Charles Hammond, CEO of Forth Ports, celebrates 25 years in the ports industry this year. He also completes his four-year stint as chairman of the UK Major Ports Group in November \u2013 handing over to Port of Bristol CEO Simon Bird.<\/p>\n
Ask him about the key issues facing the industry, and the phrase \u2018what goes around, comes around\u2019 comes to mind. Mr Hammond joined the industry in 1989, the pivotal year in which the National Dock Labour Scheme was abolished.<\/p>\n
The scheme had been introduced in 1947, to put a stop to the uncertainties of casual labour by giving dockers the right to minimum work, holidays, sick pay and pensions. However, it ended up as a restrictive \u2018job for life\u2019 system, with the ports covered by the NDLS losing business to others in the UK and Europe.<\/p>\n
\u201cThe scheme really grew up to protect workers because competition between ports was so intense that nobody could be sure where cargo was going at the drop of a hat \u2013 and because of that, people didn\u2019t know whether they would be employed from one day to the next,\u201d says Mr Hammond. \u201cWhen the NDLS stopped, the industry had a bit of stability.<\/p>\n
\u201cToday, container shipping and the ports themselves have never been more competitive. The problem is, if it gets too competitive, might we see a return to those days when people can\u2019t count on their employment in some of these major container handling facilities?\u201d<\/p>\n
He would certainly not be advocating a new dock labour scheme and is clearly a champion of efficiency and productivity \u2013 but, he says: \u201cThere has to be a balance between competition and continuity.\u201d<\/p>\n
That, he says, largely depends on the good old \u2018level playing field\u2019 in terms of transparent, realistic investment. \u201cWhen people invest in port facilities and infrastructure, they should invest in response to market demand and so that a proper rate of commercial return can be made \u2013 whether public sector, UK or foreign finance, that money being invested should be transparent and have its own cost of capital.<\/p>\n
\u201cInfrastructure investment should be made for the best economic return, not for the best political return. But it goes beyond the fixation with public sector investment \u2013 whether ports are publicly or privately owned, ultimately the source of capital for investment should come from sources that require a return. By logic you would therefore invest in facilities that deliver a return because of market demand.\u201d<\/p>\n
The issue that has dominated the agenda throughout Charles Hammond\u2019s chairmanship is European regulation. For the third time of asking, a Port Services Directive is on the agenda. \u201cWe are lobbying very hard against this. Having had the European elections, we now find the Italian presidency trying to accelerate this measure through the Commission, despite the fact that many of the parties haven\u2019t been given enough time to scrutinise the details.<\/p>\n
\u201cWe have explained our concerns to the new minister of transport. It is a bad piece of legislation, it is a burden, and it will harm investment in UK ports.\u201d<\/p>\n
The issue of too much interference from regulation in Europe is one that unites all ten CEOs around the UKMPG table, says Mr Hammond. \u201cIn the UK ports sector, productivity is up and investment is up, and it is continuing to create jobs and support the economy \u2013 so why would you interfere in that process?<\/p>\n
\u201cThe concept of setting up committees to second guess customers\u2019 commercial contracts is not only inefficient \u2013 it is absolutely crazy.\u201d<\/p>\n
The UKMPG has asked government ministers and the various House of Commons and House of Lords select committees to slow down the process for consultation, he says. \u201cFirst of all, it is undemocratic and requires proper scrutiny. It is being rushed through, it isn\u2019t supported and it will potentially damage UK business. It is the third time of asking on this legislation; in most democratic processes, you accept defeat and move on.<\/p>\n
\u201cThe great irony is that ports are amazing trading vehicles which benefit the economies they serve. The EU was set up to enhance trade \u2013 now it is hindering it.\u201d<\/p>\n
The upcoming Sulphur Emission Control Areas (SECAs) covering the Baltic Sea, North Sea and English Channel are \u2018another great example of a badly thought-out piece of European legislation\u2019, says Mr Hammond.<\/p>\n
He has written to the Scottish government expressing his concerns in particular about the future of the freight ferry service between Rosyth and Zeebrugge. The additional costs of using low-sulphur fuel from January will have a much greater impact on the longer Scottish route than its rivals further south, he says.<\/p>\n
\u201cOn the longer routes, operators will have to impose much bigger surcharges on their customers. Customers will look at that and say \u2018we\u2019re not paying this\u2019, and will drive further south to pick up less expensive crossings. So you will out more traffic back on the roads.<\/p>\n
\u201cMarine is still the better form of transport environmentally, despite the emissions concerns, compared to road transport. We should be cutting road miles, not artificially increasing them. This is a very bad, retrograde step and the danger is that we lose the Rosyth service.\u201d<\/p>\n
There are, he says, people in Europe who think up policy initiatives in isolation and don\u2019t think about the effects. \u201cThey have no practical experience and deliver legislation that doesn\u2019t make any sense.\u201d<\/p>\n
Forth Ports, headquartered in Edinburgh, owns and operates seven ports in Scotland \u2013 Grangemouth, Dundee, Leith, Rosyth, Methil, Burntisland and Kirkcaldy \u2013 and the Port of Tilbury on the Thames.<\/p>\n
Charles Hammond holds his private views, of course, but stayed out of the political debate over Scottish independence, ahead of the referendum. Now, he says of the result: \u201cIt is business as usual for Forth Ports and, throughout our ports in Scotland and at Tilbury on the Thames, we plan to play an important role in the continued growth of the whole UK economy. I would look for unity now among the people of Scotland and our own workforce both north and south of the border as we continue to provide an excellent service to our customers and support key industries in the UK.\u201d<\/p>\n
<\/b><\/p>\n
Petrochemicals and portcentric<\/u><\/b><\/p>\n
Key areas in Scotland\u2019s economy are food and drink (especially whisky), oil and gas, and petrochemicals \u2013 and these are the drivers behind recent investments and developments at Forth Ports\u2019 seven Scottish facilities.<\/p>\n
At Grangemouth, an important announcement has been INEOS\u2019s project to build a new import terminal to store and process ethane from shale gas imported from the US.<\/p>\n
Meanwhile, Forth Ports is developing more and more portcentric warehousing proposals at the port, particularly for the drinks industry, says Charles Hammond. \u201cIt is all about getting exports to market efficiently,\u201d he says.<\/p>\n
The group\u2019s facilities continue to support North Sea oil and gas projects and investments, providing berths, bases and fabrication facilities for major energy companies. This includes Bredero Shaw\u2019s pipecoating plant at Leith, which has been winning major new contracts.<\/p>\n
North Sea supplies may be dwindling, but the ports are also on standby to benefit from decommissioning work. Dundee Decommissioning is a company formed by Robertson Metal Recycling, to specialise in marine\/oil rig decommissioning and recycling.<\/p>\n
The new company will operate from a purpose-built facility in the Dundee dock area.<\/p>\n
\u201cWe have our first decommissioning base in Dundee and are beginning to build the supply chain for decommissioning and recycling,\u201d says Mr Hammond. \u201cWe have created the site and invested in the hardstanding and offices.<\/p>\n
\u201cA huge number of people are likely to be involved in North Sea decommissioning work from 2015 onwards. We are well positioned in the supply chain and expect to see that work at both Leith and Dundee.<\/p>\n
\u201cIn addition, we will probably start to see components and assembly for renewables when that finally takes off.\u201d<\/p>\n
Forth Ports has one facility south of the border \u2013 the Port of Tilbury, which is a major container port but also handles ro-ro, new vehicles, paper and forest products, grain, cars, recyclables, waste, bulks and general cargo.<\/p>\n
A long-term partnership with recycling company SITA UK has recently been announced. Forth Ports has sold Nordic Recycling to SITA \u2013 the agreement will lead to the creation of a major recycling and resource management hub at Tilbury.<\/p>\n
Work is also progressing on Tilbury\u2019s 70-acre London Distribution Park, a site which is earmarked for more than 940,000 sq ft of distribution facilities and is planned to play a major role in Tilbury\u2019s portcentric operations.<\/p>\n","protected":false},"excerpt":{"rendered":"
Next month, Charles Hammond steps down as UK Major Ports Group chairman. Felicity Landon asks him about the hot topics in the industry.<\/p>\n","protected":false},"author":8,"featured_media":4023,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[13],"tags":[],"sponsor":[],"class_list":["post-4022","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-europe"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/4022","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/comments?post=4022"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/4022\/revisions"}],"predecessor-version":[{"id":4024,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/posts\/4022\/revisions\/4024"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/media\/4023"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/media?parent=4022"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/categories?post=4022"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/tags?post=4022"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/coastlink\/wp-json\/wp\/v2\/sponsor?post=4022"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}