A look ahead to IMO 2020

The shipping industry must prepare for a future with lower transport emissions. IMO 2020 will ensure that ocean transportation remains the most environmentally friendly and carbon efficient mode of transportation.

WHAT IS IMO 2020?

From 1st January 2020 onwards, all seagoing vessels will have to reduce sulphur oxides by 85%. The new regulation is set by the International Maritime Organisation (IMO) with the aim of reducing greenhouse gas emissions, protecting public health and supporting the environment.

The regulation will apply globally and throughout the industry to fuels used in the open sea. Vessels must use marine fuels with a maximum sulphur content of 0.5% compared to the current limit of 3.5%.

WHAT ARE THE CHALLENGES OF IMO 2020?

The prospect of IMO 2020 has resulted in a high level of uncertainty about availability of petroleum products and pricing. It will affect vessel operators, refineries, and global oil markets.

Vessel operators have the following choices to comply with the new IMO 2020 sulphur limits:

1. Use scrubbers (emission cleaning technology) to remove pollutants from the ship’s exhaust, whichallows them to continue using higher-sulphur fuels.

However, the process of installing scrubbers is limited and expensive due to space and capacity constraints and will increase operating costs. In addition, the price and availability of higher-sulphur fuels after 2020 remains uncertain. Amongst others, China and Singapore have already banned open- loop scrubbers in inland port waters and coastal shipping ECAs because the environmental benefits are questionable.

2. Switch to non-petroleum-based fuels such as liquefied natural gas (LNG) for newer vessels with appropriate specifications However, the infrastructure to support the use of LNG is currently limited in scope and availability. Experts predict that by 2020 approximately 250-500 vessels, or a maximum of 10% of the global container fleet, will either be equipped with pollution cleaning technology or will be able to burn LNG.

3. Switch to a Very Low Sulphur Fuel (VLSF) that complies with the new rules (Most likely choice).

However, the cost, widespread availability and specifications of a new fuel for use in marine engines are still uncertain. The petroleum industry needs to adapt refineries and supply chains and is likely to pass these costs on to the market.

WHAT ARE IMPACTS AND RISKS?

It is currently not possible to indicate an amount for the future price levels for VLSF. At this stage all we can predict is that it will cost more than currently available fuels.

Today’s forecast assumes a short to mid-term increase in bunker prices* between US$ 180 and US$ 400 per TEU. Due to the significant increase in bunker prices, every company involved in sea freight will be confronted with rising transportation costs. When IMO 2020 comes into effect transportation services may be disrupted as a result of inadequate fuel quality, which may lead to engine failures or insufficient availability of compliant bunker fuels.

WHAT WILL BE THE IMPACT ON FREIGHT RATES?

According to current calculations, the expected increase in costs* will have a significant impact on the overall prices of container transportation and on freight rates. Whilst the implementation date for IMO 2020 is 1st January 2020, it is anticipated freight rates to increase as early as the end of the third quarter of 2019.

Therefore, freight agreements for both full and part load containers will include a price adjustment method also known as Bunker Adjustment Factor (BAF).

Through our strategic partnerships with ocean carriers from the main shipping alliances, as well as a network of independent overseas agents, FSEW always endeavours to negotiate mitigation of increases in freight, fuel and other surcharges. Our comprehensive carrier coverage provides our customers with multiple service options at market competitive rate levels.

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China-Europe rail services a real success story as exports rocket

China’s Belt and Road initiative (BRI) may have faced recent strong criticism from the EU, but that has not dented the growth in its exports to Europe.

Chinese officials have claimed a 106% increase in the value of cargo travelling by rail from China to Europe, equating to some $33bn.

Xiao Weiming, from the office of the leading group for promoting the BRI, told Xinhua that 14,691 trips have been made by China-Europe freight trains since 2011.

Operator United Transport And Logistics Company Eurasian Rail Alliance (UTLC ERA) recorded a 54% (62,622 TEU) upturn in volumes between China and Europe.

While the bulk is exports from China (35,536 TEU, up 69%), imports from Europe have been closing the gap, recording a 44% increase to more than 27,000 TEU in Q1.

The Russian-Kazakh-Belarussian-owned UTLC ERA has furthered its links between the two regions, having announced cooperation agreements with two European partners.

President of UTLC ERA Alexey Grom said: “I am perfectly confident the agreements signed with our partners will contribute to the active growth of the transit transportation market, enabling UTLC ERA to strengthen its leading positions in cargo shipments on Europe-China-Europe routes.”

During this month’s TransRussia exposition the operator entered an agreement with Slovakia’s public rail company, ZSSK Cargo, to facilitate IT collaboration on container shipments from China, to include route scheduling and an analysis of potential customer bases between Slovakia and China.

“This is the first time we have fixed in writing the intention to build a direct transit transportation technology process,” said Mr Grom. “We will be solely responsible for the 1520 gauge, whereas ZSSK Cargo will be in charge of the 1435 gauge.

“That is how we will be able to offer our customers the end product – a comprehensive shipping service solution.”

We are pleased to advise you that,  through our network of independent agents in China, and in addition to our ocean and air services,  FSEW is also offering a regular container service by rail from China to the UK. 

Current frequency is weekly and recent examples of transit times are achieving 25 to 28 days door/door.

If you would like to learn more about this service, please feel free to contact the undersigned or your appointed customer service representative.

Article courtesy of The Loadstar

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UK box port congestion could worsen during Q4 peak

Two-week delays already apparent ahead of the pre-Christmas peak import season as Southampton and Felixstowe struggle to clear backlogs

UK shippers and forwarders face a difficult fourth quarter if congestion at Felixstowe and Southampton container terminals continues, according a growing number of freight forwarders.

Although Southampton reported that congestion was easing last week, forwarders are telling, told Lloyd’s Loading List that backlogs were still significant at both ports and volumes would soon spike.

“Whilst we aren’t suffering the worst waiting times, we still are feeling the consequences and are needing to adjust our processes carefully,” said one.

“It’s very testing. We are already up to a two-week delay on bookings. We are likely to see an increase in container arrivals come the end of October through to mid-December for the pre-Christmas peak.

“Perhaps a slow period between Christmas and early January may be the answer to balancing demand again before Chinese New Year. But, if not, then I guess this could be a long road until the CNY closedown.”

Congestion stemmed from IT failure at Felixstowe earlier this year. This resulted in containers arriving at terminals in surges, or being diverted to alternative ports.

As volumes were switched to Southampton, congestion there also began to build.

“The IT problem affected hauliers getting in to port,” the forwarder said. “After what was thought to be a small blip, it continued for weeks and various importers made a drastic decision to switch the port of entry to Southampton. “Imagine even a 10% increase overnight and the strain on trucking that would be caused. The influx of extra containers has simply put booking times back to around 14 days.”

Asked why more boxes were not being diverted to London Gateway, the forwarder said its liner service roster was different to those of Felixstowe and Southampton. “Why would anyone opt for a slower service? Time is money,” he added.

Remember

In addition to FSEW being a leading independent international freight forwarder, with multiple carrier/service options, we also have at our disposal the resources of our container haulage division, with our own trucks, trailers and drivers under our direct control.  We also have a large block booking on the daily rail service from Southampton into the Freightliner deport at Cardiff, which is adjacent to our yard and office and from where we can arrange prompt onward delivery by road.  This provides our customers with more options, flexibility, reliability and overall better control of your container deliveries and associated costs, which significantly mitigates some of the issues adversely affecting the general marketplace.

A recent example of our capacity and capability was having the resources to run one of our own vehicles empty to London Gateway to collect a diverted container that was urgently required by one of our customers.

Result: our customer received urgent stock 14 days prior to shipping line’s earliest available delivery date and also avoided incurring significant demurrage costs.

If you would like to know more or discuss your business requirements in more detail, please feel free to contact me or speak directly to your designated account manager.

We value your business and assure you of our best attention and service at all times.

 

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Case Study: Nikon

Brief: For its ‘Big Hands’ advertising campaign to promote the launch of its new Nikon 1 camera, Nikon asked Specialist Models in Cardiff to create a collection of giant hands which would appear simultaneously in eight cities across Europe. A big part of the brief was the necessary element of surprise in the statues suddenly appearing in busy locations, as if out of nowhere. They turned to FSEW who they felt had the necessary experience to help them deliver the campaign to Nikon’s high standards.

Outcome: Working closely with Specialist Models, FSEW devised a schedule which enabled them to transport the giant hands safely across Europe, arriving in the desired city centre locations, such as, Covent Garden, Milan, Stockholm, Berlin, Paris, Warsaw & Zurich at exactly 4am. They also took care of all international customs paperwork and local government formalities to ensure safe passage.

Once they reached their destination the Specialist Models team were able to erect the statues undercover before revealing them. The campaign caused a worldwide stir and ensured that the launch of the Nikon 1 was an internet sensation.

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New FSEW Appointments to Encourage International Growth

Leading international freight forwarders, FSEW, has expanded its team with two key appointments.

Chris Lacey has joined as European Sales Manager, while Mike Hosking is the company’s new Air & Sea Freight Supervisor.

The two roles have been created as a result of a successful 12 months for FSEW which has seen the company strengthen its product offering and winning new clients, especially in the Asian sea freight sector.

Chris, originally from Aberdare, joins FSEW with over a decade’s experience in the freight industry, specialising in the European market.

Chris said: “I’ve worked with FSEW in various capacities for a number of years and have always been impressed by their professionalism and ambition. Relatively speaking they are a fairly small company but they have a huge appetite for growth.

“I am looking forward to building on the company’s European credentials by emphasising our USPs such as our 24/7 service and our strong presence in Europe.”

Mike, who specialises in air and sea operations, has been in the industry for six years and has worked for a number of South Wales cargo companies.

Mike said: “FSEW has an excellent reputation within the industry and I’m looking forward to developing my career as part of their busy team. I was impressed by the direction FSEW is moving in in terms of securing new business and its commitment to customer care.”

Geoff Tomlinson, Managing Director of FSEW said: “Earlier this year we spent time reviewing the business and assessing what we needed to do to take it forward. As part of our future strategy, we identified Chris and Mike’s roles as crucial to our success and recruited accordingly.

“Chris and Mike bring with them a wealth of experience and I’m confident that they will have a positive impact on FSEW and our clients.

“As one of only a handful of Freight Forwarders in the UK to operate our own truck fleet,, we are able to closely control our costs and service. This gives us an edge over our competitors, both locally and nationally. I believe that we are ideally placed to grow and Chris and Mike are integral to our future plans.”

FSEW, based at the South Wales International Freightliner Terminal in Cardiff, is South Wales’ leading independent intermodal freight forwarder providing transport and delivery services world-wide.

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FSEW Shortlisted for Prestigious National Award

FSEW is celebrating this week after being shortlisted for a prestigious national award. The Guardian’s Small Business Showcase is an opportunity for businesses to demonstrate their success in a variety of categories.

FSEW has been shortlisted in the ‘Logisitics: Driving Growth’ category which specifically focuses on how a small business effectively gets its product or service from A to B and what has been done to innovatively improve the service for customers.

Director Geoff Tomlinson said: “We are constantly striving to improve the services we offer our customers and to ensure that our offering is second-to-none. For our efforts to be recognised by The Guardian alongside businesses from across the UK is testament to the hard work that has been put in by the whole FSEW team.”

To read about how FSEW is helping businesses keep their environmental impact to a minimum click here.

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Nicky Brand Takes to the Road Thanks to FSEW

Following a major deal with tissue paper manufacturer, the Sofidel Group’s Intertissue site, Cardiff-based logistics experts FSEW has redesigned a number of specialist trailers to showcase one of the company’s major brands.

The freight company has worked closely with Sofidel to enable them to brand their lorries with the Nicky logo. The branding aims to highlight Nicky’s green credentials and emphasises their links with the Woodland Trust.

FSEW works with Sofidel to deliver their products from their Intertissue factory in Baglan to the rest of the UK.

Nicky is a brand growing in reputation for its quality and innovation. The Nicky range includes toilet tissue, kitchen roll, facial tissue and pocket tissue.

Geoff Tomlinson, founder of FSEW, said: “We have worked closely with Sofidel and Intertissue for a number of years and when we saw an opportunity to help them promote their brand we jumped at it.

“Although it might seem like a fairly simple step to take, it is an enormously effective one for promoting the brand UK-wide.”

Richard Wheeler, Nicky Brand Manager, Sofidel, said: “At the start of 2013, Nicky was very proud to announce a partnership with the Woodland Trust, where the brand committed itself to fund the planting of at least 20,000 native trees each year for the next three years – trees that are planted right here in Great Britain.

“To date, the number of trees we have helped plant stands at around 12,500. This is set to grow with the tree planting season quickly approaching. It’s also seen as a strong link to the Sofidel group’s environmental strategy and their participation in the WWF Climate Savers programme, where we are committed to reducing our 2007 CO2 emissions by 26% by 2020.

“We’re delighted that FSEW have supported us with communicating this message around the roads of Great Britain.”

FSEW, based at the South Wales International Freightliner Terminal in Wentloog, is South Wales’ leading independent intermodal freight forwarder providing transport and delivery services world-wide.

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FSEW Wins Silver at National Awards

FSEW has won two silver awards at the prestigious Chartered Institute of Logistics and Transport (CILT) Cymru Wales Awards.

FSEW was awarded the accolades in the 2013 Supply Chain Best Practice and Partnership categories.

The awards, which are held annually, celebrate best practice and highlight organisations that can make a difference in the transport industry in Wales. The judges look for businesses which demonstrate sustainable development and new ideas that will make a lasting difference to services in Wales.

FSEW’s founder, Geoff Tomlinson, said: “To receive two silver awards in a prestigious award ceremony such as this is testament to how hard the team has worked over the past few years to ensure that our client offerings are second-tonone and we are very pleased to have had our efforts recognised.

“We’re especially proud of the work we have done in collaboration with Tesco, International Greetings, Bob Martin and Intertissue to help them drastically reduce their CO2 emissions.”

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New Trucks to Continue Driving FSEW Growth

FSEW has made a major investment in a £500,000 fleet of new haulage trucks to service its ever increasing client base at home and abroad.

The freight company worked with Gulliver’s to replace its existing trucks with eight new Renault Premiums, further expanding the company’s fleet. The new trucks offer improved fuel usage and lower CO² emissions which ties in with FSEW’s goal to become more environmentally aware.

Gethin Worgan, General Manager of FSEW, said: “We are consistently trying to ensure that we provide our clients with the highest quality of service and the standard of our trucks is closely linked with this. Improved fuel usage is also vital for keeping our costs down while fuel prices increase.

“A few months ago we took on a new Sales and UK Sales & Development Manager Manager and he has been instrumental in bringing on a number of significant contract wins which make it more important than ever that we have an outstanding fleet.”

Karl Hadley, Business Director of Gulliver’s said: “We have worked with FSEW for a number of years, ensuring that they have only the highest quality, reliable tractor units for their business. With their current fleet they will be miles ahead of their competitors.”

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The New Tipper Skelly Trailers in Action

Following a significant contract win FSEW has invested in three new Tipper Skelly trailers.

This significant investment will streamline the process involved in transporting goods UK-wide on behalf of Bob Martin (UK) Ltd, manufacturer of pet health and hygiene products.

The trailers are designed to tip up and slide the load out more easily, making them particularly useful for bulk powders.

Geoff Tomlinson, founder of FSEW, said: “While this investment was primarily for work with Bob Martin it will also benefit other clients in the future.

“By training our staff to use this specialist equipment we will be able to offer an additional service which wasn’t previously available from FSEW.” FSEW, based at the South Wales International Freightliner Terminal in Wentloog, is South Wales’ leading independent intermodal freight forwarder providing transport and delivery services world-wide.

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