Wednesday, July 8, 2015

Logistics Group Exchanges RoRo for Container Freight in Million Tonne Contract

New Deal Sees Switch of Terminals for Old Partners
Shipping News Feature

SWEDEN – GERMANY – EUROPE – A cooperation which dates back 20 years between SCA Logistics and Iggesund Paperboard will see an expansion over the next year with around a million tonnes of paperboard, paper and pulp shipped annually via a new transport link to and from Kiel. There will be a major shift in the traffic from RoRo to container freight and the shipping group and paper producer will phase out operations at the distribution centre in Lübeck in 2016 and relocate to a new main terminal in Kiel 85 kilometres to the North.

Seehafen Kiel is starting the process to expand its existing warehouse capacity in Ostuferhafen. The new forest products terminal will lie directly adjacent to the Intermodal rail terminal and the RoRo terminal in the same port area. Magnus Svensson, President of SCA Logistics commented:

“Seehafen Kiel has made a big and dedicated effort to develop the concept that eventually won the terminal study we conducted jointly with Iggesund to handle the volumes for Iggesund Paperboard and SCA Paper. It is very pleasing that we will be able to continue developing and expanding our longstanding partnership with Iggesund Paperboard, which dates back to 1995. Jointly, Iggesund and SCA have the volumes required to generate cost-efficient transport solutions.”

When SCA’s RoRo vessels begin calling at Kiel, RoRo traffic between Sundsvall, Umeå, London and Rotterdam will be reduced from the current number of two departures per week, to one. The service will be maintained by moving a considerable volume, from RoRo to containers. To allow for this development, SCA Logistics’ existing container route between Sundsvall, Umeå, Rotterdam and St. Petersburg will be expanded. The container volumes in SCA Logistics’ terminals in Sundsvall and Umeå are expected to grow by 80% to 90% and in Rotterdam by 50%. At the same time, the RoRo volumes at these ports will decline proportionately.

Svensson foresees the growth in container transport for this product type to continue unabated. He says that container systems in Europe are becoming so large-scaled and comprehensive that the box system will continue to grow and that SCA are modifying the company’s transport mix to allow for this. Christina Törnquist, Logistics Director at Iggesund Paperboard, sees other advantages, saying:

“Delivery service is my speciality and I am pleased with the measures we are taking now. Equally important, though, is the service package we are launching under the name of ‘Care by Iggesund’. It includes everything from the fast delivery of samples to local technical support and an extensive range of knowledge material that enables customers to get the most out of our paperboard.”

Iggesund was founded as an iron mill in 1685, but has been making paperboard for more than 50 years. The company has two mills, in northern Sweden and northern England employing 1500 people, and its flagship product, Invercote, is sold in more than 100 countries helping the company to turnover in excess of half a billion euros annually. Under the new arrangement Iggesund will be able to ship paperboard with the same frequency as before, both to Kiel and to other ports. The new sea transport arrangements and new terminal are part of an in-depth review of its service that Iggesund is currently conducting.

Photo: Work at the Lübeck terminal will be phased out.