Shift from air freight to sea freight detected
Oct-31-2012 By : agxadmin
More companies are shipping their products by sea instead of by air in a shift that is seen as a permanent trend. Alfred Hofmann, Senior Vice President for Sea Freight in the Asia-Pacific at logistics firm Kuehne+Nagel, said “it’s a trend that can’t stop”. Nick Rhodes, Director of Cathay Pacific Cargo, tended to agree with the prognosis. “Our loads are definitely down but it is hard to say how much is due to less production, more competition or a modal shift. A bit of each, I suspect,” he added. Hofmann said the pharmaceutical industry and manufacturers of temperature-controlled products were at the “forefront of change” from airfreight to sea freight. He pointed out that high-technology electronic manufacturers aimed “to convert over 50% of notebook shipments to ocean”. “Tablets go by ocean after the first wave by air,” he told about 600 shipping, logistics and manufacturing executives at the Journal of Commerce TPM conference in Shenzhen. Hi-tech industries began moving shipments from air to ocean about three years ago. At the time, cargo airlines were unsure if it signaled a short-term trend in response to the poor economic conditions or a structural shift. Moving 10 tons of cargo by sea from Shanghai to Los Angeles was slightly more than 5% of the cost of moving the same cargo by air – USD2,600 versus USD46,000. Container line Matson said the transit time to ship a container from Shanghai to Los Angeles was 10 days, compared with four days by air, depending how much cargo owners paid to transport their freight. Logistics firm DB Schenker said shipping freight by sea from Shanghai to Hamburg would take 28 days, compared with four to six days by air.
Xian Park to become largest inland port in Western China
By : agxadmin
The Xian International Trade and Logistics Park will play a vital role in the modernization of China’s western areas and will help close the gap with the more-developed eastern coastal regions, said Han Song, Deputy Mayor of Xian. It is set to become the largest inland port in West China and help build an open economy in the whole western area. Foreign trade volume in the park has been increasing at an annual rate of more than 50% since it was set up in 2008 with a planned area of 44.6 square kilometers. The inland port functions through the synergy of three projects – the Xian Railway Container Transport Center, the Xian Comprehensive Free Trade Zone and the Xian Highway Hub. The Xian Comprehensive Free Trade Zone enables northwestern China to have the same advantages in processing trade and free trade logistics that coastal ports have, which has reduced the cost of and time needed for foreign trade done in inland China. Meanwhile, it also provides favorable conditions for inland areas to develop an outbound economy and modern services, such as international trade and outsourcing. The Xian Railway Container Transport Center project is a key link that allows China to promote international container transport in inland China. The Xian Highway Hub project can integrate such functions as transportation management, shipment, logistics and information, and it can provide comprehensive services for logistics enterprises in the region. The park has also established strategic relations with some major coastal ports, such as those in Shanghai, Tianjin and Lianyungang in eastern China, and the border ports of Horgos and Alataw Pass in Xinjiang in western areas of China, the China Daily reports.
As of the end of August, total fixed-asset investment in the park had reached CNY10.3 billion, of which CNY4.2 billion was made during the first eight months of this year, an increase of 78.14% over last year. Total foreign trade volume reached USD519 million, of which USD235 million was made between January and August, an increase of 56.2%, compared with last year. About 58,000 containers were handled during the first eight months of the year at the railway container transport center that serves all of Shaanxi province and the surrounding provinces. Contracts have been signed involving a combined investment of CNY51 billion in a total of 58 projects of various types, including eight foreign invested projects with a total investment of USD350 million. By the end of August, 16 projects had been completed and 39 projects, with a total investment of CNY65 billion, were under construction. Activities to attract foreign investment were held in foreign countries, including Japan, Turkey and the Netherlands. By the end of August, investment worth a total of CNY2.4 billion had been poured into the park to develop infrastructure, including bridges, electricity and water treatment plants. To make up for the shortage of land, the area of the park may be enlarged to 120 square kilometers, according to the management committee.
Fedex to build new freight hub at Pudong Airport
By : agxadmin
The new 134,000-square-meter Fedex international express and cargo hub to be built at Pudong International Airport in Shanghai by 2017 will be capable of handling 36,000 parcels and documents per hour. The new facility’s annual sorting capacity may reach more than 90 million items, meeting demand in the next 20 years. Shanghai aims to be the world’s top air cargo hub by 2015, with a throughput of more than 5 million tons. Major domestic airlines have based 80% of their freight capacities at Pudong airport, which now ranks No 3 by cargo turnover worldwide, after Hong Kong and Memphis in the U.S. Li Derun, President of the Shanghai Airport Authority, said the facility will further raise the airport’s handling capacity and help build it into a global cargo hub. Freight handled by DHL, FedEx and UPS accounts for 10% of Pudong airport’s total cargo volume while the value makes up more than 40% of the total, Li said. A slower global economic recovery saw a 6% fall in cargo handled at Shanghai’s two airports in the first nine months of this year.
Anji-CEVA No 1 in automotive logistics in China
By : agxadmin
Anji-CEVA Automotive Logistics, founded as the first company of its kind in China in 2002, has become the biggest in its field. Automobile production in China has grown from 3.29 million units in 2002 to an estimated 19.85 million units this year. Anji-CEVA, which helps manage the supply chain for the industry, is set to generate CNY3.7 billion of sales at an annual compound growth rate of 52.7%. The company is a joint venture between Dutch-based CEVA Logistics and Chinese partner Anji Logistics based in Shanghai. It employs more than 10,000 people. “Ten years ago, when the company was first registered, it was hard for authorities to define who we were,” Xu Qiuhua, President of Anji-CEVA, said during ceremonies marking the company’s 10th anniversary. “At that time, China had warehouse and transport companies but no idea about third-party logistics.” Chinese automakers used to handle all the logistics themselves. But the increasing complexity of the supply chain forced them to outsource some of those management functions to professionals. Anji-CEVA provides logistics services to several vehicle manufacturers, more than 400 auto-parts suppliers and over 1,000 car dealers in China. The company also serves over 200 overseas auto parts suppliers in more than 20 countries. Investment bank Morgan Stanley has predicted that China will become the world’s third-largest market for contract logistics by 2016, worth CNY1.1 trillion. According to the 2012 State of Logistics China Survey, logistics costs are equal to about 18% of China’s gross domestic product (GDP), almost double the level in Western countries. Anji-CEVA is trying to address poor supply-chain efficiency by providing end-to-end logistics solutions for more customers, said Martin Thaysen, Executive Vice President of CEVA China, the Shanghai Daily reports.
Logistics industry urges Hong Kong government for more support
By : agxadmin
The Hong Kong government should give more support to the logistics sector if the city is to thrive as a regional distribution hub, industry trade groups say. Their call comes amid growing industry concern that buildings in Kowloon used for logistics purposes are being demolished and the sites redeveloped as upmarket offices, putting further pressure on supply. Dr Paul Tsui, Chairman of the Hong Kong Association of Freight Forwarding & Logistics, said the logistics industry had urged the government to consider releasing more land dedicated for logistic operations, but only two sites in Kwai Chung had been earmarked and tendered for development. Tsui said both sites were being built as single rather than multiple-user projects, which only put more pressure on small and medium-sized logistics companies because they could not use the buildings. He said that before the administration of Chief Executive Leung Chun-ying took office, the Transport and Housing Bureau was looking at other locations such as Tuen Mun to provide more land to the industry. Sunny Ho, Executive Director of the Hong Kong Shippers’ Council, said shipping and logistics, according to the government, was one of the four pillars of the Hong Kong economy and therefore it should be given adequate support. Ho said there needed to be “commitment at the top and policy support in order to get more land for the industry”, adding that new infrastructure was needed. Meanwhile, Agility Logistics officially opened a new 13,000 square meter logistics center in Tin Shui Wai that will act as a regional distribution center across Asia for high-technology and retail companies. James Gagne, Agility’s Chief Executive for Greater China, said it took more than a year for the company’s logistics team to find a site for the complex. Gagne expects the center, which was about 10% to 15% full since the soft opening last month, to be 70% to 75% full by the first quarter of next year. He also said Hong Kong, as a free port, still offered advantages over the mainland for companies looking to set up a regional distribution center, such as more connectivity to the region and few export restrictions, the South China Morning Post reports.
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