Transportation of bulk cargoes and raw materials: we are ready for changing flows and cost optimization

2021 January 28

Bulk cargo handling

Low-value cargo transportation flows are a puzzle for cargo owners and a significant challenge for logistics companies. Cargo transportation as fast and safe as possible ensuring the highest-quality, as well as low transportation costs – this is a solution sought by the customers of Tarptautinės logistikos centras (hereinafter – TLC). We are ready to react flexibly to various needs and offer an optimal cargo transportation plan, as well as a competitive price.

 

According to the data of Klaipėda State Seaport, in 2020 the port’s cargo handling turnover increased by 3.2 percent, about 47.74 million tons of various cargoes were handled during this period in total. This is the most successful year in the history of Klaipėda State Seaport.  A significant – 16.5 percent – growth is observed in the segment of bulk cargoes.

In 2020 the Lithuanian Institute of Agrarian Economics recorded a record national harvest of grain crops – 6.38 million tons, it is almost 16 percent more than during the previous year.

 

Full package of services from same hands

 

Fertilizers and grain crops account for the majority, almost 70%, of cargoes transported by TLC. We also transport other bulk cargoes: various types of pellets, technological and fuel chips, peat, and briquettes.

In addition, we have accumulated considerable experience in transportation of raw materials such as log wood, sawn wood, and scrap metal. We transport about 250 containers of such cargo per month. Therefore, our customer will find all the necessary services, experts in their field, and an efficient specialized equipment for loading of bulk cargoes and raw materials “under one roof”.

In order to meet the needs of our customers, we offer a service of bulk cargo packing: we pack the cargo into packing bags of the desired size and then load these smaller bags into big bags. For those who want to save money and transport loose cargo, we offer containers with an integrated protective barrier. In this way we can fill almost the entire volume of the container. For bulk unpackaged cargoes, where contact with the surface of the container is not desirable, such as grain crops and legumes, we use another method – containers with an installed liner.

Owners of timber and grain cargoes often face the threat of pest damage. In order to save customers’ time, we provide a specialized fumigation service in containers, warehouses, and ships. This service is particularly relevant for shipments to countries where the fumigation procedure is mandatory, such as China.

For the convenience of customers transporting bulk cargoes and raw materials, we have all the necessary specialized equipment at our disposal, which may not be available to all logistics companies. We use high-capacity loaders for timber and other heavy cargoes, and specialized bulk product equipment for loading bulk cargoes into containers.

The company is located “next to the cargo”, – jokes the head of the company Justas Kairys. We are located in the territory of the port, therefore all transportation processes are observed and controlled in real time. Due to the convenient location, we are faster and more efficient in accepting cargoes arriving by railway lines or trucks.

 

The problem of high costs is manageable

 

The transportation of bulk cargoes and raw materials has a common problem: the low market value of the cargo itself, therefore the transportation costs are disproportionately high.

“For example, for the transportation of low-value cargo to the European Union (EU) countries, an amount reaching about 50% of the value of the cargo may need to be deducted for transportation costs. In other words, transporting such cargo costs exactly the same as any other, but due to the low value of the cargo itself, the customer’s earnings decrease,” explains the head of TLC.

Therefore, the desire of our customers to optimize and significantly reduce possible transportation costs and thus increase the margin of low-value cargo is understandable to the team of our company.

“Finding of the best solution for the customer, i.e. to offer cheaper means of transportation and look for economical storage and chartering options is the main task of our team. By choosing the optimal transportation option, we can act as intermediaries during negotiations with carriers, shipowners, and stevedoring companies. Our company’s one-stop-shop services help you save money as well,” says J. Kairys.

However, the most realistic way to control transportation costs, that are disproportionately high compared to the value of the cargo, is to increase the flow of cargoes. According to J. Kairys, it is difficult to offer a logistics solution that meets the customer’s expectations, if we are talking about a cargo of 2 to 3 thousand tons. In such case, the only way is to increase the amount of cargo transported. Customers who transport a constant flow of cargoes and have long-term contracts will always win. We can offer them a cheaper warehouse rent for a year or two, we have a bigger time reserve to find a cheaper solution to transport the cargo by sea, land, or railway.

Transportation of raw materials and bulk cargoes is one of the main specializations of our company for more than fifteen years. On average, we transport about 800,000 tons of cargo per year, the major part of which, about 70%, is the said types of cargo. We have almost 80 thousand square meters of cargo storage area, therefore we can offer long-term lease and more favourable conditions to cargo owners, who ensure constant flow of cargoes.