Session 3. Export / import challenges Critical points of
logistics in the steel supply chain Bart-Luc Olde Hanter, Sales
& Marketing Director NewTide Chartering BV, Rotterdam The
Netherlands
Slide 2
Introduction NewTide NewTide is a young and ambitious maritime
service provider located in the dynamic city center of Rotterdam,
Europes main port Currently we have the exclusive commercial
management over a modern multipurpose fleet of dry cargo vessels
ranging between 2.000 10.000dwt By operating transparent NewTide
strives to achieve clean logistical and shipping solutions by using
our assets and network Our focus will be on dry cargo, (break)bulk
and projects not limited to the full Atlantic, Mediterranean,
Baltic and Black Sea
Slide 3
A chain is as strong as the weakest link Critical points of
logistics in the steel supply chain
Slide 4
Focus on shipping Market developments Effects of the Emission
control areas (ECAs) regulations Focus on logistics Logistics after
the crisis: Lean and mean? Lsps: necessary evil or necessary
partner? Critical points of logistics in the steel supply
chain
Slide 5
Shipping market developments Reduced shipbuilding capacity
Increased scrapping of vessels Increased number of distressed
vessels Freight rates historically low ever since September 2008
Currently freight rates seem to increase Green-Shipping is becoming
of more importance Fuel efficiency is getting more important
Reallocating of tonnage due to ECAs in 2015 High fuel prices
possibly to increase further due to ECAs Increasing demand for
(green) vessels is expected
Slide 6
The table is expressing the sulphur percentage allowed in fuels
in a time bar; the red line is the bar applicable for Baltic and
North Sea Green shipping is becoming more important
Slide 7
The below figure is showing where the current ECAs are
located
Slide 8
Fuel price development Baltic dry index
Slide 9
The search for improving margins by steel producers has lead to
a shift from a steel production driven sellers market to a customer
oriented buyers market What are the consequences for logistics?
Changing steel logistics environment 20072014
Slide 10
Logistics after the crisis: Lean and mean? Although total crude
steel production worldwide picked up this didnt result in large
international trade flows but in general more regional flows Steel
logistics has changed and is still changing We still see only small
lots max 5.000 ton Predominantly handling, hardly storage Multiple
forwarding and shipping companies fighting the same cargo which
resulted en still causes a pricing battle => concessions on
quality High fixed and operating costs Very low market prices
Slide 11
Characteristics of a customer oriented market Shift from
Ex-works To DAP/DDP logistic concepts Shall the logistics ambition
of steel producers follow through?
Slide 12
Characteristics of a production driven market Steel producers
focus on output maximisation Goal: max output => lower
production costs => higher margins Players and their influence
in logistical processes: Traders + Distributors / Steel Service
Centers + Steel producers +/ End consumer -/- Consequences: Large
quantity stockholding caused by trade Logistics is not that
important, marginal costs Damage to steel (coils) is a matter of
insurance Asset based lsps are a necessary evil Characteristics of
a customer oriented market Steel producers focus on customer
satisfaction & service Two goals: Increasing margins + customer
satisfaction Players and their influence in logistics: Traders +/-
Distributors / Steel Service Centers +/- Steel producers ++ End
consumer + Consequences: Logistics is getting more important,
implementation of total supply chain management and Just In Time
concepts Focus on damage control, cost savings and risk reduction
Asset based lsps have become necessary partners for success
Slide 13
Questions Are shippers really interested in sustainable
logistical solutions? Will the customer satisfaction approach
prevail over production maximization once the markets pick up? Will
Steel producers implement total supply chain management from raw
materials to finished products? Roberto Re Commercial Director of
Metinvest Western Europe I think that this is a time to select and
develop partnerships to provide efficient logistics and guarantee
uninterrupted service and technical support (Metal Expert interview
21-01-2013)
Slide 14
Partnerships are critical points in the steel supply chain! A
partnership implies: Trust (by transparency) Long term vision
Stability Information exchange, understand each others pains &
gains Developing logistical concepts together The next step towards
customer satisfaction Working together on operational excellence
and creating competitive advantages in order to strengthen the
chain!
Slide 15
We cannot direct the wind but we can adjust our sails NewTide
Turn the tide
