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Finnish visions for a bright future

Finnish ports stand to benefit from more direct calls and EU initiatives to reduce the environmental impact of ferry operations

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The Pansio expansion area has been allocated by the Port of Turku for logistics activities
The Pansio expansion area has been allocated by the Port of Turku for logistics activities

Finland is a prime example of how ocean carriers in general are putting a greater focus on the Baltic region by offering more direct ports of call and phasing-in bigger ships. As a consequence, Finland’s main ports are handling more cargo and investing in and modernising infrastructure and facilities that are capable of accommodating the larger tonnage being deployed.


At the west coast port of Rauma, the deepening of the Rihtniemi access channel from 10m to 12m, and the lengthening of the berth at the container terminal to 520m, have opened the facility to Panamax-class ships.

 

Meanwhile, with an additional 4-ha of land paved for container stacking and a new STS crane erected, the terminal’s handling capacity has almost doubled to 500,000 TEU a year.


Euroports Rauma, which operates the port, is confident that the €30M capital expansion programme, undertaken in conjunction with the port authority, will result in considerably more box traffic being handled.


Hannu Asumalahti, the port authority’s managing director and CEO, agreed. He pointed to the significance of the port’s focused operating philosophy, saying: “We are a partner to the business sector across Finland and globally, and
our biggest advantages are our comprehensive service package and extensive shipping line network. Our goal is to expand and provide more space to develop our activities and enable growth. We will extend our yard further in the coming years.”


US bound


Rauma is the only port in Finland that offers customers direct service to the US, and this trade is growing strongly. Recent data published by the US Census Bureau, for example, show that the value of two-way trade between Finland and the US was worth US$6.95B in the first nine months of 2018. This was up more than 30% on the corresponding period of 2017.


Moreover, Rauma has an expanding and increasingly diverse industrial hinterland and a growing cargo base that lends itself to containerisation. The bigger container terminal should accelerate this process further. But the first nine months have proved disappointing for the terminal, with box traffic down 5.7% on the same period of 2017 (see accompanying table).


By contrast, Helsinki is heading for another record year, with 11.4 Mt of general cargo handled in the first nine months of the year, up 10.4% on the corresponding period of 2017. It means that Finland’s largest general cargo port should comfortably exceed the 14 Mt processed in 2017 (full calendar year).


According to Ville Haapasaari, CEO of the Port of Helsinki, container and trailer traffic have continued to build on last year’s performances, with 282,000 TEU and 456,000 trailers handled in the January/end-September period. This was up by 4.1% and 4.3%, respectively, compared with the same period of 2017.


The Port of Helsinki is keen to handle a larger proportion of its growing ro-ro traffic at its newer Vuosaari Harbour complex, which has been developed well away from terminals located in the city’s more congested urban districts. To
encourage importers, exporters and truckers to transfer to Vuosaari, management has devised a mix of incentive and penalty fees.


Consequently, during weekday mornings (between 07:30 hrs and 09:30 hrs) and afternoons (15:15 hrs to 17:00 hrs), additional charges of €15 are imposed on vehicle/ trailer combinations longer than 12m calling at the port’s South, Katajanokka and West Harbour facilities. By contrast, similar sized vehicle/trailer combinations travelling to Vuosaari enjoy discounts of €10 per unit.

 

In addition, new operating procedures have recently been implemented for heavy traffic using the West Harbour. Increasingly, automated check-in procedures will be conducted by the driver from within his/her cab, and trucks will enter the terminal just two to three hours in advance of loading. It will speed up the booking in process and reduce the need for queuing and provision of parking/waiting areas. Indeed, the port company intends to decommission the existing waiting area for heavy trucks by the end of 2019.

Heavy cargo logistics


Elsewhere, the port of HaminaKotka Ltd has extended its relationship with the Belgium-based Sarens Group NV, which is a leading player in the crane rental, heavy lift and transport engineering sectors. The group, which signed an initial €20M deal with HaminaKotka in 2016, uses the port to transfer heavy modules (70m x 16m x 11m, and weighing between 1,500t and 1,800t) from oceangoing ships to barges for transit via Russia’s inland waterways to a project in Kazakhstan in which it is involved.


The new deal means that Sarens will employ 150 additional logistics personnel in HaminaKotka, raise its investment to about €46M, and extend its operations at the port until at least 2021.


Several new contracts have also been concluded, including a long-term agreement with Finnpulp, which is building a new wood products/pulp plant at Kuopio, located 323 km north of the port. It will lead to an estimated 1.2 Mtpa of cargo being routed through the harbour complex, which is located in the south-eastern region of Finland.

 

“Finnpulp’s decision to choose us as its export port means a huge opportunity for HaminaKotka,” said CEO Kimmo Naski. “This agreement will raise our exports of the Finnish wood-processing industry to a whole new dimension
and give us the status of the leading pulp port on the Baltic Sea.”


For its part, HaminaKotka Ltd will provide the land area for the development of a large warehousing and logistics complex for the company in the Mussalo D-area of the port. This facility will be used to store, package, manage and
distribute the company’s products for all of its global markets. Given that Finnpulp’s products will be moved in various modes, HaminaKotka believes the deal should result in traffic gains at terminals handling breakbulk, ro-ro and
container traffic.


This latest agreement follows a similar deal announced in March between HaminaKotka, Steveco and UPM. It stems from the latter company’s decision to consolidate pulp produced at its mills in Kaukas and Kymi and destined for the international market through the port of HaminaKotka. The annual production capacity of the two mills is 370,000t, and the majority is sold overseas.

 

Commenting on the group’s strategy, Jukka Hölsä, director of maritime logistics at UPM, said: “This concentration in our transport network enhances our pulp logistics activities while increasing our operating flexibility. The new centre will offer high-quality facilities, and it is served by rail, which reduces the carbon footprint of our transport operations.”


He added: “From Mussalo, our pulp can be delivered to the world on both conventional ships and in containers. In addition, we can use the terminal as an intermediate transport delivery and storage centre for our domestic business.”


Steveco is investing €8.5M on developing the 20,000 m2 wood pulp distribution centre for UPM, and the stevedoring/cargo freight handling company will operate the facility. The whole complex, including the quay, should be
completed by the spring of 2019.


The port authority is investing over €30M in developing the first phase of this zone, with the project involving the construction of 220m of quay, a breakwater and the preparation of land for the development of logistics facilities. The site allows for at least 550m of additional berthing line to be built.


Profitable venture


“Our decision to construct the D-area in Mussalo has turned out to be profitable, even before it is actually complete,” said Naski. He sees developments in this area as providing the port with the momentum to post sustainable rates
of growth and to leverage new business opportunities.


The port of Turku also has ambitious expansion plans, with a new cargo handling hub earmarked for Laivateollisuus area in the western part of the harbour. The new area is adjacent to Turku’s most recent developments in Pansio and will, according to Jaakko Nirhamo, the port’s director of sales, make it easier to build terminals and warehouses near the existing harbour.


He sees the concentration of modern wharves and logistics facilities in this area of the port as giving Turku the opportunity to create cluster operations that can efficiently process a wider range of cargoes and support a bigger customer base.

 

In particular, port investments in Finland are closely linked to improving connectivity and enhancing efficiency and productivity on the country’s main trading corridors. This is clearly illustrated in the various twin port projects carried out by Helsinki and Tallinn in Latvia. They have also been supported by the main carriers involved (largely ro-ro operators). Currently, an estimated 9M passengers and 4 Mt of largely trailer traffic are moved yearly over the corridor.


Partially funded by the EU through its Connecting Europe Facility programme, phase 3 involves expenditure in excess of €70M and covers the period between 2018 and 2023. It is focused on reducing the environmental impact of ro-pax shipping services, and improving and expanding multimodal transport options on the corridor.


On this basis, plans to integrate the Helsinki/Tallinn corridor into the EU’s central and southern Europe TEN-T projects are vital.


The Port of Helsinki will contribute about €24M to the third-phase project. Specifically, it will lead to transport networks in the West Harbour being revamped, a new bridge being built, and a multimodal facility constructed close to
the port’s West Terminal 2. According to the Port of Helsinki’s Ville Haapasaari, this will “connect different modes of transport seamlessly with the ferries”.

 

Helsinki’s West Harbour will also benefit from the installation of new automooring and on-shore power supply systems, as will the Old City Harbour in Tallinn. This will reduce noise, CO 2 and other emissions, as auxiliary engines will
be switched off while ships are in port.

 

Indeed, when it comes to Finland’s maritime transport sector, it is its impact on the environment that is being taken increasingly seriously, and the above mentioned plan, although mainly implemented to ease traffic congestion in the city, will also help cut pollution from vehicles.


Similarly, management want the ‘greenest’ ships to call at the port, and at the beginning of 2018, they introduced an environmental discount programme. From January 2019, it is being improved, in an effort to encourage vessel owners/ operators to further decrease their emissions and noise levels, and invest in better energy-saving and environmental efficiency programmes.

 

According to executives familiar with the plans, this latest move could result in a difference in fees of at least 4% being levied on the cleanest and dirtiest ships calling at Helsinki. Further incentives cannot be ruled out.

Mantsinen Group Ltd Oy has set up an assembly facility at Rauma, space leased from Euroports Rauma
Mantsinen Group Ltd Oy has set up an assembly facility at Rauma, space leased from Euroports Rauma

Green path


Shipping lines based in Finland are among the leaders in the world when it comes to investing in and operating environmentally friendlier ships. Espoo-headquartered Containerships, which was acquired by Marseilles-based CMA CGM earlier this year, for instance, is in the midst of a fleet renewal programme that is based on the deployment of LNG-fuelled vessels.


“Five years ago, we committed to the largest investment in Containerships’ history and started to build Europe’s first LNG-based supply chain, basically from zero,” explained Kari-Pekka Laaksonen, the company’s CEO. “Obviously, as the first logistics company to do this, it has not been easy, but I still believe it is the way to go. The environment needs new solutions, and both the public authorities and our customers demand more ecological transport options.”


He added: “Even though we have been forced to reschedule the delivery of the LNG vessels by some months, I am happy to say that no major issues, that would have put the whole project at risk, have appeared, and in July, Containerships Nord completed the first part of its sea trials.”

 

Four ships will be phased into the company’s Baltic/Scandinavia/European network in 2019, with a further two units scheduled to enter service during 2019, and two more expected to be delivered during 2021.


Elsewhere, Finnlines is also introducing a new series of eco-friendly ships into its operations. Emanuele Grimaldi, CEO of Finnlines, said the company is continuing to invest in “technologically and environmentally advanced” tonnage, with three ships worth €200M on order at the Jinling Shipyard in China. Each 17,500 dwt vessel has a carrying capacity of 5,800 lane metres for trailers/block-stowed cargo, 5,600 m2 of decks for vehicles, and a weather deck capability to load 300 TEU.


Due for delivery by 2021, the ships will be fitted with scrubbers, and feature a bank of lithium-ion batteries that can be recharged during sailings, and will provide the ships’ electric power during their port stays. Meanwhile, the CEO said that “further resources would be invested in a new series of modern large green ro-pax vessels for Finnlines in three to four years’ time”.


Meriaura Ltd, the small intra-regional operator, is also adding more modern ships to its fleet and upsizing, as it seeks to widen its customer base. It recently concluded a long-term charter contract with Aalto Shipping Company Ltd for
the 8,700 dwt vessel airisto. Previously, its fleet was largely confined to ships in the 3,000-4,000 dwt range.

 

“With this vessel type, we respond to customer needs and to changing material flows in the Baltic Sea,” explained Beppe Rosin, vice managing director of Meriaura. “Carrying products of bio and circular economy has always been part of the core business of our company, and now we are able to carry larger cargo quantities.”

 

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