Container Barge Service Constantza - Belgrade

Dipl.-Ing. Saša Jovanović Deputy Commercial Manager

General overview• It is a very well known fact that

Serbia is a landlocked country• In such position, orientation

towards the nearby seaports as hubs is a must

• Nevertheless, Danube “Sea” offers vast possibilities for strategic transport orientation towards Constantza port hub

• The Danube “12-lanes highway” offers good possibilities for reaching the maximum benefits – maximum number of TEU at minimal costs

KOPERKOPER

RIJEKARIJEKA

BARBAR

THESSALONICATHESSALONICA

CONSTANTZACONSTANTZA

BELGRADEBELGRADE

HAMBURGHAMBURG

Motivation and first experiences• Then came the idea…• Jugoagent undertook an analysis of cargo flows in Serbia• Results showed that both freight rates and inland haulage routes

from/to traditional export-import ports (in the Adriatic, Aegean, Med and North Sea) were fairly stable

• It seemed that no alternative could be foreseen• But…• As general agents for ZIM ISS Jugoagent strongly supported a

direct Constantza call of ZIM’s Far East liner services from where originate the great share of Serbian import cargoes

• Danube proved to be the best possible option for inland haulage to/from Serbia

• Best partner for inland haulage via the Danube found in Bulgarian River Shipping

• Port of Belgrade offered strong support and exclusive conditions

• Jugoagent activated a strong marketing campaign

• Industry was attracted by attractive rates, acceptable transit time and contingency plans in case of nautical hindrances

• Jugoagent’s clients accepted the challenge

• Official opening of the eastbound service took place in the Port of Belgrade on May 12, 2005.

• Port of Belgrade became an important gate for export cargoes to Mediterranean, USA, Middle and Far East and Australia and for import cargoes from Far East and other world areas

• Jugoagent’s service offered the well known advantages:• Direct link with the main Black Sea port of Constantza• Lower tariff rates in comparison with the tariffs of other sea ports

(Rijeka, Bar, Thessalonica, Koper, Hamburg) serving Serbia• Link with direct lines from Far East and other world areas• Opportunity for all shippers dealing in and with Serbia to improve

their competitiveness• Promotion of export of raw material, finished and semi-finished

products, without changing the swappable transport unit• Containers can be manipulated anywhere in the world as their

dimensions are an ISO standard. Transfer infrastructures allow all elements (vehicles) of a transport chain to handle it with relative ease

• Environmentally Sustainable Transport, in line with European initiatives on environment protection and on promotion of using European Inland Waterways Network.

Organization, operational problems and countermeasures

• Line designed to ship max 80 TEU/barge, 10 TEU in length, 4 in row, 2 stacks high

• Service was scheduled to run on a weekly basis, given the satisfaction of minimum cargo volume, otherwise it runs on a bi-weekly basis

• Transit time upstream 7 days, downstream 6 days• Economy of scale could not be applied at present country-wide

volume of only 20.000 TEU/year• This required a genuine solution of integration of the container

barges in the existing convoys running on the route• Since the beginning of service Jugoagent carried some 2500 TEU,

roughly 60% import and 40% export cargoes

Operational problems and countermeasures

Nautical hindrances:-Ice-Extreme water levels

Activation of contingency plan:-Road haulage-Rail haulage

Compliance with reliability and regularity of the service

Containers treated as goods by customs

Some import cargoescould be cleared in determined places only

Short deadlines for exitingthe country of the exportcleared containers

Obsolete and slow customsand border procedures

Intervention byJugoagent

Movement of containersfacilitated (control sheet)

Variety of sites available forcustoms clearance ofcontainerized goods

Deadlines adjusted withrealistic operationalconditions in IWT

Ongoing process incooperation with Govt.

Problem Countermeasure Result

Statistics for 2006

61 51112 142

77

219

11688

204 223169

392

542

385

927

0

100

200

300

400

500

600

700

800

900

1000

I trimester II trimester III trimester IV trimester Total

Container barge line volumes for 2006

Import

Export

Total

Statistics for 2007

141 180

321371

287

658

344

217

561

856

684

1540

0

200

400

600

800

1000

1200

1400

1600

I trimester II trimester III trimester Total

Container barge line volumes until 30-Sept-07

Import

Export

Total

Trends in 2006-2007Import trends 2006-2007

61

142116

223

141

371344

0

50

100

150

200

250

300

350

400

1 2 3 4 5 6 7

Import

Log. (Import)

Export trends 2006-2007

5177 88

169 180

287

217

0

50

100

150

200

250

300

350

1 2 3 4 5 6 7

Export

Log. (Export)

Total trends 2006-2007

112

219 204

392321

658

561

0

100

200

300

400

500

600

700

1 2 3 4 5 6 7

Total

Log. (Total)

Development and expansion

• Experienced only slow growth of cargo volumes by IWT• Reasons for that were not the freight rates, but longer

transit time in comparison with the “Adriatic solution”• Recent increase of FCL exports – signs of recovering

economy• Being ready to absorb the substantial growth of the

country’s economy and to offer more attractive options Jugoagent turned to looking for better solutions

• Improvement of transit time through looking for the self-propelled cargo vessel solution

• Expansion of the service both eastwards and westwards

• Looking for a convenient self-propelled vessel, adjusted to nautical conditions on the Danube, capable of carrying reefer containers

• Expansion westwards including ports of Novi Sad and Vukovar, and, in the later stage Budapest

• Expansion downstream and further eastwards, directly connecting via water the region with Black Sea ports of Novorossiysk and Odessa and the huge market of ex Soviet Union where duty free trade agreements with Serbia are in force

• Great opportunity for Serbian exporters of fruit and vegetables and cargoes requiring refrigeration during transport

• Monitoring of the shipping situation and cargo flows in the Adriatic, which in great extent influences the transport via the Danube

• For all these plans and visions Jugoagent counts on its true advantage – its young people, top experts in the shipping industry, well educated, fast learners and multilingual, educated and experienced in the West

Looking two steps ahead

• Jugoagent strongly supports and backs up structural changes in various aspects of the overall system of IWT

• Closely monitoring the latest trends and developments in the EU and resulting programs and initiatives (PINE, NAIADES…)

• Supporting the need for a straightforward national plan of developing of all aspects of IWT

• Existing “Master Plan for IWT Serbia” did give the overview of the most of present problems and recommendations for overcoming them

• However, a concrete, fast and most of all, visible action is still missing

• Jugoagent has its own view on the necessary improvements:

• Improvement and harmonization of the legislative framework with EU legislation

• Improving the existing waterway infrastructure

• Enhancing the overall performance of the port and terminals

• Innovations in ship technology• Human resources and promotion

of IWT education• River Information Services (RIS)• Integration of IWT into intermodal

logistic chains• Marketing issues and

improvement of IWT image

Eager to see more of this on the Danube

Thank you for your attention!

Bulevar Mihaila Pupina 165aBulevar Mihaila Pupina 165a11070 Beograd11070 BeogradTel :Tel : +381 (11) 20 18 700+381 (11) 20 18 700Fax :Fax : +381 (11) 31 12 070+381 (11) 31 12 070e-mail :e-mail : office@jugoagent.netWeb :Web : www.jugoagent.netwww.jugoagent.net

Maritime-River AgencyMaritime-River Agency