Handelskammer Hamburg 2008

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Port services

Riding the container shipping wave

The container transhipment volumes at the Port of Hamburg continue to grow: year after year, a diverse range of local companies benefits from the daily hustle and bustle.

Hamburg’s container business is booming. Last year saw a continuation of the dynamic growth of previous years, with the port handling 9,889,792 standard containers – up 11 percent on 2006. Ongoing globalization and the associated growth in trade volumes are directly benefiting companies involved in container transhipment and transport. There are also many other types of enterprises, providing employment to many people, that owe their existence to the container business.

Shipping agents, container terminal operators, shipping companies, ship brokers, road haulage companies and rail carriers are obvious examples. In addition, port services companies perform a range of container-specific services – in some cases under contract to shipping agents or container terminal operators. These include container leasing, temporary container storage, container repairs, custom container modifications and cargo-related services, to name but a few. Indeed, a multitude of niche operators with long-standing, specialist port-related expertise today work for the container business.

CMR Container Maintenance Repair Hamburg GmbH caught the container shipping wave quite early in the piece – the company has been providing container repair and storage services for over 25 years. Every day, a good 500 units roll into its yard on Hamburg’s Reiherstieg wharf. “To keep up with that sort of volume, we have to ‘push’ the containers through our works halls,” comments CEO Kai Ove Tiedemann. CMR’s specialists repair and maintain containers under contract to major line shipping companies, ensuring the containers are “up to spec” for the – in some cases highly sensitive – goods they carry. This involves much more than simply repairing the outer iron housing. “We inspect and maintain sophisticated hi-tech systems designed to keep goods like fruit, vegetables and meat fresh,” explains Mr. Tiedemann. The company owes its expertise in container technical systems – which can be worth anything up to Euro 40,000 per unit – to its 35 highly skilled employees. The ability to repair as many as 1,000 containers a month is also largely due to the skill and commitment of its staff. Mr. Tiedemann believes that rather than merely benefiting from the container shipping boom, his industry is instrumental in making the boom possible in the first place.

The key indicators of the current upswing, alongside practical points of view, are container handling volumes. The ‘container handling volume’ indicates the number of containers a container crane handles within a specified period and is generally measured in twenty-foot-equivalent-units (TEU). Hamburg’s throughput has been increasing steadily over the years. While in 2002 the port shifted 5.4 million TEU, the figure will most likely reach the 10 million mark this year – an increase of almost 100 percent in just six years. The total cargo volume is even higher because Hamburg is a universal port. Last year, for example, over 140 million metric tons of international marine cargo passed through the port. Thereof, containerized cargo accounted for 95.5 million metric tons, making it easily the port’s most important form of cargo.

John-Carsten Lindemann, CEO of container logistics specialist J.C. Lindemann Containerverpackung GmbH, sees Hamburg’s main competitive advantage over other ports as being the expertise of its service providers. “Hamburg’s strength lies in its wealth of experience and its ability to handle port-related tasks flexibly and reliably”, he says, noting that he routinely fields enquiries for highly specialized services. “Sometimes we even ensure flexibility by using a handshake - still as good as a contract for a port trader.” Mr. Lindemann is delighted with the large volume of containers his company handles, particularly the ones that are filled with fake and counterfeit goods because, in addition to container logistics, his company also coordinates the destruction of intercepted counterfeit goods on behalf of the major brand owners. “Sometimes this means sifting through several container loads-worth of tennis shoes, sorting the genuine ones from the fakes,” explains Mr. Lindemann. Each step from sorting to shredding must meet customs requirements, a logistical challenge. J.C. Lindemann’s staff master by drawing on four generations of port expertise and by acknowledging the fact that skilled workers are just as important as managers when it comes to meeting the challenges posed by Hamburg’s container or, better to say, tennis shoe boom.

There seems to be no end in sight to the current upswing. The container industry has enjoyed double-digit growth rates since 1999, when the Elbe River was last upgraded. Containerised cargo now accounts for about two thirds of all cargo handled at the port of Hamburg, up from 30 percent in 1990.

Empty container logistics is another part of the container business that is both a driver of employment and a unique challenge. Hamburg’s empty container volumes are forecast to increase markedly, reaching about 19 percent of total container throughput by 2015. This trend is driven primarily by differences between import and export volumes on the main trade routes. Progeco Deutschland GmbH’s empty container business grew by a good 30 percent in 2007. Progeco is a subsidiary of the CMA CGM Group that specializes in container repairs and storage. The upswing in this segment is reflected in the technology that is now used to manage the increased volumes: “Our container lift trucks can now handle two empties at once, rather than just one,” comments Progeco CEO Jörg Diedrichsen. Notwithstanding this, the number of employees has also doubled in 2007. Mr. Diedrichsen notes that there is no shortage of containers, but definitely a shortage of new storage space in and around the port area.

Companies engaged in loading and unloading container cargo for onward shipment are also experiencing something of a boom. Hamburg is an ideal location in this regard: it just makes sense to store and re-combine container loads directly at the port. A large proportion of this kind of work is performed by external providers of integrated logistics services who manage everything from transport and storage to customer-specific stock-picking. Demand for these types of services is growing almost as fast as the port’s transhipment volumes. “We are definitely benefiting from globalisation,” explains Michael Liening, CEO of LCH Logistik Centrum Hamburg Hinderer GmbH & Co. KG. “In many cases we deliver goods directly to our customers’ places of business or central warehouses. They often never actually get to see the shipping containers theirself.” Liening and his three teams – located in Allermöhe, Billbrook and Billstedt – organise stock-picking and goods storage for a range of discounters. He is happy to take on the great diversity of goods, cargo volumes and destinations involved because he has “well trained and experienced employees who know the business”. LCH Logistik had a very good year in 2007, unloading a total of about 5,000 standard containers.

All of these examples clearly show that employees are still the most important resource in the container service industry. The upswing in the container sector is also putting pressure on the logistics sector labour market. While logistics providers are still able to fill basic-level vacancies fairly quickly, it has become much harder to find skilled dispatchers and coordinators. Last year, around 2,400 vacancies remained unfilled in the logistics sector. This is due in part to the long time it takes to train as a logistics professional, and in part to the mounting demand for university graduates in other industries.

It is against this background that the Hamburg Chamber of Commerce and the Logistics Initiative Hamburg have partnered to create the project “Logistik Lernen” (Learning Logistics”to promote Hamburg as an ideal place to study and start a career in logistics. Dr. Karl-Joachim Dreyer, President of the Hamburg Chamber of Commerce, explains the reason for this initiative: “The very future and success of Hamburg as a logistics competence centre depends of the availability of qualified personnel.” Hamburg’s offering of logistics-oriented entry-level professions, further education and practical oriented courses of study at universities is unrivalled in Germany. This makes Hamburg the location of choice for young logistics career-starters. On the demand side, local Hamburg logistics companies stand to benefit from a steady supply of logistics graduates. And the outlook for job openings in the sector is good, with Hamburg’s port-related companies forecast to create 14,000 new positions by 2015. For example, J.C. Lindemann will again be taking on trainees from this year on. LCH, Progeco and CMR will also be taking on new staff in 2008.

With Hamburg’s container transhipment volumes forecast to virtually double from 9.9 to 18 million TEU by 2015, there will certainly be no shortage of work for the city’s downstream providers of port services in the years to come.

René Löffler
rene.loeffler@hk24.de
Telefon 36 13 8 382

Information

“Learning Logistics – in Hamburg, of course!” is the official slogan of a cooperative project between the Hamburg Chamber of Commerce and the Logistics Initiative Hamburg. The project is in the form of an internet portal designed to inform prospective career starters about the wealth of logistics training and further education possibilities available in Hamburg. They can choose from more than 15 tertiary logistics study courses, over 20 entry-level professions and over 200 further education courses. There is also a PC Game called “Logistik-Master” that young people can download from the website and use for free to gain an initial insight into Hamburg’s logistics sector. www.logistik-lernen-hamburg.

hamburger wirtschaft, Ausgabe April 2008