07th July 2023
With rising container volumes at seaports forecast for the years ahead, congestion is likely to increase for both exports and imports. To accommodate growing global trade, transport development is gradually moving to an inland port model. The complexity of modern freight distribution, the increased focus on intermodal and co-modal transport solutions and capacity issues appears to be the main drivers behind a renewed focus on hinterland logistics as the next step in regional freight planning.
The evolution of inland freight distribution can be seen as a cycle in the ongoing developments of containerisation and intermodal transportation. The geographical characteristics linked with modal availability, capacity, and reliability of regional inland access has an important role to play in shaping this development. As maritime shipping networks and port terminals become better integrated, the focus has shifted towards inland transportation and terminals as a fundamental component of reaching hinterlands.
An inland port is a transportation hub that is located away from traditional coastal ports and is connected to other major transportation networks such as highways, railroads, and airports. Inland ports play an important role in facilitating the movement of goods from one location to another, especially in regions where access to coastal ports is limited.
The importance of inland ports is that they provide efficient and cost-effective transportation solutions to businesses and industries. Companies can avoid congestion and delays that often occur in coastal ports and reduce excessive transportation costs by using alternative modes of transportation such as rail or barge.
Inland ports have a level of integration with maritime terminals and support more efficient access to the hinterland markets for inbound and outbound traffic. Inbound goods can be quickly offloaded from ships in seaports and transported to inland distribution centres via rail, for handling and redistribution within the country. This takes the pressure off the seaport container yards and reduces road traffic for onward shipment.
A supply chain network that includes inland ports increases the intermodal capacity for inland distribution and additional off-site storage. The functional specialisation of inland terminals has been linked with the cluster formation of logistical activities and the creation of logistics zones. In recent years, the dynamics in logistics networks have created the right conditions for the large-scale development of such logistics zones.
Inland ports also allow for the consolidation of import and distribution functions in one location saving time, fuel and cost as well as reducing reliance on long-haul trucks and subsequent emissions.
Cheaper land and greater availability of space for logistics warehousing and distribution facilities are other benefits of moving inland away from seaports. Many seaports have limited land available for expansion leading to a search for lower value locations supporting less intensive freight activities, such as transloading.
Moreover, Inland ports confer a higher level of accessibility through long-distance transport corridors because of lower distribution costs and improved capacity. These high-capacity inland transport corridors allow ports to penetrate the local hinterland of competing ports and extend their cargo base. In such a setting, the inland port becomes a commercial and trade development tool that jointly increases imports, exports and international trade patterns.
In addition, logistics companies can consolidate multiple distribution centres into smaller hubs situated at inland ports with abundant storage capacity which can provide a buffer to the supply chain acting as temporary warehousing during congested periods at the seaports.
Lately, rail is the preferred mode of transport for transiting to and from an inland port, as it uses less fuel than trucks and has fewer emissions. With careful collaboration between stakeholders on the implementation and management of inland ports, cargo can move quickly from ships to alternative land transportation networks.
In China, many inland cities are increasing their use of the country’s extensive rail network links to boost exports, such as countries in the Regional Comprehensive Economic Partnership (RCEP) agreement.
The country’s inland provinces including Hunan, Jiangxi, Guizhou and Hubei have been exploring various options to improve their exports via direct rail network links to operate efficiently and sustainably. These inland cities with existing rail freight networks transport goods to other RCEP markets, like Indonesia, Malaysia, Vietnam, Laos, Thailand, Singapore, Japan and South Korea will improve the country’s foreign trade growth, according to China Daily.
As China begins its ‘dual circulation’ system in the economy, it is aimed at increasing imports including food, iron ore and coal, and through a unified domestic market that the country is building. Seaports and inland ports should be inter-connected to achieve a direct river-sea combined transportation model, according to Yin Xiandong, Executive Deputy General Manager, Hunan Port Group in an article published in Hellenic Shipping News.
In Europe, the network of inland terminals is advanced with close integration of port terminals with rail shuttles and barge services. Rail and water based inland ports are found throughout Europe, often linked to the development of logistics zones.
In the Netherlands and beyond, Hutchison Ports Europe Intermodal (formerly called European Gateway Services), a subsidiary of Hutchison Ports ECT Rotterdam, offers shipping companies, logistics service providers and shippers an extensive network of high-frequency rail and inland shipping services.
Hutchison Ports’ inland terminal network connects the Netherlands (Moerdijk and Venlo), Belgium (Willebroek), Germany (Duisburg) and third-party inland terminals with the ports of Rotterdam and Antwerp in Western Europe. Hutchison Ports Europe Intermodal provides intermodal transport and offers optimal flexibility, sustainability and integrated supply chain solutions to customers, which significantly reduces CO2 footprint in line with the group’s decarbonisation strategy.
In Southern Europe, Hutchison Ports BEST, the group’s most technologically advanced semi-automated terminal in Barcelona, Spain, has committed to using rail transport and has significantly increased local rail traffic at the Port of Barcelona from three to twenty percent since 2012.
BEST’s eight-track railway facility offers the biggest on-dock railway terminal in the Mediterranean connecting to inland intermodal terminals in Southern Europe. With the aid of SYNERGY, an integrated intermodal and logistics service provider connecting BEST terminal in Barcelona to all major cities in Spain and Southern Europe, BEST will continue to invest in inland intermodal terminals and its influence towards a greener mode of transport to the logistics chains.
In Asia, it is China that has the largest potential for the emergence of a network of inland terminals. Significant development is taking place on the Yangtze River up to the upper stretches near Chongqing, some 2,400 km upstream from Shanghai. Such initiatives can be far-reaching since the goal is to promote trade and economic integration across central Asia and towards Europe. The rise of the international trade economy and the boom of the manufacturing sector in inland areas of China has created a significant demand for cargo exports globally through ports in Shenzhen.
Hutchison Ports YANTIAN commemorated establishing five new inland ports in the Guangdong, Hunan and Jiangxi provinces in 2022. These ports offer new logistics solutions for exporters and greener modes of transport with seamless network connections to the Greater Bay Area and central China. YANTIAN’s inland ports offer a world-class port experience via its welldeveloped rail-sea service.
To date, YANTIAN has eleven inland ports located in Pinghu South, Changping, Heyuan, Longchuan, Heshan, Jiangmen, Liling, Yueyang, Ganzhou, Nanchang and Chenzhou with 29 sea-rail services offering a wide span of direct connection to the hinterlands.
A report published in May by China Railway Nanning Group mentioned `The New International Land-Sea Trade Corridor’ bridging western China with ASEAN, central Europe, and central Asian countries (regions). Chongqing is the logistics and operational centre, and Guangxi Beibu Gulf Port is the intersection for international land-sea connectivity. More than 300,000 TEUs have been moved by rail in the last 12 months, a year-on-year increase of 14 percent. Through an efficient multimodal linkage of rail, sea and road the corridor connects 17 provinces and 61 cities in China and it has expanded its reach to 393 ports in 119 countries and regions.
Looking ahead, demand for inland ports will continue to grow as congestion at seaports has become a new norm which led to shippers, importers and exporters exploring ways to avoid delays, mitigate expensive storage costs and reduce the number of trucks transiting from inland areas to and from the coast.
It is the seaports that are currently driving the inland port initiatives providing the physical infrastructure, digital pathways and connectivity to inland areas which will ultimately benefit shippers and logistics service providers.
Inland ports serve as an important economic development engine for their surrounding regions by attracting businesses and industries that require efficient transportation and logistics infrastructure. It can also create more job opportunities and generate revenue for local communities.
Concurrently, inland ports also contribute to a more sustainable and environmentally friendly transportation ecosystem, including reduced emissions, energy consumption, congestion around coastal ports and preservation of coastal ecosystems.
The prospects for inland ports remain positive, with large continental markets relying on a network of satellite terminals and load centres as a fundamental structure to support the build-up of hinterland freight movements. This has entailed the emergence of extended gates and a variety of supply chain options in which inland terminals play an active and important role.
