Targeting transshipments

Targeting transshipments

The twin ports of Marseilles and Fos have a slight geographic problem. While they are on the idyllic coast of the south of France, and serve as a gateway to the region's market of 10 million people, that's nowhere near the population base of 50 million to 80 million that northern European ports such as Antwerp and Rotterdam can offer shippers.

What about the transshipment trades? Surely Marseilles-Fos is well-positioned to capture a growing share of the Mediterranean transshipment trade. There's a slight geographic problem here, too. Marseilles-Fos must compete with the booming transshipment ports of Algeciras in southern Spain, Gioia Tauro in southern Italy, and Malta, all of which sit astride a direct line drawn from Suez to Gibraltar and attract transshipment cargoes from round-the-world services that don't need to deviate from their east-west routes. Ninety percent of the throughput at these three transshipment ports consists of containers unloaded from big round-the-world ships for transshipment by smaller ships bound for ports in the eastern Mediterranean and North Africa.

"Marseilles is important gateway for southern France and Switzerland, but it's not nearly as competitive in the transshipment trade as Algeciras or Gioia Tauro," said John Fossey, executive consultant with Drewry Shipping Consultants Ltd. in London.

The ports at Marseilles and at Fos, 40 miles to the east on the mouth of the Rhone River, currently attract little transshipment cargo, which accounted for only 1.3 percent of total throughput in 2003. Most of the cargo at Fos is on the east-west trade, while much of the throughput at Marseilles is north-south trade with former French colonies in North and West Africa.

The Port Authority of Marseilles, which administers the two ports, is trying to marry the north-south trade through Marseilles with the east-west trade through Fos to drum up more transshipment business, while wresting a larger share of the European market from the north European ports.

"We want to grow the transshipment trade, but we aren't as well located for that trade as Algeciras, Gioia Tauro or Malta," said Monica Bonvalet, commercial director of the port authority. Marseilles-Fos is, however, well-positioned to capture a larger share of the north-south trade, where it is enjoying growing volumes. "North Africa is a growing market, and that's not just potential, but actual," Eric Brassart, executive managing director of the port authority, told a group of carriers in the U.S. last year.

The port authority is heavily promoting its key advantages to attract more transshipment trade from the carriers whose large vessels call at the port to deliver cargoes destined for its hinterland in southern France and Switzerland. Although transshipments in 2003 amounted to a mere 17,218 TEUs, the traffic is starting to show robust growth from that small base. Transship-ments through Fos grew by 44 percent to 7,625 TEUs in 2003, and transshipment cargo at Marseilles grew by 11 percent to 9,593 TEUs.

Though more cargo is still transshipped through Marseilles, transshipment at Fos is growing faster because the port authority is trying to shift the transshipment trade to the new container terminals in Fos, where there is more room to grow. The industrial port of Fos covers approximately 75 square miles, almost twice the size of the city of Paris.

The transshipment trade has traditionally been located in Marseilles. But containers unloaded by the larger vessels calling at Fos had to be shipped 50 miles by rail overnight to Marseilles, a move that costs about $100 per container. That's why the port authority decided to relocate the trade to Fos. It has, however, met some resistance from the old family owned shippers and forwarders who live in Marseilles and are attached to the old port, where they have always conducted their business and don't want break with age-old tradition.

Perhaps to avoid stirring up further resistance, Bonvalet denied that the port authority is trying to take transshipment volume away from Marseilles. But she did say that she hoped the transshipment volume at Fos would grow "organically" as Fos captures more market share and attracts more direct calls from the U.S. and China. She said she expects Fos's share of north-south trade to grow as more cargo to and from Europe goes through or is transshipped there.

She said the port authority is trying to increase its market share in France and Europe by promoting its efficiency and quick turnaround as well as its road and rail networks, which can provide overnight delivery to most of southern France and one- or two-day delivery by rail to anywhere in France and three-day delivery anywhere in Germany and Switzerland.

The port authority has invested in dredging the berths and buying new cranes that can handle the larger container ships that are coming onto the east-west trades. In the last year, the existing berths have been dredged to a depth of more than 46 feet and can handle 6,700-TEU vessels. The port has acquired eight gantry cranes, six of which can handle post-Panamax vessels. This has given it the ability to offer guaranteed windows for loading and unloading.

Results have been positive. Volume this year promises to break last year's record of 833,000 TEUs. First-quarter container throughput at both ports reached 222,000 TEUs, up 8.1 percent over the same quarter of 2003. The Fos container terminal, handling the key east-west trades, registered 9.9 percent growth to 143,000 TEUs, while a continued revival in north-south trades produced a 4.9 percent improvement to 79,000 TEUs at Marseilles. Overall container volume was up 7.1 percent at 2.2 million tons. Breakbulk cargo grew 4.2 percent to 3.8 tons for the period and roll-on, roll-off traffic was up 20.2 percent to 1 million tons.