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Ports and Terminals

Sahathai and MOL Partner for New Bangkok Barge Terminal

Sahathai and MOL Partner for New Bangkok Barge Terminal
Logistics Manager

Bangkok Barge Terminal (BBT) is a new joint venture between Sahathai Terminal and Mitsui O.S.K. Lines (MOL). Barge transportation is positioned for an increase in demand, since it has larger capacity per trip compared to trucking, and offers considerable advantages in safety and environmental friendliness compared to other modes of intermodal transportation. The BBT-operated barge container terminal, slated to open in 2016, will serve as a new gateway to Laem Chabang Port for customers who need cargo moved to and from the outlying areas of Bangkok. For a deeper insight into this newly formed partnership and barge operations in general, LM sat down with Mr. Peeradech Jareonsethapanich, Chief Commercial Officer of Sahathai Terminal, and Ms. Sauwakun Karuchit, Executive Director of Bangkok Barge Terminal and Sahathai Terminal.

“We are in an exciting time now with a shift in the intermodal transportation model for Thailand,” said Mr. Jareonsethapanich. “I think there’s a need for more barge transportation in the future for intermodal, especially in Thailand. It’s easy to see that the traffic in between Laem Chabang and Bangkok is quite congested. Even though in the future there are plans to double the amount of lanes on the road, we expect that the traffic will still be very bad, especially during peak times. The drought of drivers for trucking companies is also leaving many with idle trucks. Rail has limitations in Thailand as well, which requires a huge investment for improvement With a barge, it’s very convenient, straight forward with no delays, and it’s very ‘green’ friendly.”

A Long-Lasting Partnership

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Ms. Sauwakun Karuchit, Executive Director of Sahathai Terminal.

In just three short months an agreement was set in place for a partnership between Sahathai and MOL. This came together so quickly because of their long working relationship Sahathai and MOL already had. They have trust in one another and see barges as the next definitive mode of intermodal transportation for the area.

“I think MOL has the same vision as us, that barge will be the solution for intermodal transport in the future,” said Ms. Karuchit. “We have been working with them for years already, so we know that they share the same sense of long term perspective in a project like this. Like many big infrastructure projects, it’s not built for short term profit and takes years to develop. The future is always unknown and partnering with us for this service helps MOL secure their cost and capacity in the long term. It helps BBT as well to know that we are partners and will be with them for the long term. I think BBT will help the barge industry as a whole by having this partnership. If we can really make this a success and make barges a good partner, it could be in the future that more carriers are interested in this model. For instance, this year alone I’ve already had three other carriers call me to come and visit them at their regional office to tell them the story of BBT. It was a surprise to me, as this terminal, BBT, is not a large terminal, but we do have an important link between Laem Chabang and Bangkok. It’s become an interest to major carriers.”

“The current challenge is finding a berth window at Laem Chabang. They have been slowly improving the wait times at Laem Chabang for barges, but currently there is no dedicated barge terminal at Laem Chabang. MOL has been proactive in helping to bring in this needed change. MOL can cooperate well with the terminals at Laem Chabang as they have some shares in the terminals there,” said Mr. Jareonsethapanich.

After speaking with Mr. Jareonsethapanich and Ms. Karuchit, we contacted Mr. Dan Miura of the Port Project & Logistics Business Division at MOL. He confirmed much of what Mr. Jareonsethapanich had said already, and is excited for the opportunity for growth in the barge sector. “To invest in this kind of infrastructure project, MOL believes in the necessity of teaming up with a local partner who can be trustworthy long term,” said Mr. Miura. “MOL and Sahathai have already been working closely together for many years and we fully respect each other’s working attitude. Moreover, Sahathai already being a major barge service provider in the market as well makes it a quite natural choice for MOL and Sahathai to team up in this project.”

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Right Place, Right Time

We asked Mr. Jareonsethapanich to go into further detail about the plans for the terminal. “BBT terminal was designed to be exclusively for barges, and is in a very convenient location. We’ve learned if you want to handle the export and import at a terminal, you must layout the area efficiently.”

“Everyone has put great effort towards using what we have learned to make this terminal run efficiently.”

“With a berth length of 120 meters and a draft of 5 meters, barges with a capacity size of 60-200 TEUs will be able to dock at the new terminal. The two cranes that will be used can accommodate 36 moves per hour. The quality of the barges we use are also quite high and up to global standards. To make the facility operate smoothly, EDI container tracking will be implemented throughout. This terminal will also be able to process on-site customs clearance and operate import customs warehouse we will manage the import from Laem Chabang to this new terminal. We are expecting to be able to handle up to 175,000 TEUs annually. BBT will be a neutral terminal that can accommodate anyone as well. This new company, BBT, was set up to be truly neutral and independent. The response from the other barge operators was quite positive, with a focus on working together on how we can improve this emerging industry.”

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Mr. Hajime Miyabe, President of Mitsui O.S.K. Lines (Thailand).

Because the barge industry is still in its infancy, there is obviously still room for the other intermodal options in the market. MOL for instance still operates its own fleet of trucks as well as using subcontractors to move cargo back and forth from Laem Chabang and Bangkok. We asked Mr. Hajime Miyabe, Board of Directors of Bangkok Barge Terminal and President of Mitsui O.S.K. Lines (Thailand) why they are starting the investment in barges and what affect it would have on other intermodal options. “MOL does not foresee negative impact on its trucking business because there are and there will be customers who still require trucking mode due to various reasons. Besides, MOL also sees growing demand in local trucking in which we would be able to allocate some fleets to the Bangkok-Laem Chabang corridor if the need arises,” said Mr. Miyabe. “Currently, Bangkok based customers have to rely on truck, rail, or barge in order to move their cargo between Laem Chabang and Bangkok. Among these transportation modes, MOL is confident about the future of barge transportation because of its efficiency, safety, and most importantly environmental friendliness; we believe we are offering a new platform to the market at the right time.”

The future of barge transportation looks promising for Thailand, especially with companies like Sahathai and MOL working together to help mold the future intermodal landscape. “No matter what happens in the future, we are always trying to keep up with the changes in the market and to be one step ahead of them,” said Ms. Karuchit. “This is how we are developing the BBT terminal today. I think everybody would like to have this kind of relationship with a container line, and we are fortunate to have MOL as a partner. We are looking forward to a successful long term relationship.”

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