Containerisation Helps Cement Distribution Directly to End User

Containerisation system in cement distribution from Teluk Bayur Port to some remote areas along the West Coast of Sumatera Island has helped the delivery of cement directly to the end user, thanks to ‘tol laut’ (sea toll) services and the facilities of the port for this service.

This sea toll service has also encouraged distributors of Sumatera’s cement producer ‘Semen Padang’ to choose containerisation system to distribute cement. This might not a new trend. This has been running earlier. Some shipping lines that have earlier run the service include Meratus, Temas, and SPIL. But, for sure, sea toll has increased the containerized distribution of cement within the Sumatera region.

But, in line with the policy of zoning system for domestic cement distribution in which Semen Padang is focused for Sumatera Island, the volume of distribution to other areas dropped, affecting a drop in volume of the shipping players, including container players.

“We are tasked to focused on Sumetra Island and its surroundings. This makes a drop in distribution to other regions in Indonesia, forcing a drop in volume of the shipping lines, including container shipping, we guess,” said Semen Padang Operation Manager Firman, in a discussion with Indonesia Shipping Gazette in Padang, (Wednesday, March 5, 2020).

Though only for domestic distribution, trend to use container in the distribution of cement has increased in the last several years, but it was disturbed due to the zoning policy in cement distribution. “But for the Sumatera Island and surroundings the trend is increasing,” he said.

Delivery by container, according to Firman, has some advantages compared to bulk or general cargo shipping: it is more efficient since it can be directly delivered to end user (door to door) and better in view of safety.

“Though in view of volume it will be smaller and the price is little bit more expensive, but container can be directly delivered to end user. In addition, delivery by container is more secured. It will be free from risk of damage,” he said.

He admitted that the containerisation of cement delivery from Semen Padang is only for domestic, while the export will use bulk carrier.  “Fortunately, in line with the operation of ‘tol laut’ ship, the volume increase. It will be higher during the peak season in the second half of this year, starting June,” he said.

In addition to cement, this sea toll shipping also encourages other products of consumers goods since sea toll shipping also deploy some reefer containers.

Sea Toll vessel KM Kendhaga Nusantara-2 routinely calls at Teluk Bayur. It distributes logistics of cement and some other products of consumers goods from Teluk Bayur to Sinabang (Aceh), Sitoli (North Sumatera), and Mentawai Islands.

On its call, this vessel loads/unloads container of more than 50 boxes.

Semen Padang and IPC TPK Team

Growth 12%

According to data, cement container via Teluk Bayur’s container terminal (IPC TPK) grows 10-12% per year.

In 2019, total containerized cement commodity loaded at IPC TPK Teluk Bayur reached 10,775 twenty-foot equivalent units (TEUs), up 12% year on year, from 9,589 TEUs in 2018.

In addition to cement, IPC TPK Teluk Bayur also handled other leading commodities from this province (West Sumatera). IPC TPK Teluk Bayur Assistant Manager for Supporting Operation Yudha Sutanto named some of them, including rubber, cocoa, coconut, gambier, cassia, betel, perlite, perishables goods, and dangerous goods (DG).

The increasing volume of cement, according to Yudha, has significantly contributed to the total yearly growth of container throughput at IPC TPK Teluk Bayur Terminal. Last year (2019), this terminal volume reached 89,56 TEUs (80,848 boxes), increasing 7% yoy, from 83,904 TEUs (76,484 boxes) in 2018.

Both Firman and Yudha affirmed that in addition to sea toll vessel, there are some private shipping lines that have routinely distributed containers carrying cement from Teluk Bayur to some ports in Sumatera Island, including to Belawan Medan, Bengkulu, Palembang, and Tanjung Pinang.

Service Improvement

In responding the increasing volume and to trigger high volume of all containerized cargoes, dry bulk, liquid bulk, and general cargoes, IPC Teluk Bayur commits to improve service through infrastructure development, service level improvement, and facilities upgrade.

At this time for example, Teluk Bayur is strengthening its berth and installation of piping system and loading point for crude palm oil (CPO) loading. CPO remains one of the leading commodities in Teluk Bayur, reaching over 2 million ton a year.

“We encourage the growth of cargoes volume including CPO through optimizing the asset, improvement of infrastructure and facilities, and service level as well,” Teluk Bayur General Manager Wardoyo told Indonesia Shipping Gazette.

Wardoyo GM Teluk Bayur

Teluk Bayur has just built cooperation with CPO producer PT Asean Agro Agung Jaya (AAJ). This Apical Group will utilize the port 6 hectare area for CPO tanks, while IPC Teluk Bayur will build loading point and pipe installation connecting tanks with loading point at the berth. “We also strengthen our berth,” Wardoyo said, adding that IPC would pour Rp30 billion for the works of pipe installation and loading point.

Wardoyo expects the cooperation is expected to create more than 500,000 additional tons of CPO, creating a 3 million tons in total this port will handle in a year.

Even Wardoyo expects that in the next 10 years, Teluk Bayur will handle up to 5 million tons of CPO in a year.

“That is our big dream for this port. It is why we expand our cooperation and partnership with CPO producer,” he said.

AAJ remains one of CPO producer as leading customers to Teluk Bayur, in addition to PT Wira Indomas, Incasi, Wilmar, PT Perkebunan Nusantara (PTPN)-6, and PT Agro Muko.

Wardoyo also explained that Teluk Bayur Port continues to improve its level of service overall its terminals, including at container terminal, general cargo terminals, and bulk terminals.

For its container terminal, for example, PT IPC TPK has just signed windows contract and service level agreement (SLA) with some shipping lines, including Temas, Tanto, SPIL, and Meratus.

Contacted sources from shipping lines affirmed it. Teddy Arief Setiawan, Operation Director Temas Line admitted it saying: “the contract is meant to adapt the standard of terminal with SLA and SLG”.

In 2019, IPC TPK Teluk Bayur handled 244 ship calls, increasing from 165 units in 2018.

This terminal container handling process is also very well, reaching 39.2 BSH box/ship/hour and 22.3 box/crane/hour (BCH) along the year of 2019.

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