Positive Ports in a Storm

24 October 2019

Customs log jams and other import hold-ups are among post-Brexit predictions, but ports say they’re doing their utmost to minimise problems and longer-term are upbeat about developing their timber and wood products services. Mike Jeffree reports

The UK’s ports are in the Brexit front line. They are having to prepare for any eventuality. Deal or no deal, or an extension on article 50. New customs procedures, import processing taking longer, a build up of traffic into ports en route to the EU, and vice versa are all possibilities they are having to take into account.

Already, say some, they’ve had to contend with a greater volatility in the timber marketplace, with shipments fluctuating in line with latest predictions on when and if the UK will leave the EU.

“Timber volumes overall have remained steady, but we’ve seen unusual buying patterns, unseasonal peaks and downturns, which are a likely effect of unknown Brexit outcomes and price falls within the timber market,” said Samantha Woskett, head of customer relations and logistics at Shoreham Port.

However, while they are not underplaying the potential Brexit “bumps in the road”, they express confidence in their ability to cope, working closely with customers and keeping a weather eye on latest developments in government, parliament and Brussels. They are also underlining their confidence in their longer-term future timber operations with investment in handling and storage facilities and introduction of new services.

Shoreham has dedicated personnel specifically to deal with the ebb and flow of the UK’s relationship with the EU.

“We have a Brexit team prepped and ready for any outcome,” said Ms Woskett. “We’re offering customers in-house customs clearance service for all imports via independently appointed customs agents. We anticipate smooth, efficient turnaround for clearance, with vessels to be cleared via one source.”

Peel Ports has also prepared across its various terminals.

“Things could change from week to week or even day to day,” said group business development manager Jason Mayor. “Our focus is on getting even closer to customers to understand their business and what their pressures are. Then, whatever comes our way, we can work together to keep the supply chain moving smoothly. More practically, we’ve been identifying set-down or additional parking space to alleviate any problems with cargo flows or traffic congestion as a contingency should there be a requirement.”

Importers having to undertake due diligence under the EUTR, or UKTR post- Brexit, on all imports from the EU is another administrative change the trade will have to contend with. But ports say they are ready to help customers here too.

“As with so much of Brexit, the devil is in the detail and how changes will be implemented on the ground,” said Mr Mayor. “We will do all we can to support cargo owners, statutory authorities and others in following new regulations and we hosted an EUTR event in September to discuss developments further.

“Peel Ports will follow instructions from the Port Authorities, Border Force, HMRC, and the Forestry Commission to ensure we fulfil our obligations. In the event of no deal, there’s likely to be an increase in container/ break-bulk examinations for all cargoes from the EU. We have contingency plans – additional examination areas – to ensure the turnaround of containers is swift to minimise potential delays for importers. In essence, all cargoes ex the EU will be handled the same as cargoes received as ‘rest of world’ goods. Peel Ports have robust systems in place to ensure cargo is only released once customs cleared and authorised by the authorities.”

Forth Ports says it has invested in IT systems to allow greater levels of customs processing.

“We’ve enhanced the level of EDI (electronic data interchange) with customers and, in such areas as container handling, IT systems are aligned, ensuring customers’ methods of processing information are the same across Forth Ports,” said chief operating officer Stuart Wallace.

Forth is also in close dialogue with HMRC and UK Border Force in order to “deliver a joined up approach”.

“We’ve built on customer discussions held before the March 31 Brexit deadline, and put in place procedures to allow our ports to assist with and undertake elements of customs processing,” said Mr Wallace.

At the same time, he added, due to the continuing level of uncertainty surrounding Brexit, it urged customers to keep in touch.

“I’d encourage engagement with companies’ contacts at Forth to explore options to ensure movement of goods remains as streamlined as possible when the withdrawal agreement extension comes to an end,” he said. “It’s important to keep dialogue going.”

Regardless, the UK’s key ports for the trade say timber is and will remain a mainstream cargo for them into the future. In fact, say some, with the market’s growing focus on low carbon and sustainable economic development, and notably sustainable, low energy construction, they see it becoming an increasingly key commodity.

Shoreham terminals handle over 450,000m3 of timber and wood products per year, distributing via its in-house haulage across the UK and Northern Ireland.

“Timber is a fundamental part of what we do,” said Ms Woskett, “and we continue to see new timber product lines coming into the port on a regular basis. We handle a vast array, including panel products, from Sweden, Latvia and Finland and this year we’ve imported several shipments from Russia, which has not been seen for the past few years.”

Peel Ports handles about 1.3 million tonnes of forest bulk products a year including packaging and publishing paper, wood pulp, timber and panel products. It too is looking to develop and diversify the business.

“We’ve seen an upward trend in plywood imports in recent years, with decreases from Malaysia and Europe offset by volumes from China, Brazil, Indonesia and Chile,” said Mr Mayor. “There’s also been a steady increase in wood panels imports – MDF, OSB and other particleboards from Germany, Ireland, Belgium, France and Latvia.

“Timber imports have been fairly flat recently with Sweden remaining the main source, but Latvia has been gaining traction.”

He added that Peel was constantly looking to attract additional services to add to existing ones from major European ports and North America.

“We also have direct links into the Far East and Middle East/Subcontinent via Transhipment in Sines, Portugal,” he said. “We’ve seen growing interest from large importers in attracting deep-sea connectivity into Liverpool too and we continue to work with customers and partners to identify emerging markets and working directly with shipping lines enables us to identify and respond to market trends.”

Shoreham has also continued to develop timber-handling operations.

“We’ve invested heavily in our stock control system and continue to develop and revise it in line with our customers’ changing stock handling requirements,” said Ms Woskett. “We also continue to invest in cargo handling plant, with a modern fleet of Sennebogen cranes and forklifts specifically equipped to handle timber products. We’ve recently added to undercover storage facilities too, with a new warehouse on one of our busiest terminals.”

According to Mr Mayor, Peel has recently taken a strategic look at the forest products sector in liaison with customers.

“This has helped identify where we can add value and efficiencies,” he said. “We’ve seen especially strong growth in the sector in Port of London Medway, where large scale investment has enabled us to attract new business and consolidate our existing customer base into a purpose-built timber terminal. This has allowed us to concentrate our expertise to improve service and maximise capital equipment utilisation. It has also enabled us to develop a roadmap for further development across the group.”

Among developments at Medway is a £40m spend to convert a steel holding area into “flexible, purpose-built logistics facilities”.

“This has included a custom-built facility for Rowlinson Timber, with a 26,000ft2 treatment, 12,700ft2 of covered operation and 10-acres of open storage,” said Mr Mayor.

Peel Port’s London Medway operation is also the first UK port to use a new Liebherr semi-automated sawn timber spreader.

“This will improve vessel discharges for customers including Södra and Rowlinson for wholesale distribution,” said Mr Mayor. “It will be used in combination with our Liebherr LHM280 crane and will quadruple handling capacity, moving eight packs of sawn timber per lift, rather than two.”

Meanwhile, Forth Ports is pushing on with development of Tilbury 2, aiming to bring the new facility on stream in Q2 2020.

To further assist the timber sector, ports said they would support a change in customs processing for FLEGT-licensed cargoes from Indonesia. Currently, bonded warehousing procedures applied to other timber goods, allowing duty payment as individual lots from a shipment are dispatched to spread the cost, cannot be used for licensed cargoes as the licence applies only to the whole shipment.

“This potentially makes licensed goods less competitive and we would back reform,” said one port spokesperson.

Despite current economic and political uncertainties, port operators are broadly optimistic for timber operations.

“Peel Port’s investment in operational capability and port-centric infrastructure is enabling the business to continue to enhance our proposition in the timber and wood commodity sector,” said Mr Mayor. “We continue to engage with new and existing customers to develop new value propositions and we’re confident we can achieve ongoing sustained growth.”

Shoreham is equally upbeat.

“We continue to analyse and evaluate procedures with customers to ensure effective, diverse timber handling, storage and forwarding requirements,” said Ms Woskett. 

Peel Ports says it has robust systems in place to deal with Brexit-related issues
Forth Ports is pushing on with the development of Tilbury 2
UK ports are in the Brexit front line