IFW article: Friday Focus: Something to whet the freight appetite

7/1/11 3:33 PM

Shipping was once the primary method for moving goods, a role now taken by road in the UK. Is water freight just a relic of the past, or can it play a key role in the future of our supply chain? asks Christopher Snelling

There is a substantial network of sea freight services in use today, with the potential to grow considerably. With challenges, such as climate change, pollution, rising fuel costs and constrained road infrastructure, facing the logistics industry, water is well placed to play an increasing role.

The Freight Transport Association (FTA) has always wanted to see the UK getting more out of our sea and water capabilities, and now we have a new opportunity to help make that happen. Since November, the UK’s official shortsea promotion centre, Freight by Water, was merged into the FTA to make use of its pan-modal nature and capabilities.

The biggest users of shipping services are the petroleum industry and bulk products such as aggregates, coal, forestry and agricultural products. But we should be clear that containers also feature heavily, and this is clearly an area with potential. Already UK domestic coastal services alone carry out 2.5 billion tonne km of container movements each year.

The recession has impacted all aspects of the logistics industry, but water freight has held up impressively – for example, coastal container traffic in 2009 fell by only 9% against an across-the-board decline of 15% in all box traffic through UK ports.

In the FTA’s view, there is the clear potential to expand the use of water freight in the UK. Inland waterways provide key opportunities in specific areas – around waterways such as the Thames, Severn or Humber. This particularly applies to construction projects, or industries working with bulk commodities.

Much bulk traffic also makes long-distance road journeys and these would be prime candidates for switching to coastal services.

Perhaps the biggest market is containers. If shippers and forwarders can be convinced of the advantages of water, and if the range of services can improve, then we could see a step change that would see water integrated as a standard option for the logistics industry

There is the possibility of a virtuous circle here. If there are more services, more shippers will use water, leading to more familiarity, leading to increased volumes, lowering costs, making more services viable, and so on. And you can start at any point in the circle.

The key question is how to get into this circle to start realising these benefits. Shippers need to be willing to become more creative to enhance their supply chain, ports and operators need to work to launch new services and ensure high performance on existing ones and we need government to support the development of water freight through a sensible planning regime and an easy-to-use grants system to support new services.

We will be providing information through the Freight by Water website setting out the opportunities available in water freight to make that first step easier.

With efficient supply chains and carbon performance high on the logistics industry’s agenda, this is a crucial time for water freight to grow and enhance its offer.

Christopher Snelling is Head of Supply Chain Policy at the Freight Transport Association

Neil Berry