TOGY talks to
Proactive logistics in QatarDecember 4, 2018
Ashutosh Sharma, Qatar country head of Transworld Shipping & Logistics, talks to TOGY about changes in Qatar’s shipping trade, Hamad Port’s ability to compete and the role of logistics companies during the blockade. Part of Transworld Group, in Qatar the company operates with its own ships, containers and warehouses, as well as providing agency services.
• On the embargo’s impact on ports: “The ports in Qatar were quite overwhelmed once the embargo happened, since they were all taken by surprise. The Hamad Port was jammed due to heavy import landings, with no way in or out. Shipping companies and port authorities came together to discuss problems and how they could solve them together. The port authority [Mwani Qatar] took very proactive action and the Hamad Port jam was cleared within 15 to 20 days. Now everything is working very well. Port authorities were instrumental for shipping companies during this period.”
• On Qatar’s port authority: “The port authority is providing online solutions and is very open to solving issues and listening to suggestions when it comes to expanding the services they offer. This was not the case before. They are looking for Hamad to become a trans-shipment hub. Now they are setting new records in ship handling.”
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Are you witnessing an increase of shipping companies penetrating the Qatari market?
These companies have always been here but are more active now. They were working with limited staff in small offices in the shadows, but now they have come up. Before the embargo, we were only using the transfer feeder vessels which we own . We later brought more vessels – which had been servicing our Indian domestic route – to Qatar and other parts of the Middle East and Indian subcontinent so we could do more for the customer here.
You could say that the embargo was a blessing in disguise for us. We saw a 232% jump in revenue, primarily due to inbound and outbound traffic shifting modes of transport. Previously, 10% of volume came by ship and 90% by road especially foodstuff. The embargo completely changed that set-up and now about 70% of goods come via ships, whereas perishable goods are transported by air. After the embargo, our throughput went up to 1,500 containers per month
How effectively did Qatari ports react to the blockade?
The ports in Qatar were quite overwhelmed once the embargo happened, since they were all taken by surprise. The Hamad Port was jammed due to heavy import landings, with no way in or out. Shipping companies and port authorities came together to discuss problems and how they could solve them together. The port authority [Mwani Qatar] took very proactive action and the Hamad Port jam was cleared within 15 to 20 days. Now everything is working very well. Port authorities were instrumental for shipping companies during this period.
The port authority is providing online solutions and is very open to solving issues and listening to suggestions when it comes to expanding the services they offer. This was not the case before. They are looking for Hamad to become a trans-shipment hub. Now they are setting new records in ship handling.
All in all, one has to adapt quickly to market conditions, to know the cost metrics and the routes that are operating, because you can change the route but at the same time, cost matters. If you have costs escalating, nobody will come to you.
How can the Hamad Port compete with regional shipping hubs?
It very much depends on the people and the approach that they adopt to become a trans-shipment hub. The QTerminals management is very active. They are looking at the requirements of the port, from the very basic to the advanced. There are many elements that need to be looked at, including critical infrastructure such as warehouses, staging options, a big draft for large vessels, the cost matrixes and the activeness of the management.
As of now, only one terminal is working, since the Hamad Port project is still in its first stage. It will take some time to increase this but if they continue with their approach, they can compete with other regional shipping hubs in perhaps three years.
Inbound and outbound traffic is predicted to continue to increase over the next three years. What do you attribute this to?
The first reason for the increase in traffic is that Qatar is gearing up for FIFA in 2022; major construction projects are underway and many more are coming up. Within perhaps one or two year these will be finished. Then comes the finishing stage. A lot of products from this stage are from the Chinese and European markets, such as chairs and lighting for the stadiums. There’s a lot of business to be had in that. Qatar is also constructing stadiums that can be dismantled following the World Cup, which will benefit shipping companies further.
The second reason is the import of foodstuffs. Qatar is opening up to imports from India, Singapore, Malaysia, Europe, the USA and other parts of the world. More products gives more choice to consumers too, I remember two years ago we could only find dairy products from one particular country. We had little choice, and the price was high. Now there are more products in the market, giving people more choice, because of the shipping companies.
Given the blockade, how can logistics providers help companies improve their supply chain?
Due to the blockade, the cost of shipping increased, and so did the bureaucracy. For instance, if a container is loaded in Dubai, you cannot route it directly to Qatar. First and foremost, it is about mastering the entire chain. It’s a mixture of manpower, timing and technology. We applied a warehousing management system that provides real-time information and avoids endless emails and faxes.
On our end, we filed contracts with the other shipping carriers, which entails that three or four shipping companies come together, put cargo on one vessel and cater to everyone’s contracting obligations and arrive at a set destination. That is a major initiative. Secondly, we are creating a hub in India, as there is a direct service from India to Doha.
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