PORT LOGISTICS

Colombia 2018 | TRANSPORT | B2B

With improved inland connections and logistics, Colombia's ports are poised to make further strides.

Liborio Cuéllar Araujo
LIBORIO CUÉLLAR ARAUJO
General Manager
Hamburg Süd
Álvaro Rodríguez Acosta
ÁLVARO RODRÍGUEZ ACOSTA
President
Ventura Group

What have been your main accomplishments and challenges in Colombia over the last few years?

LIBORIO CUÉLLAR ARAUJO Hamburg Süd has consistently grown in Colombia since 2008. Our 10-year growth has been over 100%. The driver of our growth was primarily through opening up new services in new ports in Colombia and thereby offering transportation for Colombian goods. We have always had a strong presence in Cartagena, being the most important port for transshipments globally for Hamburg Süd. In 2017, we opened a strong presence in Buenaventura. We also have a direct service to Santa Marta, Barranquilla, as well as Turbo, which is Colombia's banana-growing area to the north of Medellín and is not an area that is easy to access with shipping. Hamburg Süd has seen significant growth and facilitated trade for the Colombian economy. Maersk Line acquired Hamburg Süd, and with this acquisition, Hamburg Süd and Maersk Line are now by far the largest shipping line in the world with close to a 20% market share.

ÁLVARO RODRÍGUEZ ACOSTA We are involved in grain cargo, unloading products such as cereals, flours, fertilizers, and chemicals, and loading export products such as coal. In 2017, our operations totaled 4.2 million tons through the port of Buenaventura, making us the biggest operator in this port. Also, the superintendent of industry and commerce of Colombia authorized us to operate as a port group. That was an important issue for us, because Sociedad Portuaria of Buenaventura seeks to be the only bulk operator in the port.

What more could be done to improve the infrastructure in Colombia to assist the transport and logistics industry?

LCA Colombia's port infrastructure is adequate and up to speed. For us, Cartagena is the best and biggest port. We have also grown at Buenaventura Port, and today it is the sixth-most important port for Hamburg Süd. In addition, there is sufficient competition in Buenaventura because in addition to Sociedad Portuaria de Buenaventura, there is the APMT terminal and a new terminal, Aguadulce. Colombia's port infrastructure is well developed, especially compared to other ports in the region. The problem Colombia faces is how to get the cargo to and from ports. According to World Bank and OECD data, Colombia is logistically the most expensive country in the world. To truly be competitive, Colombia needs to tackle this problem. There has been some road development, though we have not seen any significant improvement in terms of road transportation times. Colombia is largely dependent on trucks; there are no significant developments in rail transportation or river transportation. The country needs to start developing and investing in viable multi-modal transport solutions. We would like to see a concerted effort to improve transportation and logistics in the country.

ARA Colombia has many problems with transportation and multimodal logistics. The new government has to make the railway between Buenaventura and Buga viable, which will cost USD400 million and will strengthen Pacific ports by lowering transportation costs. Furthermore, the only rail systems in Colombia are private projects that operate mineral cargo; at the moment, we do not have a system for different types of cargo. This is an important opportunity, and we are working with other external companies such as certain Italian operators to extend and adapt the Pacific train line.

What are your main targets and goals for 2018?

LCA We expect 2018 to be challenging for us because there will be some changes. Some of our operations areas will move to Maersk, though the commercial and customer service will not. We need to make sure this shift is successful and ensure that customers are not impacted at all. Hamburg Süd's service is personalized and local, and we want to ensure that the customer experience does not change. Eventually as Hamburg Süd, we want to offer to our customers more than just ocean transportation, but offer products to fully integrate our customers' logistics and add value to their supply chains.

ARA Our main targets include the Pacific rail project, growing the port's logistics infrastructure, investing in equipment to reduce the permanence of ships in the port, improving rates of discharge, and reducing transport costs. The logistics operation area wants to coordinate the import and export cargo to reduce the cost of land freight, given the compensation charge that will occur once the railway arrives. As such, we want to have a strategic infrastructure partner to help us manage all the investments we want to make.