Increasing connectivity between Bangladesh & Sri-Lankan Ports:

in context of containerized cargo

Ahamedul Karim Chowdhury

Chittagong Port Authority

Content

• Present situation of Containerized Trade in Bangladesh

• Transshipment ports; Currently used by MLOs

• Major Import & Export of Bangladesh• Colombo as a Transshipment hub• Singapore as a transshipment hub• Comparative scenario between

Singapore & Colombo • Comparative transshipment movement

during last 2-Year (Calendar) • Comparative Feeder Freight Structure

• Colombo bound Feeders at present

• Trend of Colombo movement• Possible ways to increase volume

of cargo in CTG-COL route: Stakeholders perception

• Recent development in Colombo route;

• Chart comparison; recent development

• How to increase volume between Chittagong-Colombo?

Present situation of Containerized Trade in Bangladesh • Chittagong port is handling around 1.54 million TEU containers per

annum for both import and export trade in total.

• Major containerized imports are coming from;– China– Hong Kong– Taiwan– India– South Korea.

• Major containerized exports are destined to;– USA– Canada– EU destinations– Australia – Japan etc.

Transshipment ports; Currently used by MLOs

Containerized cargo moving mostly through feeder vessels and via following transshipment ports;

– Singapore– Colombo– Port of Tanjung Pelapas (PTP)– Port Kelang

Major Import & Export of Bangladesh

Major importing cargoes of Bangladesh are;

– Different machineries, – raw materials of readymade

garment (RMG)

Coming from China, Hong Kong and Taiwan.

Moving via Singapore & PKL.

Major exporting cargoes of Bangladesh are;

– RMG, – Raw jute & Jute products, – Frozen foods, – Leather and Tea

Going to USA, Canada, EU destinations and Australia.

Moving via Singapore, Colombo, PTP & PKL.

Colombo as a Transshipment hub • Using transshipment hubs depends on how each Main Line Operators (MLO)

chooses to transship out of the above transshipment hubs.

• Colombo is ideally suited for transshipment cargo destined for East coast of USA and Canada, Europe, Mediterranean, West Asia and African ports.

• For cargo ex BD to Europe / Med / USEC regions the shippers will have an advantage in meeting the same connector which calls SIN and thereafter COL enroute to the Western destination which may give them a lead time of 5-7 days over cargo T/S via SIN.

• From Chittagong to Singapore or PTP and Colombo generally take 4 days but Colombo takes 8 hour less than Singapore.

• Major MLOs routed their containers via Colombo are; Maersk, APL, MSC, Hapag Lloyd, OOCL, Mitsui OSK, Hyundai, Evergreen, NYK, HJS, COSCO, YML, Kline, SCI & Norasia;

• Feeder operators are; Sea-Con, OEL, Simatech ,NYK EMC & FAR

Singapore as a transshipment hub

• Mainline vessels frequency in Singapore is much higher than other hubs.

• Singapore is also suited for various destinations and has different loop options in every week almost all carriers to connect the mainline vessels to move worldwide destinations.

• Advantage of geographic location and connectivity with different feeder ports creates added advantage for Singapore.

• Apart from those for air-sea-air logistics Singapore is better than other hubs in the region. Dubai is growing on sea air sector being close to some Europe locations.

• PSA may have long-term service agreement with major MLOs on the basis of certain volume commitment. Fulfilling minimum quantity commitment almost mandatory otherwise there might be penalty on MQC. This may also a great factor to move more volume to Singapore transshipment.

Comparative scenario between Singapore & Colombo

• In Chittagong-Colombo routing the monthly volume of inbound is approximately 10000~11000 TEUS while outbound volume was 12000 TEU~15000TEU on an average.

• Colombo feeders are carrying mostly laden containers not empty.

• Chittagong-Singapore volume of inbound is 47000~50000 TEUS per month while export volume from Bangladesh to Singapore-PKL is 26000~30000 TEUS laden

• Remaining of the inbound volume are being reposition to Singapore and PKL as empty container.

Comparative transshipment movement during last 2-Year (Calendar)

Route 2013 2012

CTG-SIN 8,37,164 8,09,963

CTG-COL 2,54,722 1,99,139

CTG-PKL 2,29,648 2,07,289

CTG-PTP 2,19,983 1,90,065

TOTAL 15,41,517 14,06,456

Route

Ctg-Sin

Ctg-Col

Ctg-Pkl

Ctg-PTP

Comparative Feeder Freight Structure

Category CTG-SIN

(HK-CY)

CTG-COL

(HK-FO)

CTG-PTP

(HK-FO)

CTG-PKL

(HK-FO)

20’ Laden $170-180 $155-170 $170-180 $160-170

40’ Laden $330-350 $310-340 $330-350 $320-340

20’ Empty $100-110 $90-100 $100-110 $90-100

40’ Empty $190-210 $180-200 $190-210 $180-200

Colombo bound Feeders at present Feeder

OperatorNo of

VesselName of Feeder Vessels Schedule Special notes

SIMATECH(250) 2 ELINICTG sailing MON and COL berthing SAT

Jointly weekly service routing CTG-COL-KHI-MUNDRA-COL-CTG

SEACON(250) 1 LISSY SCHULTE

EMC(250) 1 EVER PEARL

NYK (250) 1 VIOLETTA

OEL 1 OEL BANGLADESH CTG sailing Tue AndCOL berthing SAT

Joint Venture Weekly service CTG-COL-CTGSEACON 1 MADELEINE RICKMERS

FAR 4

SMILY LADY CTG sailing Sun and COL berthing THU

CTG sailing TEUandCOL berthing SAT

Operate twice a week on a 14 days round voyage covering CTG-COL-CTG

HANSA CALYPSO

SILVER FERN

HANSA CENTURION

Trend of Colombo movement

0

500010000

1500020000

2500030000

35000

No. of vessels

Total Box

Total TEU

Month No of Vsl Total

    Box TEU

JUNE'2013 14 15,761 22,816

JULY’2013 17 19,381 30,405

AUGUST’2013 18 14,765 24,100

SEPTEMBER’2013 12 13,853 22,479

OCTOBER’2013 16 12,482 19,960

NOVEMBER’2013 15 13,211 20,784

DECEMBER 18 17,692 27,995

Possible ways to increase volume of cargo in Chittagong Colombo route; Stakeholders perception

• Mainline vessels should be attracted to call Colombo as a transshipment port by the Colombo Port Authority. If MLOs place more and more main line vessels in Colombo automatically feeder vessels movement from Bangladesh will be increased.

• Rebate, priority berthing, window berthing facilities to the major players may play an important role in this case.

• Increasing feeder vessels in Chittagong-Colombo-Chittagong route may also create a positive impact to increase transshipment trade volume.

• COL Port to give an increased rebate in T/S tariff rates for cargos routed via Sri Lanka for cargos bound to/from Bangladesh to attract more interest.

• The freight rates filed for customers are covering all costs and the feeder port or T/S point will not have a major cost differentials.

Recent development in Colombo route Since the commencement of the new Terminal, the Port Volume throughput has increased by 5%. During the period Jan to March 2014 vs. 2013 the increase in volume is 11%. This is bound to grow, with the larger vessels now calling Colombo and more T/S volumes being routed via Colombo.

Route January February March

CTG-SIN 79852 66348 77499

CTG-COL 28304 30545 32633

CTG-PKL 10471 17091 12185

CTG-PTP 20479 14468 12660

TOTAL 139106 128452 134977

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

C TG -S IN C TG -C OL C TG -P K L C TG -P TP

J anuary

F ebruary

Marc h

CYKHE going to start new Europe service (NE8), maiden voyage at COL is on 26th April at CICT Terminal, expected volume per week for this service ex CGP is 300 Teus per week.

Chart comparison; recent development

1S T Qtr of 2014

C T G -S IN 55%

C T G -C OL 23%

C T G -P K L 10%

C T G -P T P 12%

Othe r22%

2013

R oute 0%

C T G -S IN 54%

C T G -C OL 17%

C T G -P K L 15%

C T G -P T P 14%

Othe r29%

Recently MSC started using ISES lane to move a portion of Europe cargo through Colombo and their target is around 250 TEU weekly from CTG.

How to increase volume between Chittagong-Colombo?

• Consistency in operational performance of Chittagong port such as;– minimum turnaround time;– window berth facilities;– fixed day sailing of feeders.

• Apart from those guaranteed connection of mainline vessels in Colombo can increase reliability of service route and gradually volume will be increased.

• Presently volume of bilateral trade around 10-12% of total container trade between Bangladesh and Sri-Lanka.

• Increasing volume of bi-lateral trade between two countries can be a trigger to improve shipping connectivity with Sri-Lanka-Bangladesh trade route.

Thank you

Any question ?