Indian Institute of Logistics

CAPT. V.J. PUSHPAKUMAR 1

INDIAN INSTITUTE OF

LOGISTICS (A School of Logistics)

Academic Partner of Vels University


Logistics

• Logistics refers to the planning, execution and control of transportation of goods (merchandise) from suppliers’ manufacturing place to the consumers’ consumption place in a safe, timely, efficient, and cost-effective manner, without damages along with all other associated activities incidental to such transport.


INDUSTRY GROWTH• The Estimated Size Of The INDIAN LOGISTICS

INDUSTRY in 2006~ usd $ 90 Billion Which is 13% of GDP

• Of this the Share of The Organised Logistics Outsourcing Industry is 6%

• The organised Logistics outsourcing Market is projected to witness 25% CAGR over FY 06 – FY 11 Which is $ 115 Billion

• This would Increase the CONTRIBUTION to 14%


Year 2006 -05 Million TEUS

Year 2012 (Estimated)-12 Millions TEUS

CONTAINER VOLUME IN INDIA


DSB REPORTS

• DSB states on Aug 13 ’07 that

$ 499 million Approx. Rs.20,000 Crores


Baltic Dry Index Position 1985 to 2003 - 500 to 2500 Pts

2003 to 2007 - 7000 Pts ( 5 Times increases)

As of Aug 3rd ’07- 7007 Pts (103 % growth from last year 2006)


ROE ( Return on Capital Employment)

• Dry bulk Shipping profitability ( Approx) 20 % to 30% growth

• Some the Dry bulk companies yielding profitability about 300 % ROE


PRIVATISATION

• Railway traffic for Cargoes Privatized

• The new policy opens up all the container freight transportation routes simultaneously and allows entry even to companies without prior exposure in the transportation sector.


ChPT plans Mega terminal

• Apart from PSA-Sical to operate second box terminal at Chennai port and Ennore Container terminal, ChPT plans Mega Terminal

• The Chennai Port Trust is setting up a megaterminal for container handling at an estimated cost of Rs 3,050 crore

• Able to handle ultra-large container ships of 13,000-15,000 TEUS capacity and length exceeding 400 metres.

• The terminal will have an along-side depth of 18 metres, continuous quay length of 2 km and a backup area of about 100 hectares


Port Expansion

• Chennai Port presently handling about 500 Million tonnes

• Capacity addition to the port will be 1.5 Billion tonnes per annum


Economy growth with Seaborne trade

Economy Growing @9.1% with Seaborne Trade Growth @95 %

China ports capacity -3 Billion Tonnes

Strong economic growth: IMF estimates 4.9% global GDP growth for 2007 on the back of a rapid growth in China and India and a moderate growth in the US.

A strong global GDP growth should lead to a strong demand for

key industrial raw materials like crude, iron ore and coal. This is expected to aid the shipping industry's growth.


BUDGET 2006-07

• Investment of Rs 220 bn expected in the refinery sector in the next few years.

• National Maritime Development Programme (NMDP) approved. Work is in progress in 101 projects covering inland waterways, shipping and ports including deepening of channels in Kandla, JNPT and Paradip.

• Plan allocation for Department of Shipping increased by 37% to Rs 7.4 bn.

• Approved the revised proposal for time-bound implementation of International Transshipment Terminal (ITT) at Kochi port


NMDP PROJECTS

• The Investment of Rs.55803.73 Crores has been earmarked

by all Major Ports for NMDP projects

• About Rs.40505.34 Crores envisaged from the Private sector

including JVs with other PSUs and respected State Government.


NMDP IN Port Sector

• For Various scheme/projects Port sector entailing the total investment of Rs. 90,000 crores

• 70 % of the above investment comes from Private sectors


India to start work on freight corridor

India plans to start work on a dedicated rail freight corridor

Prime Minister MANMOHAN SINGH and Railway Minister LALU PRASAD flag off additional suburban trains after laying the foundation for the Freight Corridor (Western) project in Mumbai on Oct’06


INFRA STRUCTURE PROJECTS

• Focus on port infrastructure: In 2005, Ministry of Shipping, Road Transport and Highways announced the Rs 610 bn National Maritime Development Programme (NMDP) to boost infrastructure at major ports in the next 10 years. The programme is expected to increase the port capacity from 389.5 MT to 917.5 MT by 2014.


Size of Logistics Industry• The size of Global Logistics industry is US$ 2 trillion

(Rs.90,00,000 crores)

• US’s expenditure on logistics is 8.7% of its GDP of $12 trillion ie., US$ 1 trillion

• You may note that the size of US’s logistics industry alone is roughly 50% of the entire logistics spend of the world.

• In comparision, India with a GDP of US$ 691 billion spends 13% of her GDP on logistics, creating an industry size of US$ 90 billion. (Rs. 4,00,000 crores)


Projections

• According to Goldman Sach’s research study, India’s GDP could touch US$ 1 trillion by 2010 and at that time, size of India’s logistic industry would be US$ 110 billion (Rs.5,00,000 crores).

• By 2020, the size of logistic industry would be 10% of India’s GDP of US$2 trillion, ie., US$ 200 billion (Rs.10,00,000 crores)

and steadily growing thereafter…….• It is obvious that logistics will be one of the fastest

growing businesses and we only have to take advantage of this boom.


Projections of Logistics Industry Size

400,000500,000

700,000

1,000,000

0100,000200,000300,000400,000500,000600,000700,000800,000900,000

1,000,000

in R

s. C

rore

s

2006 2010 2014 2020

Year


Companies which require logistics professionals

• Ship Owners

• Ship Operators

• Ship Managers

• Ship Charterers

• Ship Brokers

• Shipping Agents

• C.F.S s

• Freight Forwarders

• Airline/Air cargo agents

• Road Transport Cos

• Rail Transport Companies

• Export Import Companies

• Trading Houses

• Marine Consultants

• Stevedores

• Container Terminals

• Port Authorities

etc


SUPPLY CHAIN MANAGEMENT

F1 F2 LOGISTICS F4 F5

INTERNATIONAL MULTIMODAL LOGISTICS

RAIL + ROADINLAND HAULAGE

PIPE LINES

EX

PO

RTE

R

CHA

CUSTOMS C.F.SF.F

SHIP BROKERS

SURVEYORSVESSEL AGENTS

CONTAINEROPERATION AGENTS

STE

VE

DO

RE

SE

A

LOAD PORT


IMPORTSS

TE

VE

DO

RE

SURVEYORSVESSEL AGENTS

CONTAINEROPERATION AGENTS

CUSTOMS C.F.SF.F

SHIP BROKERS

CHA

SE

A

DIS

CH

AR

GE

PO

RT

WAREHOUSETRANSPORTATION

RETAIL DISTRIBUTIONS

IMPO

RTE

R


EXIM TRADE MANAGEMENT

E X

P O

R T

E R

CHAMBER OF COMMERCE

GOVERNMENTBODIES

BANKSB/L

ICC & S/PCONTRACTS

PORT AUTHORITIES

INSURANCE

TRADE ASSOCIATES

I M P

O R

T E

RWAREHOUSE

INTERNATIONAL TRADE ORGANIZATION


Reefer Ships

• To carry fresh fruit, meat & Vegetables and other food products in a clean manner

• Eg: Banana carriers, trading between the Caribbean and Europe.

• Sleek & Fast


Reefer


Heavy Lift• Heavy lift vessels are quite

amazing vessels,

• Built to load, carry and discharge large, unusual shaped cargoes (or even smaller vessels) that will simply not fit inside the holds of conventional vessels.

• Shaped quite unlike any other cargo vessels,


Heavy Lift

• These specialist vessel are often used in the oil industry for the carriage of jack up rigs.

• Other unusual cargoes can include power plants, desalination units, generators and yachts.


Container Ships• Cargo damages, theft and claims on

general cargo vessel• Cargo handling cost on a general cargo

vessel• Requirement of alternate safe and speed

mode of carriage• Containers been introduced• To day the general cargo ships have nearly

come to an end.• Cargo stuffed in the rectangular boxes 20’ x

8 x 8.5 / 40 x 8 x 8.5• High Cube (or) Super cube of 9.5 “ are also

being loaded• Ship’s constructed to carry these boxes


Roll on – Roll Off • The roll on / roll – off vessel is

used to carry vehicles which can be driven ‘on’ to the ship directly from the jetty and driven ‘off’ from the ship.

• Frd or aft ramp door and side ramp

• different levels of decks provided for loading vehicles.

• Hydraulic doors fitted to access different decks.

• Stringent requirement for fire fighting appliances


Car Carrier• Two types (PCC), Pure car carrier & (PC/TC)

build to carry Pure Cars/ Truck carrier• Multi level of decks with feasible height for

the cars.• Stingent regulation for fire fighting appliances• Ramp doors fitted forward or aft and or mid

ships.• Various decks connecting hydraulic doors

fitted• DbBtanks and side tanks fitted.• Ship side doors fitted for pilot access• Windage area very high• Cargo handled by experienced stevedores


Pure Car Carriers


Oil Tankers• To carry oil and other liquids in bulk quantity.• Crude carriers are biggest ships ever built• Product carriers move different combustible oil

away from the refineries• Other tankers carry edible oil & wine and some

designed specifically to carry Orange juice• ULCC = 300,000 – 500,000• VLCC = 150,000 – 300,000• MCC = 70,000 - 150,000


Chemical Carriers• Tankers which carry chemicals in

bulk• Size ranging upto 50,000 DWT• Carry many complex liquids such as

solvents & feed stocks for the manufacturer of plastics

• Highly corrosive, control of pressure & temp needed.

• Carry most highly hazardous materials in bulk


Gas Carriers

• The LNG carrier (Liquified Natural Gas) and it's cousin the LPG carrier (Liquified Petroleum Gas) are products of the late twentieth century.

• LNG and LPG are the preferred fuel types of certain countries for their industrial power needs.


LPG

• Petroleum Gas is a by-product of the refining process of crude oil.

• Many uses (eg) cigarette lighters• Two main types – Butane & Propane• Cargo tanks – Cylindrical in shape –

Aluminum Alloy, free standing• To insulate it fm heat – coated with

Polyurethane foam & plywood skins• Butane carried at minus 10 dec C• To transport it, it needs to be either

pressurised into a liquefied form, or kept as a liquid by reducing the temperature


LNG Carriers

• LNG = Natural gas comes out of ground

• Can be used with little or no treatment• North sea gas – fuels most factories

& homes in UK - typical example.• Japan is also a biggest importer of

LNG• It is not the easiest of cargoes to be

transported, In its natural state, • LNG cannot be liquefied by pressure

alone, hence carried at low temp


LNG Carriers• Main type of LNG are Ethane &

Methane• Ethane carried at Minus 104 dec C• Methane carried at Minus 176 dec C• GRT=> 75,000 is approx 125,000 cu,.

mtr of cargo• The carriage of an explosive gas -

kept at below freezing temperatures as an unstable liquid presents a very dangerous cargo, but,,,

• LNG Carriers have about the best safety record of all maritime vessels.


Bulk Carrier• Typical Tramp vessels• Built to carry ore, coal, grain, Scrap, sulphur in bulk in

large quantity• Single deck,long wide hatches• Tanks- wings & double bottom runs all the way• Top and bottom side hoppers to facilitate loading &

discharging• Steel (mc gregor) hatch cover• Bilge system for pumping out• New solas regulations reg bulk• Sizes vary:

– Mid size,panamax, cape size.• Cranes, grabs provided for cargo work• Long short alternate hold (hvy crg)• Cleaning & washing of holds needed• At present in booming market.


Bulk Carrier


Bulk Carrier


Bulk Carriers

• Self Un loaders


Timber Carrier• Cargo is carried in

Hold & on Deck• Have Stanchions on

deck for support of the log

• Cargo lashed by chains & Wire ropes on deck

• Wind age increases • Stability calculation


Cement Carrier • Vessel designed to carry only Cement.

• Have own pumps to discharge cement

• Cement is pumped using compressed air

• Totally enclosed system


Coaster

• Typical vessels plying in Baltic sea

• Designed for near coastal voyages

• 1 or 2 cargo holds


Combination CarriersOBO & Oil/Ore

carriers• Iron ore carriage –small

heap – stability• Reduced cubic capacity of

the hold to load ore cargo.• Natural development –use

spare space to carry oil.• All gearless vessels


Live Stock Carrier• The carriage of live animals around the

world is performed by specialist vessels, designed (or adapted) to transport large numbers of cattle and sheep in secure but humane conditions.

• The trade is largely from Australia to the Middle East &/or S.E. Asia.

• One modern vessel may carry up to 125,000 sheep.This transport of live animals requires experienced and specialised operators.

• In 2003, Australia exported over 4,500,000 sheep and nearly 800,000 cattle.


PASSENGER SHIPS• To accommodate more than 12

passengers• Small ferries, large ships• As size increases comforts

increase• Large dining, swimming

pool,gymnasiam,dance lounges• Liner trade ( definite ports, with

scheduled departures)• Regulation of construction and

maintanance are more stringent• Titanic incident brought SOLAS


Ferries• Fast ferries or high speed

passenger / Ro-Ro vessel• Air-cushion technique used to

lift the vessel to reduce the resistance and increase the speed of the vessel

• Aluminium alloy, high tensile steel is used for construction

• Large open deck, catamaran type ferries widely used for carrying passengers

• Imo ensures the safety of these crafts with ‘code of practice for high speed craft’ 1996.


Hydrofoil• A hydrofoil is a boat with wing-like foils mounted on struts

below the hull. As the craft increases its speed the hydrofoils develop enough lift for the boat to become foilborne - i.e. to raise the hull up and out of the water. This results in a great reduction in drag and a corresponding increase in speed.

http://en.wikipedia.org/wiki/Boat

http://en.wikipedia.org/wiki/Hull_%28ship%29

http://en.wikipedia.org/wiki/Lift_%28force%29

http://en.wikipedia.org/wiki/Drag_%28physics%29


Other ships

Tugs


Other Ships• Dredger

Such ships are usually engaged in the dredging of sand and gravel from the sea bed for commercial use or the maintenance of channels in rivers or harbours and the dumping of soil at sea.


Other Ships• Ice Breaker

• Research Ships


Specialised Ship• Fishing Vessel

• Trawlers


Specialised Ship• Cable lying ships

• Rescue Vessel


Specialised Ship• Offshore construction

vessel

• Supply Vessels


Off-shore Support Vessel

• Construction/ Pipe Laying Barges

• Anchor Handling Tugs• Diving Support

Vessels• Crew Boat


Specialised Ship

• F P S O

Floating Production, Storage and Offloading (FPSO) Installations


Specialised Ship• Oil Recovery Vessel

• Salvage Ships


Harbour Crafts

• Pilot Vessel

• Mooring Boat



INDIAN INSTITUTE OF LOGISTICS (School of Multi-Modal Transport)

#6, India Chamber Building, II Floor, Esplanade, Chennai – 600 108

Documents

Indian Institute of Logistics