Six months after establishing a new project cargo team, Hong Kong-based ship management group Wallem estimates that it - and its clients - have accessed around 800,000 tonnes of business that would otherwise have gone elsewhere.
Part of the group’s Ship Agency division, Wallem’s new commercial project cargo team is building cargo volumes quickly, using its extensive network across Asia to help ship owners and operators to find and win new cargoes.
“Cargo is king. If we can generate cargo inquiries using an extension of our people on the ground as their eyes and ears, we can look out for what kind of cargo opportunities our clients may be seeking,” said Dickson Chin, Managing Director of the Wallem Group’s Ship Agency division.
“We are now regularly feeding our clients - the carriers - with new types of cargo inquiries”, said Chin, reflecting on the first half year of dedicated activities in a familiar but specialized part of the shipping business. “Some might be parcel shipments, some might be an entire project. It depends on what’s available at the time. But we are on the hunt.”
If carriers are awarded cargo contracts on the basis of that information, then Wallem is in pole position to support the operation, said Chin. To an extent, breakbulk business can also be generated – although most of that originates from freight forwarders, he added.
“We are just starting to build momentum and moving a lot more cargo than we did before. We’re certainly working with a few more combines than we once had who are recognising our specialty. We are not a freight forwarder, but we’re not a carrier either.
“We have the ability to be a chameleon: we can slot into the project cargo arena or we can go back into the freight forwarding circle and then offer the carriers the cargo that we have on hand.”
Everything everywhere at once
Acting as an agent means Wallem does “absolutely everything, anything that the client needs us to do to move cargo from one place to another,” said Chin.
In cases where Wallem does not have specific expertise, it can tap into the capabilities of the array specialists that it knows and works with, to help load or unload cargoes or move them through nearby ports and deliver inland if the nearest terminal is unable to handle them.
Knowledge of the local terrain and regulations are invaluable, said Chin. Wallem has its own port captains, works with officials in terminals or with clients’ technical teams to ensure cargoes are correctly loaded on ships.
“We would already be working with the shipper and getting the cargo to the right place at the right time. We assist with stevedores or with transshipment; or if there are any permits required.”
Knowing that these issues will be taken care of as part of the Wallem service allows the carrier to enter into the tender process with the confidence that questions arising will also have ready answers.
“Our input here can really help our client to secure the business,” Chin said, with Wallem able to respond quickly to questions with technical answers, for example about which ports and routes work.
In contrast to standalone competitors, being an agent that is part of a wider ship management group can also help where accessing technical shipping knowledge is concerned. It can even sometimes result in transferring business between carriers if one operator has tonnage better suited to heavylift cargo than another.
First step is the hardest
To date, Wallem’s project business has largely been focused on southeast Asia, from Japan to Malaysia, but the company is open to expanding into other areas.
“We would like to grow with our customer. If a customer has a specific project that is significant and is relatively long in terms of time period, then we would look into setting up a new office or satellite office with them,” Chin said.
Trade restrictions have generally eased since the end of the Covid pandemic, but sanctions imposed due to the Russia-Ukraine conflict have made some trades difficult and shifted some business away, he acknowledged.
“It’s definitely impacted us because clients that we work with mostly can’t take those cargoes anymore. And we are seeing that being fed to other carriers that we are not working with.”
However, global efforts to cut carbon emissions are opening new avenues of business. Electric vehicle manufacturers import about 90% of the batteries they need from China, observed Chin. As lithium batteries are dangerous cargoes they are increasingly not being shipped in containers, with Wallem seeing multiple purpose vessels coming in to take that business.
Construction of wind farms is another renewable energy driver of business, with turbine towers and blades requiring project carriage.
Chin also believes China will continue to be a major market for project cargoes because even if its GDP growth is slowing, it is now on a much bigger base of consumption within the country.
“We certainly have the confidence that there is always going to be project cargo moving. And one area that we have seen driving that a lot has been the China one belt one road initiative. So, we see that infrastructure being constructed,” he concluded.
Source: Wallem
