Russian shipping market changing to meet new challenges

Associations, Container shipping, Containers, Dry Bulkcarriers, Logistics, Markets, Ports & Terminals — By on June 30, 2014 at 9:52 AM
A recent arrival at Novorossiysk.  Part of the China Shipping Line new deep-sea service from the Far East to Russia

A recent arrival at Novorossiysk. Part of the China Shipping Line new deep-sea service from the Far East to Russia

Russian shipping market changing to meet new challenges,  says DELO Group

Over the past three years, DELO Group, one of Russia’s leading private transport companies, has implemented a major investment programme, including investment in rail and other adjacent port infrastructure, construction of stevedoring and inland storage terminals for oil products, construction of the KSK grain terminal, acquisition of 50% of the NUTEP container terminal from its JV partner and subsequent expansion programme turning the terminal into one of the leading container terminals on the Russian Black Sea coast and in Russia as a whole.

“We are planning to double capacity at NUTEP from 350, 000 to 600 – 700, 000 TEU, ” said Andrei Bubnov, CFO of DELO Group. “This is a breakthrough project for us. It will allow us to handle mother ocean container vessels, which could reshape the entire Black Sea market by allowing direct calls to Novorossiysk bypassing the traditional transhipment hubs.”

One of the advantages for ships calling at Novorossiysk is the low bunker prices – currently almost $200 per tonne cheaper than at nearby Istanbul.

“We also expect more consolidation in the market and DELO will continue to invest in strategic assets and launch more innovative services to support continued growth.”

Speaking about the impact of the recently denounced P3 alliance or the outlook for any prospective alliance, the very fact that it was proposed has already changed the liner shipping market – in Russia at least, according to Mr Bubnov.

“It prompted the smaller shipping lines serving Russia to consider new niche strategies in order to compete, ” he told delegates to the TOC Conference session on Ports and Liner Shipping in the Russian and Baltic markets.

The P3 Network shipping alliance would have positioned the three partners (Maersk, MSC and CMA-CGM) to control as much as 50% of all Russia-bound container traffic.

One new strategy which is bringing many opportunities for DELO Group is that many of the carriers are expanding into in-land operations to be able to offer value added services along the logistics chain.

“Through our intermodal logistics operator, Global Container Services (GCS), we have an extensive network of road, rail, customs, logistics and warehousing facilities and services, so the carriers are happy to work together with diversified service providers such as GCS, ” said Mr Bubnov. “Having a strong local partner continues to be a competitive advantage for international players.”

The carriers are also looking at increasing both the number of vessels and the range of alternative port calls that they can offer to customers, so facilities are being upgraded and extended in many areas of Russia.

Mr Bubnov emphasised that rapidly changing conditions in Russia means companies have to be flexible in order to meet customer needs – and take advantage of business opportunities. For instance, a lot of commodities, including chemicals, agribulks and minerals, continue to be shipped in bulk, so there is a lot of potential for containerisation.

DELO

DELO Group, a privately-owned company launched in 1993, employs 2, 000 people and offers a full range of services including liner agency, cargo handling and vessel bunkering in the port of Novorossiysk; road, rail and multimodal container services, freight forwarding, customs clearance and other services.

DELO Group is the parent holding of GCS, specialising in investments in logistics, terminal and transportation segments. The holding company through its stevedoring segment DELOPORTS owns a number of port terminals in the South of Russia. The holding also owns over 1600-strong fleet of container and tank-wagons, as well as several intermodal, trucking, logistics and agency companies in the main gateways of Russia and FSU.

GCS

Global Container Service (GCS) has worked successfully in the Russian container market since 1995. Beginning as a liner agency, today it is among the top ten container transport companies in Russia and the CIS. GCS belongs to one of Russia’s largest transport holding companies, Delo, which also owns several terminal assets in the port of Novorossiysk.

The GCS Group consists of seven companies in various fields of container shipping including agency, logistics and terminal operations. It is active in all of the major container ports and provinces of Russia, as well as in neighbouring CIS countries and overseas.

The group has ambitious plans to continue to expand its existing companies and to add new ones in order to meet the growing demand for professional transport services in Russia, the CIS and further afield.

GCS has announced a strategic target of doubling its container throughput and tripling revenue over the next five years. This will be achieved through consolidation of its vertically-integrated systems to enable seamless delivery of containers to any destination in Russia and worldwide. GCS relies on its 1, 200+ staff and close partnerships with leading Russian and international transport companies to help it meets its targets.

Tags: , , , , ,

Leave a Reply

IMPORTANT! To be able to proceed, you need to solve the following simple math (so we know that you are a human) :-)

What is 10 + 14 ?
Please leave these two fields as-is:

Trackbacks

Leave a Trackback