LOG357 Port & Terminal Management

Study Unit 1
The Seaport Industry
Dr. YAP WEI YIM
 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Importance of seaport in global trade & transport

Source: Notteboom

• A seaport is a geographical area where ships are brought alongside land to load
and discharge cargo.

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 Importance of seaport in global trade & transport

Source: Notteboom
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 Importance of seaport in global trade & transport

Cumulative Cost and Time of Moving a

40 Foot Container between the American
East Coast and Western Europe

Source: APEC

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 Importance of seaport in global trade & transport

Cumulative Cost and Time of Moving a

40 Foot Container between the American
East Coast and Western Europe
20% savings in
total freight cost

50% savings

Source: APEC

Investment in facilities plays a key part in the competitive process!

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 Importance of seaport in global trade & transport
Busiest ports in the world

Source: Vox.
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 Importance of seaport in global trade & transport

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 Importance of seaport in global trade & transport

Same story for every 2008 (‘000 TEUs) 2019 (‘000 TEUs)
container port?

#6 Singapore 1982: 1.12 million TEUs

#7 Long Beach 1982: 0.90 million TEUs

#177 Shanghai 1982: 66,000 TEUs

Prepared by WY Yap for SUSS Source: various. Source: various.

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 Importance of seaport in global trade & transport

Source: Notteboom
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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal. Self study

– Discuss the planning considerations for a container terminal.

– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
Refer to
– Analyse the factors that determine seaport competitiveness. Activity 1
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Seaport competitiveness

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 Seaport competitiveness

Port Klang PTP Singapore

1996 1.4 0.0 98.6

1997 1.9 0.0 98.1

1998 3.4 0.0 96.6

1999 6.9 0.0 93.1

2000 8.6 2.4 88.9

Maersk
2001 11.4 11.9 76.7
CMA CGM
2002 13.0 HPH 13.5 73.5

2003 12.4 CSCL 15.3 Evergreen 72.3

2004 11.4 15.4 73.1

2005 11.3 15.4 73.2

Port Klang 2006 12.5 16.2 71.2

2007 12.8 16.4 70.8

MSC

Singapore 2008 13.7 15.2 71.1

PIL
2009 13.4 17.5 69.1
Inter-port competition MISC
2010 15.4 17.3 67.2

1. Entice major shipping lines to hub 2011 15.9 18.3 65.8

transhipment operations 2012 15.6 17.8 66.6
2. Target specific services to boost 2013 15.9 16.9 67.1
connectivity
2014 16.6 18.4 65.0
3. Local cargo in southern Malaysia
2015 19.0 20.0 61.0 CMA CGM

2016 21.3 17.7 60.9

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 Seaport competitiveness

Ministry of Transport Ministry of National

Maritime and
Building and
Port Authority Development
of Singapore Construction
Ministry of Land Transport Authority Authority
Finance Maritime National Parks Board
Monetary Authority of Singapore
Transport Services Container Port Agri-Food & Veterinary Authority
Inland Revenue Policy Development Urban Redevelopment Authority
Authority of Singapore Fiscal Policy Food Imports
Ministry of Singapore Land
Schools and institutes Tax Matters
Land Use Policy Ministry of
Education Authority
of higher learning Legal Framework Law
Skill
Development Energy Imports Energy Market Authority
Singapore Workforce
Ministry of Development Agency
Employment
Port Industrial JTCCorporation
Manpower Development
Economic Development Board
Singapore Labour
Policy
Cluster Intra-Port
Foundation Competition Commission
Defence and
Security
Policy Competition
of Singapore
Immigration &
Ministry of Trade Promotion and International Enterprise
Checkpoints Authority Singapore
International Investment
Home Affairs Police Coast Guard
Quality of
Port Waters Productivity and Standards, Productivity
Navy Service Quality and Innovation Board
Environmental
Policy R&D Policy Agency for Science,
Ministry of Public Utilities Board ICT
Industry Technology and Research
Defence National Involvement Maritime Policy
Heritage Infocomm
Environment Development
Ministry of Trade
Agency Authority and Industry
Ministry of the National
Singapore Maritime Foundation; Heritage
Environment and Singapore Shipping Association, Ministry of Information,
Board
Water Resources Association of Singapore Marine Communications and
Industries, Singapore Business
Federation, Temasek-linked
the Arts
companies, Industry players
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 Seaport competitiveness

Corruption, nepotism, egos,

favours, personalities,
relationships?
Influence of State Owned Enterprises
•COSCO/COSCO Pacific
•China Merchants Group •National maritime master plan
•China Shipping Ministry of •Coastline usage
•China National Petroleum Communications •Features of main ports and
Corporation layout
•China Petroleum & Chemical
Corporation •Involved in
Provincial
•China National Offshore Oil Maritime Safety formulation
Department of
Corporation Administration of port
Communications
•China Shipbuilding Industry layout plan
Corporation
•Baosteel Group Corporation •Port safety
•Wuhan Iron & Steel Group •Environmental protection
•China National Coal Group •Shipping channel City/municipal
•China Grain Reserves Corporation management Government
•China State Shipbuilding Corporation Investment
etc. Vehicle
•Port master plan
•Regulate port operations Port Bureau
Source: Zhou Wei Jiang
•Provide for infrastructure
Port Group

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 Seaport competitiveness

Source: Porter

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 Seaport competitiveness

Firm strategy,
structure and rivalry
Role of
government

Factor Demand
conditions conditions

Source: Yap Related and Chance

supporting
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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge.

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 Seaport competitiveness

• Perspective of shipping lines:

Transatlantic

 Port choice determined by Transpacific

Europe-Asia

 Central geographical location

 Efficient hinterland connections
 Cargo-generating potential
 Good maritime access
 Ability to offer competitive rates
 Berth allocation profile
 Strategic fit with shipping lines’ and shippers’ network strategies
 Bargaining power vis-à-vis ports or port groups
 Pattern and distribution of cargo flows over the port’s hinterland

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 Seaport competitiveness

• Perspective of shippers:
 Port choice determined by
 Distance
 Port charges
 Transport cost
 Cargo volume
 Level of connectivity
 Commodities involved
 Level of port efficiency
 Adequacy of infrastructure
 Turnaround time on cargo
 Inland transit time Source: North American
Inland Ports Network
 Schedule reliability
 Frequency of ship visits and viable alternative routings
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 Seaport competitiveness

• Perspective from the supply chain:

 Shippers and supply chain integrators no longer choose a port per se but focus
on the bundle of logistics services offered by the entire supply chain.
 Seaports must constantly adopt new roles to capture opportunities arising from
changing market conditions to remain competitive.
 Need to position themselves as elements embedded within supply chains and
logistic networks which are continuously being restructured.

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 Seaport competitiveness

• Perspective of terminal operators:

 Seaports must cater to the strategic, commercial and operational aspirations of

various terminal operators, given their different emphasis and focus.

 Core business of pure stevedores is in terminal operations and their strategy is to

seek the best investment opportunities in terms of terminal productivity and
profitability (terminals are run as ‘profit centres).

 Integrated global carriers manage container terminals as ‘cost centres’ to integrate

the terminal with the wider service network (some integrated carriers are
developing terminal operations as business units in their own right).

 Future can see increasing number of global alliances between liners and
stevedores as a key strategy in providing long-term contractual relationships to
ensure steady cargo volumes for the stevedoring companies and stable
stevedoring costs and homogenous quality of service for carriers.
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 Seaport competitiveness

• Perspective of terminal operators:

ECT Delta
HPH

Delta
APM Terminals

Euromax
HPH
Cosco Pacific
K Line
Hanjin
Yangming

World Gateway
DP World
MOL
HMM
APL
CMA-CGM

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 Objectives

• At the end of this study unit, you are expected to:

– Show the importance of the seaport in global trade and transport.

– Demonstrate efficient methods for handling bulk (liquid/dry) or
containerised cargo at the terminal.
– Discuss the planning considerations for a container terminal.
– Analyse the factors that determine seaport competitiveness.
– Examine seaport competitiveness from the perspectives of various
stakeholders.
– Discuss the challenges faced by container ports in sustaining their
competitive edge. Self study

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 Activity 1.1

• Discuss what needs to be taken into account in the planning of Tuas Mega Port?
• Do these concerns apply to the planning of Pasir Panjang Terminal?

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 Activity 1.2

• Singapore,
Rotterdam, Busan and
Hong Kong were
identified as leading
ports in their
respective
geographical regions.
• Can you determine
the cargo composition
of these ports?
• What do you think
drives cargo volumes
handled in these
ports? •Container (e.g. manufactured goods): yellow
•Dry bulk (e.g. coal, aggregates): blue
•Tanker (e.g. oil, chemicals): red
•Gas bulk (e.g. liquefied natural gas): green
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 Activity 1.3

• Discuss the competitive advantages possessed and challenges faced by the port
of Singapore in sustaining its competitive edge. In addition, what other competitive
advantages do you think would be required in the post COVID-19 environment?

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 Activity 1.4 – Reflect on this

• PSA International, HPH and APM Terminals are renown global terminal
operators. Can you suggest how these entities contribute to the competitive
advantage of the ports of Singapore, Port Klang and Tanjung Pelepas?

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Thank you for your attention.
Contact details:
wyyap@suss.edu.sg
+65 9642 1971