London – 2 June 2008- Following government approval for the Northern Gateway Container Terminal (NGCT) at Teesport in North East England and before construction work has started, shippers and retailers are already anticipating the benefits of direct supply chain services between northern England and the Far East. When the first phase construction is complete in 3-years time, the NGCT will effectively position imported containers nearer to their final UK destination. As an added incentive and subsequent bonus, the NGCT will also substantially contribute to reduction in congestion on UK roads and lowered carbon emissions caused by traditional inland cargo transport via lorries.
“There is already a strong trend away from road haulage in the UK and towards more environmentally friendly and operationally beneficial alternatives,†commented Martyn Pellew, Group Development Director of PD Ports (PDP). “Retailers and logistics companies are increasingly favouring rail and water transport. What we know as ‘Portcentric logistics’ is definitely going to be the next major logistics trend in the UK.â€
Portcentric Logistics, a concept pioneered by PDP, provides all processing associated with container shipping at the UK port closest to the final UK destination of the product. Unpacking, storing and loading goods at the port for onward delivery to stores directly benefits the supply chain at multiple levels. By eliminating road miles travelled from southern UK ports to DCs (Distribution Centres) often based in the Midlands and the North, the environmental footprint of the entire supply chain is minimised.
In addition, Portcentric Logistics provides financial and operational advantages such as decreased costs of demurrage, storage and distribution. “Retailers will also see a reduction in their shipment delays because their products won’t be caught up in UK southern port and road congestion. There’ll be a marked increase in the accessibility of inventory†stated Martyn Pellew
The development of the NGCT by PDP at Teesport is certainly going to challenge the supremacy of the existing southern container terminals such as Felixstowe, Southampton and Thamesport. Many shipping lines already use feeder services to move containers from the south up to Teesport and this area is increasingly favoured by retailers as a good location for their northern distribution centres. Furthermore a number of major UK and global retailers are looking at operating port centric distribution centres.
Tesco, the UK’s largest retailer, recently announced plans to build a 1.2 million square foot import centre on land at Teesport and the retailer’s Corporate Affairs Manager Juliette Bishop highlighted the benefits of Portcentric Logistics:
“We need to increase our storage capacity to deal with the increased levels of imported containerised goods and building a storage facility at the port removes the need to move stock from the port where it is imported, to a storage facility inland. As well as reducing the double handling of imported stock, this will help to reduce the road miles that products travel, which is better for the environment.â€
This approach has already proved highly successful for rival ASDA, owned by the giant Wal-Mart Group. In 2005 ASDA decided to invest £20 million in a new 350,000 sq ft import centre at Teesport, to allow the company to be more flexible and responsive to customer needs. The benefits of this strategy created estimated savings of an additional two million road miles per-year by shipping 70% of ASDA’s non-food imports directly to Teesport as opposed to transporting them from the south via road when destined for northern consumers. By virtually eliminating these inland container movements, ASDA has not only reduced costs significantly, but has also cut the environmental impact of its distribution operations.
Companies like Tesco and ASDA are leading the way in proving that Portcentric Logistics is the answer for supply chain efficiency in the 21st Century. Other businesses across the UK need to embrace this positive trend and take better control of their supply chains. Says, mp “By incorporating better Portcentric Logistics options into their import planning, retailers empower themselves because they’re able to make smarter decisions about their own supply chain needs.â€
“Freight forwarders and shipping lines will really have to start seriously reconsidering their business plans because much of the non-food stock for Tesco, ASDA and multiple other retailers comes from the Far East†said, Martyn Pellew. “The entire logistics structure of the UK has the prospect for changed as retailers are recognising the potential for direct calls between the Far East and the Northern Gateway Container Terminal.â€
When importers and retailers are provided greater choice for importation port locations, such as they will be with the NGCT, they can implement tailored Portcentric Logistics solutions that provide for more timely shipments. States Martryn Pellew “The end result of the Northern Gateway Container Terminal will be to directly improve the economic and environmental bottom-line of the entire supply chain.â€
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Notes to Editors: May 2008
• PD Ports Limited was formed following the successful takeover of PD Ports plc by Babcock and Brown Infrastructure (ASX: BBI) in February 2006.
• PD Ports is a high performing specialist ports business offering a wide variety of supply chain services to improve customers’ international product and material movements into and out of – as well as within – the UK.
• PD Ports employs over 1350 members of staff, and generates an annual turnover of over £130 million from 30 UK locations.
• PD Ports operates throughout the UK from bases at many key ports and logistics centres.
• The 3 business interests of PD Ports are:
o Port Operations– this includes:
 Teesport: one of the top 3 UK ports, with flows of containers, bulk traffics and finished cars, handling 50 million tonnes of throughput p.a.
 The Northern Gateway Container Terminal: a major new deep sea container terminal planned at Teesport on the South side of the River Tees. The £300+ million development will have a capacity of 1.5 million TEU (twenty foot equivalent unit) and is anticipated to deliver over 5,500 jobs to the Tees Valley, opening in 2011. Please visit www.thenortherngateway.co.uk
 Portcentric Logistics: a new concept promoted by PD Ports for locating the storage and distribution of imported goods close to the point of arrival at a UK port. This concept avoids the slow handling and return of empty containers as well as eradicating unnecessary UK road mileage, which occurs when delivering to a traditional inland import centre, such as in the Midlands. In 2006 ASDA Wal*Mart opened a 350,000 sq ft import centre at Teesport and has saved more than 2 million road miles by adopting the portcentric concept. Tesco is also building a 1.2 sq ft import centre at Teesport to open in 2009.
 Humber & Small Ports: owners and/or operators of ports on the Humber estuary, Rivers Trent and Ouse, and at Medina Wharf, Isle of Wight. Service offerings include ship’s agency, chartering and stevedoring services.
 Logistics: PD Logistics offers warehousing and distribution services at 15 UK locations throughout the North East, Humberside & East Anglia, including at Felixstowe. Please visit www.pdlogistics.com
o Conservancy – this includes:
 Management of river traffic for the ports of Tees and Hartlepool, ensuring safe navigation and maintaining the required channel depth.
o Property– this includes:
 Revenue and income from property and facilities owned by PD Ports and used by third party clients on long term leases.
 Land that is not utilised for operational purposes and forms part of the potential for development.
 The redevelopment of part (133 hectares) of Hartlepool docks known as Victoria Harbour.
See also www.pdports.co.uk
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