Gussmagg COLD

Results of the COLD-study(COntainer Liner Service Danube): 

Danube Summit 2006 Budapest, 18 Oct. 2006 Gerhard Gussmagg Results of the COLD-study (COntainer Liner Service Danube)

Project COLDContainer Liner Service Danube: 

Project COLD Container Liner Service Danube Austrian – Romanian initiative Provides unbiased and comprehensive information on potentials to all interested stakeholders Feasibility study covering: Starting situation Market and peer analysis Inland navigation concept Analysis of supply chain Krems – Shanghai in terms of duration, cost and environmental balance Conclusions and recommendations for action

Growing container flows…: 

Source: Hulocon 2005 Growing container flows… Asia-Europe 2004: + 16,5 % !!!

… and transhipment figures: 

… and transhipment figures Source: ISL: Lemper, Stuchtey (2004)

Most important container ports: 

Most important container ports *including river trade Source: Websites of the port authorities and the publication “Port Statistics 2005“, Rotterdam Port

Modal Split of selected sea ports: 

Modal Split of selected sea ports Source: OIR 2006 IWT = Inland Waterway Transport

Container transport on Europeaninland waterways: 

TEU Source: VNF - CCNR Container transport on European inland waterways in TEU

European Success Stories: 

European Success Stories Rhine Yearly movements of more than 1.8 Mio TEU Daily services between ARA-ports and German Hubs Usage of high-capacity vessels: JOWI etc.

European Success Stories (2): 

European Success Stories (2) Seine/Rhône Container market literally booming with an increase of 20% on the Rhône (2005: 55,807 TEU) and 40% on the Seine (2005: 121,584) New services from Marseille up to Lyon etc. Flemish waterways Container transport average yearly increase of 31 % between 1994 and 2004

Transport volumes on the Austriansection of the Danube (350 km): 

1992-2002: + 84 % Setback in 2003 due to low water period Continued growth expected up to 27.4 mio t in 2015 Transport volumes on the Austrian section of the Danube (350 km) Source: Statistik Austria

Container transport on theAustrian Danube: 

Container transport on the Austrian Danube Source: Statistik Austria

Reasons for the underdevelopment: 

Reasons for the underdevelopment Massive impediments for Danube navigation by the two crises in former Yugoslavia. Nautical and economic difficulties for inland navigation in the western direction (long transport times to ARA passing through more than 60 locks and from the very competitive block train routes). In the East, there were no important maritime container hubs in the estuary mouth of the Danube. BUT, we have a different situation now…

Black Sea: Container throughputby Port, 1995-2005: 

Black Sea: Container throughput by Port, 1995-2005 Source: Ocean Shipping Consultants „The European & Mediterranean Containerport Markets to 2015

Developments in the Black Sea Area (1): 

Developments in the Black Sea Area (1) Container throughput at Black Sea ports increased by factor 10 over 1995-2005 to 1.76 Mio TEU. Recently, several direct services to/from the Far East have been introduced: CMA-CGM: Bosporus Express* China Shipping / ZIM Hapag/Norasia: Asia Black Sea Service – ABS MSC: Tiger Service* *Vessels over 2000 TEU

Developments in the Black Sea Area (2): 

Total volumes of all relevant countries (Romania, Bulgaria, Ukraine, Black Sea Russia, Georgia) are forecasted to increase to 3 Mio TEU in 2010 and 5 Mio TEU in 2015. Developments in the Black Sea Area (2) Source: Source: Ocean Shipping Consultants „The European & Mediterranean Containerport Markets to 2015

Container traffic in ConstantaPeriod 2001 - 2006: 

Container traffic in Constanta Period 2001 - 2006 2006: estimation Source: Representative Constanta Port in Vienna

Opportunities for Constanta: 

Opportunities for Constanta An alternative to the ports in the northern range (Rotterdam, Hamburg) which are struggling with capacity problems as regards transshipment and Hinterland transport. Connection to Corridor VII (Danube) via the Black Sea Canal and thus a link to the dynamic regions of Central Europe by waterway. Shorter ocean route for Europe-Asia lines: Avoids more than 2,400 nautical miles (almost 4,500 km) versus North Sea ports and thus shortens travel time by 3 to 4 days. Coming Membership of Romania in the European Union (unified customs procedures).

A possible shortcut to Central Europe: 

A possible shortcut to Central Europe nM = nautical miles Source: Constanta Port Authority Constanta

Risks to Constanta: 

Risks to Constanta Waiting times at the “bottleneck” Bosphorus. Competition from Adriatic ports for shipments from and to Central Europe. (close ties to AT/HU for geographic and historic reasons) Higher Ocean freight rates to and from Constanta versus Hamburg and Rotterdam – despite the shorter distance by sea. Inefficiencies in the area of customs: a slower and deficient implementation of EU standards could have a detrimental effect.

Market and peer analysis: 

Market and peer analysis Altogether, the current overseas container volume for the region of Austria, Hungary and Slovakia is estimated at around 700,000 TEU per year. The base volume required for scheduled Danube services that would connect the upper Danube section with Constanta is around 10,000 TEU per year. This represents a share of 1.5% of total volume.

Austria‘s preferred seaports: 

Austria‘s preferred seaports No precise figures for container traffic volumes Predominance of the North Sea ports (95 %) Hamburg clearly in first place

Situation in Hungary and Slovakia: 

Situation in Hungary and Slovakia Hungarian overseas container volumes approx. 200-250,000 TEU p.a., two-thirds being imports. North-sea dominance (75%) Overseas container volume for the Czech Republic and Slovakia is a total of around 200,000 TEU. For Slovakia: 12 block trains per week, a capacity utilization of 80% (= 60 TEU) and at 50 operating weeks per year would mean a volume of some 80,000 TEU. Source: Rotterdam Port Representative Budapest, March 2006

Selected railway rates (container): 

Selected railway rates (container) Railway rates obtained by a small forwarder; including one container handling in the inland terminal;

Forecast of the flow of goods (1): 

Forecast of the flow of goods (1) Analysis of foreign trade between Austria, Slovakia and Hungary and selected European countries and overseas regions. Definition of overall modal potential derived from the potential containerisation of the groups of goods and from route assumptions. Definition of IWT-potential within the Danube region Definition of COLD-potential, with the attainable share being assessed at 5% of the inland navigation potential. Calculation was based on a theoretical containerization. Calculation includes continental shipments in the Danube region as well as short-sea (Maghreb, Levant, Turkey) and overseas shipments (Near East, Southeast and East Asia). Source: ÖIR, 2006

Forecast of the flow of goods (2): 

Forecast of the flow of goods (2) The study arrives at a potential for inland navigation for all three Danube countries for the year 2003 of 180,000 to 280,000 TEU. As early as in 2010, an increase is expected to 650,000 - 1.15mn TEU and by 2020 of 1.3 to 2.4mn TEU. The inland navigation potential for Austria is estimated at around 1.25mn TEU by 2020. The attainable potential for scheduled Danube services (COLD Potential) was assumed at a share of 5% for inland navigation. In the area of Austria, Hungary and Slovakia, 9,000 to 14,000 TEU per year are expected, by 2010 a volume of 33,000 to 57,000 TEU p.a., and by 2020 almost 120,000 TEU p.a. The corresponding figures for Austria amount to 63,000 TEU per year. Source: ÖIR, 2006

Slide26: 

Constanta Belgrade Budapest Vienna Krems Inland navigation concept

Distances and Main Inland Terminals: 

Distances and Main Inland Terminals

Selected inland port in Lower Austria:Mierka Donauhafen Krems: 

Selected inland port in Lower Austria: Mierka Donauhafen Krems Source: Mierka Donauhafen Krems

Definition of the Liner Service Concept: 

Definition of the Liner Service Concept Keeping deadlines and binding offers even if the waterway is temporarily unavailable (nautical hindrances), Existence of a time schedule (sailings at least every 14 days), Service available throughout the year (in both directions), Offer made to the general public.

Rough structure of inland navigation costs: 

Rough structure of inland navigation costs

BASE SCENARIO: Danube-Service usingavailable fleet capacity: 

BASE SCENARIO: Danube-Service using available fleet capacity Roundtrip Krems – Constanta - Krems in 3 weeks Deployment of 3 convoys  Weekly departures from Constanta and Krems Structure of convoy: Self propelled vessel + 1 Barge Capacity of convoy: 60 + 60 TEU (10 x 3, double-stack) Annual capacity: 4,100 TEU / convoy 12,500 / total

Time table (Base scenario): 

Time table (Base scenario)

Cost situation base scenario: 

Cost situation base scenario Railway rate approx. €340/TEU €670/40‘

OPTIMISED SCENARIO: using adaptedcontainer vessels and 3 layers: 

OPTIMISED SCENARIO: using adapted container vessels and 3 layers Roundtrip Krems-Constanta-Krems in 16 days Structure of convoy: Self propelled vessel (DDSG ‘Steinklasse’) + 1 Barge adapted for container transport (4 x 11 x 3) Capacity of convoy: 90 + 132 TEU (triple stack!) Annual capacity per convoy: 10,000 TEU

Vertical clearance situation: 

Vertical clearance situation Only one critical bridge: Temporary railway bridge Novi Sad at HNWL

Cost situation optimised scenario: 

Cost situation optimised scenario Railway rate approx. €340/TEU €670/40‘

Overall View of the Supply Chain:Example Krems - Shanghai: 

Overall View of the Supply Chain: Example Krems - Shanghai Deep-sea voyage Shanghai-Hamburg vs. Shanghai-Constanta + Transhipment in Hamburg vs. Constanta + Hinterland transport: Rail (Hamburg) vs. Inland Waterway Transport (Constanta)

Transit time of total supply chain: 

Transit time of total supply chain

Cost comparison of the supply chain(as of 1 Q 2006): 

Cost comparison of the supply chain (as of 1 Q 2006)

Cost comparison of the supply chain(convergence of ocean freight rates): 

Cost comparison of the supply chain (convergence of ocean freight rates)

Environmental balance: 

Environmental balance The combination of Constanta and the Danube produces 22% less CO2 per container in exports, 10% less in imports, and on the round trip 16% less.

Opinions of ocean carriers/agents in Vienna: 

Opinions of ocean carriers/agents in Vienna “Ocean freight rates in the Black Sea region are much higher than NC rates, because not all shippers are there.” “The travel time of inland vessels is not the biggest problem, reliability is a bigger issue. But in Hamburg there are also massive problems with the railways.” “Customers of our shipping company would never go to Constanta, because they prefer the “premium” ports on the norther continent (quality aspect).” “The capacity problems in access to and from the North Sea ports will become worse in the foreseeable future, we believe the Danube is a good alternative.“ “We would urgently need inland vessel offers for the transport of empty containers between Hungary and Austria.“ …

Opinions of ocean carriers / agentsin Budapest: 

Opinions of ocean carriers / agents in Budapest “Constanta does not play any role for business in Hungary today, but for Romania, Bulgaria, Turkey, Ukraine, Russia and the Caucasus states it is important.“ “We are theoretically in favour of a scheduled container line on the Danube but we do not want to be the guinea pigs. Just do it, we will then see.” “Up to now we have been using inland navigation only for empty containers – freight price and transport times must be right for us.” “As of right now there are 60 empty containers for loading ready in Budapest, we are looking for barges.” Even to Giurgiu! “ …

Opinions of ocean carriers/agents in Belgrade: 

Opinions of ocean carriers/agents in Belgrade “We prefer the ports of Koper, Rijeka, Bar and Thessalonica. For Rijeka, we use mainly trucks, Koper and Bar have good connection with Belgrade by rail.” “A Danube solution must be attractive versus road and rail with respect to price and travel time!” “To connect Serbia via the Danube, the port in Belgrade must be included (to solve transport and customs problems).” “We would greatly appreciate if all Danube countries were to cooperate in the COLD project; we have enjoyed working with via donau in Vienna very much.” … Generally, container volumes in Serbia are very small. In 2005, an estimated 20,000 TEU were transported. There are only few Serbian exports Second and the degree of containerization in Serbia is generally very low.

Recommendations for action: 

First, feedback from the overseas shipping companies and large industrial companies is to be obtained. Defining the structure/shareholders of the operating consortium - main partner is to be an ocean carrier. Activities of CMA CGM may be used as role model, they founded a subsidiary “River Shuttle Containers”. Proposals: Organisation of round tables in Austria (e.g. at the chamber of commerce) and in Constanta (e.g. at the port authority – taken place 12 Sept 2006!) Establishment of a central platform modelled after the “Antwerp Intermodal Solutions” Recommendations for action

Recommendations for action (2): 

Recommendations for action (2) Subsequently, a detailed analysis and validation of the inland navigation concept must be conducted: Availability of adapted container vessels and fairway depth. Organisation of substitute transport, especially in the event of ice in the canal. Discussion of structure of fees for Black Sea Canal. Improvement of cost structure by transporting empty containers and continental cargo (silo and tank cont.), involvement of intermediate ports. Reduction of start-up risk by National and EU-funding Proposal: Follow-up project by via donau in cooperation with companies that have an interest in setting up, operating and using scheduled container services on the Danube. The objective is to draft an operation plan.

Soon to come…: 

Soon to come…

Gerhard GussmaggTeam Leader Transport Developmentvia donau – Österreichische Wasserstraßen-Gesellschaft mbHA-1220 Vienna, Donau-City-Straße 1, AUSTRIATel +43 50 4321 1617, Fax +43 50 4321 1050gerhard.gussmagg@via-donau.orgwww.via-donau.orgwww.donauschifffahrt.info/transport: 

Gerhard Gussmagg Team Leader Transport Development via donau – Österreichische Wasserstraßen-Gesellschaft mbH A-1220 Vienna, Donau-City-Straße 1, AUSTRIA Tel +43 50 4321 1617, Fax +43 50 4321 1050 gerhard.gussmagg@via-donau.org www.via-donau.org www.donauschifffahrt.info/transport