Inland Container Depot(ICD) in Korea: focusing on … · Inland Container Depot(ICD) in Korea: focusing on Uiwang and Yangsan 2017.9.18 Sub-regional Meeting on Rail-based Intermodal

Inland Container Depot(ICD) in Korea:

focusing on Uiwang and Yangsan

2017.9.18

Sub-regional Meeting on Rail-based Intermodal Transport in Northeast and Central Asia

Dr. PARK, Ju Dong

Dr. JO, Ji Sung

Dr. KIM, Geun SubPort Policy Research Department

1

Yangsan ICD

Uiwang ICD

Contents

I Inland Container Depot(ICD) in Korea

II

III

Dry Port Development in Asia-PacificIV

Lessons and LearnedV

2

I. Inland Container Depot(ICD) in Korea

3

ICD in Korea

5 ICDs in Korea

Metropolitan Area: Uiwang ICD

Honam Area: Jangsung ICD

Central Area: Sejong ICD

Yeongnam Area: Chilgok ICD

Busan Area: Yangsan ICD


Source : Ministry of Land, Infrastructure and Transport(MOLIT),

“Inland Logistics Hub in 5 Regions of Korea, 2016.

4

ICD in Korea

Infrastructure of 5 ICDs

Area

Capacity

Size(㎡)Bulk

(thousand TON

/year)

Container

(thousand TEU

/year)

CFS

(thousand R/T

/year)

Metropolitan Uiwang ICD 1,370 754,807

Honam Jangsung ICD 4,700 340 343,203

Central Sejong ICD 2,360 350 173,422

Yeongnam Chilgok ICD 3,570 330 321,026

Busan Yangsan ICD 1,410 4,460 720,241


Source : Ministry of Land, Infrastructure and Transport(MOLIT), “Inland Logistics Hub in 5 Regions of Korea, 2016.

5

II. Uiwang ICD

6

Korea’s first

Uiwang ICD

Began to operate in 1984

ICD Terminal 1 in 1993 &

Terminal 2 in 1997

Korea’s largest

Total area : 754,807㎡

Total 51 tracks

17 main tracks

3 side tracks

12 tracks for container

15 tracks for general cargo

2 repair tracks

2 lead tracks

Source : Korean Rail Road Corporation(KORAIL), 2017.09


7

Container

Uiwang ICD

Total 12 tracks

8 at Terminal 1

3 at Terminal 2

1 at Container Yard(CY)

Max of 31 services per day

16 outbound & 15 inbound

Max of 63 daily services in total

by day

Mon(48), Tue~Fri(63), Sat(53), Sun(36)

389 services per week

Container: 164 per week(42%)

Cement: 157 per week(40%)

Steel: 56 per week(15%)

Paper: 12 per week(3%)



Source : Uiwang ICD web(www.uicd.co.kr), 2017.09

8

Cargo flow of rail based shipment

Uiwang ICD



Manufacture(Shipper or 2PL) Truck Obong Station Rail Sea Port

(Busan, Gwangyang, etc.)

Contracted service(private rail)

Annual contract between customer

and operator by train unit

Fixed rate(excluding cargo volume)

Contracted vs. Uncontracted Service

Uncontracted service

Urgent and unpredictable cargoes

Relatively higher rate

9

Uiwang ICD



Structure of Total Revenue in 2016

Cargo Transportation Business

Cargo

Outbound Inbound Total

Volume

(ton)

Revenue

($)

Volume

(ton)

Revenue

($)

Volume

(ton)

Revenue

($)

Container 2,590,614 27,055,720 1,995,600 19,718,850 4,586,214 46,774,570

Cement 0 0 3,316,446 28,334,510 3,316,446 28,334,510

Steel 3,174 31,040 494,731 5,131,550 497,905 5,162,590

Paper 0 0 92,124 1,692,480 92,124 1,692,480

Others 137,545 246,400 44,034 66,260 181,579 312,660

Total 2,731,333 27,333,160 5,942,935 86,742,680 8,674,268 82,276,810

10

Uiwang ICD



Structure of Total Revenue in 2016

Logistics Business

Lease : Yard, Reach Stacker, Cement Silo, Land

Warehouse

ICD Rent : Using the land of rail track

Business

Outbound

Revenue

($)

Ratio

(%)

Lease 2,896,851 26%

Warehouse 808,485 7%

ICD Rent 7,613,974 67%

Others 28,708 0%

Total 11,348,018 100%

ICD Rent67%

Warehouse 7%

Lease26%

11

Uiwang ICD


Route by Cargo Type

Container

Uiwang ICDBusan

(Old & New Port)Gwangyang Port

Source : Uiwang ICD, 2017.09

Annual Trade Volume in 2016

Major route

Measurement Outbound Inbound

Ton 2.6 million 2 million

TEU 221,486 TEU 176,586 TEU


12

Uiwang ICD



Annual Trade Volume and Revenue by Origin-Destination(O/D) in 2016

O/D

Outbound Inbound Total

Volume

(TEU)

Revenue

($)

Volume

(TEU)

Revenue

($)

Volume

(TEU)

Revenue

($)

Ratio

(%)

Busan

New

Port

North 115,191 14,200,550 89,116 10,004,340 204,307 24,204,890 52

South 43,308 5,196,140 34,036 3,737,730 77,344 8,933,870 19

Busan Old Port 57,687 7,065,520 42,094 4,666,200 99,781 11,731,720 25

Gwangyang Port 4,581 568,200 11,003 1,310,580 15,584 1,878,780 4

Others 719 25,310 337 10,650 1,056 35,960 0

Total 221,486 27,055,720 176,586 19,729,500 398,072 46,785,220 100

13

Uiwang ICD


Route by Cargo Type

Cement

Uiwang ICD

Dodam-riIpseok-ri

Ssangyong-riJecheonDonghae



Major route

Measurement Inbound

Car 63,776 cars

Ton 3.3 million


14

Uiwang ICD


Route by Cargo Type

Steel

Uiwang ICDPohang

Gwangyang



Major route

Measurement

Inbound

Cold

SteelHot Steel Others

Car9,695

cars559 cars 452 cars

Ton470

thousand

27

thousand

16

thousand


15

Issues of Uiwang ICD

Individual operation system

Useless of integrated information system such as Electronic Data Interchange(EDI)

No sharing and reporting information in advance between trucking company and ICD

operator causes terminal congestion

Therefore, 17 operators serve based on their own operation system(yard plan, stack

direction, etc.)

Lack of Container Yard(CY)

No space for turning train in the terminal cause safety issue

Max. 33 cars are acceptable in the terminal

but rail operator increase the number of cars over 40 because of the

economies of scale

then, complicated load plan due to use of more than one track in each

service

Old equipment

over 20 years of operation, maintenance problems


Uiwang ICD

16

III. Yangsan ICD

17

Yangsan ICD

To resolve traffic congestion in the city resulting from ODCY in Busan Old Port

Off-dock system at Busan Old Port

Opened in 2000, and rail transportation has been available since 2006

Build-Own operate-Transfer(BOT)

total 10 blocks and 17 private/public operators

Background

Corporation Number

Public 1

ODCY 10

Line 3

Transport 2

CY.CFS* 1

Total 17

Source : Ministry of Land, Infrastructure and Transport(MOLIT), “Inland Logistics Hub

in 5 Regions of Korea, 2016.

Note(*) : CY(Container Yard), CFS(Container Freight Station)

Source : Kim Byung Ki, “A Study on the Reestablishment of the Function of Yangsan ICD”, 2011.2


18

Yangsan ICD

Network

Connect to Busan Old Port

Route 1 (33km): Yangsan ICD-Gyeongbu highway-The first expressway-Busan Port(General Port)

Route 2 (38km): Yangsan ICD-Gupo,Yangsan highway-The second expressway-Busan

Port(Gamman)

Route 3 (31km): Yangsan ICD-Gupo,Yangsan highway-Baegyangsan tunnel-Sujeongsan tunnel-

Busan Port(Jasungdae)



19

Yangsan ICD

Network

Connect to Busan New Port

Route 1 (37.8km): Yangsan ICD-Gupo,Yangsan highway-Gonghang Ro-Local road 2-Busan New Port(BNP)

Route 2 (49.1km): Yangsan ICD-Gupo,Yangsan highway-Naengjeong JC-Garak IC-Gadeok IC-BNP

Route 3 (34.6km): Yangsan ICD-Gupo,Yangsan highway-Chojeong IC-Gadeok IC-BNP



20

Yangsan ICD

Container Throughput

The CY/CFS volume has been decreased since 2005

The CY volume’s compound annual growth rate between 2005 and 2016 is -16%

The CFS volume’s compound annual growth rate between 2005 and 2016 is -8%

0

200

400

600

800

1000

1200

1400

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

CY(thousand TEU) CFS(thousand R/T)

YearCY

(thousand TEU)

CFS

(thousand R/T)

2005 1,331 1,331

2006 1,123 1,145

2007 1,065 1,039

2008 1,025 1,209

2009 647 1,008

2010 395 1,186

2011 293 869

2012 195 670

2013 157 563

2014 139 416

2015 131 408

2016 160 517

Source : Yangsan ICD, 2017.9


Busan New Port opened with on-dock system in 2006

21

Yangsan ICD

Bulk Throughput

The bulk volume has been increased since 2007

The bulk volume’s compound annual growth rate between 2007 and 2016 is 74%

0

500

1000

1500

2000

2500

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Bulk(thousand TON)

YearBulk

(thousand TON)

2005 -

2006 -

2007 8

2008 204

2009 366

2010 523

2011 639

2012 820

2013 924

2014 1,272

2015 1,621

2016 2,012

Source : Yangsan ICD, 2017.9


22

Yangsan ICD

Issues of Yangsan ICD

Decreased container throughput

To resolve, adopted alteration of the purpose of use

Implemented “Act of development and operation of logistics facility”(2013.12.31)

By the law, construction of manufacturing and sales facility is possible in 25% of ICD

area

However, the practical development is difficult because of low level of upper limit of

building-to-land ratio(20%) and environmental issue


AreaBuilding-to-Land ratio (%)

Legal basis Current

Metropolitan Uiwang ICD 60 29.0

Honam Jangsung ICD 40 21.3

Central Sejong ICD 40 13.6

Yeongnam Chilgok ICD 40 15.2

Busan Yangsan ICD 20 19.8

Source: Lee Dong-Hun, Kim Yul-Seong, Shin Jae Yeong, and Park Ho, “A study on the Revitalization of Yangsan ICD”,

Journal of Korea Port Economic Association, 2015, 31(4) pp.121-132

23

Yangsan ICD

Issues of Yangsan ICD

Deficit operation resulting from unexpected additional investment

Improvement of soft ground ($53 million) and support for private investment sector ($54

million) cause deficit operation

2010: $3.2 million, 2011: $3.1 million, 2012: $2.7 million

Inefficiency of operation resulting from highly fragmented operators

10 different blocks and 10 operators

Operating independently

Lack of provision consolidated level of marketing strategy, incentive, service, and etc.

Policy restriction

Policy for usage of land at Yangsan ICD changed to allow constructing facility by given

limitation

But, environmental issue to protect the green tract of land


24

IV. Dry Port Development in Asia-Pacific

25

Dry Port Development in Asia-Pacific


Total 240 Dry Ports in 27 economies

International Agreement on Dry Port in 2014

(Reason) Economic inequality was intensified among members of ESCAP

(Objectives) International awareness of Dry Port, Attracting investment funds for Dry

Port infrastructure, Increasing efficiency of logistics network between member countries

Planning

Developing

109 existing(including on-going) in

Central Asia(Tajikistan, Pakistan,

etc.) and Southeast Asia(India,

Bangladesh, etc.)

131 future development in

Southeast Asia(Laos, Myanmar, etc.)

and Europe(Turkey, Armenia,

Azerbaijan, etc.)

Source : UN ESCAP(www.unescap.org), access 2017.8.29

http://www.unescap.org/

26

V. Lessons and Learned

27

Location

Lessons and Learned

Optimizing location concerns with distribution of industry and its development plan in

mid- and long-term

Prevent idling facility by changes in logistics flows


Unification of ownership and operation

Encouraging sustainable investment on infrastructure and equipment

Regardless of risk by contract issue

Container Yard(CY)

Securing sufficient CY and its appropriate plan

Avoid additional investment and waste in short-term

28

Lessons and Learned

Deregulation

Should avoid conflict of laws and regulations

Regulation support by government

Environment-friendly facility

Equipment: automation, changes in power(electricity etc.)

Yard Truck: changes in power(electricity etc.)


Operation system

Integrating operation and information system on the initial stage of development

Increasing operation efficiency and decreasing terminal congestion

Thank [email protected]

Documents

Inland Container Depot(ICD) in Korea: focusing on … · Inland Container Depot(ICD) in Korea: focusing on Uiwang and Yangsan 2017.9.18 Sub-regional Meeting on Rail-based Intermodal