uk containerfreight

The container freightend-to-end journeyAn analysis of the end-to-end journey of containerised freight through UK international gateways

December 2008

This document extends to Wales and Scotland in so far as it covers our UK policy responsibilities for regulation of shipping, and some aspects of road traffic regulation, such as vehicle licensing.

With certain exceptions, such as safety, rail policy is a devolved matter for Scotland, so the geographical scope of the document is primarily limited to England and Wales, recognising the powers of the Welsh Assembly Government in relation to Welsh and cross-border services.

It does not cover ports in Wales or Scotland, transport funding programmes administered by the devolved administrations, or transport services which operate solely within Wales or Scotland.

Its proposals do not extend to Northern Ireland.

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Contents

1. Preface 2

2. Overview of the UK international freight market 4

3. The container freight end-to-end journey 8

4. Overview of the international container freight market 10

5. Getting to and from the port 20

6. Getting through the port 29

7. Onward distribution within the UK 38

8. Improvements to the container end-to-end journey 69

9. The container freight end-to-end journey: emerging issues 73

Annex A – Goals and associated challenges identified for international networks 76

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1. Preface

International trade gives UK consumers the option to purchase a wide variety of goods at competitive prices. For UK firms, international trade gives access to intermediate inputs such as raw materials and parts and to a global market in which to sell their products.

The UK’s status as the leading global economy in the second half of the nineteenth century was enabled by its strength as a maritime trading power. Globalisation means that today the worldwide economy is more interconnected than ever with shipping still key to that connectivity.

Although the global economy is experiencing a downturn in 2008, in the longer term continuing trends towards greater globalisation are expected to encourage businesses to operate on an ever wider-reaching scale. The UK needs to adjust to the rapidly changing global environment and to build on its competitive advantages. These trends will present opportunities both for the UK as a whole and for individuals and businesses, but will also present challenges such as dealing with climate change and increased competition.

A growing share of economic activity is globally mobile, meaning that it could be carried out in a number of locations – this has led to competition for investment between countries on the basis of cost and efficiency. An increasing trend that has been enabled by the expansion of global trade and freight traffic is for production processes to be distributed across a number of locations. The process of supply chains ‘unbundling’ offers opportunities to skilled labour in the UK which specialises in high-end skill-intensive manufacturing.

For the UK, globalisation, increasing world trade and supply chain links across countries

are likely to reinforce the trends of growth in services, a smaller domestic manufacturing sector and increasing importation of goods. The UK is likely to specialise further in knowledge-intensive services and high-tech manufacturing. Sustainable, reliable, efficient and resilient international end-to-end journeys are critical to supporting the competitiveness and productivity of the UK and attracting inward investment into the UK. Improving the movement of freight across its end-to-end journey and understanding where pinch points exist is essential to maintaining and improving the UK’s competitive position.

The Department for Transport’s discussion document “Towards a Sustainable Transport System” (October 2007) pointed towards adopting a network oriented approach to transport policy development. A key step to achieving this is to understand journeys of both freight and passengers from an end-to-end perspective.

Working with key industry stakeholders, the Department is developing a suite of documents that analyse the end-to-end, multi-modal journey of passengers and freight through the UK’s key international gateways – airports, ports and the Channel Tunnel.1

This publication focuses on the movement of containerised cargo through key UK international gateways.

The document lays out some of the quantitative and qualitative data collated by DfT and our strategic partners to give a picture of what the end-to-end supply chain journey looks like. The data provides a series of snapshots through the journey, rather than a continuous assessment of an individual container’s movement.

1 Available at: http://www.dft.gov.uk/about/strategy/transportstrategy/tasts/userexperience/

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It also sets out the current and future improvements that the Department and industry partners are promoting, which will help improve these journeys.

End-to-end case studies2 were also published by the Department in July 2008 in the ‘The logistics perspective: End-to-end journey case studies’. These are available for download on the DfT website.

The UK ports industry is one of the most competitive in the world. Multiple organisations with differing responsibilities are involved with the delivery and regulation of the ports end-to-end journey. The extent to which the DfT can influence different stages of that journey varies considerably.

This series of documents comprise the first step in better understanding the end-to-end journey and user experience. Moving forward, the Department will continue to refine this approach in order to develop a more systematic evaluation of end-to-end journeys to support policy development.

‘Towards a Sustainable Transport System’ defined transport goals, explained the actions already being taken or planned to advance them, and set out the approach we intend to take for planning the additional measures needed in 2014–19 and beyond. In November 2008, we published two documents; Delivering a Sustainable Transport System3 which sets out our latest strategic thinking, and a Consultation on planning for 2014 and beyond which consults on the next steps in developing and implementing our long-term strategic plans for transport.

For International Networks, the key goals and challenges identified in the consultation document are outlined in annex A. The analysis in this document will be used to inform the generation of options to meet the challenges facing our international networks.

The Department would like to extend special thanks to its strategic partners for their cooperation and willingness to share data and information used in this publication.

2 Available at: http://www.dft.gov.uk/about/strategy/transportstrategy/tasts/userexperience/3 Available at: http://www.dft.gov.uk/about/strategy/transportstrategy/dasts/

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2. Overview of the UK international freight market

2.1. Market OverviewGreater global economic integration and competition place increased emphasis on the quality of the international logistics networks, that link the UK to the rest of the world as other countries invest in their infrastructure and in improving processes.

It is important that the UK has the domestic and international transport networks that allow firms and households to continue to make the most of the opportunities of globalisation. UK firms need to be able to get their goods to market and transnational firms with part of their supply chain in the UK need fast and reliable logistics to integrate the different links of the chain.

This will require continuous improvements to ensure that logistics chains are optimised across the full end-to-end journey.

The reduction in international shipping rates and the trend towards larger ships means that port operations and inland connections become an increasingly significant share of overall transport costs.

Ensuring cost-competitive and reliable connections from ports to factories and shops is vital to ensuring the competitiveness of UK firms, and the UK as a location for foreign firms to do business.

The maritime industry is vital to the UK economy. The latest figures from the British Chamber of Shipping estimate that the UK shipping industry directly contributed £5.2 billion to UK GDP in 2006.

UK international freight amounted to 458 million tonnes in 2006, an increase of 82% since 1980. Figure 1 illustrates the volume by weight and mode of transport between 1980 and 2006.

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Source: Department for Transport (Sea and Channel Tunnel) and Civil Aviation Authority (Air)

Figure 1: UK international freight transported between 1980 and 2006

In 2006, about 95% of international freight by weight was transported by sea, compared

with 4% via the Channel Tunnel and less than 0.5% by air.

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2.2. Freight flowsFigure 2 summarises freight flows in 2007, inwards and outwards between the UK and key continental regions including Europe and the Far East.

All continental regions, with the exception of North and Central America, export more goods to the UK than they import from the UK. 70% of major UK port international freight traffic by weight is to or from countries in Europe or around the Mediterranean coast.

2.3. Freight typesThere are four key methods of freight transportation by which goods enter and leave the UK. These are:1 Container or ‘lift-on lift-off’ (lo-lo) services:

the transport of containerised freight, which is loaded and unloaded at gateway terminals by cranes onto container ships and transported by sea. Container freight is carried by either deep-sea5 services calling directly at the UK from the port of origin, on short-sea6 feeder services carrying goods from mainland Europe, or on freight trains through the Channel Tunnel.

2 Roll-on roll-off (ro-ro) services: freight units are driven on/off sea ferries, or on/off specialised truck shuttle rail services through the Channel Tunnel.

3 Bulk goods: the movement of either liquid commodities (predominantly oil and fuel) or dry solids (such as coal and aggregates).

4 Air freight: the transportation of goods in the hold of passenger services or on dedicated air freight services.

Source: DfT Maritime Statistics 2007

Figure 2: UK Seabourne freight: 2007 (million tonnes)4

4 Based on UK major port traffic (97% of total traffic). Origin/destination grouping based on first port of unloading/last port of loading

5 Traffic between the UK and countries outside Europe and the Mediterranean.6 Traffic between the UK and Europe and other Mediterranean countries.

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Figure 3 illustrates UK ro-ro and container traffic growth between 1970 and 2007. Containerised freight has increased from 11 million to 61 million tonnes between 1970 and 2007. UK ro-ro freight has increased even more significantly from 6 million tonnes in 1970 to 105 million tonnes in 2007. These trends are set to continue. UK container freight is forecast to grow by a further 178% and ro-ro freight 112% by 20307.

Growth in liquid and dry bulk freight transport has grown at a more modest rate in comparison to ro-ro and container traffic. Dry and liquid bulk combined grew from 320 million tonnes in 1970 to 385 million tonnes in 2007.

UK air freight traffic has grown rapidly over the last 15 years, and is now more than double the level it was in 1991. The 2.3 million tonnes

carried by air into and out of UK airports in 2007 was an increase of 20% on the total for 1997 (CAA Airport Statistics).

Figure 4 provides a breakdown of freight type by value for UK international cargo moving outside the European Union.

Courtesy of DP World Southampton

7 It should be noted that all forecasts in this document were made prior to the global economic downturn.8 From 2000 onwards, containers series shows lo-lo containers only, containers on port-to-port trailers are included in the

ro-ro series. Prior to 2000, containers on port-to-port trailers are included in containers series.

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Figure 3: UK container and ro-ro port traffic (tonnage), 1970 to 20078

Bulk liquidsand solids 20%

Roll on/Roll off 7%

Lift on/Lift off 29%

Air 41%

Other (including rail)3%

Source: DfT – derived from UK Port Demand Forecast to 2030, MDS Transmodal (MDST) for DfT (2006)

Figure 4: UK international freight types by value of goods (excluding EU traffic), 2004

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For UK trade outside the EU, over 96% of freight by tonnage is transported through our sea ports, 42% of freight by value is transported by air.

Figure 5 provides an indication of the relative value per tonne by freight types. Air freight goods have an average value over 230 times that of bulk items.

Figure 5: UK international freight types: values per tonne (excluding EU traffic), 2004

Freight Type Value (£ / Tonne)

Bulk liquids and solids £220

Lift on/Lift off £1,800

Roll on/Roll off £3,900

Air £51,400

Source: DfT – derived from UK Port Demand Forecast to 2030, MDS Transmodal (MDST) for DfT (2006)

Containers typically have a lower weight density than bulk goods, so their significance is understated in the standard weight-based statistics. Moving 25 tonnes of bulk can be done in one HGV, but 25 tonnes of containerised goods are likely to require two HGVs, with implications for vehicle kilometres generated, fuel consumed and pollutants emitted.

2.4. UK sea freightSea freight traffic is concentrated in a small number of ports, with the top 15 ports (of the approximately 120 active UK ports) accounting for almost 80% of total UK port traffic by tonnage.

Almost one third of all UK port tonnage goes through the Greater South East ports – those lying between Southampton and Felixstowe.

Courtesy of Tilbury Container Services

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The container freight end-to-end journey, from port of origin to distribution centre, involves the sea leg, the process in getting through the port, and onward distribution within the UK. This document considers each leg of the journey in turn, identifying some of the key performance issues and market trends by compiling a range of qualitative

and quantitative data collected by both the Department for Transport and external stakeholders.

Figure 6 illustrates the stages of the container freight end-to-end journey, highlighting the delivery, policy and regulatory responsibilities at each stage.

The analysis in this document examines each of the stages in turn.

‘Getting to and from the port’ focuses on key shipping routes to and from the UK and the major shipping lines operating to and from the UK, including domestic transhipments.

‘Getting through the port’ examines the processes between berthing the vessel and the onward distribution of the container – namely unloading the vessel, stacking the containers, and security and customs clearance.

‘Onward distribution within the UK’ looks at the domestic leg of the journey by road, rail, inland waterway, and coastal shipping.

3.1. Organisations involved in the container end-to-end journey

Figure 7 illustrates the key organisations in the end-to-end container supply chain from port of origin outside the UK to a distribution centre in the UK for a typical import journey.

The flow of a container is highlighted alongside the typical contractual relationships in purple.

The number of organisations involved in the supply chain has decreased in recent years due to market consolidation among shipping lines with several shipping lines now offering a complete origin-to-destination service.

However, for most journeys, the distribution chain consists of multiple organisations which

3. The container freight end-to-end journey

Source: Department for Transport, 2008

Figure 6: The container freight end to-end journey

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in turn creates challenges for optimising the supply chain from end-to-end to ensure the efficient movement of goods.

In most major ports the terminal operator acts as the terminal stevedore.


Terminal stevedore Shipping line Terminal

Operator

Shipping line

Road haulage

Rail operator

HMRC

Distribution centre

Freight forwarder

SEA/PORT LEG LAND LEG

Information Flow Container Flow

Figure 7: Organisations involved in the container end-to-end journey


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4.1. I ntroductionContainer freight transport or containerisation is the movement of goods in standardised shipping containers that are loaded onto container ships, road trucks and rail wagons.

Dedicated container vessels were first introduced in the late 1960s when the container shipping and ports industry realised the vast potential of the container transport method. Huge investment was made into vessels, container terminals and onward haulage methods which continues today. As standards in container size and fixings were adopted, containerisation enabled a revolution in freight shipping transport.

The container freight market has undergone rapid growth and significant changes over the past decade. Transporting goods by container has become an increasingly inexpensive method of moving freight.

4.2. Growth in container freightFigure 8 illustrates the growth in the worldwide container market between 1996 and 2007 in both TEU9 and tonnage terms.

In 1996 332 million tonnes of goods were transported in 42 million TEU of containers worldwide. In 2007 these figures had increased significantly to 828 million tonnes of goods transported in 118 million TEU, representing a year-on-year growth of circa 9% between 1996 and 2007.

A wide range of factors is responsible for this growth in the containerisation market. Increase in world trade and GDP have augmented the requirement for import and export of goods. The standardised format of container transport has enabled

increased economies of scale in shipping and discharging, lowering costs of importing and exporting goods. Furthermore, lower manufacturing costs in China and India have contributed to a surge in container trade from the Far East to the West, although this has seen significant slowing in recent months due to the global economic decline.

The sea leg cost of shipping a container has reduced to as little as one tenth of the cost in 1996 per TEU for a typical route from the Far East to Northern Europe. This has contributed to an increase in the containerised shipping of lower value goods, further increasing the volume of container trade.

4. Overview of the international container freight market

Courtesy of Port of Felixstowe

9 Twenty-Foot Equivalent Unit (TEU) is a unit of measurement equivalent to one 20-foot container.

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Exports from China to Europe and the US have been a driving factor behind the growth in containerised trade in recent years. In 2007 the Port of Shanghai increased operations by 4.4 million TEU to 26.2 million, equivalent to a growth of 1.3 times the size of the Port of Felixstowe in one year alone.

To handle the expected continued increase in container traffic worldwide, capacity will need to increase. It is estimated that a further 85 million TEU of capacity will need to be offered by 2010, corresponding worldwide to 65km of new quays from total quay length in 2006, although this is subject to global market conditions and the current economic downturn.

Figure 9 illustrates the growth in the UK lo-lo container market between 1988 and 2007. Traffic has increased from 2.4 million containers (3.6 million TEU) in 1988 to 5.4 million containers (8.9 million TEU) in 2007, at an average rate of 4% containers (5% TEU) per annum.

4.3. Container growth forecasts to 2030

Container traffic in the UK is forecast to increase, on average, by around 4% per annum between 2005 and 2030. This is

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Figure 8: Worldwide contanerised loaded maritime TEU, 1996–2007

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Figure 9: Growth in UK lo-lo container freight 1988–2007 (million units)

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less than the 6% growth forecast globally, predominantly as a result of higher growth rates in Asia.

An increase in transport of goods by container that were not historically containerised and the trend towards increased numbers of 40’ long, 9’6 high containers (from 20’ length) contribute to this growth.

Figure 10 forecasts trade in TEU between world regions and the UK. Trade with East Asia dominates, with an increase in TEU from 2.7 million in 2004 to 8.8 million in 2030, accounting for 44% of total UK container trade.

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Figure 10: Forecast containerised traffic, 2004–2030, by World Region (‘000s TEU)

Courtesy of Maersk

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4.4. Worldwide container flowsFigure 11 shows approximate container flow volumes along major trade lanes between world regions. Trade routes with over one million TEU are illustrated on the map in

Figure 12. This indicates the scale of worldwide trade to/from the Far East. 86% of all worldwide trade container trade is to, from or within the Far East.

Australasia & Oceania

655 37 1,413 217 27 75 297 224 10 2,955

East and Southern Africa

44 202 270 213 26 143 112 387 95 1,492

Far East 1,722 1,139 24,072 5,561 2,446 4,558 14,498 10,146 654 64,795

Gulf & ISC 100 265 1,195 1,425 61 937 750 1,596 153 6,483

Latin America 50 128 911 317 1,274 901 2,834 1,749 233 8,398

Mediterranean 135 173 914 1,055 393 1,369 1,348 1,286 218 6,891

North America 207 172 4,213 773 1,898 813 776 1,898 38 10,789

North West Europe

301 550 3,710 1,638 808 1,474 3,498 2,569 461 15,008

West Africa 1 21 103 122 11 94 42 269 80 743

Total 3,216 2,686 36,802 11,321 6,943 10,366 24,155 20,123 1,942 117,554

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Figure 11: Container trade between world regions (thousand TEU)



Figure 12: Shipping route container flows greater than 1 million TEU (million TEU)

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Internationally terminal operators have experienced a level of consolidation, so that more terminals are operated by fewer organisations. This consolidation is illustrated in Figure 13. In 2003, the top four worldwide

terminal operators in 2008 owned 24% of all terminals by TEU. By 2008 this had increased to a 34% market share.

4.5. European and UK port trafficThe UK is home to Europe’s sixth (Felixstowe) and eleventh (Southampton) largest container ports. Rotterdam is the biggest container port in Europe with 9.6 million TEU of trade in 2006.

In 2006, the total European10 container traffic was 74 million TEU. The three largest ports in Europe (Rotterdam, Hamburg, Antwerp) constitute 34% this total.

Figure 14 illustrates the largest 20 container ports. UK ports are denoted in red.

2003 2004 2005 2006 2007 2008

Hutchison Port Holdings

28.6 32.0 34.0 30.5 35.5 40.9

PSA International

24.8 28.5 32.4 44.5 51.4 59.2

APM Terminals

16.8 20.6 24.1 29.4 37.2 43.0

DP World 5.8 9.1 9.9 25.7 28.6 33.2

Top four operators

76.0 90.1 100.0 130.0 153.0 176.0

Share of total market 24% 25% 25% 29% 32% 34%

Figure 13: Worldwide container terminal ownership (million TEU)

Source: Hercules Haralambides – “The Role of Ports as Potential Bottlenecks in Global Supply Chains”, Erasmus University Rotterdam

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10 27 countries in the EU plus Norway and Croatia.

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Figure 15 shows the market share for the movement of containerised goods of the largest container ports. This includes both international and domestic movements. Southampton and Felixstowe dominate container traffic in the UK.

Figure 16 shows that Felixstowe and Southampton account for 59% of container trade in the UK. The top five UK ports account for 83% of all and 99% of deep-sea UK container traffic.


Figure 15: Key container ports in Great Britain – total container movements, 2007

Domestic Short-sea Deep-sea All routes% share of all

routes

Felixstowe 93 692 2,275 3,343 38

Southampton 53 170 1,574 1,869 21

London -– 526 310 844 10

Liverpool 53 274 344 675 8

Medway 2 32 423 519 6

Hull 11 293 –- 304 3

Belfast 92 172 –- 264 3

Forth 76 180 –- 256 3

Tees and Hartlepool 14 132 7 154 2

Grimsby and Immingham 9 134 1 144 2

Bristol 1 56 28 85 1

Portsmouth 28 14 35 77 1

Clyde 8 68 ––º 76 1

Goole –– 63 –- 63 1


Figure 16: Container traffic by port (thousand TEU)


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Figure 17 illustrates this share by the top 12 UK ports. Felixstowe, Southampton, London and Liverpool ports handle over three quarters of all UK container trade.

Figure 18 illustrates the top 12 UK container ports’ shipping origins and destinations by domestic, EU countries, other short-sea countries and deep-sea countries all measured in TEU.

Felixstowe and Southampton combined handled 75% of all deep-sea container cargo and 57% of all container traffic departing from and arriving to the UK in 2007. These ports have the terminal capacity to accommodate the largest vessels and are closer to the prime Asia/North West Europe shipping route, making them attractive destinations to vessels calling from the East to Northern Europe.

Figure 19 shows the weight of containerised goods loaded and unloaded in the UK in 2007, including both international and domestic traffic. The UK is a net importer of containerised goods, importing over 35 million tonnes in 2007 and exporting 22 million tonnes. As a result 53% of containers leaving the UK in 2007 were empty, compared with 5% of those entering the country.

Felixstowe37%

Southampton 21%

Liverpool 8%

Belfast 3%Hull 3%

Medway 6%

Other major ports 9%

London 10%

Forth 3%

9.7 million TEU


Figure 17: Container traffic UK share by top 8 portsFe

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Figure 18: Top 12 UK container ports – trade by world region

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4.6. Types of containerThe main types of standard containers in use internationally are shown in Figure 20. There are other container sizes, including 30’, but the below comprise the majority of containers.

Figure 21 illustrates trends in container sizes to and from the UK between 2000 and 2007. In 2000 4.5 million TEU of 40’ containers were imported and exported to/from the UK. This figure had increased to 6.2 million in 2007, representing an increase from 67% to 69% of overall TEU.

45’ ‘high-cube’ containers increased in share from 2% in 2000 to 8% in 2007, or from 149,000 TEU to 750,000 TEU.

There are other types of specialised container as follows:

Refrigerated or ‘reefer’ containers are used for the transportation of temperature-sensitive cargo. They require an external power supply when held on land, or can be powered by diesel powered generators whilst on road.

Open-top containers are fitted with either a solid or tarpaulin removable roof to enable loading and unloading from above.

Bulk containers, or ‘bulktainers’ are used for transportation of free-flowing dry cargo which is loaded and unloaded through a hatch in the roof of the container.

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Figure 19: UK major ports foreign and domestic container traffic

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Figure 21: UK ports container size 2000–200711

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40’ 8ft 8ft 6in – 9ft 6in 2

45’ 8ft 8ft 6in – 9ft 6in 2.25


Figure 20: Types of container

11 There are also a small number of containers sized between 20’ and 40’, which have been excluded from this graph.

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4.7. Commodities transported by container

Shipping lines are required to declare the contents of all containers arriving and departing to/from the UK to HMRC when the goods have originated from or are destined for outside the EU.

Figure 22 uses data from HMRC’s CHIEF12 database to illustrate the commodities imported and exported to/from the UK to/from non-EU countries. Manufactured goods account for 27% of all UK imports.

6.6 million tonnes of food and beverage goods were imported by container from non-EU countries in 2007, and 1.3 million tonnes from EU countries in 2007, totalling nearly 8 million tonnes of food and beverage imports. This equates to one tonne of food and beverages for every eight people in the UK.

Figure 23 illustrates the top UK container imports from the EU. Food, live animals and beverages account for 19%.

Food and LiveAnimals 19%

Chemicals 8%

Fuels and lubricants 5%

Beverages and Tobacco 4%

Crude Materials including (wastepaper and scrapmetal) 10%

Machinery and transport equipment 11%

Manufactured Goods 27%

Miscellaneousmanufactured articles 16%

Animal, vegetable oils, fats and waxes 0.1%

25.4 million tonnes

Source: HM Revenue and Customs CHIEF database, 2007

Figure 22: UK container imports from non-EU countries (tonnes)

12 CHIEF (Customs Handling of Import and Export Freight) is the main system used by HMRC for processing import and export declarations.

Courtesy of Teesport

Food and LiveAnimals 17%

Chemicals 21%





Miscellaneous manufactured articles 3%


6.6 million tonnes

Source: MDS Transmodal: Great Britain Freight Model, 2007

Figure 23: Estimated GB container imports from EU countries (tonnes)

19

Figure 24 illustrates container exports to non-EU countries by weight. Waste products account for 41% of all exports, with pulp and waste paper making up 28% and ores and scrap materials a further 13%.

Figure 25 illustrates container exports to EU countries. Manufactured goods comprise the largest proportion of exports, with 35%, chemicals constitute a further 23% of exports.

Food and Live Animals 7%

Chemicals 15%

Fuels and lubricants 4%





Miscellaneousmanufacturedarticles 3%


13.4 million tonnes

Source: HM Revenue and Customs CHIEF database, 2007

Figure 24: UK container exports to non-EU countries (tonnes)

Food and Live Animals 7%

Chemicals 23%





Miscellaneous manufactured

articles 1%


3.3 million tonnes

Source: MDS Transmodal: Great Britain Freight Model, 2007

Figure 25: Estimated GB container exports to EU countries (tonnes)


This section sets out some of the key data for the sea leg of the end-to-end journey.

Figure 26 illustrates the key European shipping routes, gateway ports, transhipment ports and core logistics regions. The importance of the UK’s South East ports is illustrated by the proximity of Felixstowe and Southampton to the major shipping lanes.

Figures 27 and 28 illustrate inwards and outwards trade of containers between the UK and world regions and domestically. Container trade between the UK and mainland Europe accounts for the highest proportion of trade.

20

Getting to and from the port Getting through the port Onward distribution within the UK

5. Getting to and from the port


Figure 26: Key European ports, shipping routes and inland regions


Figure 27: Container freight movement to/from UK (TEU), 2007

124

109

UK Domestic

Africa

Australasia & Polynesia

North & Central America

To UK

From UK

246

261

56

19

373

306

147

108

South America

Europe

Asia

1,377

1,562

2121

1634

21

5.1. Container ship capacityContainer ships vary in size, some serving major ports have capacities exceeding 10,000 TEU whereas others built for feeder service (i.e. serving smaller ports from a major port) have capacities of 500 TEU or less.

The largest container ships are only able to dock at ports with sufficient draft clearance and navigable width. Gantry cranes with the largest reach are also required to discharge containers from the widest ships.

The Emma Maersk is the largest container vessel currently in operation. She has a length of 400m, beam of 56m, has a dry weight tonne capacity of 157,000 tonnes (approximately 11,000 TEU of containers) and has a draft of 15.5m. Felixstowe and

Southampton are the only UK ports capable of handling the Emma Maersk.

Figure 29 illustrates the growth in the number and size of container ships since 1995. In 1995 there were 463 panamax13 container vessels with a total of 1.3 million TEU, representing 2,900 TEU per vessel. The full container fleet in 1995 was 1,329 vessels, with a capacity of 2.8 million TEU.

In 2008 there were 1,768 container vessels, comprising 8.4 million TEU, an average of 4,700 TEU per vessel.

Figure 30 illustrates the growth in standard container ships over the past forty years. Today’s largest vessels are able to carry twice as many TEU as the largest ships in operation only ten years ago.

The pace of container growth coupled with the underlying trend of increasingly large vessels has encouraged port operators to

Inwards Outwards

Asia 2121 1634

Europe 1377 1562

North & Central America 373 306

UK domestic traffic 246 261

South America 147 108

Africa 124 109

Australasia & Polynesia 56 19


Figure 28: Container freight movement to/from UK (Thousand TEU), 2007

Courtesy of Maersk

13 ‘Panamax’ vessels have a beam of around 32.3 metres, the widest able to negotiate existing Panama locks.

1995

1996

1997

1998

1999

2000

2002

2001

2003

2004

2008

2007

2006

2005

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

Total TEU

0

200

400

600

800

1000

1200

1400

1600

1800

2000

Tota

l Ves

sels

Total Vessels Total TEU

Source: MDS-Transmodal Containership Databank, 2008

Figure 29: Number of container vessels worldwide


22


plan for vessel sizes which are currently not operational in order to future proof investments for potential larger ships.

The diagram denotes the maximum draft clearance of main terminals at a range of ports worldwide and in the UK. This indicates that the next generation of container ships will be unable to call at some UK ports without development to increase draft clearance.

Erasmus University Rotterdam has undertaken analysis into optimum container ship sizes, based on shipping costs and port costs and suggest that there is an optimum container ship size. Figure 31 is one of the outputs of this study.

While the specifics are open to academic debate, the study highlights that while shipping costs per TEU decrease through

economies of scale as ships get larger, port costs increase due to higher handling fees, the requirement for the vessel to remain berthed in the port for longer and the cost of infrastructure to support the vessels increases.



Figure 30: Container ship sizes and port draft clearance

23


The analysis points to a generalised optimum ship size which takes into account both shipping and port costs, which they estimate to be around 8,000 TEU. This model is simplified and there are many other variables which factor into the overall cost, however it demonstrates the aspects that both port operators and shipping lines take into account when planning and the difficulties of optimising operations across the supply chain.

The benefits of economies of scale from increasingly large ships are also tempered by the operational costs of running the vessels. For example, a vessel over approximately

400m would require a second engine to generate the required propulsion, significantly increasing fuel costs.

5.2. Shipping lines

The container ship industry has experienced considerable consolidation in recent years. In 2000, the top ten global shipping lines collectively handled 37% of total TEU transported. In 2006, the top ten lines handled 65% of the total annual TEU transported.

Figure 32 illustrates this consolidation since 1980 between the top 20 shipping lines and terminal operators. The top 20 shipping lines have increased market share from 26% in 1980 to 81% in 2007.

Generalisedcosts

Economies of scale in shipping

Port costs and diseconomies

of scale

Shi

ppin

g C

osts

per

TEU

~8,000TEU Ship size

Por

t Cos

ts p

er T

EU

Source: Erasmus University Rotterdam

Figure 31: Optimum container ship sizes

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1980 2007 Top 20 shipping lines share of TEU capacity Top 20 terminal operators share of throughput

Sha

re o

f TEU

cap

acity

55%

81%

42%

26%

Source: Notteboom, 2008

Figure 32: Consolidation in the container shipping industry

Courtesy of Ace Stock Limited/Alamy

24


The top 20 terminal operators handled 42% of the total throughput in 1980 and 55% in 2007.

Figure 33 shows the top ten worldwide container ship carriers in 2008 by TEU.

Maersk and MSC combined have a 41% share of the total top ten shipping lines by TEU.

Courtesy Maersk

Current ShipsCurrent

Shipboard slots (thousand TEU

Ships on order (thousand TEU

TOTAL (thousand TEU)

%

1 Maersk Line 563 1,913 410 2,323 23%

2 MSC 412 1,335 448 1,783 18%

3 CMA-CGM 373 939 540 1,479 15%

4 Evergreen 180 631 4 635 6%

5 Hapag-Lloyd 126 479 105 584 6%

6 Coscon 137 477 437 914 9%

7 APL 123 442 133 575 6%

8 NYK 131 419 151 570 6%

9 CSCL 104 402 185 587 6%

10 Mitsui OSK 111 371 174 545 5%

TOTAL 2,260 7,408 2,587 9,995 100%


Figure 33: Top ten container lines by slot capacity deployed

25


Figure 34 illustrates the number of worldwide vessels by size and the trends in growth between 1995 and 2008.

The number of new post-Panamax14 vessels by TEU was approximately 55,000

in 2007 and 100,000 in 2008. There are an estimated 442,000 TEU of new post-Panamax vessels currently on order worldwide, further demonstrating the trend towards larger ships.

5.3. Shipping routesShipping lines determine the most profitable routes based upon a range of factors including connections offered by the port, capacity for deep-sea vessels and volume of trade opportunities at each port – determined by client demand.

Figure 35 shows journeys, or ‘loops’, operated by shipping lines on the dominant East Asia to Europe route, including the number of port calls in Asia and Europe.

0

500

1000

1500

2000

2500

3000

3500

4000

4500

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 On order

TEU Panamax TEU Post Panamax TEU New post Panamax

Thou

sand

TEU


Figure 34: Total TEU capacity of container ships15

14 ‘New post-panamax’ vessels have a length greater than 366 metres and a beam greater than 49 metres.15 ‘Post-panamax’ vessels have a beam greater than 32.3 metres but less than 49 metres.

Courtesy of Hoberman Collection UK/Alamy

26


Transit times between the UK and Far East ports vary based on the number and order of ports called en route. Typically it can take around 25 days to import a container from Shanghai to Felixstowe but up to 40 days to export to Shanghai due to the order of port calls en route. A typical transit from Singapore to Felixstowe takes around 25 days.

Once the container arrives in the port, the ‘free time’ grace period, where ports allow lines to hold containers free of charge in the dock, can last up to five days, depending upon the port of arrival and the shipping line transporting the

container. An onward distribution leg of one to two days, from a total of around 35 days to transport a container from Shanghai to Felixstowe can therefore constitute less than 5% of the overall end-to-end journey.

The volatility of the price of oil has an impact on transit times. Some shipping lines responded to the high price of oil by slowing the speed of the vessels (slow-steaming) to reduce fuel-burn. As fuel costs have decreased in recent months this is less prevalent, although remains a method adopted by some lines.

Source: Notteboom, 2005

Figure 35: Selected loops on the Asia – Europe route

OperatorLoop name

No. of vessels

No of port calls

Asian port of call

European port of call

Grand Alliance

EUR 1 8 9 5 4

EUR 2 8 9 5 4

EUR 3 7 7 4 3

EUR 4 8 8 5 3

EUR 5 9 12 8 4

New World Alliance

Asia Europe Express 8 11 7 4

Japan Europe Express 8 10 6 4

China Europe Express 8 9 6 3

South China Europe Express

7 7 4 3

MSCSilk Express 10 10 6 4

Lion Service 10 11 8 3

Evergreen CEM Service 8 9 5 4

CMA-CGM

FAL Service 8 10 5 5

North China Express 8 11 6 5

Sunda Express 7 8 3 5

CKHYS alliance

China Europe Service 8 11 7 4

China Europe Express Service

8 9 6 3

Japan Express Service 8 10 6 4

Maersk

AE1 8 12 7 5

AE2 9 14 9 5

AE7 8 12 7 5

China ShippingAEX1 8 8 4 4

AEX2 8 17 11 6

Average 8 10 6 4

27


5.4. TranshipmentContainer traffic falls into one of two categories: direct call and transhipment. Direct call traffic travels from the port of origin to the port of destination without the goods changing ship en route.

Transhipment traffic calls at an intermediate port en route to its ultimate destination and is discharged and reloaded onto a secondary vessel for final shipping. This serves as a more cost-effective way for shipping lines to maintain long-distance, deep-sea operations of their largest vessels, and allows containers to be shipped, by smaller vessels, to ports incapable of handling the largest ships due to draft clearance or operational constraints.

Shipping lines tend to call at ports in the South East of England due to their proximity to the Northern Europe shipping lanes. In order to maximise productivity and turnaround times the largest vessels will seek to call at ports with minimum deviation from the global shipping lane. In the UK this has been a key factor in the emergence of Felixstowe and

Southampton as the largest UK container ports.

There are multiple market factors which influence transhipment activity. UK customers (e.g. retailers and goods owners) tend to dislike transhipments, because it creates an additional leg in the journey that is avoidable and can drive costs up and reliability down.

North West Europe has a number of ports available to shipping lines, enabling a choice as to which port to call before transhipping. Typically a vessel will call at up to four ports – Rotterdam (or Antwerp), Hamburg (or Bremerhaven), Felixstowe (or Southampton) and, say, Le Havre. Transhipment to smaller ports can take place from any one of these. With sufficient capacity, UK ports would have the ability to compete in the European transhipment market. Transhipments between Europe and the UK also serve a distinct market that is not always tied to Far East trade.

Figure 36 below shows the growth in transhipment traffic to 2006 and forecast growth to 2011.

Courtesy of Roland Shaw/Alamy

0

20

40

60

80

100

120

140

160

Mill

ion

TEU

2008

20

09

2010

20

11

1996

19

97

1998

19

99

2003

20

02

2004

2001

20

00

2007

20

06

2005

Source: MDS Transmodal, 2006

Figure 36: Global transhipment traffic 1996 – 2011

28


Figure 37 illustrates transhipment volumes at seven major European transhipment ports, and Figure 38 illustrates transhipments as a percentage of overall traffic at the same ports, in 1994, 1999 and 2004.

Hamburg, Rotterdam and Antwerp have all experienced large growth in transhipment traffic between 1994 and 2004. Transhipments at Antwerp have increased from 400,000 TEU in 1994 to 1.5 million TEU in 2004 representing 24% of overall trade.

Similarly, the port of Hamburg has increased transhipments from 1 million TEU to 2.6 million TEU representing 37% of overall trade.

Felixstowe, by contrast, has decreased transhipment trade from 700,000 TEU in 1994 to 300,000 TEU in 2004, a decrease from 33% in 1999 to 13% in 2004 of overall trade.

The decrease of UK transhipments at Felixstowe is a consequence of the increased import demand to the UK. As import demand

has grown, transhipments have been replaced by direct deep-sea vessels.


Rot

terd

am

Ham

burg

Ant

wer

p

Bre

men

& B

rem

erha

ven

Felix

stow

e

Le H

avre

Zeeb

rugg

e

0

500

1000

1500

2000

2500

3000

1994 1999 2004

Tran

ship

men

t tra

ffic

(thou

sand

TEU

)


Figure 37: Transhipments at major European ports (TEU)

Rot

terd

am

Ham

burg

Ant

wer

p

Bre

men

& B

rem

erha

ven

Felix

stow

e

Le H

avre

Zeeb

rugg

e

0%

5%

10%

15%

20%

25%

30%

35%

% o

f ove

rall

traf

fic

40%

1994 1999 2004


Figure 38: Transhipments at major European ports (% of total TEU)

29


6.1. Terminal operatorsFigure 39 illustrates the terminal operators of the twelve largest UK container ports in TEU terms. This includes London Gateway,

a container terminal which is currently under construction but is expected to commence initial operations in 2011.

6. Getting through the port


Figure 39: UK port terminal operators

Port Terminal OperatorApproximate thousand TEU handled per annum

Felixstowe Hutchison Port Holdings 3,340

Southampton DP World (51%) Associated British Ports (49%) 1,870

TilburyTilbury Container Services: DP World (34%) ABP (33%) Forth Ports (33%) Tilbury Short-sea terminal: Forth Ports

820

Liverpool Mersey Docks and Harbour Company 680

Medway (Thamesport) Port of Sheerness 520

Hull Associated British Ports 300

Belfast Belfast Trust Port 260

Forth Forth Ports PLC 260

Teesport Babcock & Brown Infrastructure 150

Grimsby & Immingham Associated British Ports 140

Bristol Bristol Port Company 90

London Gateway DP World n/a

6.2. Container ports summaryThe following provides a short profile of the ten largest English container ports.

6.2.1. BristolBristol port is served by two lock systems, which separately provide access to Royal Portbury and Avonmouth docks. Royal Portbury Lock has a draught clearance of 14.5m and can accommodate vessels of maximum size 300m length and 41m width. Avonmouth Lock has a draught clearance of 11.0m and can accommodate vessels of maximum size 210m length and 30m width. Collectively these provide over 35 berths, the largest of which are at Royal Portbury Dock.

Source: The Bristol Port Company

Figure 40: Bristol port plan

30


An application has been made to the DfT for a Harbour Revision Order (HRO) to enable construction of a new container terminal.

6.2.2. FelixstoweThe Port of Felixstowe is the UK’s largest container port with an annual capacity of approximately 3.3 million TEU. The main navigation channel is dredged to 14.5m with a maximum depth of 15m alongside the quay, sufficient to accommodate post-Panamax vessels.

The port has two container terminals named Trinity and Languard with a combined area of 143 hectares.

Trinity Terminal has one of Europe’s longest continuous quays, at 2,350 metres. The Terminal has seven deep-water berths, varying in depth from 11.6 metres to 15 metres. The terminal has a capacity of approximately 97,000 TEU.

Languard Terminal consists of 550m of quay, at a maximum depth of 11.9m, and is capable of handling 450,000 TEU per year.

6.2.3. Grimsby and ImminghamGrimsby and Immingham ports are located on south bank of the Humber estuary, the busiest shipping estuary in the UK. Container traffic is mostly through feeder vessels to mainland Europe (the port of Rotterdam is less than 200 miles from the Humber). Immingham is the UK’s busiest port in terms of tonnage, handling chiefly bulk freight.

6.2.4. HullThe Port of Hull is located on the north bank of the River Humber. Regular short-sea services operate to Europe, Scandinavia and the Baltic states.

Hull’s container traffic is handled primarily at Queen Elizabeth Dock by Hull Container Terminal, which handles around 300,000 TEUs per year for operators such as Samskip, EuroAfrica Shipping Lines, Bulcon, OOCL and Finnlines. The terminal provides 300m of quay, enabling three vessels to be berthed simultaneously.

6.2.5. LiverpoolThe Port of Liverpool handled approximately 613,000 TEU of containerised cargo in 2006. The location is suited to serving the Americas and it handles more container units to America than any other port in the UK.



31


6.3.2. Medway

Medway Ports is the Port of Sheerness and Chatham Docks. It is part of Peel Ports, the UK’s second largest port group and has annual capacity of 520,000 TEU. Medway is located at the confluence of the River Medway and the Thames.

The Port of Sheerness has nine berths, six with ro-ro facilities. Chatham has eight berths, a total length of 1,200m and four ro-ro ramps.

6.2.7. Southampton

Southampton port is operated by DP World Southampton and is the second largest container operation in the UK.

The container terminal sits on over 86 hectares of operational land, with 1,350 m of continuous quay, and a five berth quay able to accommodate vessels up to 150 m in length.

During 2007, DP World Southampton increased its terminal footprint by 23.5 additional acres with an additional 15 straddle carriers and two super post-panamax gantry cranes each with an outreach of 22 containers wide.

Courtesy of Peel Ports Group

Courtesy of DP World SouthamptonSource: Medway Ports

Figure 41: Medway Port

32


6.2.8. Teesport

Teesport, operated by PD Ports handled 133,000 TEU of containerised cargo in 2006. The majority of the Port’s container traffic is handled at Teesport Container Terminal, located on the South bank of the River Tees adjacent to Tees Dock.

PD Ports has invested in a second facility known as TCT2. Opened in Autumn 2003, Phase 1 of this new facility operates with two wide span gantry cranes each capable of operating in excess of 30 moves per hour. TCT2 offers two berths of 10.9m depth, coupled with the crane out-reach of 32.5m allowing the handling of 13 boxes across.

6.2.9. TilburyTilbury’s Freeport status encompasses the entire 325 hectares (800 acres) of the Port of Tilbury complex. Tilbury Container Services is jointly owned by three of the largest port operators; DP World, Associated British Ports and Forth Ports. It is the only direct access deep-sea terminal within the port of London.

The entrance lock is 305m long and 34m wide, with a depth of 7.3m. The largest vessels usually acceptable are 262m in length, beam up to 32m and draught of 11.4m. The Port consists of 34 operational berths, over 7.5km of quay.

6.3. UK container port capacityPort capacity is a function of a range of variables including the number and length of available berths, draft clearance16, crane performance and yard space.

Berth capacity, ship size and the volume of container traffic to load and unload determine the number of ships that can be processed through the port during the course of a day.

These factors affect the ports ability to berth different sizes of vessel (larger vessels require longer berths and deeper draft clearance), and how quickly and efficiently vessels can be serviced when they arrive.

A number of UK port expansion schemes are at various stages of development and, if they proceed, will provide significant additional capacity. The projects are shown in Figure 39, which outlines where potential future capacity will emerge to meet the rising demand.

Opening dates and TEU capacities are best estimates only. Delivery of additional capacity will depend on many factors, including progress with statutory procedures and market conditions.

16 The maximum water-depth of the terminal facility



33


In 2006 the Department undertook a review of ports policy for England and Wales and published an Interim Report in July 2007. This confirmed the Government’s commitment to a thriving market-oriented ports sector. Following the successful passage of the Planning Bill through Parliament in November 2008, the intention is to consult during 2009 on a draft National Policy Statement on ports.

Figure 42 shows the notional capacity plotted against forecast demand. This is indicative only as phasing and scheme development details and timescales are subject to change. Forecasts in the short-term are also influenced by the global economic conditions.

Demand has been calculated by estimating a growth in UK container trade between 3% and 4% per annum based on MDS Transmodal’s forecasts, 2006/07. This has been aggregated to a low and high forecast, with a variance of 5% above and below the forecast.

Eddington stressed the importance, for transport infrastructure generally, of making best use of existing facilities. It is in each port operator’s interest to seek to operate its existing terminals at an efficient capacity utilisation rate before engaging in costly new investment. At the same time, there is a national interest in resilience and, of course, in environmental protection. The ports NPS will guide the Infrastructure Planning

PortAdditional Capacity

(Million TEU per annum)

Development StageEstimated opening

dateOwner

London Gateway Phase 1

0.7Preparatory works

started2010–11 DP World

London Gateway Phase 2

2.8Cleared to proceed,

not yet started2017 DP World

Felixstowe South Phase 1

0.7 Construction started 2010 Hutchison Ports UK

Felixstowe South Phase 2

0.9Cleared to proceed,

not yet started2014 Hutchison Ports UK

Bathside Bay (Port of Felixstowe)

1.7Approved, pending Harbour Revision

Order2017 Hutchison Ports UK

Mersey 0.5Cleared to proceed,

not yet started2011 Peel Ports LTD

Teesport Phase 1 0.7Cleared to proceed,

not yet started2011 PD Teesport

Teesport Phase 2 0.8Cleared to proceed,

not yet started2014 PD Teesport

Bristol Port Phase 1 (if consented)

0.5Application outstanding

2015 (arbitrary date assumed)

Bristol Port Company

Bristol Port Phase 2 (if consented)

1Application outstanding

2018 (arbitrary date assumed)

Bristol Port Company

Southampton Container Terminal

1.8Proposed

enhancements2012

DPW (51%) ABP (49%)

Hull 0.3Cleared to proceed,

not yet startedUnknown ABP


Figure 42: Approved and proposed container terminal schemes

34


Commission (IPC) on the interpretation of capacity requirements in the context of all the other criteria that must apply to major development applications.


0

5000

10000

15000

20000

25000

Mid forecast Low forecast (-5%) High forecast (+5%) Notional Capacity

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Source: Department for Transport modelling

Figure 43: Notional UK container port demand versus capacity forecast 2005 to 2030

6.4. Processes in getting through the port

There are generally five stages involved in transporting a container through a port:

Berthing the vessel

Loading and discharging the containers

Stacking the containers

Security clearance

Customs clearance

In each of these areas the metrics used to quantify productivity vary from port to port. The ports are not directly comparable and therefore trends at each port are more instructive than comparisons between the ports.

6.4.1. Berthing the vesselPorts with the facility to service the largest deep-sea vessels will typically have longer

average loading and unloading times because the higher capacity of the ship allows it to carry more containers. For example, in 2007, the average berth time at the Port of Felixstowe was just over 22 hours.

35


6.4.2. Loading and discharging the containers

Containers are discharged from the vessel by container handling gantry cranes – specialised cranes designed to lift containers from container ships. Container cranes are classified by their lifting capacity and the size of the vessels they can discharge. Panamax cranes can load/unload container ships of 12–13 container rows wide. Post-Panamax cranes can lift containers from vessels of around 18 container rows wide. The largest cranes are termed Super-Post-Panamax, and are capable of lifting containers from vessels 22 container rows wide.

There is no accepted, systematic method of data collection for berthing vessels and loading/discharging containers.

6.4.3. Stacking containersThe number of containers a port can stack once discharged from a vessel is key to the overall capacity of the port. Above a certain utilisation of space the port yard can no longer operate effectively – a maximum level of capacity is required to allow space to move containers and perform other operations.

When a vessel calls at a port the containers bound for that port are discharged to the quay and moved to be stacked. Laden containers for export are then loaded onto the vessel ahead of empty containers.

Containers are moved to and from the quay cranes by a variety of equipment which varies from port to port. For example the Port of Felixstowe uses rubber tyred gantries in the port yard, capable of stacking up to 5 containers high in conjunction with tractor trailer units which deliver containers to/from the quay. Southampton and Tilbury ports use straddle carriers capable of stacking 2 and 3 high. Thamesport use rail mounted gantries for yard operations and tractor and trailer units to connect the yard to the quay.

Containers can be moved from the port side by straddle carriers – cranes designed solely to transport and stack containers in ports. The largest straddle carriers can stack containers up to five high. Rubber tyred gantry cranes (RTGs), which enable increased storage density, are also used at some ports to move



36


containers. Rail mounted gantry cranes (RMGs) perform the same function from fixed rails, usually to lift containers onto rail wagons.

Ports allow a ‘free time’ period during which containers can be stored in the port following discharge at no additional cost to the shipping line or haulier. Following this period, charges are usually incurred. This incentivises shipping lines and hauliers to move containers within an allotted time.

To provide greater flexibility to hauliers and to avoid the above charges, a number of hauliers are making use of private holding depots located near to the ports. An example of this is the Pentalver depots located next to the Ports of Southampton and Felixstowe.

If a ship is running behind schedule it will often set sail without loading empty containers in order to regain lost time before arriving at the next port, hence occasionally empty containers will be stock-piled at the port awaiting distribution, using valuable space at the UK’s container ports.

6.4.4. Security clearanceThe Department for Transport’s Transport Security and Contingencies Directorate (TRANSEC) is responsible for implementing the International Ship and Port Facility Security Code (ISPS Code) in the UK.

The ISPS code mandates the minimum security requirements for ships and ports.

Ports are responsible for meeting the requirements of the Dangerous Goods in Harbour Areas Regulations and the International Maritime Dangerous Goods Code. HMRC is responsible for operating UK points of entry (sea ports, airports and international rail terminals), and for the initial detection of any imported nuclear or radiological material.

The Container Security Initiative (CSI) was introduced in 2002 by the US Bureau of Customs and Border Protection. It has since been adopted by ports around the world, and is currently in place at Felixstowe, Tilbury, Thamesport, Southampton and Liverpool in the UK.

The initiative consists of four elements: using intelligence to identify containers that may pose a security threat, pre-screening containers before they arrive at a port, using detection technology to pre-screen containers, and using tamper-proof containers.

The Secure Freight Initiative (SFI) was created from the US Safe Port Act with the objective of screening 100% of freight bound for the USA. Southampton port took part in the first phase of the trial, which concluded in April 2008. The results of this initial phase will be included in an EC report with a view to wider implementation; however doubts exist as to the feasibility of scanning 100% of container freight on a global basis.

Figure 46 illustrates the UK customs clearance process.Courtesy of Bristol Port

37


6.4.5. Customs clearanceThe legislative basis for customs data requirements is stated in the EU Community Customs Code, which codifies current customs law. The code prescribes that all non-EU goods arriving in the EU must be:

Immediately considered to be in a state known as ‘Customs Supervision’;

Legally presented by the shipping agent to customs within three hours of arrival;

Once unloaded, accepted by the wharf operator into Temporary Storage (pending entry to a Customs Procedure);

Entered to a Customs Procedure within 45 days.

Goods are declared by shipping lines to customs prior to the arrival of the vessel;

however only a small proportion are moved to temporary storage to be physically checked.

Cargo arriving on a vessel may include containers from both EU and non-EU countries and the customs procedures are different depending on whether the origin of the goods is from within or outside the EU.

STAGE 1 PRE-SEA LEG

STAGE 2 PRE-PORT CLEARANCE

STAGE 3 PRE-ONWARD DISTRIBUTION

Contract between supplier and UK buyer

Booking made with shipping line

Export declaration

Loaded onto vessel

Vessel details recorded on Port Community System

Vessel and consignment reference numbers generated by PCS

PCS makes consignment data available to relevant parties

Vessel arrives, PCS updated

CHIEF declarations released, UKBA

selections revealed

X-ray scanned, examined, goods seized/released

Haulage assigned

Selected for examination by HMRC/UKBA

Release note issued UKBA select containers to holding based on

risk level

Figure 46: UK imports customs clearance process


Port Community System (PCS)Port Community Systems control the movement of freight at most major UK container ports. These provide a means for traders to submit declarations to the UK’s electronic declaration processing system (CHIEF). The CHIEF system handles over 21 million import and 5 million export declarations per annum and relays release messages via the community system on each container.

38


Distribution of containers within the UK is a key component of the end-to-end journey. This section considers the methods used to distribute containers to/from the port and where pinch-points in the journey exist. For the purposes of this analysis, the distribution centre, where the container is loaded for export or broken down following import is the final stage in the end-to-end journey.

Data on the onward mode of containers in the UK and the means of transport is not collected by all ports in a standardised format. Assumptions are required on the data in order to calculate the modal share of onward container distribution.

Figure 47 tabulates the modal share by road, rail and coastal shipping.

7. Onward distribution within the UK

Courtesy of Freightliner

Imported container movements (thousand TEU) (DfT Maritime Statistics)

1,065 578 27 46 250 206 147 81

Containers transhipped (thousands)

107 29 –– –– 8 12 15 ––

Containers by rail (thousands)

194 170 –– 13 18 2 24 ––

Containers by road (thousands)

764 379 27 33 225 191 108 81

% rail 20% 31% 0% 28% 7% 1% 18% 0%

% road 80% 69% 100% 72% 93% 99% 82% 100%

Felixs

towe

Southam

pton

Med

way

Liverp

ool

Bristo

l

HullTe

esport

Tilbury

Figure 47: Container onward distribution modal share from selected container ports


39


Figure 48 illustrates the modal share by port for road, rail and transhipments. Teesport and Southampton transport the highest proportion of containers by rail. All of the containers leaving Bristol port and Hull port are transported by road. Some ports, notably Liverpool, also distribute containers by barge.

Road is the dominant means of transporting freight in the UK. 167 billion tonne km by rail, representing 8 tonnes transported by road for every one tonne transported by rail17.

7.1. Regional DistributionThe majority of imported container traffic is distributed to regional and national distribution centres (RDC/NDCs). A high proportion of distribution centres are located in the Midlands area. The Midlands is advantageously placed for distribution by road as it is served by the M1 and M6 to the north, and the M40, M5 and M1 to the south. The core of this region is termed the ‘Golden Triangle’ for container freight due to its prevalence of distribution centres and accessibility to the rest of the UK. This is illustrated by figure 49.

Around three quarters of the country’s population can be served by road in a one-day return trip from locations within the Golden Triangle, and around 90% can be accessed within a four-hour drive.

Felix

stow

e

Transhipment Road Rail

Mod

al s

hare

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Bris

tol

Tees

port

Hul

l

Med

way

Live

rpoo

l

Tilb

ury

Sou

tham

pton

Source: MDS-Transmodal, 2007

Figure 48: Container modal share by port

17 This figure includes all freight movements by road, including light goods vehicles.

40



Figure 49: Strategic road access from ‘Golden Triangle’

41


Figure 50 illustrates the first inland destination districts for containers moved by road, using the Continuing Survey of Road Goods

Traffic (CSRGT). This illustrates the prevalence of distribution centres in the Midlands and in close proximity to the port of Felixstowe.

Source: DfT using CSRGT, 2007

Figure 50: Inward containers 2004–2007 moved by road from container ports by first destination district (tonnes)

© Crown copyright. All rights reserved. Department for Transport 100039241 2008

42


Source: DfT, Continuing Survey of Roads Goods Transport

Region%

shareOf which n% travels from

Eastern England 27% 63% – Felixstowe 17% – Tilbury 20% Other

East Midlands 13% 42% – Felixstowe 17% – Tilbury 41% Other

South East 12% 38% – Southampton 24% – Tilbury 21% – Felixstowe 17% Other

North West 11% 47% – Liverpool 15% – Felixstowe 38% Other

Yorkshire & the Humber

9% 29% – Felixstowe 23% – Hull 20% – Immingham 28% Other

West Midlands 8% 34% – Felixstowe 18% – Southampton 18% – Tilbury 30% Other

Greater London 8% 40% – Felixstowe 28% – Tilbury 17% – Medway 15% Other

South West 5% 39% – Southampton 26% – Tilbury 35% Other 40% Other

Wales 3% 26% – Southampton 19% – Felixstowe 15% – Tilbury

Scotland 3% 48% – Grangemouth 21% – Teesport 31% Other

North East 2% 51% – Teesport 49% – Other

Total 100 36% – Felixstowe 15% – Tilbury 14% – Southampton 35% – Other

Figure 51: Regional distribution of inwards container movements by road from UK container ports

Courtesy of Mark Dyball/Alamy

The Port of Bristol conducted a study into onward distribution in the UK. Using postcodes for container origins and

destinations the study provided a view on the UK distribution of container freight, illustrated by figure 51.

43


Figure 52 tabulates the destination of containers imported and distributed onwards by road. CSRGT only records the first destination of the vehicle, and not its ultimate destination, which explains the high

proportion of containers whose destination is the Eastern England region; as containers are initially moved to holding depots near Tilbury and Felixstowe ports, before being moved to a distribution centre.

Source: The Bristol Port Company, 2007

Figure 52: Container freight imports destination

44


Container import distribution is represented by red circles. This data reinforces the importance of the Midlands as a key market for distribution centres.

The majority of container imports are transported to distribution centres in the Midlands and London.

It should be noted that this survey was commissioned by Bristol Port and data was collated from one onward distributor only.

The data should therefore be treated as indicative on this basis.

In terms of future patterns of demand for warehousing and distribution facilities, Figure 53 shows a forecast conducted by Gerald Eve chartered surveyors, examining the most appropriate locations for warehouses based on a variety of factors including transport connections, labour market issues and the planning environment.

Source: Gerald Eve, 2006

Figure 53: Great Britain Warehousing Activity Forecast

45


7.2. Onward distribution by roadThe movement of containers by road to/from the port accounts for over 80% of all container movements within the UK. Road transport is a flexible means of transporting goods, without the terminal location constraints inherent in rail transport, although generates more carbon and contributes to congestion on the UK road network.

The following sections shows, for each of the ports, how the volumes of imported container traffic are distributed on the strategic road network and the levels of congestion and traffic speeds on key routes surrounding each of the ports.

Courtesy of Imagebroker/Alamy

46


7.3.1 Road distribution – Port of Bristol

Bristol port has direct access to the M5 motorway from a spur road connecting to junctions 18 (Avonmouth) and 19 (Portbury). The M5 provides connectivity to Birmingham and the Midlands to the north, and Devon and Cornwall to the south. Bristol port is well placed both geographically and by road

connectivity to serve distribution centres in the Golden Triangle.

The M4 motorway, via junction 15, provides access to Wales over the Severn Estuary and access to London markets to the east.

Figure 54 illustrates international HGV container flows from the port.


Figure 54: International HGV container flows from the Port of Bristol

© Crown copyright. All rights reserved Department of Transport 100039241 2008

47


Figure 55: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around Bristol port18

18 The background to this measure is set out in CSR07 Baseline figures and methodology which can be found at: http://www.dft.gov.uk/pgr/statistics/datatablespublications/roadstraffic/speedscongestion/congestiononthestrategicroad5359

Figure 55 illustrates the average delay per ten vehicle miles for the slowest 10% of journeys around Bristol. Average journey time heading north on the M5 is 9 minutes per 10 miles travelled.

Figure 56 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding Bristol port.

Figure 56: Average speed during weekdays (6am–8pm) in 2007 on theroad network around Bristol port

48



Figure 57: International HGV container flows from the Port of Felixstowe

7.3.2 Road distribution – Port of Felixstowe

The A14 and A12 are the strategic road routes serving the Port of Felixstowe. The A14 extends 130 miles from the Port of Felixstowe in the east to the junction of the M1/M6 in the Midlands at the heart of the golden triangle. The A12 links to the A14 (13 miles to the west

of the port) and provides connectivity to the M25, London orbital motorway, 50 miles to the south. Both routes have estimated container import volumes of over 400,000 containers per year.



49


Figure 58: Average delay per 10 vehicvle miles for the slowest 10% of journeys on the road network around Port of Felixstowe

Figure 58 shows the average delay per ten vehicle miles for the slowest 10% of journeys on the road network surrounding Felixstowe. The A12 heading south has the most congestion of roads to/from the port.

Figure 59 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding Felixstowe port.

Figure 59: Average speed during weekdays (6am–8pm) in 2007 on the road network around Port of Felixstowe

50


7.3.3. Road distribution – Ports of Grimsby, Hull and Immingham

The A63 links the port of Hull to the M62, located 17 miles to the west and provides the main access to the north west of England and the conurbations of Leeds, Manchester and Liverpool.



Figure 60: International HGV container flows from the Port of Hull


51


Figure 61: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around ports of Hull, Grimsby and Immingham

Figure 61 shows the average delay per ten vehicle miles for the slowest 10% of journeys on the road network surrounding Hull.

Figure 62 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding the port of Hull.

Figure 62: Average speed during weekdays (6am–8pm) in 2007 on the road network around Ports of Hull, Grimsby and Immingham

52


7.3.4. Road distribution – Port of Liverpool

The A565/A5036 connects the port to the motorway network (M57, M58). The M57 links to the M62 which provides access to Manchester, Leeds and Hull to the east. The M58 links to the M6 which provides access to the Golden Triangle.



Figure 63: International HGV container flows from Port of Liverpool


53


Figure 64: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around Port of Liverpool

Figure 64 shows the average delay per ten vehicle miles for the slowest 10% of journeys on the surrounding road network.

Figure 65 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding the port of Liverpool.

Figure 65: Average speed during weekdays (6am-8pm) in 2007 on the road network around Port of Liverpool

54


7.3.5. Road distribution – Ports of Medway and Tilbury

The A1089 links the port of Tilbury to the A13, 3 miles to the north. The A13 links to the M25, four miles to the west. Medway port is linked by the A249 to the M20, 17 miles to the south west. The M20 links to junction 3 of the M25 21 miles to the north west.

Figure 66 and Figure 67 illustrate international HGV container flows from the ports of Medway and Tilbury.


Figure 66: International HGV container flows from Medway port


Figure 67: International HGV container flows from Tilbury port

55


Figure 68: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around Medway and Tilbury ports

Figure 68 shows the average delay per ten vehicle miles for the slowest 10% of journeys on the road network surrounding Tilbury and Medway ports.

Figure 69 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding Tilbury and Medway ports

Figure 69: Average speed during weekdays (6am–8pm) in 2007 on the road network around Medway and Tilbury ports

56



Figure 70: International HGV container flows from the Port of Southampton

7.3.6. Road distribution – Port of Southampton

Access to the port of Southampton is via the A3024 linking to the M27 to the west, and the A3025 which connects to the M27 in the east. The M27 joins the M3 approximately 8 miles north of Southampton, which provides the key access to London and the midlands. The M27

joins the M25 approximately 55 miles to the north.



57


Figure 71: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around the Port of Southampton

Figure 71 illustrates average delay per ten vehicle miles for the slowest 10% of journeys on the road network surrounding the Port of Southampton.

Figure 72 illustrates the average speed between 6am and 8pm on weekdays on the road network surrounding the Port of Southampton.

Figure 72: Average speed during weekdays (6am-8pm) in 2007 on the road network around Port of Southampton

58



Figure 73: International HGV container flows from Teesport

7.3.6. Road distribution – Teesport

The A66 connects Teesport to the A1(M) approximately 22 miles to the west. The A19 provides access to Newcastle approximately 40 miles to the north.



59


Figure 74: Average delay per 10 vehicle miles for the slowest 10% of journeys on the road network around Teesport

Figure 74 illustrates average delay per ten vehicle miles for the slowest 10% of journeys on the road network surrounding Teesport.

Figure 75 illustrates the average speed during 6am and 8pm on weekdays on the road network surrounding Teesport

Figure 75: Average speed during weekdays (6am-8pm) in 2007 on the road network around Teesport

60


Vehicle Booking System (VBS)

VBS is an online booking system for HGV collections and deliveries of containers. It requires hauliers to select a designated slot for delivery and collection to the port, aiming to spread the load for vehicle calls throughout the working day, minimising congestion.

The system ensures that all necessary container information is present before the haulier arrives at the port and allows ports to limit the number of vehicles throughout the day, minimising peaks in demand and vehicle queues. Haulage and logistics operators are required to factor in time to safeguard against road congestion, in order to predict an accurate terminal arrival time. For this reason VBS can be seen by hauliers as an operational overhead.

Most distribution centres only accept delivery of containers during normal working hours, and typically require containers at 8am, allowing time to strip and sort container contents before transporting to stores. This forces a peak in demand when hauliers are required to collect containers in order to meet distribution centre demand. Hauliers can therefore be constrained in the onward distribution stage of the journey by VBS upstream and the distribution centres’ requirement for goods at 8am downstream, a constraint known as the ‘8am syndrome’. Nevertheless VBS has delivered efficiency improvements to the haulage industry. The system ensures that the containers for collection are available and customs cleared.

Operation Stack

Operation Stack is a traffic management system implemented when port stoppages (as a result of, for example, adverse weather) result in a build-up of traffic. Initially, vehicles are stacked in on-port holding areas. When these are full, Operation Stack is invoked and vehicles are queued on key roads close to the ports.

Felixstowe Port operates such a system where HGV’s are parked along the A45 near Levington.

Operation Stack is controlled by a working group consisting of the port, police, county council, district council and the Highways Agency.

61


7.4. Onward distribution by rail

7.4.1. Overview of UK rail freightFigure 76 illustrates the average actual weekday usage of the rail network by freight trains in financial year 2004/2005. The busiest sections of the network used by freight trains are set out in red. These sections see in excess of 50 trains per day in each direction.

Figure 77 tabulates trends in tonne kilometres of freight moved (weight of freight lifted multiplied by the distance carried). Containers are represented in the ‘Intermodal’ category.

Source: Network Rail Freight Route Utilisation Strategy, March 2007

Figure 76: Average daily freight trains in single direction 2004/05

Billion net tonne km moved

2000/01 2001/02 2002/03 2003/04 2004/05 2005/06

Coal 4.8 6.2 5.7 5.8 7 8.6

Metals 2.1 2.4 2.6 2.4 2.6 2.2

Construction 2.4 2.8 2.5 2.7 2.8 3

Petroleum 1.4 1.2 1.2 1.2 1.2 1.3

Channel Tunnel 1 0.6 0.5 0.5 0.5 0.5

Intermodal 3.8 3.5 3.4 3.5 4 4.4

Other 2.6 2.6 2.7 2.8 2.5 2.3

Total 18.1 19.4 18.5 18.9 20.6 22.1


Figure 77: Amount of rail freight moved by freight type


62


7.4.2. UK container rail freightFigures 78 and 79 show that the Midlands, North West and Yorkshire are the dominant destinations for container freight trains arriving from UK deep-sea ports.

The total number of inland bound trains (only collected in the month of January each year) has increased from 176 in 1997 to 307 in 2006, an increase of 170%. The Midlands has seen the largest gain, at 420%, from 15 trains in 1997 to 78 trains in 2006.

Reliability is generally higher for containers transported by rail as road hauled containers can be susceptible to congestion on the road network. Furthermore, increased fuel prices have inflated the cost of transporting containers by road, making rail haulage more attractive.

1998

1999

2000

2001

2003

2004

2002

2005

0

50

100

150

200

250

300

350

n Midlandsn Yorkshiren North-westn South-east

2006

1997

Num

ber o

f tra

ins/

wee

k –

Janu

ary

each

yea

rn North-eastn Walesn Scotlandn East Anglia

Source: Woodburn, Allan (2007) ‘The role for rail in port-based container freight flows in Britain’, Maritime Policy & Management, Issue 34:4

Figure 78: Container train arrivals at inland terminals from deep-sea ports

Region 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 % change, 97–06

Midlands 15 14 25 30 40 25 41 73 72 78 420

Yorkshire 26 26 31 31 36 38 40 46 51 71 173

North-west 61 56 66 76 86 67 79 86 97 92 51

South-east 17 11 10 10 20 10 15 20 10 20 18

North-east 10 5 10 10 12 12 11 11 12 11 10

Wales 11 15 20 15 10 10 15 16 13 10 -9

Scotland 36 41 36 35 35 25 20 20 20 20 -44

East Anglia 0 – – – – – – – 10 5 n.a.

Total 176 168 198 207 236 187 221 272 285 307 74

Source: Woodburn, Allan (2007) ‘The role for rail in port-based container freight flows in Britain’, Maritime Policy & Management, Issue 34:4

Figure 79: Container train arrivals at inland terminals from deep-sea ports (no. of trains/week; January each year)

63


Figure 80 outlines the increase in rail container freight between 1998 and 2005. Total container traffic increased 24% during

the period, whereas the number of trains departing from deep-sea ports and arriving at inland terminals increased by 44%.

Figure 81 illustrates the market share of operators of rail container movements. Freightliner is the largest container rail operator in the UK, accounting for 79% of the market for inland distribution of international containers. At the time of privatisation in 1994, Freightliner was the only container rail operator, EWS and GB Railfreight have since gained a 11% and 9% market share respectively.

Freightliner79%

GB Railfreight 9%

EWS 11%

Fastline 1%

Source: Allan Woodburn, Westminster University, 2007

Figure 81: Estimated UK market for inland distribution of international containers (volume of TEU carried)

1998/99 2004/05 % change

UK container traffic (million TEU)* 6 8 24%

Domestic intermodal rail freight (billion tonne km) 4 4 14%

No. of loaded services per week** 470 594 26%

No. of departures per week from deep-sea ports** 184 265 44%

No. of container train arrivals per week at inland terminals** 198 285 44%

*1998 and 2004 calendar year figures; **January 1999 and 2005 figures.

Source: Woodburn, Allan (2007) ‘The role for rail in port-based container freight flows in Britain’, Maritime Policy & Management, 34:4, 311 – 330

Figure 80: Summary of key trends relevant to the containers-by-rail market, 1998/9 – 2004/5


64


7.4.3. Container freight rail routesFigure 82 illustrates the volume of intermodal19 freight carried on the UK rail network. This gives an indication of the key rail routes used to transport containers.

The current core rail freight route from Felixstowe is via the Great Eastern Main Line, North London Line and West Coast Main Line. The Great Eastern Main Line which runs from Felixstowe to London is gauge cleared to take 9’6” containers on standard deck height wagons, and is operating near to capacity.

This is the only electrified route; an alternative diesel-only route for freight from Ipswich to the West Coast Main line at Nuneaton is being developed via Ely, Peterborough and Leicester, although this is currently capacity constrained around the Leicester area and both west and east of Peterborough.

Rail container freight from Southampton uses the South Western Main Line to Basingstoke then runs to Reading to join the Great Western Main Line to Didcot. From there it runs north via Oxford towards the West Coast Main Line and the Midlands, the north of England and Scotland.

A capacity pinch point for freight and passenger trains exists at Reading where revised layout options are being developed by Network Rail, including grade separation.

Much traffic from Tilbury and London Gateway (when opened in 2011) will be routed via north London on the Barking to Willesden via Gospel Oak route. This route is being gauge cleared and additional signals are being added in 2009.

7.4.4. Inland container rail terminals As with the ports themselves, inland rail terminals are an important node in the flow of containers by rail. Figure 83 shows in green the connections that exist by dedicated container train services between key ports and the inland terminals. The two main ports, Felixstowe and Southampton, have direct links to the majority of the 14 terminals, while Tilbury and Thamesport have fewer connections since their container throughput is smaller resulting in fewer corridors where volumes justify dedicated rail services.


Figure 82: Intermodal trains per day in 2004/2005

19 Intermodal freight transport is the transportation of freight in a container or vehicle, using multiple modes of transportation (rail, ship, and truck).

65


20 3 separate terminals within Manchester (Trafford Park)

Terminal RegionRegular connection to/from:

Felixstowe Southampton Tilbury Thamesport

Daventry East Midlands

Wilton North East

Ditton North West

Liverpool North West

Manchester20 North West

Coatbridge Scotland

Cardiff Wales

Birch Coppice West Midlands

Birmingham West Midlands

Hams Hall West Midlands

Doncaster Yorks. & Humber

Leeds Yorks. & Humber

Selby Yorks. & Humber

Wakefield Yorks. & Humber

Source: Based on research for Woodburn, Allan (2008) ‘Intermodal rail freight in Britain – a terminal problem?’ Planning Practice and Research, Issue 23:3

Figure 83: Inland container rail terminals and their regular connections with the key ports, 2008


Figure 84 illustrates the same data on a map. The three distinct destination regions of the Midlands, North West and Yorkshire are visible.

Many of these terminals solely handle containers being imported to or exported from the UK, while others handle a mixture of containers, other unit loads and other types of flow, including domestically and traffic passing through the Channel Tunnel to and from mainland Europe.

In addition, containers are carried along with other types of freight flow on shared-user trains. Examples include from Immingham, Purfleet, Southampton and Tilbury to South Wales, from Purfleet to Manchester and from Teesport to Scotland. These flows are small in comparison to the dedicated ones, but have been developing in recent years as a way of using rail when volumes are insufficient to justify an entire train direct from a port to an inland terminal.

66


The larger terminals have fixed gantry cranes. By contrast many of the other terminals rely on mobile ‘reachstackers’ to transfer containers between rail, road and storage facilities. Most of the terminals have considerable on-site storage.

Customers are rarely located on the same site as the rail terminal, so road hauliers provide onward transfer of containers to customers’ locations and deliver containers to the terminals for rail movement to the ports.

Source: Based on research for Woodburn, Allan (2008) ‘Intermodal rail freight in Britain – a terminal problem?’ Planning Practice and Research, 23:3, 441 – 460March 2007

Figure 84: Rail terminal connections from Felixstowe, Southampton, Tilbury and Medway ports

67


Length Height WidthMinimum gauge required

on standard height wagon

Deep-sea containers

20ft 8ft 6in 2.44m W8

40ft or 45ft 8ft 6in 2.44m - 2.5m W8

40ft or 45ft 9ft 6in 2.44m - 2.5m W10

Short-sea containers

40ft or 45ft 9ft or 9ft 2in 2.5 – 2.55m W10 – W12

40ft or 45ft 9ft 6in 2.5 – 2.55m W10 – W12

40ft or 45ft 8ft 6in or 8ft 9in 2.5 – 2.55m W8 – W9


Figure 85: Gauge requirements for container sizes

7.4.5. Gauge clearanceFigure 85 shows the rail gauge clearance required to transport typical deep-sea and short-sea containers. Gauge clearance of tunnels and overhead restrictions enables high-cube containers along the line. This is illustrated in Figure 86.

Figure 87 is the UK rail network map in 2004/05 with indicative gauge clearance by route. A review of gauge capability is being

undertaken that will verify the accuracy of published data for this measure.


Figure 86: Required gauge envelopes and container sizes


Figure 87: 2004/05 gauge clearance map

68


7.5. UK coastal shippingCoastal, or domestic, shipping is the movement of freight between UK ports. Containerised goods only account for a small proportion of coastal shipping (around 3% of goods lifted). Much of this is feeder traffic being moved from the largest container ports

to regional ports on smaller vessels, but there is also traffic between the islands of the UK.

Figure 88 indicates the split between coastal shipping domestically within the UK and internationally by TEU and weight in 2007.



Figure 88: Foreign and domestic (coastal) shipping of UK containers (TEU)21

Thousand units Thousand tonnes of goods

In Out All In Out All

Foreign container traffic 2,571 2,448 5,019 35,032 22,090 57,123

Coastwise container traffic 159 173 333 1,491 1,896 3,387

21 Coastwise traffic is double counted where it was both loaded and unloaded at a major port (one handling more than 1 million tonnes of all cargo types per year).”

Figure 89 shows the top ten ports for domestic container traffic in 2007. Overall, domestic traffic accounts for only a small proportion of all container traffic, the main exceptions being ports providing inter-island services (e.g. Belfast, or Aberdeen which serves Shetland and Orkney) or participating in feeder services with the major UK terminals (e.g. northern east coast ports operating feeder services with Felixstowe).

The UK’s major ports give lower priority to coastal shipping than to direct calls, as it is

more commercially viable to sell slots to direct-call deep-sea vessels than to coastal shipping vessels. Furthermore, a charge is levied by the port for containers being moved by coastal shipping from the port, in comparison to road and rail modes of onward travel which do not incur a charge from the port.

DomesticAll

routes

Domestic as % of

total

Felixstowe 93 3,343 3%

Belfast 92 264 35%

Forth 76 256 30%

Southampton 53 1,869 3%

Liverpool 53 675 8%

Portsmouth 28 77 36%

Aberdeen 27 28 98%

Tyne 18 53 34%

Tees and Hartlepool

14 154 9%

Orkney 12 12 100%

Other major ports 45 2,146 2%

All UK major ports 510 8,874 100%


Figure 89: Coastal shipping of containers from top ten UK container ports (thousand TEU)

69

This section sets out the many improvements in progress or in the pipeline that will improve the container freight end-to-end journey.

8.1. Getting through the port

Harwich International Bathside BayIn October 2000, Hutchison Ports (UK) Limited, owner of Harwich International Port, announced that it had agreed to purchase Bathside Bay, a 101 hectare site adjacent to the existing port operation.

The £300 million container terminal scheme will make Harwich International Port the second largest container port in the UK, almost doubling the total quay length to 3,000 metres, and enabling the port to handle up to four deep-sea container vessels simultaneously. Road and rail infrastructure is already in place, servicing the present Harwich International Port. A new rail terminal will be an integral part of the proposed developments.

In addition to the container terminal, an area of around 45 hectares to the south and east of the site will be landscaped or developed for mixed amenity and appropriate commercial use related to the port development. The development of these areas is subject to stringent local authority planning procedures, which recognise the need for an integrated approach to meet the needs of the locality and encourage economic growth.

Felixstowe South ReconfigurationFelixstowe South Reconfiguration redevelopment proposals comprise the construction of a new container quay (approximately 1,350 metres), quayside berths (providing 4 deepwater berths) supported by quayside cranes/rubber tyred gantry cranes,

a container stacking area/yard of 65 hectares, HGV roadways and parking.

The development will provide an additional 910m of deepwater quay face bringing the total length of quay at the Port to 3,828 metres. When fully developed the terminal will be equipped with thirteen ship to shore gantry cranes and fifty rubber tyred gantries.

The development will increase the handling capacity of the Port by 1.56 million TEUs per annum.

The planned Northern Gateway Container Terminal will increase container handling capability from current 350,000 boxes per year to up to 1.5 million containers per year in 2020.

To allow deep-sea vessels from the Far East to berth, the channel will be dredged from 10.5 to 14.5 m.

Felixstowe ultra post-panamax cranesFelixstowe Port is serviced by 27 ship-to-shore gantry cranes – from Panamax to ultra post-Panamax – with five new ultra post-Panamax cranes due for delivery in early 2008. These cranes will the largest at the Port, with an outreach of 22-containers wide, and are equipped with twin lift capability, and heavy lift capacity of 85 tonnes.

DP World Southampton ultra post-panamax cranesIn 2008 DP World Southampton took delivery of two new super post-panamax gantry cranes each with an outreach of 22 containers wide. An order for a further two new super post-panamax gantry cranes has been placed. These cranes will be the same specification

8. Improvements to the container end-to-end journey

70

and manufacture and will be delivered into operation in August 2009.

London GatewayThe construction of a major new deep water port commenced in 2008, with container operations to begin in late 2010. The development, being undertaken by DP World, will have capacity for the largest container ships currently in operation, will include a 2,300m long quay and, when fully developed, a capacity of 3.5 million TEU.

The port development will also include a distribution park of over 300 hectares and warehousing of over one million square feet.

Bristol Port deep water container terminalThe Bristol Port Company has initiated development work on a new deep water container terminal in the Bristol Channel. The new terminal would, if consented and built, give the port the capacity to handle 1.5M TEU per year, and fifteen post-panamax cranes will be installed to service the vessels. The new terminal would be outside the locks and offer a draft of up to 16m.

The development is designed to service the largest container vessels currently in circulation as well as successive generations of Ultra Large Container Ships up to 14,000 TEU and 16 metres draft, as and when they enter service.

The proposal has been subjected to detailed investigation in a series of Bristol Port Company studies of its economic need and benefits, environmental impacts and engineering requirements.

An application has been made to the DfT for a Harbour Revision Order (HRO) to enable construction of the terminal to start.

Port of LiverpoolPort of Liverpool is planning a second container terminal to be built in the River Mersey at a cost of £100 million and able to simultaneously accommodate two of the new generation post-Panamax container ships. The new facility, capable of handling 500,000 TEU’s a year, will almost double Liverpool’s container capacity to nearly 1.5 million TEU.

8.2. Road improvements benefiting key container freight routes

A14 The DfT and the Highways Agency are addressing the difficult challenge of accommodating an increase in container traffic and tackling congestion on the A14, particularly through South Cambridgeshire, where heavy goods vehicle movements coincide with local travel to work. The Highways Agency’s Ellington to Fen Ditton improvement scheme addresses the road capacity issue and is expected to enter construction (subject to public inquiry) in late 2010. The HA is also delivering technology improvements on the route, such as variable message signs.

M25 To manage flows better on the M25 it is proposed to enhance capacity on almost all the remaining three-lane sections, with work scheduled to begin on widening the north west quadrant from junctions 16 to 23 in 2009, and options are being explored for locking in the benefits of this additional capacity through integrated traffic management of the access to the motorway. The Highways Agency is looking at proposals for improvements at junction 30 of the M25, to facilitate development at the London Gateway Port and in the Thames Gateway.

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M27The M27 is being widened between junction 3 (M271 to Southampton) and junction 4 (M3), work began on this project in February 2008. In addition, the Highways Agency opened new climbing lanes on the uphill sections of the M27 eastbound from junction 11 (Fareham) and westbound from junction 12 (M275 Portsmouth) in September 2008.

The M27 between junction 4 (M3) and 11 (Fareham) is being considered for hard shoulder running.

M4 and M5Current works on the M4 and M5 motorways include upgrading communication equipment, bridge replacements and junction improvements. Proposals for managed motorways with hard shoulder running for junctions 19 to 20 (M4) and junctions 16 to 17 (M5) around Bristol are being investigated.

Further improvements to the strategic road network are detailed in the Highways Agency Business Plan (available on the website at http://www.highways.gov.uk/aboutus/18403.aspx ).

High-value international gateway schemesIn November 2008 the Government announced £300m of investment to support international gateways. These included:

A12 (Highways Agency, regional scheme) –a large-scale package of traffic management measures on the A12 to address reliability, congestion and safety issues on the freight route to the Haven Gateway Ports.

The A160/A180 (Highways Agency, regional scheme) will deliver additional grade separation on the main access route to Immingham Port.

8.3. Rail improvements

Felixstowe branch lineIn July 2008 the Secretary of State granted Felixstowe Branch Line and Ipswich Yard Improvement Order. The Order seeks to increase the capacity of the Felixstowe branch line through the dualling of a stretch of the existing single-track line between Trimley Station and a point west of Levington Bridge, to construct three additional 24-wagon sidings within the existing Ipswich marshalling yard, and to undertake some modifications at Westerfield level crossing.

The capacity enhancement will allow up to 40 freight trains per day to run in each direction by the year 2020, and will help Port of Felixstowe to achieve a rail modal share of 26% – taking a total of 500,000 lorry movements off the roads.

In parallel with these local rail improvements, HPUK is working closely with Network Rail to fund gauge and capacity improvements to the route between Ipswich and Peterborough and the East Coast Main Line, and its diversionary routes to south Yorkshire.

Southampton to West Coast Main Line rail gauge clearanceTo further promote modal shift to rail, access is being improved between Southampton and the West Coast Mainline (scheduled to begin in 2010), by increasing the gauge and by grade separation with the Great Western Mainline at Reading.

North London Line capacity improvementsThe North London Line Freight Enhancement (Network Rail) – to increase the long-term capacity of this key rail link to the Thames Gateway and the London Ports.

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This will include improvements to signalling and track layout to allow additional freight trains to operate on the network, set to complete in 2014.

East Coast Main Line improvementsThe Department’s 2007 High Level Output Specification set out the outputs the Government wish to purchase from the rail industry between April 2009 and March 2014. This included over £500 million investment in the East Coast Main Line, and a parallel route, to provide additional passenger and freight capacity by 2014.

Haven Ports to Midlands rail gauge clearanceThe first phase of work to increase the gauge of the rail-link from Haven Ports to the Midlands (so that it can handle 9’6” containers) has been completed, and the second phase (gauge and capacity enhancements facilitating rail freight movement from Ipswich via Peterborough through Nuneaton) is funded by the Government and is in Network Rail’s investment programme for 2009–14.

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This document has laid out some of the quantitative and qualitative data that gives a picture of the end-to-end journey. This section draws out some of the findings from each stage of the journey analysis, and highlights where the evidence points towards areas where the DfT could carry out further analysis, or where additional data may be required, to inform the generation of a range of solutions to meeting the challenges.

The consultation document “Delivering a Sustainable Transport System” (DaSTS), (published 25 November 2008) set out the timetable and the Department’s intentions to adopt a whole journey approach to inform future policy interventions for international networks.

It is likely that investment decisions for the period 2014–19 and beyond will be taken in stages leading up to 2012. Between now and 2012 the Department will need to consider a range of high level options. The analysis in this document will inform that process. Our wider approach to ensuring that the needs and impacts are reflected fully in this decision making process is outlined in “Delivering a Sustainable Transport System: The Logistics Perspective” published in December 2008.

During 2009 the Department will also be consulting on a National Policy Statement for ports in England and Wales for designation under the Planning Act 2008. The Statement will set out the Government’s strategy on nationally significant sea port infrastructure, and guide those involved in applications for the development of such infrastructure.

Onward distribution within the UK1 Rail access: Stakeholders have identified the potential to make further use of rail in the

container market. But there are a number of barriers to taking this further. These include:

Lack of commercial incentives at a time when road transport is still seen as having a price and flexibility advantage over rail freight;

Lack of intermodal connectivity to key locations – including distribution centres;

A shortage of capacity at intermodal terminals at some ports; and

Understanding how to make a rail service work in practice – including who to approach and what Government support is available.

There are also issues concerning:

the comparatively short distances that some containers travel from ports, which make them less likely to be suitable for rail transport given the handling costs imposed; and

the need for further gauge clearance of routes including improvements currently planned and funded by the Department through Productivity TIF funding.

2 Road access: The analysis in this document helps identify the key road pinch points on the core distribution routes from container ports. For some ports the problems are most acute on

9. The container freight end-to-end journey: emerging issues

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roads in close proximity to the terminal. However, in other cases, congestion is more severe on core routes near distribution centres.

Further, many ports experience significant peaks and troughs – with most hauliers wanting their boxes picked up from the ports at around 8am. A more effective spread of demand would impact on the capacity of the surrounding infrastructure, easing congestion and improving end-to-end journey reliability.

As part of the DaSTS option generation phase we will work with stakeholders to understand the challenges in road and rail surface access to our key container ports in more detail. We will ensure that the needs of container traffic are considered fully in reaching decisions on the 14 strategic national network corridors as part of our wider work, including analysis of freight flows on the corridors.

3 Transhipment and reducing congestion and carbon emissions: Port capacity constraints in the Greater South-East are likely to mean an increase in transhipment of containers into ports in the rest of the UK via transhipment hubs on the Continent such as Rotterdam. The net effect of this could be a relatively small reduction in lorry miles, bringing environmental benefits, but evidence suggests these would be outweighed by a net increase in handling costs.

With a greater focus on reducing carbon emissions flagged in the DaSTS publication, there is scope for further examination of what opportunities exist to reduce congestion and carbon emissions from container freight distribution. The Department would welcome further evidence to better understand transhipment benefits.

4 “Port-centric” Logistics: The requirement to minimise end-to-end supply chain costs and a heightened focus on climate change issues has seen increasing interest in and use of the practice of “port-centric” logistics. In pure form, this means holding goods at warehouses in close proximity to the port of entry, sometimes directly accessible by specialised port handling equipment. Variants already exist (e.g. Asda at Teesport, B&Q at Immingham) and a major logistics centre at London Gateway port (Shellhaven) is planned. There are potential benefits, such as possible elimination of a road leg to the distribution centre and reduction in lorry mileage by avoiding trips back from the distribution centre or retail outlet nearer the port itself. However, stakeholders have also identified potential disbenefits including the potential for increased HGV traffic in the vicinity of ports and impacts on the opportunities for use of modes other than road for inland distributions – potentially leading to overall increases in carbon.

Further evidence is needed, so as to better understand the role port-centric logistics can play in addressing the key challenges facing container ports and their net impact on carbon emissions.

Origin and destination data: Understanding the routes taken and modes used in transporting goods to their final destination is important if we wish to tackle pinch points, address resilience in the journey and understand the efficiency of the land leg from a cost and environmental perspective. Data exist on the general destination of goods (though not if they have been transported via multiple journeys) and the volume of goods traffic on the national road and

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rail networks. However, we have gaps in our evidence base concerning how these pieces of information fit together.

Information on the origin and destination of containers, their onward movement to distribution centres and retailers and rail utilisation would help answer these questions recognising that much of this data is held by our strategic stakeholders across the end-to-end journey. However, we will need to consider carefully how this could be gained without imposing excessive burdens on business.

Getting through the Port5 Potential efficiency improvements: This analysis has indicated that in the context of

improving the efficient movement of goods through the container port, opportunities may exist to improve:

a. Information sharing and consistent recording of information to minimise delays as containers move from ship to destination;

b. Customs processes and border controls;

c. The provision of port hinterland distribution centres;

d. The smoothing of traffic flow into and out of ports.

As part of the DaSTS option generation phase we will work with stakeholders to understand the challenges in getting through the port and the potential options available to address them, recognising that the Government only has a role to play in delivering these solutions in some parts of the end-to-end journey.

6 Performance metrics: Making better use of existing assets was identified as a key priority by the Eddington Transport Study. There is little consistent, publicly available performance information to understand the efficiency of making use of our container ports. Information on getting through the port is currently drawn primarily from each port’s own operational information, which is tailored to that port’s requirements. Understanding how UK ports benchmark with each other and with European and international ports in terms of efficiency and performance can inform policy analysis, for example in striking the right balance between the regulation of border controls (customs/security etc) and facilitating trade.

Data on the timings containers spend travelling through ports would enable a better comparison of the proportion of time spent in each stage of the end-to-end journey. This would provide the basis for a more accurate understanding of the durations associated with each stage of the journey.

Further work is required to understand whether there are any further performance metrics or new data sources that could be used to allow better comparison between container ports and to understand the constraints in getting through the port.

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Annex A – Goals and associated challenges identified for international networks

To support national economic competitiveness and growth, by delivering reliable and efficient transport networks– Reduce lost productive time on international networks by maintaining or improving

efficiency, predictability and reliability of international end-to-end journeys.

– Ensure passengers and freight have access to globally competitive levels of international connectivity.

– Ensure international networks are resistant and adaptable to shocks and impacts such as adverse weather, accidents, terrorist attacks and impacts of climate change.

To reduce transport’s emissions of carbon dioxide and other greenhouse gases, with the desired outcome of tackling climate change– Ensure forecast growth in international aviation emissions is matched by equivalent

transport reductions or offset by reductions in other sectors.

– Increase the carbon efficiency of international shipping. Forecast growth to be offset by reductions in other sectors.

To contribute to better safety, security and health and longer life-expectancy by reducing the risk of death, injury or illness arising from transport, and by promoting travel modes that are beneficial to health– Reduce the risk of death or injury due to transport accidents

– Reduce the social and economic costs of transport to public health, including air quality impacts.

– Work internationally and nationally to reduce vulnerability of international networks to terrorist attack.

To promote greater equality of opportunity for all citizens, with the desired outcome of achieving a fairer society– Improve accessibility for persons of reduced mobility on international networks.

– Contribute to the reduction in the gap between economic growth rates for different regions.

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To improve quality of life for transport users and non-transport users, and to promote a healthy natural environment– Limit and, where possible, reduce the number of people in the UK significantly affected by

aircraft noise.

– Minimise the impacts of transport on the natural environment, heritage and landscape and seek solutions which deliver long-term environmental benefits.

– Improve the experience of end-to-end journeys for international transport users.

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