAINER YARD (ASC)
Unmanned Automatic Container Yard
After more than 2 years’ research and development, the project “Research on the Integrated
Technology for Modern Container Logistics and Equipment and Its Demonstrative Application”,
a key scientific and technological project proposed by Shanghai Science Commission and
undertaken by Shanghai International Port (Group) Co., Ltd (SIPG), has come into productive
operation. At present, it has passed the acceptance inspection made by an expert panel
organized by the said Commission, fulfilled the industrial and productive operation and turned
out 21,685 TEUs.
This stacking technique has immediate significance because it can make maximum utilization of
the space in the Port of Shanghai where one inch of land means one inch of gold.
The conclusion made by the Shanghai Science and Technology Information Institute (a GradeA
national science and technology information consultant) declared, after a wide and thorough
search in an effort to find out the latest level of the stateofthearts in connection with the
unmanned automatic intelligent container yard.
In the Project, the container handling technique effected by relays of a high container gantry and
a low container gantry, i.e., a container unloaded from a truck by the low gantry is first placed on
a transfer platform and then is hoisted and put in the container yard by the high gantry, is a real
world great beginning. Currently the yard is able to stack eight over 9. In other words, after the
8th
containers were placed one on the top of the other to form a vertical pile, the 9th
container
can still pass over the top of the pile formed. In comparison with the present international level,
the number of containers thus stacked is almost doubled the world average.
The gantry crane with twin 40foot containers and the fullyautomatic positioning and unloading
of a container carrier innovated by the Research Team of the Project are all technologies that
our predecessors have never done.
Taking the Yangshan Deepwater Port for example, the handling efficiency of its limited
container yard area has been raised greatly, the transportation expenses of container carriers
and operating costs have been reduced due to the increase in the height of container piles.

The smooth operation of unmanned automatic container yard and the establishment of digitized
intelligent system of the Port marked a crucial step the Port of Shanghai took on its road
towards autonomous innovation. This project has been granted 4 domestic patents of invention,
11 domestic patents of utility model and other 15 domestic patents of invention are still on
application.
In the unmanned automatic intelligent container yard system, the ‘automatic container yard and
container handling techniques that have applied for the national patent of invention have their
originalities. In comparison with their foreign counterparts, the serial technologies used
comprehensively for the capability of stacking 8th container in the form of a vertical pile and
passing of a 9th
container over the top of the pile, the unmanned automatic operational
management of the containers and the strategic planning for the operation of the unmanned
container yard … have all reached the international advanced standards.
The unmanned automatic yard, which had been listed on the state construction planning by
virtue of the support and care of Shanghai Science Commission, is a product of the joint
endeavor of Shanghai International Port (Group) Co., Ltd., Zhenhua Port Machinery Company
and Shanghai Jiaotong University.
Konecranes ASC-Advantages That Really Stack Up
The automatic moving and stacking of containers is the next step in the evolution of container
crane technology that began with the introduction of containerized shipping in the 1960’s.
Konecranes Automatic Stacking Cranes (ASCs) offer significant advantages in an evermore
automated industry.
Several of ASCs can be operated remotely by a single operator, for example, significantly
increasing operator productivity.
Container Crane - Inspired by experience
The Konecranes ASC design drew upon rail and yard conditions that are the daily reality in
ports around the world. Konecranes ASCs are built specifically to handle actual yard and rail
configurations and work practices. Their light, intelligent structure in combination with Active
Load Control (ALC) and integrated positioning deliver fast, accurate container stacking over a
range of real world conditions.
Delivering a complete solution
Konecranes can deliver a fieldproven complete ASC solution for your yard operation, from
equipment design to handover. Konecranes ASCs are modular, making onsite erection
efficient. All phases of delivery are streamlined so that handling operation can start on schedule,
according to plan.
D.AUTO CONTAINER WAREHOUSE
High Density High Productivity Port Storage Systems
The FATA System” is an automated system designed specifically for intermodal rail terminals
(containers, semitrailers, swapbodies), but can be adapted for marine container terminals. The
system includes a high rack storage system.
FATA System, is a multistory steel structure providing for inventory management of containers.
Multiple access bays are provided for rapid truck turn around. The FATA System includes an
integrated hoist transfer system based on proven technology. Its straightforward mechanical
design and operational simplicity endures its on time performance and long term dependability.
The main component, a fully automatic Elevating Transfer Vehicle (ETV) is the key element of
the system. The ETV is a stacker crane that interfaces horizontally and vertically with the
storage position (bins) in the bays. The shuttle mounted on the ETV cradle is the mechanism
that stores and retrieves the containers from the storage positions.

Typical Configuration:
 Main aisle 1
 40’ Shelf, 2
 lenght 720m
 N. of Floors 7
 Total storage capacity 6,500 TEU
 Rail tracks 2
 Trucklanes 2
 Rail Cranes 4
 Truck Cranes 2
 Shuttles per each crane 4
 Total Shuttle n. 29
 Lifts 6
 Space required 35,000 sqm
 Space utilization 5,4 sqm/TEU
Typical Performance:
Working conditions
 Daily working hours 24 h/d
 Working days 360 d/y
 Wagons/train 45
 TEU/train 90
 TEU factor 1.5
Overall Performance
 Peak Unload/load Rail side 180 TEUmov/h
 Average flow Rail side 60 TEUmov/h
 Average flow Truck side 60 TEUmov/h
 Average total throughput 1,037,000 TEUmov/y
 Potential max throughput 1,500,000 TEUmov/y
Proven computer control technology provides many functions:
 Fast track positioning loading and unloading
 Real time inventory and location information
 Operations and maintenance records
 Low cost sorting and positioning for rapid ship loading.
The high-rack store has a modular structure and comprise:
 The warehouse end and center modules.
 Storage bays
 The highrack handling device and the channeling vehicles
The FATA System features the following advantages:
 Extremely fast handling
 Space saving 5070% compared with conventional systems
 Productivity increase: up to 70%
 Modular design for more efficiency
 No shifting and short waiting time for trucks
 Simplicity and high reliability
 Low investment cost
 Low operational cost

 High speed of operations
 3dmodularity
 Improved security
 Proven reliability
 Improved environmental impact
The storage bays for the containers are on the lower level of the highrise system to avoid
having to lift bulky loading units unnecessarily and effortintensively. Apart from height they
have the same dimensions as all the other rack bays.
The highrack handling device moves along the transverse aisle on running and guide rails. It
consists of a lifting frame, lifting crossbeam, turning device and channeling vehicles. The high
rack handling device mainly serves to transport the loading units vertically to the storage levels.
Technologies shown are from ABB Robotics, The Port of Rotterdam, and TEUSTACK from
FATA Group/Finmeccanica.
3. “I” TRENDS (INTELLIGENCE)
A. INTELLIGENT CONTAINER (RFID-CONTAINER)
The container will have intelligence.
In the last decade, losses through cargo theft have soared. In the beginning of the eighties
average global cargo theft statistics show losses to the tune of 20 to 30 billion USD annually.
In 2001 losses reached 300 billion USD, and at present they grow with an average of 20 to 30
billion 10 per year. Cargo theft is a serious threat to products in transit, the supply chain and
ultimately, shareholder‟s value. Organized criminal gangs account for a fair percentage of the
thefts, especially in Eastern Europe, Russia and the CIS.
Current efforts to ensure the integrity of containers have focused on the sealing mechanism
used to secure the container entry points. It is possible, however, to imagine that future
container security efforts might go beyond the sealing and door mechanisms and extend to the
very conception and construction of the container. It is already possible to equip containers with
multiple sensors that track the environmental conditions within the container. These may
measure temperature, humidity, light, motion, and any number of either radioactive or chemical
compounds. These sensors need not be directly integrated with a doorsealing device and can
be purposebuilt within the container itself. Physical barriers to entry can also be deployed for
the whole of the container and not just the door.
Perhaps the container of the future will even has its own navigation system with which it can
efficiently determine its own routes. An example: the container figures out for itself how it can
best secure its expensive cargo. These kinds of options are all feasible for the container of the
future. In the past, the difference between transporting people and cargo was that people were
smart; if something went wrong somewhere, they undertook action themselves. The container
will now also start doing this.
Programmable chips will become available which will offer numerous opportunities for having
the container play an active role in complex situations. This also offers opportunities for cargo
which is currently not or hardly moved in containers, such as fresh produce. It may even be the
case that a container which is only half full starts thinking about how it could still be transported
fully laden. With the aid of virtual agents, this could be possible just like that. What will become
reality and what will remain science fiction depends on the profitability factor. If the transport
costs of a container keep going up, then it could for example also become increasingly more
important that the transport of this container takes place in an efficient and environmentfriendly
manner through smart combinations of multimodal concepts.
More Added Value
A smart container also means that you need to organize the surrounding processes in a smarter
fashion.

Terminals will need to think about their role as a hub in these kinds of modern flows. How can
you make sure that specialised cargo runs through your terminal and not that of your
neighbour? The requirements in terms of handling will considerably go up, for example for that
one container which needs to be handled with priority. Terminals in addition should ask
themselves how they could add value to the cargo in certain containers.
Now, the operations at a terminal are mostly driven by the actual physical handling of a
container. In the future, the contents of this container will however to a great extent determine
that handling.
The increased use of container security systems will ultimately depend on industry’s recognition
of the bottomline benefits and on the existence of real government incentives. The sooner
those incentives can materialize, the sooner businesses are likely to see benefits from smart
containers.
Functions
A smart container system, then, is much more than just a locked door. It is a complete functional
system that must:
 Electronically identify the authorized personnel stuffing and securing the container, and
accept and report information such as container/trailer number and booking data
 Detect a breach in any part of the container
 Report the breach in real time (or close to real time)
 Track the container through the supply chain
 Identify authorized personnel unsealing container
 Be softwarefriendly to accommodate disparate logistics programs in communicating
critical data
Smart containers
Containers that use sensors and systems to track and report data such as contents,
unauthorized access and physical location hold huge promise for improving supply chain
efficiencies and strengthening security.
These days, there are more and more of what are called “smart containers” – electronic tracking
and reporting systems and infrastructure, and the boxes themselves. While most supply chain
executives understand that smart containers can detect something, little more is known or
appreciated, such as the fact that not all smart containers have the same level of intelligence.
The smartest type tells who supervised its stuffing, what’s in it, where it’s leaving from and
where it’s going, who’s carrying it, where it is at any given time, where it is but shouldn’t be, and
whether an authorized person opens it at destination. It will also signal unauthorized access en
route and say where that took place. The dumbest container usually can tell you if its doors
were opened en route.
There’s a difference between what should be detected in the private sector and what makes
sense in the public sector. Government needs are likely to be more comprehensive. In addition
to theft concerns, detection will include the need to detect weapons of mass destruction,
including chemical, biological, and nuclear materials. The smart container must also detect
illegal drugs and human cargo.
In most cases, basic detection is available and inexpensive. We can detect breaches into
containers using magnetic switches, light, vibration, temperature, and more. Companies such as
General Electric and GlobalTrak offer systems that use a combination of sensors, RFID,and
satellite technologies to detect unauthorized breaches.
Sensor monitoring technology
Container monitoring system consists of controller, sensor, power and related signal circuit.

Controller is like a person’s brain, sensor is like a person’s eyes, and sensor can detect and
collect the container environment information, and tell the controller what he feels.
Temperature and moisture sensor can detect inside the temperature and humidity of container,
optical sensor and magnetic sensor can detect open and closed statement of container door,
velocity sensor can detect the speed of container, acceleration transducer can detect the
acceleration of container, pressure transducer can detect the inside pressure of container.
Container monitoring is restricted by 3 main factors:
 First, condition of container transport is extremely harsh, it brings great challenge for
monitoring system stability and reliability.
 Second, container transport has a very long cycle, power supply is challenge that
requires low power dissipation of monitoring system.
 Third, space of container is occupied mainly by the cargo, the space for monitoring
hardware is limited which requires the hardware is as possible as small.
MEMS (MicroElectroMechanical Systems) can deal with above problems, which consists of
microsensor, microcontroller, and related signal circuit, the sensors such as temperature and
moisture sensor, optical sensor, velocity sensor, acceleration transducer, pressure transducer
and others can be packaged into chips, these chips can be welded on the electronic board,
this way can not only reduce the power dissipation, but also save the hardware space.
Magnetic sensor is used for monitoring the open and closed statement of container, which is
made into the Eseal, when container door is open, the magnetic field power of magnetic sensor
will change, this way can realize to monitor container door statement, but container has six
sides; only monitoring the container door is not enough. In order to monitor the break of six
sides of container, a layer of safety pad can be fixed on the inside surface of container (except
bottom plate), this safety pad is made of electricity sensor network, safety pad divides every
side (container roof, container side plate) as a big unit, every unit is divided into small standard
pieces, conductive net is laid on the standard pieces, connectors connect the small standard
pieces.
When some small standard piece is broken, we can change it with new piece, the standard
piece is made of something of hardness insulated materials which can be folded pending,
conductive electricity net can be laid inside of glue plate, this kind of glue plate will placed on the
bottom of container, which need to have the capacity of bearing the forklift weight, at this time,
the electricity net of 6 sides of container will connected as a whole, when some break happens
on the container, the electricity through the break will change, different extent break will cause
different electricity change, destroyed the balance of electricity sensor net, the controller will
analyze the electricity change comparing with the prevalue, and can find the precise broken
position of break.
At origin, container systems must include the identification of a party responsible for final
inspection of the cargo prior to its dispatch and subsequent international movement. Someone
must take responsibility for confirming the cargo on the bill of lading or booking sheet, for
activating the smart container system, and for locking the doors. This responsible person must
be vetted for his or her integrity and competence.
Equally, there must be a counterpart at destination, and both parties must be electronically
associated with the smart container by a unique identifier in order to complete the system. This
can be done with an activation key that is loaded at origin with the bill of lading and booking
information.Other data (such as the identity of the supervising and arming agent atorigin) then
allow the fi nal agent todeactivate the system at destination.
The secure electronic key is used to transport and insert the data from the company’s logistics
system into the device affixed to the container. When the key is used to activate the system at
origin, the data contained in the container device’s memory can be read at almost any time
during the voyage through satellite communication.

The activation also allows a smart container to notify appropriate parties of an unauthorized
breach or to report the condition of the container. Depending on the sensors used, it could also
report the condition of the cargo and even provide off course alerts on its own hijacking all the
way from origin to destination.
B. INTELLIGENT SEAL (SMART SEAL, E-SEAL)
After the September 11, 2001 events, both the governments and industries have illustrated the
importance of transportation security as well as cargo security.
Today more than 85% of cargo entering the United States is coming in the standard ocean
containers. It is now essential to ensure these containers are well monitored and inspected
along the way as they arrive in the U.S. ports so no mass destruction materials are smuggling
into this country. Determining how the technologies perform in the realworld operational
environments and evaluate the various tradeoffs that exist with eseal design and the potential
impact of those tradeoffs on functionality, reliability, utility, and cost.
The other name is ESeal (electronic seal) or RFID seal(Radio Frequency Identification). The
passive RFID Eseal uses only once. It can substitute for tradition seals that often applies on
gas, oil, truck and container. It can prevent the goods to steal by thief because it can build the
security system. It can provide you automatic identification and tracking for your cargo and it will
help you to manage and track the trucks or containers.
Many Customs will use it to implement certification system of authorized economic operator
(AEO) and use Eseal to enhance the efficiency of Customs clearance.
The Eseal is the mechanical bolt seal with RFID technology. It must submit the ISO
17712:2010 standard and has the main characteristics for bolt seal.
The Eseal has 2 types that is passive or active. The passive Eseal works without battery and
its reading range about 10 meter. The active Eseal works with battery and it has the long
reading range. The passive Eseal use only once, but active Eseal can reuse many times.
How to Choose
The Eseal has worked on the market for more than ten years. It can not widespread use on the
container that the price is too high. The high price will add the cost for shipper and logistics so
the Eseal price is very important. Many Eseals have some bugs that is very esay to break. If
you want to use the Eseal, you must chose the low cost and passed ISO 17712:2010 High
Security Testing.
Automatic Gate
The RFID fixed readers build the automatic gate on the road that don't need the inspectors to
check. The automatic gates work 24H everyday. Whole ports have built the RFID automatic
gate in Taiwan. It is the Automatic Clearance System.
Benefits
 The tradition seal just has some words and numbers on the seal. It can be copied and
doesn't have any secure structure. It is very easy to tamper and you can't find out that
the tradition seal was tampered by thief.
 The Eseal has the Unique TID code that can identify the UID code even if the Eseals
are the same. The thief can copy many tradition seals, but they can't copy RFID Eseal.
 Provides logistic supply chain visibility, strengthens Quality Assurance and facilitates
green lane access.
 Provides early identification of tampering – the intact status of the container may be
checked at multiple locations throughout the supply chain.
 Globally compliant device so it can be used anywhere.

 Meets industry standards for mechanical seals, passive RFID devices and Homeland
Security initiatives.
 Perfect for customs underbond movements and empty container quarantine validation.
 Maintenance free, reliable read range over a wide read angle.
 Applications include intermodal containers, trucks, railroad cars, hatches and hazmat
containers.
However, the complexity and relatively high price of these (and other) „eseal‟ alternatives are
continuing to act as deterrents to their more widespread uptake, especially when compared with
the cheaper USD1.0 or less paid today for a passive (nonelectronic) bolt or cable seal.
According to consultant ABI Research, the cost of RFID devices is expected to decrease rapidly
in the next few years. This is largely due to the increase in RFID system suppliers with the
advent of ISO 18185. Many active RFID solutions include tags costing USD50100. But single
use eseals, designed to be the cheapest active RFID devices available, today cost about
USD20. According to vendors and users, the target suggested retail price is approximately
USD10 in volume.
4. “E” TRENDS (ELECTRONIC)
A. “E-PORT”
With the target to enhance the service quality and create the most convenienceto the Shipping
Lines, Shipping agents in updating the information about the vessels, containers and the
discharging/loading process of the vessels, loading lists, discharging lists, manifest anytime and
any places where the internet is available, the Eport has the following functions:
 To provide the vessel schedule at the terminal
 To provide the information about loading list, discharging list through a summary table.
The detailed list is also available.
 The interface/theme shall be developed so as to provide the updated information about
the loading lists and discharging lists and manifests
 To provide the summary about the container operation, number of longstaying container
 To provide information about the Delivery Orders(empty and laden)...,
 To simplify the ducuments and formalities
The major benefits of using ePort can be summarized as follows:
 Increasing transactions speed
 Increasing accuracy
 Minimizing manual data entry
 Lowering communications costs
 Enabling information to be shared between a wide range of parties in realtime.
The Port Authority of Thailand (PAT) is to use innovation and radio frequency identification
(RFID) technology to provide ePort services, in order to increase its efficiency and to support
logistics service providers. The ePort status would enable easier communication between
logistics service providers and the port authority, along with realtime transfers of electronic
documents (edocuments) and eforms between service providers and the authority. This will
help to reduce the business processes involved in importing and exporting and enable
estimated times of arrival at the port of service providers' vehicles.
The ePort will have 4 main informationtechnology functions: eGate, a ContainerTerminal
Management System (CTMS), Enterprise Resource Planning (ERP) and a VesselCargo
Management System (VCMS). The system aims to increase the port authority's capacity to
exchange information with logistics service providers before containers or products arrive at the
port. Using RFID technology, an electronic labeling system that increases the efficiency of
government services and the movement of cargo and goods, both drivers and trucks belonging
to logistics service providers will be instantly recognised at port gates. By registering a cargo

delivery or pickup via the Internet beforehand, the eGate system will read RFID tags and
microchips and automatically allow recognised vehicles and drivers into the port area. It will also
recheck the authority of the driver and his vehicle with CTMS, VCMS and eCustoms,
substantially reducing time taken in identifying vehicles and drivers. The system will identify the
driver and vehicle via closedcircuit television and identify the cargo container via Optical
Character Recognition (OCR).
OCR technology is that picture captured by camera will be input to computer, the character on
the picture gets recognized by computer arithmetic. OCR needs plenteous light to capture
picture for camera, so it is hard to realize autoidentification in fog, dark day and night.
The eGate system will receive authority for movement of the container from the CTMS by using
paperless customs. All details, including the container information, vehicle registration and time
the vehicle entered the port will be recorded. The system also has an automatic identification
system to manage marine traffic.
There are 3 factors that will drive the capabilities of the ePort system:
(i) developments in technology,
(ii) improvements in people and
(iii) business processes. These will enable logistics service providers to save time by
receiving more convenient services from the port authority, thereby reducing logistics
costs, and finally improvements in the management of inventory, operational costs
and supply chains for import and export products.
B. “E-CUSTOMS”
(E-CLEARANCE)
Customs Automation System
Prior to the introduction of an automated system, traderelated documents were manually
processed by Customs officers. Given the constraints faced by Thai Customs because of the
increasing volume of international trade and limited number of officers, Customs implemented
Electronic Data Interchange (EDI) to control all Customs commercial operations by introducing
computer clearance system for exports in 1998. The system has been expanded to cover
imports and fully implemented at seaports and airports nationwide in 2000.
Key Application Areas
Thai Customs uses ICT to support its administration and business needs in 2 major areas:
service delivery to importers and exporters; and office automation.
The automation of Customs service delivery to importers/exporters and related operators
includes the following main application areas: goods declaration processing; cargo clearance
processing; revenue collection; tax and duty drawback; collection of trade statistics; and risk
management profiles.
An office automation system, on the other hand, is designed to increase the productivity of
Customs administration by supporting the coordinating and communicating activities of Customs
offices. The main application areas of office automation system include the Legislation System,
the Finance System (GFMIS) and the Human Resources System.
e-Customs
In recent years, Customs shifted its focus from EDI to an open system philosophy that would
enable it to electronically exchange information by different means with all of its clients
(commercial and noncommercial), partners (other government departments/agencies, both
national and international) and employees. This project required the redesign of all existing
client server applications to shift the existing service delivery to a Web based application.
To build on earlier success, Thai Customs implemented a new generation of Customs computer
automation system known as “eCustoms”. eCustoms utilizes Internet services, and is

consistent with the standards and guidelines. The principal Customs process and procedures
redesigned as part of the eCustoms system included various main application areas, like cargo
control, goods declaration processing, and revenue accounting. Furthermore, the new Customs
computer automation system was also integrated with the systems of other government
agencies and clients, including transport operators, banks, free zone and warehouse operators.
The new system is able to handle various types of Customs services and clients, provide high
security, high availability and quick response times. Apart from integration at the national level,
there is also a project under the framework of ASEAN Strategic Plan for Customs Development
(SPCD) to integrate automation systems among ASEAN members. Ultimately, a “Single
Window” system will make the regulatory process seamless for both import and export both at
the national and regional levels.
The “eCustoms” was implemented on 1 January 2007, comprising of eImport, eExport, e
Manifest, ePayment, and eWarehouse. It provides clients such as exporters, importers,
Customs brokers and shipping companies with a paperless environment and a one stop service.
Clients no longer submit hard copies of the Customs declaration as well as the air waybill, bill of
lading, invoice, packing list and other supporting documents with some exceptional cases such
as licenses with other government agencies. Under the EDI scheme, several steps such as
verification of classification and valuation were processed by Customs officers; however e
Customs eliminates any intervention of Customs officers, that is, all the procedures from
submission of Customs declaration to decision of screening under selectivity are processed
automatically.
C. “E-DOCUMENT”
(E-BOOKING, E-B/L, E-MANIFEST, E-TRACKING, E-D/O, E-RATE)
Introduction e-B/L service
For many years, the industry has sought a solution to the difficulties, costs and inefficiencies
associated with paper bills of lading.
An electronic bill of lading (eB/L) must clearly replicate the core functions of a paper bill of
lading, namely its functions as a receipt, as evidence of or containing the contract of carriage
and, if negotiable, as a document of title. However, a paper B/L is much more than this: it is a
document which, through usage and as a matter of custom, is versatile enough to allow traders
to buy and sell cargoes internationally and often while in transit (this versatility includes the
ability to change the B/L, for example, by changing the destination of the cargo or the volume to
be discharged to a particular receiver).
To be a true functional equivalent, therefore, an electronic bill of lading (eB/L) needs to
replicate the existing attributes of a paper B/L in an electronic world, while ensuring that the
electronic bill of lading (eB/L) is transferred at a faster rate than the cargo to which it relates,
thereby eliminating or significantly reducing the current reliance on delivery LOIs.
 Current paper bills of lading run the risk of forgery, alteration and loss, and it is quite
costly to create, archive, manage and distribute them.
 Electronic processing of trade procedures actively responds to the new trade
environment sought by international organizations and countries around the world so
that a new, more efficient trade environment can be fully accommodated.
 Electronic processing prevents forgery, alteration and loss of bills of lading, and reduces
the cost of creating, managing, archiving and distributing them.
 While shipping request has been partially processed electronically, the Bill of Lading has
yet to be electronized, hampering the promotion of eTrade. The eB/L service is a
system to receive a B/L electronically from a carrier, register the title od users.
Main Functions
 Shipping Instruction

The shipping instruction service is a shipping request from the exporter to the
carrier/forwarder that contains a commercial invoice, a packing list and information on
the export permit and the container.
 B/L Inquiry
This service is classified into eB/L inquiry and check B/L inquiry. The eB/L inquiry
service provides a variety of functions such as detailed inquiry into title registration
status, and printing of an original and a copy.
 Request for eB/L Correction
The service is designed to revise or correct the eB/L received from a carrier.
 Request for eB/L Transfer
The service enables a trading company to request for the transfer of its B/L to another.
 Acceptance of eB/L Transfer
The acceptance of eB/L transfer service allows a trading company to accept or refuse
the transfer of an eB/L from another.
 Inquiry into eB/L Title Registry
It provides a service to check on any changes (including registration and transfer) to the
title of an eB/L stored in Title Registry.
 S/R Receipt and B/L Issuance
The service provides functions to issue an eB/L based on the from the shipper. It also
provides functions to download the shipping request from the shipper.
 B/L Issuance History
This service allows users to search for the list of eB/L issued by carriers.
Expected Benefits
 Save time and cost for trading companies and reduce workload by simplifying B/L
process.
 Reduction in the negotiation period through the electronic B/L issuance and circulation.
Earlier capitalization of export payment through the electronic.
 Automated digital issuance of B/L will reduce burdens and costs of keeping originals and
paper documents.
 The service will cut back costs of system configuration and maintenance that companies
face when creating their own systems.
 Using an eB/L can prevent the risks of forgery, alteration and loss of a B/L, reduce the
cost of issuance, archiving and distributing, and resolve legal problems due to a delay of
sending a B/L
 As paper documents are no longer needed, paperwork is reduced, and flexible links with
information processing systems such as an SCM (Supply Chain Management) or ERP
(Enterprise Resoures Plan) are expected. Ultimately trading practices will be fully
digitalized resulting in dramatic increases in work efficiency.
 No need to endure the inconvenience and danger of having to get the goods delivered
by means of documents other than B/L
 Reduced cost of keeping goods that arrived prior to acquisition of the B/L and the cost of
insurance against risks
 It is possible to immediately request the delivery of the B/L regardless of time and place
in case of resale.
 If the carrier presents the B/L, there is no need to deliver goods based on a Letter of
Guarantee, accordingly the risk of fraud or deceit can be avoided due to forgery and/or
alteration

Conversion of an e-B/L to a paper (hardcopy) B/L
 The owner of the eB/L can convert the electronic version to a paper B/L by applying for
conversion to a paper B/L.
 Once converted to a paper B/L, the eB/L will no longer be effective and electronic
handling of business transactions related to the B/L cannot be processed with the eB/L.
 Once converted to a paper B/L it must be noted that the B/L cannot be reconverted to an
eB/L.
Canceling the conversion to a paper B/L
 When there is no longer a reason to convert an eB/L to a paper B/L, you can request
the cancellation of the conversion.
 KTNET will consult the cancellation request, and if cancellation is possible, the
conversion will be cancelled and the results will be notified.
 In this case, the restrictions on the eB/L ownership change will be cancelled and tasks
including transfer and purchase request attachment will be possible.
e-Signature verification
The esignature of the carrier will be verified to ensure the security of the eB/L, nonrepudiation,
and eB/L details.
ESS is user, government and technology neutral; meaning that it is not owned or controlled by
any stakeholder or government nor imposes any technological standards on customers. The
company was conceived in 2003, incorporated in 2005, is headquartered in Valetta, Malta and
is a privately owned corporation.
ESS’s electronic bill of lading solution is the global, industrystandard: used in 48 countries by
close to 1,000 customers in all market trades, i.e., tankers, bulker, barges and liner
A CargoDocs eB/L is the legal and functional equivalent of a paper bill of lading. Our secure
eDocs exchange can be accessed either by webbrowser on any computer or internetenabled
device, via business to business message (B2B) or for vessels with no internet via secure email.
CargoDocs electronic bills of lading are based on data, and as such users can interface with
CargoDocs to pull data directly into their shipping, operations, finance and/or ERP systems
Insurance
ESS holds insurance cover of $20 million per electronic bill of lading for eRisks, defined as any
loss resulting from an eCrime or eFailure.
5. “LOW COST” TRENDS
The industry with over capacity and lower price elasticity of demand is highly competitive with
freight rates fluctuating wildly even in the course of a single week. A pessimistic concept in
explaining the structure of liner shipping markets is that of destructive competition. This process,
whereby competition will eventually lead to the destruction of the liner service itself, provides the
basis for some new perspectives on the market structure of liner shipping.
To keep preadvertised time schedules, ships of 1 fleet must leave ports of call regardless of
whether they are full or not. Voyage costs thus become fixed (i.e. independent from the amount
of cargo loaded). Next, imagine the admittedly simplified case where, minutes before the ship
sets sail, an unexpected customer arrives at the port with one container to the ship. If the vessel
has unfilled capacity, which is often the case in liner shipping, its operator would be tempted to
take on the extra container even at a price as low as merely the extra (marginal) cargohandling
costs involved in taking the container onboard. If this were to become common practice among
operators, competition among them would push prices down to the level of shortrun marginal
costs and consequently the liner service would not be sustainable in the longrun, as operators

would not be able to cover full costs (most importantly capital costs such as depreciation
allowances for the eventual replacement of the ships).
At the start of 2012, container lines made a united push for profitability, announcing general rate
increases that have amounted to more than US$1,000 per TEU on AsiaEurope, after rates
dove to unprofitable levels at the end of 2011.
When shipping provides low transport cost services to the receivers, it is profitable. Cargoes will
always be available for shipment at a price. New, more cost and energy efficient ships will
always be preferred. The market is presently overtonaged. This will change and eventually
rebalance, fluctuating around a reasonably profitable level.
World scrapping capacity in 2012 reached 59 million tons (Gross Registered TonnageGRT) for
all ships. Scrapping capacity changes with demand. To balance supply with demand a lot of
tonnage will need to be scrapped. The freight market will most probably not recover until end
2014. Shipping profitability will always recover after adjusting for supply/demand imbalances.
But the arrival of additional capacity threatens to unhinge the hitherto successful rate increases.
At least 29 more new ultra large box ships have yet to hit the water, joining 26 others already
delivered in 2012. Against that backdrop of new tonnage, some carriers are reactivating idled
ships and deploying them on AsiaEurope to cope with the busy summer load.
The container shipping industry, in its 5th
year of crisis, is suffering from slow global trade, an
overcapacity of vessels and low freight rates. As new large container ships enter the market, the
imbalance will probably continue with the fleet growing 7.5 percent in 2013 compared to
demand growth of 4.5 percent.
When carriers select a ship, they are found first to choose whether to invest a new or second
hand ship and then to choose the size of the ship. This research found that new ships are
preferred to secondhand ones. However,when the shipbuilding lag is long, or the demand
growth rate is high, this preference decreases. Larger new ships are preferred to smaller ones.
For secondhand vessels, handysize is the most preferred ship size.
This means that when larger new vessels increase the unit investment cost, it is easier for them
to find a substitute from secondhand vessels than the smaller ones. This is because most of
the large secondhand vessels are newer than the smaller ones. In the lower part, these
ratios exhibit an opposite trend: It increases with the ship size.
This is because the purposes of ship investment are different for new ships and secondhand
ones:
 Investing in new ships is frequently the result of a longterm plan for capacity
development, while purchasing a secondhand vessel is either to satisfy the immediate
needs, or to take advantage of low secondhand price when the market is slow.
 Second, new ships are generally preferred than secondhand ones. In addition, larger
new ships have higher preference than the smaller ones, reflecting the pursuance of
economies of scale in investing new ships. In contrast, in the secondhand market, the
most frequently chosen ship type is handysize, and the chosen probability decreases
with the increase of ship size. The least preferred secondhand vessels are the ships
that are smaller than the handysize.
 Third, ships that can bring larger profit (higher time charter rate and lower unit cost) are
preferred.
 Fourth, both long shipbuilding lag and high demand increasing rate will reduce the
preference for new ships.
 Finally, the substitution between new and secondhand ships with the same size
displays opposite patterns. It is easier to substitute largernew ships than the smaller
ones. On the other hand, it is much easier to find replacement for smaller secondhand
vessels.

In secondhand vessels, the most preferred vessel type is handysize, and the preference
decreases when the ship size increases. In addition, ships that can bring larger profit (higher
time charter rate and lower unit investment cost) are preferred.
Freight rates will fluctuate but generally drop, freight space use rate will drop. Since container
shipping industry is a fully competitive market, supply and demand relationship will directly
determine freight rates and freight space use rate of the container ships.
There are shipping alliances which help to establish world wide freight charges per 40 ft. and
20 ft. container. The cost varies according to the distance and volume of each port of entry.
NonAlliance shipping lines such as Zim Israel Navigation and Wan Hai are sometimes
cheaper but their delivery times are sometimes longer.
Freight charges have no relationship to the value of each shipment. Whatever the value of a
containers contents, the total freight cost is the same Therefore it usually works out cheaper
prorata, to pack more value into a container, this reduces the freight cost because there is
more volume and higher investment, which means less freight charge to be added per piece
when working out final cost per item shipped.
6. “SHORTCUT” TRENDS
A. ARCTIC SHIPPING ROUTE (NORTHERN SEA ROUTE-NSR)
Arctic Geography & Climate
Geographically, the Arctic spans the Arctic Ocean and covers land areas in parts of Canada,
Finland, Greenland, Iceland, Norway, Russia, Sweden and the United States (Alaska).
The majority of the Arctic is composed of the Arctic Ocean which was formed when the
Eurasian Plate moved toward the Pacific Plate thousands of years ago. Although this ocean
makes up the majority of the Arctic region, it is the world's smallest ocean. It reaches depths of
3,200 feet (969 m) and is connected to the Atlantic and the Pacific via several straits and
seasonal waterways such as the Northwest Passage (between the U.S. and Canada) and the
Northern Sea Route (between Norway and Russia).
In the winter, the Arctic region has 24 hours of darkness because the high latitudes such as the
Arctic are turned away from the sun at this time of year. By contrast in the summer, the region
receives 24 hours of sunlight because the Earth is tilted toward the sun. However because the
sun's rays are not direct, summers are also mild to cool in most parts of the Arctic.
Temperatures are also milder in the Arctic than in Antarctica because the presence of the Arctic
Ocean helps moderate them. Some of the lowest recorded temperatures in the Arctic were
recorded in Siberia around 58°F (50°C). The average Arctic temperature in the summer is
50°F (10°C) although in some places, temperatures can reach 86°F (30°C) for short periods.
Global warming, ice melting
Global warming has led to the rapid melting of Arctic sea ice. Where the thick ice pack stretched
off the Siberian coast in August only a few years ago, there is nothing but the gray and cold
Arctic Ocean today. The ice cap off Siberia now almost completely disappears in the summer
months. Although there are still isolated floes, the Arctic Ocean is navigable.
Problems related to global warming and climate change in the Arctic include loss of habitat
critical habitat for many species, rising sea levels for the world if sea ice and glaciers melt and a
release of methane stored in permafrost, which could exacerbate climate change.
Ships have traveled in Arctic waters for several centuries. The lure of a shorter sea route
between Northern Europe and Asia sent many expeditions into this inhospitable area. The path
that would become known as the Northern Sea Route was known to be passable, without land
obstructions, as early as 1,000 years ago.
Most of these expeditions made the journey over multiple seasons since this route is only free of
fast ice for about two months per year. Fast ice is ice that is attached to something so it isn’t

floating around freely. It is fast, or fastened, to land. The floating ice including icebergs and large
free floating sheets of ice are called free ice.
Areas of fast ice that last all year have shrunk along the Northern Sea Route and the passage is
now considered clear for a few months per year. Much of the fast ice is converted to free ice
and most of the ships making this passage are accompanied by ice breaking ships. These
vessels also embark a welltrained ice pilot to actually steer the ship and communicate with the
crew of the ice breaker.
Benefit of using new NSR
 As a result of climate change, a maritime route of only 14,000 kilometers now separates
Hamburg and Shanghai (21,000 km via Suez canal). The route between Korea and the
Netherlands is shortened by almost 2 weeks with ships transiting the NSR in less than 1
week with ideal conditions.
 Savings in fuel costs and ship expenses, plus much less time at sea make the NSR very
attractive to ship owners. This PUSRTM route can translate into a saving of $250,000 to
$400,000 US per trip compared with the traditional route through the Suez Canal.
 The cost of several hundred thousand Euros per cargo ship is offset by substantial
savings. A voyage from Shanghai to Hamburg takes 35 days via Siberia up to 15 days
fewer than through the Suez Canal. Fuel savings alone, say the Russians, are enough to
offset the fees inurred on NSR route.
 Ships are not exposed to the risk of piracy in the north.
NSR Safety Precautions
Ice is the biggest problem and the use of ice breaking vessels and ice pilots eliminates a good
portion of the risk. Collisions with free ice are the most dangerous and detecting ice in real time
is still difficult.
Ships with ice strengthened hulls will be built specifically for this route which will eliminate the
necessity of ice breakers and the associated costs of an escort. Escort fees are not made public
by Russian shipping authorities but a good portion of the savings gained by the ship owner are
spent on these escorts.
An escort also provides a safe refuge for the crew of a transiting vessel. If the crew must
abandon ship they can disembark to the ice breaker. Air rescue is within range of long distance
helicopters but that means the vessel is completely abandoned. By staying on station sailors
may be able to reboard a stricken vessel after the situation has been remedied.
The NSR is remote and few of the existing Arctic ports have the rescue capacity equal to the
amount of traffic now passing through the Arctic. Radio beacons already are in place to
overcome navigational difficulties of the Polar Regions. These beacons are operated as a
network by the Arctic Seven Nations.
Along the NSR, which is a mostly coastal route through Russian Waters, the Russian
Government plans to build a series of search and rescue centers.
In a place where massive chunks of free floating ice are always on the move it’s best to monitor
the surroundings and steer clear of any ice. An icebreaker often escorts one or more merchant
vessels through the Northern Sea Passage which is operated by the Russian Federation.
Ice escort ships will refuse to enter some of the small bays and near shore locations where
wildlife and scenery is at its best, but the vessel would likely remain nearby and could assist in
an evacuation of a ship in an emergency.
Northern Sea Route Administration (NSRA)
Russian President Vladimir Putin has recently taken on euphoric tones when referring to the
"Northern Sea Route" as the Russians call their section of the Northeast Passage. With the help
of billions in infrastructure investments, Putin hopes to turn the route into the Suez of the north.

In his words, the seaway along the tundra has a golden future as an "international trade route."
But the only thing international about it will likely be the customers. The Russians insist that they
control the entire Northern Sea Route, even though parts of it pass through international waters.
In addition, each permit to travel the passage has thus far been preceded by a series of
bureaucratic hurdles. This is expected to change radically, now that a new agency opened for
business in Moscow in March. The Northern Sea Route Administration (NSRA, Russia) was
created to develop infrastructure and substantially increase traffic along the route.
Most of the ships currently using the Northern Sea Route are Russian, while others are sailing
under the flags of Panama, Liberia, Cyprus, Great Britain, China, Hong Kong, Antigua, France,
Norway and the Netherlands.
The NSRA had already issued permits to 431 ships to traverse the Northern Sea Route upto
2012. The agency doesn't even expect an "ice class" from many ships, meaning they are
allowed to enter the Arctic Ocean without a hull that is specially reinforced against ice.
The intercontinental highway through the polar sea has been open since July and will begin
closing again in late October.
Still, the eastern part of the sea route remains hazardous, even during the summer months.
Weather forecasts are unreliable, and ice and fog command the full attention of crews. The
NSRA generally requires ship captains to be accompanied by seasoned Arctic skippers while
traversing the eastern section. Furthermore, many ships still need an icebreaker escort in the
summer. Russia operates six 6 nuclearpowered icebreakers, and a seventh 7 ship is currently
being built.
Ships conquer NSR
Until then, cargo ships carrying ore, coal, fertilizer and grain, as well as supertankers carrying
crude oil and liquid natural gas, will travel back and forth between Europe and the Far East. For
the first time, Chinese container vessel freighters are now among the ships traveling through the
Northeast Passage. The Yong Sheng(14,000 gross register tons) is scheduled to arrive in
Rotterdam on Sept. 2011. Yong Sheng marked the rise in both tonnage and cargo value that
had been sought for 10 centuries. A container ship is transporting higher value loads than a ship
carrying bulk goods.
It's been only four 4 years since two German cargo ships used the polar shipping route for the
first time. The Beluga Fraternity and the Beluga Foresight put out to sea from the South Korean
port city of Ulsan in late July 2009 and reached Rotterdam in record time by traveling along the
Siberian coast.
In 2010, four 4 ships braved the Northeast Passage, and 46 followed suit last year. Still, the
voyage remains a massive undertaking for lack of a safe shipping channel. The trick is to
navigate a ship through sea mile after sea mile of ice fields and shallow straits.
Reederei Nord, a Hamburgbased shipping company, is sending its oil tanker, Two Million Ways
(40,000 Gross Register Tons), through the polar sea. The company chose not to comment on
the voyage.
The ships are taking the socalled Northern Sea Route, a shortcut between Asia and Europe
along Russia's Arctic Ocean coast. This marks the first time oilderived products have been
moved in such large volume through what maritime explorers of centuries past dubbed the
Northeast Passage.
These latest shipments on the Northern Sea Route consist of oil products headed east to Japan
from Norway and highquality diesel headed west to Europe from South Korea. The latter is
scheduled to set off this week in a 90,000ton tanker called the Propontis, shiptracking data
showed, while one of the shipments to Japan has already arrived.

NSR prospects
In recent years, it has become known that the Arctic region is extremely susceptible to climate
change and global warming. Most climate models show near to complete loss of sea ice in the
Arctic in September (the warmest time of year) by 2040.
And in the long term? It is clear that ice will continue to disappear in the Arctic. Experts believe
that the North Pole will be completely icefree in the summer months by as early as 2030, while
others say that this won't happen until 2050 or 2080. In that case, both the Northeast Passage
and the Northwest Passage, north of Alaska, which remains frozen today, will be open to
shipping. The seaway across the pole would then be the shortest route between continents. And
it would come with another advantage: No country could claim it exclusively for itself.
The Northern Sea Route has become viable as a commercial shipping lane only in the past few
years, as the season of thinning ice has grown longer. The speed at which it can develop is
limited, though, as it is still navigable only around 4 months a year (JulyOctober) although
climate change may keep lengthening that. Another limiting factor: The extreme cold requires
the use of special "Ice Class" ships, which are few in number.
Orders for Ice Class ships are pouring in. South Korea's advanced ship building industry, the
world's largest, has received a spate of orders for Ice Class LNG carriers to carry natural gas
from remote wells in Norway and Siberia to Asia.
Key Arctic trends and capabilities are new satellites, distress and safety services.
The progress in the new generation of Russia's Arctic icebreakers, design of multipurpose
icebreaking vessels, offshore support vessels and propulsion solutions for icegoing vessels.
Developing port infrastructure and hubs for logistics and shipping in the Arctic
Total cargo tonnage in 2012 was more than 1 million tons, while 25 years earlier it was less than
7 tons of bulk cargo making this trip.
A large portion of polar traffic is not headed for the Far East, but for Northwest Siberia. In the
short Arctic summer, dozens of dredgers, excavators and other special vehicles are arriving off
the coast of the Yamal Peninsula, where Russian gas producer Novatek is spending more than
€15 billion to build the Sabetta Arctic port and an ultramodern liquefied natural gas (LNG)
terminal. When cooled to minus 160 degrees Celsius (minus 256 degrees Fahrenheit), natural
gas is reduced to only one sixhundredth (1/6000) of its original volume.
The Northern Sea Route is shorter and quicker and easier to use.
B. THAI KRA CANAL ROUTE
Shortcut of India and Pacific ocean
The Kra Canal gets its name from the Isthmus of Kra, the narrowest part of the Malay
Peninsula. The Isthmus of Kra has beenknown as the most suitable site to cut a canal
connectingthe Gulf of Thailandand the Indian Ocean.
Kra, Isthmus of, narrowneck of the Malay Peninsula, 40 miles (60 km) wide, SW Thailand,
between the Bay of Bengal and the Gulf of Thailand.
The Kra Canal project will excavate a canal to connect the India Ocean and the Gulf of
Thailand. The canal will shorten the maritimeroute between the India and Pacific
Ocean. A vessel could save approximately 700 nautical miles (1,300km; 1nm = 1.852m) by
using this canal instead of passing through the Straits of Malacca.
Mega project-Kra canal
The Kra Canal would constitute a megaproject, a passageway that would connect the
Andaman Sea and the Gulf of Thailand at the Isthmus of Kra, Thailand.
The megaproject was tentatively approved by the Thai Senate in 2007, but physical work on
the canal never got underway. Nevertheless, the project was stalled due to various issues,
including preexisting environmental concerns and the inability of the government to focus on
such a large development project in the midst of continuous internal political struggles.

Now, once again, the Kra Canal project is back in the limelight. In the July 2011 elections, the
Pheu Thai Party emerged victorious, and Yingluck Shinawatra was elected Thailand’s new
prime minister. Her party has voiced its commitment to reviewing and reinstating various
development projects, including the Kra Canal, which aimed to develop and mend the country’s
Economy. Therefore, although the Kra Canal would increase trade traffic in the region, the huge
cost of the megaproject, which is estimated to cost at least 20 billion USD, would create a huge
amount of debt for Thailand.
Financing the construction
The cost, if peaceful nuclear explosions are used for blasting the last 25 miles of the mountain
ous region, would come to about $5 billion (25%). This is not a large sum of money, considering
that it would be spent over 8 years.
Last May 1985, a Japanese delegation led by Mr. Nakajima came to visit the proposed Kra
Canal site, along with representatives from Kajima, Sumitomo, Long Term Credit Bank, etc.
Upon returning, they informed the Japanese government that they have formed a consortium of
20 firms to look after the Kra Canal project. The firms include Nippon Steel, Mitsubishi Heavy
Industries, and Bank of Tokyo among others.
Ship sizes and traffic volume projections.
It is clear that tankers of at least 500,000 dwt must be accommodated, and handling of larger
tankers may be desirable. Maximum safe canal transit speeds with respect to the land of about
7 knots (13 km/h) for ships of this size. A 2lane canal is necessary. The assumption that one
lane, handling mainly west to east traffic, is sufficient is based on the untenable premise that for
a long time to come the export potential of the East and Southeast Asian nations will be small
relative to Western imports.
The canal should preferably be sealevel without locks, must accommodate drafts of at least
100 feet (fullyloaded supertankers), i.e., be at least 110 feet deep, and have a bottom width of
approximately 500 meters. The alternative to one rather wide 2lane canal would be 2 onelane
routes of about 200 meters width each.
Route selection.
Relative excavation costs and, in particular, the feasiblity of nuclear excavations methods were
prominently taken into account. These investigations were considerations concerning required
canal crossings for railroads, highways, and utilities.
The preferred route settled (route 5Asee map) would extend from about 30 km North of the city
of Satun to the Gulf of Thailand. The total canal length through land for this route is 102 km,
with sea approaches of 50 km in the West and 70 km in the East respectively. This is the
shortest possible route for a sealevel canal, minimizes excavation costs and provides for the
best possible sites on either end for harbor and industrial development. Construction time for
route 5A using conventional excavation methods is estimated to be 1012 years; partial nuclear
excavation would cut both construction time and cost by at least 40%.
2 successful principal factors of Kra
These define the overall importance and viability ofthe project. These are:
(i) The growing inadequacy of the Straits of Malacca, and
(ii) The industrial development potential based on construction of deep sea ports at 1 or
both of the canal outlets.
The Strait of Malacca is an important waterway in South East Asia. However, it is facing various
issues, such as traffic congestion, delays in shipments, maritime threats of piracy and
environmental pollution problems, creating an added cost and risk, due to the continuous growth

of traffic in the narrow channel between the countries of Malaysia, Indonesia and Singapore. For
example, some studies have shown that the 2way traffic using the Strait of Malacca in 2003
was recorded to be as high as 171 vessels per day.
The Straits of Malacca are used by well over 50,000 ships a year and further significant
increases in traffic are inevitable. Thus the Kra Canal could be expected to attract all excess
traffic from the Malacca Straits as well as traffic which assigns a premium to speed. This route,
makes possible the construction of a sealevel canal without locks through which even large (up
to 500,000 DWT) tankers could pass at normal speed (1015knots).
The integration of 1 (or possibly 2) deep sea ports and associated industrial development zones
with the Kra Canal proper can be expected to become the single greatest longterm economic
asset of the entire project. The construction of major deep sea port facilities and associated
industrial development zones at either end of the Kra Canal is both feasible and highly
desirable. However, phased port and industrial development, concentrating initially on the
Eastern canal outlet, appears to be the best strategy at this point.
Benefits for Thailand
Kra Canal would provide an alternate route to vessels plying the Europe–Middle East–North
Asia route by bypassing the Strait of Malacca, reducing the journey more than 1,000 kilometres
and saving shipping companies labour and fuel costs.
The Thai government would be able to generate revenue from activities related to the use of the
Kra Canal such as from navigation and toll fees, income tax and export tariffs, and shipyard
activities.
The Kra Canal would undoubtedly shift maritime traffic away from the Strait of Malacca (as well
as the Straits of Singapore) thus removing Malaysia’s and Singapore’s main source of economic
growth. The traffic and trade generated by the Strait of Malacca have played a major role in the
economic growth of both Malaysia and Singapore; more than 80 per cent of Malaysia’s trade
passes through the Strait, making use of major ports such as Port Klang and Port Tanjung
Pelepas.
In the commercial aspect, the Kra Canal enhances both the Thai commercial fleet and Thai
ports. The Thai commercial fleet will gain many advantages from passing through the Kra
Canal, such as a lower fee. Hence, sea liners that regularly pass through the Kra Canal could
get more benefits if they chose to register their ships as Thai ships.
When the number of sea liners registering as Thai ships increase, the Thai commercial fleet
grows. The Kra Canal will also make the Thai ports more attractive because vessels prefer to
use the ports located near their route. The more the vessels use Thai ports, the better off the
Thai economy.
The projected 10year construction period would require the employment of approximately
30,000 people. Employment would also increase due to the existence of support industries and
services around the area, such as the development of other ports that can support all types of
maritime traffic in the area.
On either side of the Kra Canal, ports would be developed, and the one on the east end of the
canal, the Songkhla Port, will be a deepsea port. It will serve an area of 1,500 miles radius,
developing in the process many transshipment points. How much benefit can it bring to
Thailand? In order to find an answer to that, you have to know about the Europort
of Rotterdam. It will surprise you that 65% of the Netherlands revenues comes from this one
port that Netherlands is a developed nation. So you see, there is no end to the opportunities that
would be opened up before Thailand as well as the region.
Benefits to South East Asia (SEA) region
The Kra Canal has the potential to turn Thailand into a shipping hub for Southeast Asia that can
also foster greater trade and cooperation among nations in the region.

If the Kra Canal is built, increased maritime traffic would boost business and trade in the region.
Another perceived benefit of the development of the Kra Canal is the projected spillover of trade
benefits to neighbouring countries, particularly Myanmar, Cambodia and Vietnam.
Myanmar and Vietnam would also benefit directly from development projects related to the Kra
Canal. Coastal cities in Myanmar and Thailand currently offer strategic water passages to the
Strait of Malacca; with the creation of the Kra Canal, these would double in importance.
As for Vietnam, the increased shipping entering and exiting the Kra Canal would pass by the
country’s Southern coast, thus creating a great incentive for Vietnam to develop its Southern
ports with the potential of rivalling Singapore. Due to its unique geographic location, Vietnam’s
economy depends heavily on its ports because 90 per cent of all of Vietnam’s goods in 2012 are
transported by sea.
Since most South East and East Asian ports with the exception of Hong Kong and Singapore
are, at present, illequipped to handle large cargo vessels and could only be enlarged at very
high cost, a port facility at Songkhla could rapidly develop into a major transshipment center for
the entire region, capturing a very substantial portion of transshipment now handled by Hong
Kong and Singapore.
PART 2: TRANSHIPMENT PORT
TRANSHIPMENT PORT AND ITS EFFICIENCE MAXIMIZATION IN HINTERLAND
CONNECTION SYSTEM.
Ports have been natural sites for transhipment in order to transfer goods from one mode of
transport to another. They have historically provided the link between maritime and inland
transport, and the interface between the sea, rivers, roads and railways.
To justify the transhipment of a container, the transhipment port needs to lie at the crossroads of
at least 2 trade routes. Alternatively, a transhipment port can handle feeder services for a trade
route which passes through the region.
1.REQUIREMENTS FOR A TRANSHIPMENT PORT
For a port to be selected as a transhipment port, it should have a strategic location in regard to
multiple trade routes and desired markets, charge market determined dues and tariffs; be
surrounded by a dynamic local economy which provides a balanced cargo baseload (except in
the case of offshore mega ports), offer modern infrastructures encompassing berths of 900
1,100 or more feet, at least 34 gantry cranes, 4050 acres per berth of container storage space
and ondock or contiguous railway connections; have 1415m of water depth; require minimal
transit time from sea to dock, be served by competitive ocean feeder and inland transport
services, and be known for harmonious labour relations and productive workers.
Many container ships of 4,000 TEUs have a laden draft of 12.8 metes. Port of Hamburg
(Germany) has decided to dredge the entrance to the port on the River Elbe to 15 meters.
The outreach of many gantry cranes is 17 rows of containers, which sets an informal limit on
postPanamax capacity. This informal limit has now been surpassed.
For example, COSCO has ordered cranes capable of covering 20 rows to be installed at the
Port of Long Beach. Port of Bremerhaven (Germany) has ordered 3 cranes capable of serving
ships with up to 18 rows of containers.
Considering future size increases, STS Gantry Crane required to accommodate 20row (10,000
TEU) or 22row (15,000TEU) container ships. The cost of purchasing multiple container cranes
with an extended outreach of 18 to 20 or even 22 containers, dredging entrance channels and
harbours, establishing efficient intermodal links, constructing extra docks to avoid vessel delays,
training a skilled workforce and offering other auxiliary services should limit the number of
contenders for transhipment port status.

Becoming a transhipment port
The most important attributes carriers look for are:
 The strategic location of the port relative to primary origins and final destinations of
container traffic
 The ability to safely accept large ships
 Extent of terminal facilities
 Efficiency of container handling operations
 Availability of frequent feeder services with an appropriate geographical coverage
 Attractive cargohandling charges.
 A transhipment port should have terminal facilities that enable quick ship turnarounds.
This includes
 Adequate numbers of cranes
 Sufficient container handling/storage areas
 First rate computer system to run the entire terminal.
Container cranes capable of spanning at least 18 rows and 6 tiers of containers on deck will be
required to handle the 8,000+ TEU ships now being built. There is already a demand from
carriers to install shiptoshore container cranes with a capability to handle 22 rows of
containers across.
Capability should be provided to berth 1 or more feederships front or rear of the mother ship
along the same quay requiring quay lengths of typically some 1,000 meters for a terminal
designed to receive 2 mainline vessels and their feeder vessels and container yard depth
behind the quay should be not less than 400500 meters.
The latter factor much depends on the container dwell time, the selected stacking and recovery
system, and the stacking rules among many others. Container handling productivity is of
obvious importance to a carrier in selecting the transhipment port. Carriers measure productivity
in terms of how long it takes to turn around the ship i.e., enter port, discharge containers, load
containers, leave port. Much of this is dependent on the availability of adequate facilities and
suitable systems and the absence of administrative
Basic Port Infrastructure:
 Maritime access channels
 Port entrance
 Protective works including breakwaters, shore protection
 Sea locks
 Access to the port for inland transport (roads, tunnels, etc.)
 Rail connection between the hinterland and the port
 Inland waterways within the port area.
Operational Port Infrastructure:
 Inner port channels, turning and port basins
 Revetments and slopes
 Roads, tunnels, bridges, locks in the port area
 Quaywalls, jetties and finger piers
 Aids to navigation, buoys and beacons
 Hydro/meteorological systems
 Specific mooring buoys
 Vessel traffic management system (VTMS)
 Patrol/fire fighting vessels
 Docks
 Port land (excluding superstructure and paving)
 Access roads to general road infrastructure

 Rail connection to general rail infrastructure, marshalling yards
 Drydocks for ship repair.
Port superstructure:
 Paving, surfacing
 Terminal lighting
 Parking areas
 Sheds, warehouses and stacking areas
 Tank farms and silos
 Offices
 Repair shops
 Other buildings required for terminal operations.
The following items are part of Port equipment:
 Tugs
 Line handling vessels
 Dredging equipment
 Ship/shore handling equipment
 Cargo handling equipment (apron and terminal)
Benefits of transhipment port
Global distribution of containers is increasingly accomplished via a network of regional and local
ports with onward service to outlying locations.
Utilizing a transhipment port, a carrier can:
(1) service marginal markets that do not justify direct call with large linehaul ships,
(2) interchange containers between liner strings at strategic crossing points and
(3) realize economies from improved port asset utilization.
All of these advantages ultimately result in greater profit to the ocean carrier.
The benefits are generated from operations of a transhipment port:
 The doublehandling of containers. Consequently, container throughput in transhipment
port can be greatly boosted particularly (TEUs).
 More importantly, transhipment ports provide local importers and exporters direct access
to linehaul service, reducing transportation time (and possibly freight rates) to and from
overseas markets.
 Reduced transport time directly impacts the competitiveness of exporters and the cost of
imports, in turn creating jobs and income throughout the economy.
 Many developing countries have created free trade zones in combination with the
transhipment port as engines for economic growth. Jebel Ali illustrates how a port port in
conjunction with an associated free trade zone can create significant economic activity.
Jebel Ali port began operating in 1979, now has 67 berths and is serviced by 100
shipping lines. About 1,450 companies from 85 countries have been attracted to start up
operations in the free tradezone.
2. PROBLEMS TRANSHIPMENT PORTS FACE
Ports compete in a highly competitive market segment where customers have options to use
other facilities and pricing. An issue confronting the developer of a transhipment port is how to
prevent “port hopping” in a situation where the number of competing port facilities is growing
rapidly and carriers have the ability to take their business elsewhere. The owner of the facility
would be faced with the dilemma of a $100200 million investment lying idle if the customer
departs.

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