UK makes great leap forward in port development

Last month London was treated to the amazing sight of the new DP World London Gateway port taking delivery of three giant cranes when the vessel Zhen Hua 26 carried the cranes up the Thames to Stanford-Le-Hope on the Essex side of London. The cranes, the biggest ever to be delivered to the UK, were 138 metres tall – two and a half times the height of Nelson’s column – and were delivered upright! A further 21 will be arriving once construction of the six main berths of the new port is completed. The quay itself, where the cranes will sit, will extend to over 2.5 km in length once the port is fully operational. This is undoubtedly a major development in the history of UK ports.

The new port, scheduled to be open sometime during the last quarter of this year, will be the UK’s first 21st century major deep-sea container port and feature Europe’s largest logistics park. The operators, DP World, are already responsible for over 60 ports across the world, and claim that the new facility will be the most efficient in the country, adding an additional 3.5 million teu (standard twenty foot cargo containers) to the UK’s port capacity.

London Gateway will join over 150 ports currently in operation around the UK’s  coastline (which is recorded at anywhere between 7,500 and 11,000 miles depending on how you measure it!). Already handling over 500 million tonnes of goods each year, the UK ports industry is the largest in Europe.

The British Ports Association, which represents around two-thirds of UK ports, says that their members are among the most efficient and competitive in the world. Unlike many other countries UK ports are not state funded or managed. The abolition of the National Ports Council in the early 1980s labour deregulation, the option to privatise and strategic independence from government have made major contributions to the industry’s strength and vitality. The industry now directly employs an estimated 117,200 people with the majority working in either transport or transport related activity, together with 19,300 engaged in cargo handling and 11,900 in maritime insurance and related matters. These figures represent a growth of five per cent in only two years – this despite the economic recession.

Ports handle some 95 per cent of UK import and export tonnage and each year process goods with a value of over £340 billion. More than 500 million tonnes of freight consist of large quantities of container and ro-ro traffic, but more than 250 million tonnes is oil products and liquefied natural gas. Dry bulk cargoes have grown by around 40 per cent since 1990, principally due to the demise of the UK coal industry and the increase in imported product.

Oil production in the North Sea has resulted in a reduction in the quantity of crude oil being moved through UK ports by some 13 per cent since 2000. However, there has also been a 12 per cent increase in the quantity of oil products and LNG travelling to or from UK ports and this trend is likely to continue as more LNG terminals come on stream in the next decade. Dry bulk cargoes, such as ores, coal and agricultural products increased by 44 per cent in the 10 years between 1999 and 2009.

Ro-ro goods vehicle movements have seen an astonishing increase of over 240 per cent since 1985 with the fastest growth being seen up to 2000 in the south east of England and across the Irish Sea.

The growing power of the Asian economies, and the ever increasing ‘Made in China’ label, has meant that it is container traffic which has enjoyed the primary public attention. This traffic has increased by 190 per cent since 1988 and, whilst this rate of growth is unlikely to continue at a similar level, it is certain to remain strong as shifts in global trade continue and manufacturing industries become ever more firmly established in the Far East. In 2010 UK container traffic represented 11 per cent of all ports traffic. 

National Policy Statement for Ports

In January 2012 the Department for Transport finally published the government’s much delayed National Policy Statement for Ports. The purpose of the publication was to estimate the nation’s needs for port facilities and to describe a planning process for permitting the construction and operation of new facilities. All of this in the light of the inevitable considerations required regarding environment, pollution, climate change, security, tourism and much more.

The document is, until further notice, the critical guidance tool for those involved in making planning decisions regarding new infrastructure at either local or national level. It describes the whole range of hoops which those seeking to create new facilities must jump through in order to create them.

Key consideration for any new ports project must be the quality of road, rail and water links connecting the port to or from the relevant original locations of manufacture or production, or for onwards distribution.

Indeed, it is a key marketing claim by DP World and its London Gateway project that adequate transport links are already in place. The new facility is just 10 miles away from the M25 with onwards access to the UK motorway network, and intermodal rail terminals are located within the port and the logistics park. Two rail terminals will primarily handle deep-sea containers and the port will enjoy rail access to the Channel Tunnel as well as the West Coast Main Line for the Midlands, the North West and for Scotland.

The particular needs of onwards transport facilities are presently under review by the House of Commons Transport Committee which is conducting an inquiry into Access to Ports (January 2013).

The Transport Committee is considering what should be the the priorities for improved access to ports and asking whether the current delay by the government in producing a national policy statement for the development of road and rail networks is creating problems. Crucially, the committee is also wondering to what extent can investment in road and rail infrastructure influence the market and regional decision making on port development.

Not surprisingly, FTA has not been slow to submit evidence to the inquiry.

FTA’s General Manager, Global and European Policy, Chris Welsh says "The government has plainly accepted that there is a need for a longer term approach and commitment to national infrastructure investment, and has recently signalled its understanding that transport infrastructure investment is essential for stimulating growth. However, the lack of national policy statements for road and rail networks has created uncertainty and concern about a long-term commitment to road and rail priorities, and is undermining confidence in future funding for those priorities in the context of the up-coming comprehensive spending review. Unless industry has confidence that key schemes are confirmed in national statements, doubts will persist about commitment to enhancing the quality of the UK’s international links and its understanding of the need for a long-term strategic approach to infrastructure priorities and investment. This, in turn, will undermine international confidence in Britain’s capability of delivering a world-class transport infrastructure, thus widening the gap with our competitors and threatening inward investment.” 

Welsh says that the National Ports Policy statement confirmed that port development must be responsive to changing commercial demands and the government considers that the market is the best mechanism for getting this right, with developers bringing forward applications for port developments where they consider them to be commercially viable. "UK ports are entirely privately run and funded and we believe that is absolutely right, as development must be market-led to deliver the UK’s needs now and in the future. Clearly, any future investment decision linking hinterland road and rail infrastructure will be a key influence on port infrastructure investment. For example, investment for the new DP World London Gateway port development would have been unlikely to have been forthcoming without the decision to build a new railhead and good road and rail access to the strategic road and rail networks. It therefore follows that when port development is thought appropriate, local planners must be aware of the effect that it will have on their local and rail networks and plan accordingly.”

The messages are clear – the UK economy needs an efficient and vibrant ports industry designed to serve not only its own import and export needs, but to act as a hub for onward distribution of goods from the Far East to the rest of Europe. Clearly our industry has the skills and ability to achieve this. That reality needs to be recognised and supported by government, as well as private, investment in a road and rail infrastructure fit for the purpose.

The danger is that, with the ever growing needs to handle large quantities of goods coming from the other side of the world, failure to provide an efficient network will result in Asian container giants heading not for UK ports, but for our competitors in mainland Europe.

 

 

This article originally appeared in Freight magazine, the official publication of the Freight Transport Association.

www.fta.co.uk