What will ports look like after COVID-19?

What will ports look like after COVID-19?

 

About the Author – Umesh Kurlekar, Senior Consultant for Ocean Cargo, Kale Logistics Solutions
Umesh Kurlekar brings with him more than 20 years of experience from port operations and shipping lines. He spearheads the CODEX – Port Community System (PCS) development for global markets. Executed under his leadership, CODEX has been recognized by esteemed institutions like the United Nations, Asian Development Bank and CII for its innovation in Trade Facilitation.

The incoming of COVID-19 pandemic, paved way for a paradigm shift in the logistics industry especially. Even though, the demand for shipping services slumped, transportation of emergency goods from country to country actively took place through the maritime sector.

A new study from ABI Research suggests that digital innovation across the global economy will be accelerated as industries search for new solutions. Technologies such as drones, artificial intelligence (AI)-based surveillance, digital twins, autonomous freight, real-time dashboards and cargo community systems will find precedence.

 

Technology – distinct silver lining on COVID-19 Cloud

The effects of the pandemic and the subsequent recovery will be wide-reaching. It will have a profound effect on the supply chain, and therefore ports as well. For the maritime sector, this will mean an even greater emphasis on supply chain visibility and collaboration. It could also help, or perhaps hinder, the long-running debate around data standardisation.

Across the maritime sector, stakeholders have been actively looking out for automation to limit human intervention significantly and promote paperless trade, e-FAL from IMO, Single Window are few such initiatives.

Ports will have to get smarter to manage ever increasing amounts of cargo, itself moved by smart technology. That is essentially using new technologies, such as AI, blockchain, Cloud-applications and the internet of things (IoT).

But as we move ahead, the question of how the post pandemic world will look like is making waves. Some say, it is all automations and integration. And some say, legacy systems and manual interventions will co-exist.

 

The Amazon Effect

The ‘Amazon Effect’ is a broad term to describe the substantial changes the supply chain has experienced in the past decade. In particular, it refers to increased customer expectations and the need to get goods to customer’s door faster. It pushes the carriers to diversify their operations and invest heavily in the end-to-end supply chain technologies to become integrated logistics providers.

Previous shipping times of 3-5 days are no longer acceptable and customers expect to receive their products within 48 hours at the most. The large scope of reducing the time lays with reducing documentation hassles and cumbersome processes, which are prone to errors and data duplication. As per a study, Digital Platforms like Port Community System can reduce cargo dwell times by 30% and documentation time by 50%.

 

The importance of technology in achieving Operational Synergies

Digitization is playing a major role in enabling trade facilitation for all logistics stakeholders. In the recent times, IT adoption has sky-rocketed across the globe i.e. in Europe, North America, Asia Pacific and other regions. On a micro level, the functions and processes are digitized so that the scope of paperwork is eliminated.

 

With all these speculations, here are some micro level observations that predicts the future of seaport operations in the post pandemic world.

Integrated Seaside and Landside Operations

Over the years, operational delays have been unprecedented in both the landside as well as seaside. According to reports, a vessel is subject to a waiting time of nearly 45 hours to berth their vessels in Asia Pacific and Middle East region. Well, the scenario at Europe and North America too isn’t rosy. The common issue across these regions are vessel congestion on the seaside as well as truck congestion on the landside.

The primary factor causing delay is manual documentation norms. But if all the operations are digitized and all documents can be obtained online, then the need for manual documentation is eliminated.

By doing so, the activities are planned in advanced and timely information on shipment movement is shared with all stakeholders through a common portal. This common portal connects stakeholders in the landside as well as the seaside. Therefore, truck congestion along with vessel congestion and a host of other challenges can be tackled seamlessly.

 

Automation takes the lead

With the ongoing pandemic scenario, many operations such as harbour marine operations, vessel management, slot booking to name a few have been digitized. Such measures have paid off well for the Shipping Lines, Forwarders and others in the system.

With this, considerable amount of visibility is achieved on the shipment movement with a central control. Yes, a Forwarder, Shipping Line and others have end-to-end access on shipment movement within and outside the port ecosystem. Hence the need for human intervention at a micro and macro level is eliminated. Experts say, only in places where a central control of activities are required, human intervention is needed.

 

Port-centric Logistics

The central idea behind port-centric logistics is for ports to not simply be a convenient point for importing and exporting, but rather become a component of an integrated supply chain. The rapid growth of advanced visibility technology, such as machine learning or predictive analysis, has allowed supply chain stakeholders to coordinate and plan their operations. The causes of the revolution in the sector were set in motion some time ago, but 2020 may be the year ports take it on themselves to become hubs of digital innovation and collaboration.