Monthly Archives: March 2015

Spring flower has huge remark on history of trade : Tulip Mania

Spring flower has huge remark on history of trade: Tulip Mania

 

Spring of 2015 has finally come with the arrival of March. Spring is a time for life to regenerate, and the New Year to begin anew, with sprouts shooting up, snow melting, and flowers blooming. With the season’s arrival, we’d like to talk about flowers decorating these beautiful times, especially about Tulip and its trade, along with the history of the Tulip Bubble.

Tulip Bubble, otherwise referred to as Tulip Mania, was a trend of speculation displayed in the 17th century Netherlands, and economists consider it the first bubble economy displayed in a capitalist society. It is considered as an economic crisis in the classical economic period, along with Britain’s South Sea Company Bubble and France’s Mississippi Bubble.

The Netherlands at the time was going through a golden age. The bulb of Tulip, a plant new to the country at the time, was being sold at an overly high contract price, until the price plummeted. The peak of the Tulip Mania was in February 1637. Tulip was sold at a price ten times higher than the yearly income of a skilled master artisan. According to Professor Shiller, a Nobel Economic Prize winner, “Tulip Mania is the first recorded case of bubble caused by speculation,” and the term Tulip Bubble is being used as a metaphor for large economic bubble (a time when the price of an asset does not match its inherent value).

 

Rate of Price Increase (%)

Increase Period (in Months)

Rate of Price Decrease (%)

Decrease Period (in Months)

Tulip

(1634~1637)

5,900

36

93

10

Mississippi

 (1719~1721)

6,200

13

99

13

South Sea Company (1719~1721)

1,000

18

84

6

The Great Depression (1923~1929)

345

21

89

34

Japanese Stock (1983~1992)

385

84

63

31

NASDAQ (1996~2002)

384

44

78

31

As shown in the table above, Tulip Bubble is one of the bubbles in which the price shot and fell in the shortest amount of time. It is also a bubble that created the largest rate of price increase with a primary industry produce, flower, rather than other momentums such as stock market. In numbers, the bubble saw twenty times more rapid increase and decrease of price.

 

History of Tulip

Tulip originated not in Europe, but in Tian Shan mountain ranges in Central Asia. The Ottoman Turks found the flower, and after being taken by its beauty, the mighty Ottoman Empire developed various breeds of the flower, which were spread to various places in Europe in the 16th century by merchants. The Italians must have been reminded of Turkish turbans upon seeing the flower: The origin of the word Tulip is Italian word tulipano (turban-shaped), from Turkish word tulbent. Tulip gained increasing popularity in France and the Netherlands from mid-16th century, and Tulip boom overtook the Netherlands around 1634. As mentioned above, the price of tulip bulb was ten to twenty times of the yearly income of a skilled master artisan. Considering that a master artisan’s yearly income was about $100,000 in today’s currency, a bulb of tulip would have cost about $1 million, an astounding figure.

 

Why Tulip?

Why was tulip, not rose, so popular? One might argue that rose, a symbol of love, is more valuable. The answer is simple: roses wither. Tulip is a perennial plant that blooms again next year after blooming and withering this year. Because of this, it was not the flower of tulip that was traded, but the bulb or root of the flower that was the subject of trade. This reason created a trade market for tulip, generating a mania and ultimately a futures market for it. Rose without a trade market was not able to generate a bubble in the same way that tulip did.

Another reason for this was that tulip had an “unidentified future value”. You would understand that the Tulip Mania was in essence a series of investments or speculations based on price, not value. This is to say that tulip at the time did not have a certain identified future value. A good example of this is America’s sub-prime market. As vague expectation that house prices will increase cause a bubble to grow, the vanity of the aristocrats fueled the madness of the bubble. Because luxury goods were limited in the past, there were not many goods to conduct conspicuous consumption with.

Semper_Augustus_Tulip_17th_century

Semper_Augustus_Tulip_17th_century

The last reason for the Tulip Bubble is limited supply. The picture above is a mutation of Tulip called Semper Augustus. Such mutations are rare. It takes seven to ten years for a tulip seed to grow into a bulb. That supply is limited means that supply elasticity is very low, which caused the price of Tulip to increase more rapidly than other goods with more elastic supply when demand for the plant increased.

 

Why the Netherlands?

The Netherlands is an extremely open and progressive country with commerce that developed from an early stage in history. The country was a superpower in the early 17th century. The Netherlands established East India Company before Britain did, and it became a trading power in the world that owned 16,000 merchant ships, compared to 20,000 merchant ships Britain, France, Spain, and Portugal owned collectively. The country also issues world’s first stocks through its East India Company, which was a high success that generated a dividend of eight times the original price for fifty years, and scored 27% yearly rate of profit. Tulip futures market opened amidst such amazing success. No need to explain all of these factors drive the bubble.

 

How It Collapsed

Tulip_price_index_Tulip Mania

Tulip_price_index_Tulip Mania

The price of tulip bulbs that continued to increase throughout 1636 peaked in January 1637. The price jumped two or three times in a day, and one month saw 2,600 percent price increase. The value of a tulip bulb was unimaginable: In 1636, the most expensive bulb called the Emperor cost 2,500 guilders, which could be eight fat pigs, four large oxen, twelve plump sheep, twenty four tons of wheat, two barrels of wine (240-630 liters), 600 liters of beer, two tons of butter, 450 kilograms of cheese, silver cups, 108 kilograms of cloth, and bed and linen. Such ridiculous price did not last when it turned for the worse. Tulip market that was traded madly until the day before February 3, 1637 collapsed without a reason. After a period of price increase that took place amidst an extreme anxiety, a short decrease in price caused even more rapid fall in the price, which continued to cut 95 to 99 percent in just four months. Considering that the price fell by 75% in two years during the Great Depression, this is the worst price drop in history.

Because of this collapse, the Netherlands yields trade dominance to Britain later in the 17th century.

 

We looked into the Tulip Bubble today. We learned that trade or transactions that are not supported by clear analysis of profits and systematical management are prone to wrong decisions caused by human errors or emotions. This is why we computerize and systemize companies’ procedures.

Click the button below to ask us about our maritime system, terminal system, forwarding system, and other systematic KPI management, along with client management, record management, and income statement. We look forward to your inquiry.
 

CyberLogitec Contact

Shipping and Terminal Industry Trend (3/3)

Shipping and Terminal Industry Trend Ⅲ

 

We are going to share the last story of Shipping and Terminal Industry Trend. If you are curious about first and second article about industry trend, click the link please. If you are interested in Shipping and Terminal Industry Trend 1 and Shipping and Terminal Industry Trend 2, you can click the links and check them out.

 

1. Emerging markets focus by GTOs and ITOs

Map-Emerging Markets

Map-Emerging Markets

There has always been a disparity between the growth rates in container demand in the developed versus emerging markets, but since the global financial crisis, this disparity has been more pronounced. Demand growth in Europe and North America is currently very modest, if not flat-lining in the case of Europe. This has led most GTOs and ITOs to focus their attention on emerging market opportunities and seek to change the balance of their portfolios. This is the reason behind some of the disposals mentioned at article Shipping and Terminal Industry Trend 1 and Shipping and Terminal Industry Trend 2. This is not to say that GTOs and ITOs are abandoning the developed markets – far from it. Most are well entrenched, and in some cases investing heavily in greenfield developments for the long term. However, the overall trend is for a strong focus on emerging markets, and this is unlikely to change soon.

 

2. Lack of public money for port infrastructure investments

The economic problems evident in Europe and North America have put great pressure on public finances. This has in turn meant that there is limited public money for infrastructure investment. This is fuelling a greater interest in the private funding of port and terminal infrastructure, alongside the well-established private funding of terminal superstructure and equipment.

infra-investment

infra-investment

Public port authorities ought to be managed in such a way that they are self-financing – in other words port dues and concessions generate sufficient revenue to cover both operating costs and long-term investment needs. However, this is not always the case.

If it requires an investment of $350 million per million TEU of capacity(covering both terminal infrastructure and equipment), then accommodating all of the expected 190 million TEU of volume growth would require an investment of $65 billion over the next five years. Clearly this represents the upper end of the likely cost, as some of the growth will be absorbed by existing capacity, but the actual investment requirement will still be substantial.

 

3. Ports and terminals still profitable

Apart from the financial challenges faced by some port authorities, the port and terminal industry in general proved during the global financial crisis that it was remarkably resilient in terms of profitability. While virtually all GTOs and ITOs suffered reduced absolute profitability, their margins were largely maintained at the healthy level the industry has come to expect.

TTI Algeciras terminal in which OPUS Terminal TOS is in operation

TTI Algeciras terminal in which OPUS Terminal TOS is implemented

For an industry supposedly characterised by high fixed costs, this was all the more remarkable. Since 2009, most operators have successfully returned to their previous level of profitability, and indeed improved it. The container terminal industry remains characterised by EBITDA margins typically in the 35-45% range, with operators in lower-risk environments at a lower range of 20-30% while those in higher risk environments such as Russia are in the 60%+ EBITDA margin. The private port company industry, with its greater requirement to focus on capital investmentand infrastructure, and its landlord role, typically sees EBITDA margins in excess of 50%.

Drewry estimates that the world’s container terminals had a turnover of around $45 billion in 2012 and, taking a conservative profitability margin, would have generated a global EBITDA of over $10 billion.

 

4. Port and terminal valuations rising again

The resilience of ports and terminal businesses coupled with the aforementioned strong appetite by investors, particular from Asia, to acquire port and terminal assets has resulted in valuations starting to creep upwards. Of course, valuations are nowhere near the extraordinary levels of 20 or 25 times EBITDA seen in the peak of the credit bubble in the early to mid-2000s; instead they are more seen at 10 to 12 times EBITDA, but the general trend is for a slow upward tick.

 

5. Increasing requirement for higher productivity and trend to automation

Ever larger container ships will strain the operational capability of ports, with a requirement to deliver faster handling speeds in order to maintain turnaround times. The fact that the largest ships are not getting any longer is making this more challenging because simply deploying proportionately more cranes is not an option. The trend towards beamier ships is seen not just in the Asia-Europe trades, but also as a means of deploying larger, purpose-designed ships in other trades, for example the 4,500 TEU Wafmax ships for West Africa and the 8000 ~ 9,000 TEU widebeam ships for the East Coast of South America.

In addition, handling ever larger ships is not just about quayside performance. The yard and landside has to be able to keep up, including intermodal capacity. Faster ship turnaround times can only be achieved if the yard is able to support the quayside operation at a sufficient rate. Handling larger volumes from larger ships also creates more peaks, which can put pressure on intermodal rail capacity and truck gates.

Jebel Ali CT #3 Terminal Operating System and Eagle Eye

Jebel Ali CT #3 Terminal Operating System and Eagle Eye

Hand in hand with this need for higher productivity is a much greater take-up of terminal automation, particularly yard automation. Automated terminals are still rare in the industry, and most “automated” terminals are really only semi-automated (i.e. the yard only). However, an increasing number of new and planned terminals are using yard automation as a matter of course. This includes new terminals in the high-wage, developed world such as London Gateway and the Maasvlakte II terminals in Rotterdam, but also new terminals in lower wage locations such as the Khalifa port terminal in Abu Dhabi.

Chinese terminal operators are also increasingly looking at automation. One of the key reasons is that the technology is improving exponentially, certainly for yard automation. However, other technology is also moving fast, for example remote controlled gantry cranes.

The extent to which all this can and will support faster vessel handling remains to be seen.

 

This is the whole of Shipping and Terminal Industry Trend, if you are curious about first and second article about industry trend or have any questions, click the related posts below and leave some comments please.

 

CyberLogitec Contact

Interview: Head of Terminal Business Unit Jason throws new insight of vision in Terminal Industry (2/2)

Interview: Head of Terminal Business Unit Jason throws new insight of vision in Terminal Industry

If you would like to see the previous part of interview, please click this link.
 
Interviewer
: What are the current status/issues in the market, and where do you think the market is headed?

Interview Clip of Jason Hyeon from CyberLogitec

Jason: The terminal market is rather sensitive to the global economy, and the recent recession is taking away from the vitality of investment in the market. However, in the long term I expect the terminal industry to continue to grow because of the anticipation for recovery in the market. Especially under the current situation in which maritime shipping companies cannot increase their earnings as much as in the past, I expect there to be more projects to increase efficiency of the terminals rather than to build new terminals or expand existing ones.

Looking at this issue from such a perspective, I believe the trend of automation in the terminals will accelerate and they will become unmanned increasingly. This is because vessels are enlarging, shown from the building of 20,000TEU-class ship in Japan; such a trend brings about more large-scale works, and creates need for human error prevention, shortening of planning time for a large-scale cargoes, and decision making focused on terminal optimization and making it more efficient.

Vice President of Terminal Business Unit Jason 2

Head of Terminal Business Unit Jason

And as the traffic of goods that terminal workers must control increases due to the enlargement of cargo ship, the need for systems that prevent human error and plans a large volume of cargoes is increasing. This is to increase the strength and GM of container ship stowage by utilizing programs optimized for stabilization, while overcoming temporal limitation and enhance efficiency. This also explains the high interest for OPUS Stowage in Asia, Middle East, and Europe.
Continued studies for understanding technological trends such as big data and IoT, and their direct and indirect effect and market utilization are being conducted. While forecasting was conducted through analysis of standardized data in the past, we will be able to induce valuable and significant results from unstandardized data by using new technologies such as IoT.

 
Interviewer
: How are you responding to market issues?

Jason: All customers seek to buy a high-quality solution at a low cost. Because quality and cost are positively correlated, however, it is difficult to buy a good product for cheap. As such, CyberLogitec looks to utilize its insights about the market to propose an adequate level of solution at the most reasonable price to the customers.

Vice President of Terminal Business Unit Jason 1

Head of Terminal Business Unit Jason

Because the loss of jobs caused by automation of terminals is becoming a social issue, we are looking to find a solution to the future of terminal operation. Rather than simply replacing workers with automated machines and systems in order to reduce costs, we need to consider a plan for assigning professional workers to jobs that provide a bigger value to the terminal.
 
 
Interviewer
: Where do you plan to steer the unit to?

Jason: Our objective is to have the most share in the TOS market. Even after we achieve this goal, we are planning to focus our efforts and studies in two directions.

Vice President of Terminal Business Unit Jason @ his office

Head of Terminal Business Unit Jason @ his office

First is to increase the value of our customers. This parallels the company mission of establishing a successful partnership in which our products offer value to our customers, while the customers and CyberLogitec grow together in value.

Second is to increase employee satisfaction and pride. What is as important as the satisfaction of our customers is that of our employees. I will provide opportunities for my employees to take pride in the fact that they are working in a good company to create good solutions, as well as sympathize with the value that the company and the solution strive for. We are also planning to provide professional education to our employees so that they may stay flexible in the ever-changing environment, retain insights about the market.

 

 

If you have any further question about Terminal industry or Terminal Solutions, please do not hesitate to contact us.

 

CyberLogitec Contact

 

Interview: Head of Terminal Business Unit Jason throws new insight of vision in Terminal Industry (1/2)

Interview: Head of Terminal Business Unit Jason throws new insight of vision in Terminal Industry

 

Interviewer: Please give us a brief introduction about yourself.

Jason: I’m currently leading Terminal Business Unit at CyberLogitec. I’ve been working quite some time at CyberLogitec, gaining experience in various fields from being on board vessels to devising shipping IT strategies, leading terminal IT projects, and much more.

At college, I majored in nautical science. I got a job at Hanjin Shipping right out of school to work onboard container and bulk ship for three years. After that, I was placed in Voyage Management Department, working in maritime technology, ship status, and other tasks. 

Afterwards, I was placed in a new department at Hanjin Shipping that was responsible for establishing IT strategies. I participated as an IT strategy planner, carrying out my duties as a business analyst who distributed and led knowledge required for managing maritime voyages. I also took part in computerizing ship and maritime affairs. While operating the workflow and managing the computer system in all fields in Hanjin shipping, I came to understand the overall working of a maritime shipping company.

My career led me to participate in acquiring a German shipping company. I worked to finish the acquisition and went on to lead the IT team in Hanjin Shipping European branch offices, helping to launch the company’s New Information System (NIS) and apply it to overseas offices.

I joined CyberLogitec towards the end of 2001 after I returned to Korea, and I was put in charge of Hanjin Shipping’s System Maintenance (SM) organization in 2003. At the end of 2005, I worked as a project manager of a Process Innovation project for applying web environment and external best practice packages to Hanjin’s workflow. 2009 was a transition year for me, because my career was moving towards the field of terminals after 20 years of experience in maritime affairs. The transition was smooth, and now I am leading the Terminal Business Unit at CyberLogitec.

Vice President of Terminal Business Unit Jason @ KAP Terminal

Head of Terminal Business Unit Jason @ KAP Terminal

 

Interviewer: Do you remember any projects or experiences during your career?

Jason: I participated in various project at Hanjin Shipping directly and indirectly. But I fondly remember NIS, PI, and PNC projects that I participated as project manager in the field.

In 1995, I spearheaded the establishment of New Information System in Hanjin Shpping. 1994 to 1995 was a time when the main frame in the field of data processing was moving to open architecture and client servers. In order to support the execution of Hanjin’s next-generation IT strategies, my team proceeded to develop a company-wide New Information System, along with various consulting firms including IBM, James Martin (a leader in system architecture at the time), Anderson (currently Accenture). At the time when I was participating in that project, such a worldwide project was an extremely innovative and challenging task. Although I experienced shortfalls while working through the project, it became a valuable asset for me as an IT expert, in that I successfully led a project as a PMO. This project was also meaningful because it signaled a transition to developing user-centric IT systems as opposed developer-centric ones in the past. I also obtained a comprehensive view encompassing the whole of maritime shipping industry, not just a part of it.

The most difficult project was the TOS project for PNC Terminal in Busan that I led as a project manager in 2009. PNC was the largest terminal in Korea with DPW as one of the two major shareholders, and the project was a business opportunity that could affect CyberLogitec quite positively. Despite difficulties, my team and I were able to overcome crises big and small to bring the project to a success. The multitude of cases I experienced back then enabled me to successfully deliver terminal projects worldwide. I think the fact that my teammates overcame the difficulties during this project effectively allowed the Terminal Business Unit to develop to where it is now.

Vice President of Terminal Business Unit Jason

Head of Terminal Business Unit Jason

 

Interviewer: What does the Terminal Business Unit do?

Jason: Terminal Business Unit carries out various tasks regarding terminal solutions. We harbor various organizations for sales and marketing, developing solutions that CyberLogitec strive for, delivering and expressing such solutions for our customers, operating and supporting services after delivery, and developing an engine that automates stowage, the stability of container ship. In addition, we have a team that provides a solution enabling the real-time management and control of assets within terminals. This team provides the Eagle Eye solution, which realizes the convergence with the hardware, not just the software. Eagle eye is special because not only does it involve in automation of terminals, but it also expresses motions of major assets into video or 3D, using signals. In the future, we are planning to upgrade the solution to enable prediction and simulation by gathering data in the terminals. Currently, we have applied KPI to provide alerts when the motion reaches short of what the users require, or when an exception occurs. The solution also provides a rewind function for reviewing incidents after they occur.

Jebel Ali CT #3 Terminal Operating System and Eagle Eye

Jebel Ali CT #3 Terminal Operating System and Eagle Eye

<Overall situation of the terminal is monitored in the terminal control center, and tasks are executed on personal computers>

 

Jebel Ali Container Terminal that utilizes Eagle Eye is the first case in the world that automated quayside. It is currently being run as a trial basis, and it is important for the terminal business, as well. In addition, we expect the solution to bring enhanced safety and energy-saving effects through yard automation.

How Terminal Operating System Changed Container Terminal Operation of Jebel Ali CT #3

One of the strengths of CyberLogitec is that it has years of accumulated experience of overcoming various difficulties as well as successes in TOS. Based on such experiences, we are delivering TOS in any harsh conditions.
 

If you would like to see the next part of interview, please click this link.

 

If you have any further question about Terminal industry or Terminal Solutions, please do not hesitate to contact us.

CyberLogitec Contact

Four Features to consider when selecting new Forwarding Information System

Four Features to consider when selecting new Forwarding Information System

 

Are you ready for global business?

The key success factors of the global logistics industry are cost & time savings, profitability and seamless networking between trade partners. The regulations of customs are becoming increasingly complex; so hence, the trade compliance is emerging as a critical factor of the freight forwarding business.

 

Important Features for Forwarding Information System (FIS)


Forwarding Information System (FIS) is essential solution to smooth these crucial factors that many forwarding companies are facing. And it should offer high system flexibility & scalability, which enables forwarders to save on Total Cost of Ownership.

In order to choose Forwarding Information System successfully, there are four features that should be given considerations as below.

Feature of Forwarding Information System

 

1. Workflow

- Establish Standard Operation Procedure

- Operation Visibility

FIS(Forwarding Information System) has to improve operation efficiency and customer service levels through the workflow function. First, Plan and manage SOP (Standard Operation Procedure). It helps creating the specific workflow of shipments according to predefined work procedure templates. Also it facilitates and checks customer orders and current status visibility by following the system through the provided procedure. Second, Operation Visibility Features. It means that we have to consider if FIS provides real-time operational status of customer orders. This feature makes us tracking the status of work progress in comparison to the plan. Third, Streamlined End-to-End Processing. The operational data is integrated with accounting to guarantee data consistency. Invoice creation based on the freight information of shipments. Isn’t that easy?

 

2. Global Business

- Multi-lingual / Multi-Currency

- Web-based Application

As many forwarding companies operate their overseas branches and offices worldwide, integrating global business is also required to Forwarding Information System. With this feature, it is possible to manage global accounting and operation.

 

3. Automation

- Simplify Rating Procedure

- Document Automation

These automation features will improve companys business efficiency and minimize damage caused by human errors. First, has among these features, Auto-Rating is necessary to systemically manage customers and partners contract information. It can perform precise and quick ratings at the time of shipment registration. Second, Document Automation. This solution extracts information from documents received via fax or e-mail such as Arrival Notice by analyzing it automatically. It also automates the process of receiving documents and entering information into the system. Third, Document Management. It helps converting documents received Fax or e-mail to PDF format. Archiving the original and converted files in the system is not so different.

 

4. Collaboration

- Various EDI Portal and Partners

- Customs EDI

Collaboration is important because this can reduce considerable resources in cooperating diverse trading partners around the world. Global logistics companies are making decision on how many EDI formats FIS provides and how many Customs EDI it covers.

 

 

For more information about Forwarding Information System, please click contact us button or leave a comment below.

 

 

CyberLogitec Contact

 

Shipping and Terminal Industry Trend (2/3)

Shipping and Terminal Industry Trend Ⅱ

 

Last time we looked into the trend of shipping and terminal industry. We now are going to have a deeper look into the industry trend for sequel. In the last posting of Shipping and Terminal Industry Trend we shared the size enlargement of vessels and terminals. What comes next this time?

1. Proliferation of carrier alliances

Ever larger ships also intensify the pressure for more alliances and cooperation between carriers in order to fill them, and so ports and terminals face the challenge of greater concentration of volume. The Asia-Europe trade route, for example, did have just five main players (in operational terms): Maersk Line, MSC the operating alliance of and CMA CGM, the G6 Alliance, the CKYH Alliance and the China Shipping/Evergreen/UASC/Zim grouping. While there are a number of individual carriers within this total, each competing for business, in terms of ship operations they are joined together. In the case of the UK ports, for example, this means that the estimated 3.5 million TEU of annual Asia volumes is split across just five groups, each with roughly 700,000 TEU p.a.

13100 TEU Class HANJIN SOOHO

While it is important to note that not all of this volume has to be accommodated in one port or terminal (and vessel sharing and slot chartering inevitably complicate matters), the increasing concentration of alliances clearly has an impact. Traffic can be won or lost in larger lumps.

The cascading of larger vessels onto other East-West and North-South routes will inevitably increase the pressure for more alliances, and in turn concentrate volumes for ports and terminals. For example, the G6 alliance has extended its cooperation to include the Asia-East Coast North America route was announced in June 2013. This will see the top three liner companies, Maersk Line, MSC and CMA-CGM are cooperating operationally on all three East-West routes – Asia-Europe, Transpacific and Transatlantic.

More complicated still are ports where there is a mix of gateway and transshipment volumes. There is a whole host of other issues here – available terminal capacity, ship size, contractual commitments, terminal shareholdings and so on. Then there is the attitude of each liner towards its related terminal company – Maersk Line tends to be at arm’s length to APMT, MSC is perhaps closer to TIL and CMA CGM closer still to Terminal Link. These are complex issues that will take time to work through – and the immediate challenge for the three lines will be coordinating vessel operations.

More collaboration between shipping lines will surely follow and with it some degree of rationalization of port and terminal choices.
 

2. Shipping lines having to raise cash

container ship at US long beach terminal

Liner shipping remains challenged by poor profitability. Drewry’s estimate of operating profit for the liner shipping industry in 2012 was $280 million – clearly a very poor return for moving nearly 170 million TEU of loaded containers, although any sort of profit seemed highly unlikely after the heavy losses sustained in the first quarter. It also represents a significant improvement on the estimated $7.7 billion industry loss endured in 2011.

The relentless pursuit of economies of scale through deploying ever larger ships is fine, provided that trade volumes grow sufficiently to fill the additional capacity. However, over-ordering, combined with continued sluggish economic performance by developed countries in particular, has resulted in continued pressure on freight rates and continued poor profitability for the carrier sector. Carriers therefore remain under pressure to raise cash, and selling terminal assets is one of the few ways of achieving this. Hence at least in part, the disposals of stakes in terminal assets made by the likes of Yang Ming, Hanjin, CMA CGM and MSC can be seen as a consequence of this need. This trend looks set to continue.
 

3. Highly active Asian and infrastructure investors

Chinese-Investors

Chinese-Investors

The moves by carriers to raise cash have neatly coincided with the presence of cash-rich, mainly Asian investors (and particularly Chinese investors) keen to gain a greater foothold in the port and terminal industry. Hence companies such as China Merchants and Mitsui have made significant acquisitions. Others, such as COSCO Pacific and SIPG, also have a strong appetite for expanding their portfolios, in particular to spread risk away from a reliance on Chinese ports. At the same time, the infrastructure investor community also remains active and interested in ports and terminals, as shown by moves made by the likes of GIP to take stakes in TIL, and also in the Port of Brisbane.
 

4. Portfolio management by GTOs and ITOs

Tanjung Priok Terminal #3 operation and Terminal Operating System of OPUS Terminal

GTOs and ITOs started to emerge in the 1980s and for perhaps the first 20 years of their existence their primary strategic aim was to build portfolios, taking advantage of the numerous acquisition, privatization and concession opportunities in all parts of the world. Divestment of assets was a rare occurrence and usually only happened when forced on an operator by financial pressures (such as the sale of ICTSI’s international assets to Hutchison in 2001).

Over more recent years, however, a number of the stevedore and hybrid operators have started to take more of a portfolio management view, disposing of selected assets either to re-balance their portfolios or simply take advantage of attractive valuations. In part this is because the industry has reached a certain level of maturity, and so assets have become ripe for disposal. It is also a consequence of an increasing focus on emerging markets by GTOs and ITOs. That is another reason terminal automation system takes center stage lately.

If you would like to see the next post of this article “Shipping and Terminal Industry Trend 3rd”, click!

More interested in the greater details? Please do not hesitate to click the “contact us” button and leave a message.

 

CyberLogitec Contact

 

St. Patrick’s Day and Global Beer Logistics Market

St. Patrick’s Day and Global Beer Logistics Market

 

St. Patrick’s Day is coming.

St. Patrick’s Day is a festival held on March 17th of every year to commemorate St. Patrick who brought Christianity to Ireland. It has been a tradition in countries with Irish population such as Ireland, US, UK, Canada, Argentina, Australia and New Zealand since 9th -10th century. In a traditional St. Patrick’s Day event, a large street procession takes place centered around a giant figure of St. Patrick.  Bagpipes, which is Irish traditional musical instrument and bands consisting of local residents join the parade, adding to the festivities.  Irish people don themselves in traditional Irish costumes or green clothes and green accessories and join the crowd on the street.

One cannot forget to mention the color green when talking about the St. Patrick’s Day. This is because green is the color that represents St. Patrick. During the festival, the clothing people wear, decorations on the street and foods are all characteristically green. Foods and beverages are also a big part of the festival. Today, we would like to take a look at the logistics of beer which is one of the essentials in any party.

 

World’s Top Beer Exporter Ranking

So who is the number one beer exporter in the world? Germany, the originator country? Or Belgium, a small country but a powerhouse in terms of beer exports? Or the Netherlands, which is famous not only for its beer but also for its trading prowess? Surprisingly, the answer is Mexico. According to the International Food and Agriculture Organization (FAO), Mexico beat out the Netherlands to become the number one beer exporting country. The global beer exporting trends announced by FAO in 2003 indicated that Mexico exported the most quantity of beer annually with 1.39 million tons. The Netherlands, took second place with 1.30 million tons. This figure continued with Mexico in the first place, the Netherlands in second, Belgium in third, Germany in fourth and England, with its world famous ales, in the fifth place.

source: Worldrichestcountries.com

There are also countries who are fast becoming beer exporters. They are mostly growing countries so it is not surprising many of them are emerging economies.

Fast growing beer Exporters

Fast growing beer Exporters

The number one beer export in Asia is Thailand. It is a bit surprising that Japan, with its share of fine beers, is only the seventh. Europe is of course full of many strong beer exporters. It appears that the ninth ranked country in Europe has exported the same amount of beer as the number one exporter in Asia.

Top Asian Beer Exporters by Country

Top Asian Beer Exporters by Country

Top North American Beer Exporters by Country

Top North American Beer Exporters by Country

Top European Beer Exporters by Country

Top European Beer Exporters by Country

 

Global beer importer ranking

The number one beer importer, not surprisingly, is the US. It is the world’s wealthiest country with a very large population so maybe this shouldn’t come as a surprise. The Irish population living in the US is 45 million which is about 16% of the total US population. Considering that the population in Ireland is only about 6 million, this is an amazing number. The second place went to England, the country of ale.

 

Global beer consumption ranking

List of countries by beer consumption per capita
List of countries by beer consumption per capita

So then which country consumes the most beer on per capita basis in the world? Surprisingly, it’s Czech. Czech is another country famous for its beer. Pilsner Urquell, lager representing Czech famous for its incomparable balance and good taste, was recorded as the world’s best beer. It’s followed by a series of European countries, including Austria, Germany and Ireland, all countries famous for their beers.

Beer consumption by each country could be mapped as follows:

Beer_Consumption_map_by_Country

Beer_Consumption_map_by_Country

 

Global beer producer country ranking

The Top 5 Beer Producing Countries

The Top 5 Beer Producing Countries

Sources: Barth-Haas Group: The Barth Report 2011 – 2012.

So aside from beer exporter countries and consuming countries, who is the top beer producing country? Not surprisingly, it is China, the world’s factory. China is followed by the US, Brazil and Russia. As for Russia, its beer consumption has been on the decline recently.

As everyone knows, beers are transported via containers shipping. As for such container transports, logistics loading and optimization of passage determination is most critical. It is the source of the greatest headache for forwarders, as well as kpi. Therefore, efficient logistics operation system is increasingly becoming more important from efficient loading and terminal operation to the determination of passage and loading order.

 

If you have any questions regarding terminal, container shipping and logistics operation system, please do not hesitate to push the contact button below.

CyberLogitec Contact

 

Three features of Terminal Operating System that brings terminal performance enhancement.

Three features of Terminal Operating System that brings terminal performance enhancement.

 

The needs for super-sized and high-performance terminals are rising as international trade and numbers of large vessels have increased. Overall productivity and efficiency of terminals is becoming more important in the global competition between the terminals, and the increase of throughput and demands for efficiency is requesting terminals to become more optimized.

Terminal Operating System(TOS) has applied the latest IT technology for the needs; it guarantees high system reliability with transaction load balancing at peak time. Moreover, TOS offers a high system flexibility & scalability which enables our customers to save the TCO(Total Cost of Ownership). For that matter, there is always natural eager to choose proper TOS for terminal itself for better performance.

 

1. Optimized yard operation

Optimized yard operation of TOS maximizes terminal productivity with optimized real-time planning, job scheduling, dispatching and resource pooling functions. With actual status of containers & equipments data in the terminal, TLC sends job orders to automated yard equipments based on optimized algorithm. Moreover, it enables users to select preferred yard allocation-rule by either grouping or scattering according to yard utilization rates and equipment workload for real-time grounding. It supports controlling of terminal equipment such as:

  • Ship to Shore Crane (Twin / Tandem Lift support)
  • Straddle carrier, RTG, RMG operation
  • Top Pick, Reach Stacker operation
  • Automated Stacking Crane
  • Shuttle carrier & Terminal Truck pooling

To satisfy these functions, CyberLogitec has OPUS Terminal applied TLC (Terminal Logistics Control) system on it.

 

2. Yard equipment pooling

Yard Equipment Pooling system increases equipment availability by decreasing yard truck/straddle carrier idle time and unnecessary travel by suggesting the optimal travel path. It supports pooling per STS Crane, vessel, and berth which leads to higher productivity.

 

3. Resource management

Resource Management system supports resource planning and management for labor and equipment to save terminal running costs. Adopting lean management logic, Resource Management system minimizes the terminal’s unnecessary manual work and maximizes the operation productivity.

 

4. Value-added management

TOS should offers comprehensive systems for integrated terminal operation:

  • Gate, CFS and M&R Operation
  • Statistics & Analysis Report
  • Document Management
  • EDI & Web Service
  • Billing & Customs

 

OPUS Terminal, The Proven TOS for the Terminal Operation.

CyberLogitec OPUS Terminal is the Terminal Operating System suitable and optimized for conventional as well as automated terminal operation, which provides all the functions above customizing for each terminal’s conditions. As the result, moreover 90% of container handling operation in Korea is supported by OPUS Terminal, and automated terminals such as Hanjin Newport Company, Pusan Newport Company (DP World operation), and Total Terminal Intl’ Algeciras in Spain already are enjoying the benefit of OPUS Terminal.

 

PNC (Pusan Newport Company) is a good example for it. Performance of the terminal has enhanced tremendously. Considering 46% throughput increase as it was 160,000 TEU per month to 233,000 TEU per month after TOS replacement it is now.

 

 

If you need any further information, there is no reason to hesitate to contact us through the channels below.

 

 

TEL : +82-2-6350-2000
FAX: +82-2-6350-2050
E-mail : sales@cyberlogitec.com
Homepage : http://www.cyberlogitec.com/?lang=en