Arcapita and Rikaz partner to develop a new Riyadh logistics park

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What we're tracking today

TODAY: A new Riyadh logistics park + Mubadala eyes stakes in London Heathrow

Good morning, friends. It’s a busy morning with lots of storage and warehousing updates from across the region and more news trickling in on a possible Heathrow stake sale.

PSA-

Budaiya Highway eastbound lane closures:Bahrain’s Budaiya Highway will temporarily close eastbound traffic in one or two lanes for road works between Avenue 2 and King Faisal Highway for four days beginning on Friday, BNA reports.

WATCH THIS SPACE-

Qatar is set to ink more LNG contracts with European and Asian buyers, as major expansion projects look to boost the country’s output by next to two-thirds to 126 mn tons over the decade, Bloomberg reports, citing comments by Qatar Energy Minister Saad Al-Kaabi. Qatar’s main LNG producer QatarEnergy is also looking to partner with firms on expansion projects and has already signed contracts with global energy giants including Shell, TotalEnergies, Exxon Mobil, Eni and others, Bloomberg writes. Red Sea disruptions are not posing significant problems to Qatar’s LNG flows, Al-Kaabi said. Most of the country’s exports are directed eastwards, and westbound shipments are just taking longer to arrive at their destinations, he added.

DISRUPTION WATCH-

Container shipping lines are contending with port congestion and ship shortages on the back of Red Sea disruptions, the Financial Times reports. Diversions have upended shipping liner schedules resulting in clashes at ports, chief executive of Japan’s Ocean Network Express (ONE) Jeremy Nixon said. There was additional pressure on major port hubs located alongside reroutes with Singapore, Dubai, and Gibraltar seeing a sharp uptick in traffic, Nixon added. The shipping executive countered Maersk CEO Vincent Clerc’s statements that container line shipping was suffering from overcapacity, noting that the surge seen in vessel deliveries is due to decarbonization efforts and that ONE has found itself with less than the required number of vessels to maintain weekly services on now-longer routes.

Indian agriculture exporters are being crippled by the Red Sea disruptions,as elevated freight rates erode “paper thin” profit margins, the Loadstar reported, citing people it says have knowledge of the matter. Average freight rates from India to East Africa have seen up to 360% increase, figures quoted by the outlet showed. “Most customers have taken a hit, and they have no opportunity to pass on the cost increases to their buyers,” a local freight forwarder told the outlet. Many traders have stopped exports altogether, and are waiting for market conditions to normalize.

The EU kicked off its Red Sea maritime security mission, dubbed Euronavfor Apsides, on Monday, Reuters reported earlier this week. “The European Union is responding swiftly to the necessity to restore maritime security and freedom of navigation in a highly strategic maritime corridor,” Reuters cited EU foreign policy chief Josep Borrell as saying. The maritime force’s mandate will be “defensive,” whereby it will be tasked with developing maritime situational awareness, escorting vessels, and protecting them from attack, Borell added. Aspides will involve three vessels to start with, all under EU command, EU diplomats had previously told the newswire. Germany already has a warship in the Red Sea, with France and Italy looking to contribute vessels soon, the newswire said, citing diplomatic sources.

MARKET WATCH-

Marine bunker fuel sales at the UAE’s Fujairah port hit a five-month high in January, boosted by a trend which is seeing vessels rerouted by Red Sea disruptions top up at global bunkering hubs to secure competitively priced fuels, Reuters reports. Bunker fuel sales at the Fujairah hub saw a 6.6% y-o-y increase to 668k tonnes, the newswire said, citing Fujairah Oil Industry Zone (FOIZ) data picked up by S&P Global Commodity Insights. The increase broke a long-running downward trend, with the gain being the first time in more than a year that volumes saw a y-o-y increase, the newswire said.

Baltic index tops one-month high: The Baltic Exchange’s Dry Bulk Index — which tracks rates for the capesize, panamax, and supramax vessel segments – was up 1.2% to 1629 points on Monday, its highest since 19 January, Reuters reports. Gains across all vessel segments buoyed the index. The capesize subindex rose 0.4% to 2457, while panamax gained 2.1% to 1681 points, a three-week high. The smaller supramax segment bumped up 19 points to 1090 points, its highest in more than a month, the newswire said.

DATA POINT-

Iran'sQeshm Free Zone(QFZ) has seen USD 1 bn in Foreign Direct Investment (FDI) within a year, Tasnim reports. MoUs valued at USD 1 bn have been signed for FDI at QFZ, with allocations to projects in the sea-based economy, oil, energy, and petrochemicals sectors, Tasnim wrote citing statements by QFZ Chief Executive Adel Payghami.

CIRCLE YOUR CALENDAR-

The UAE will host The World Trade Organization's 13th Ministerial Conference from Monday, 26 February to Thursday, 29 February in Abu Dhabi. The event will gather ministers from around the world to assess the operation of the multilateral trading system and make key decisions regarding the future tasks of the WTO.

The UAE will host the Gulf Aviation Networking Event (GANE) on Thursday, 29 Februaryin Dubai. The event brings together aviation industry leaders to network, gain insights on prevailing trends, learn about new technologies, and take part in panel discussions and presentations run by industry experts.

The UAE will host the Future-Proof Technology Eventon Thursday, 29 February in Dubai.

The one-day event gathers industry leaders to discuss how emerging technologies, digitalization, and cross-sector collaboration, could be leveraged to bolster supply chains. The event will see presentations by a panel of experts and major logistics executives.

The UAE will host the TradeTech Forum on Tuesday, 27 February in Abu Dhabi. The forum will see some 180 trade leaders and experts discuss the technologically advanced trade environment and a showcase of trade tech solutions.

The UAE will host the Future-Proof Technologies Conferenceon Thursday, 29 FebruaryDubai. The event will unite industry experts to discuss strategies for adopting sustainable supply chain operations through cross-sector collaboration, advanced technologies, and integrated logistics.

The UAE will host the MRO Middle East on Tuesday, 5 March and Wednesday, 6 March in Dubai. The two-day event will bring together key decision makers from airlines, MROs, OEMs, lessors, and suppliers spanning all aspects of the airline supply chain.

The UAE will host The Logistics Middle East Award on Wednesday, 6 March in Dubai. The awards ceremony brings together industry experts to celebrate the sector’s biggest accomplishments over the previous 12 months.The deadline for submitting nominations is Friday, 19 January.

The UAE will host Abu Dhabi Mobility Week from Wednesday, 24 April to Wednesday, 1 May in Abu Dhabi. The event, organized by The Department of Municipalities and Transport – Abu Dhabi (DMT), will feature announcements, forums, and introduce a mobility strategy for the emirate.

KSA will host a special World Economic Forum event from Sunday, 28 April through to Monday, 29 April in Riyadh. The event will focus on global collaboration and energy.

The UAE will host the 23rd edition of the Airport Show from Tuesday, 14 May through to Thursday, 16 May in Dubai. The 23rd Airport Show will see representation from airport suppliers, airport service providers, aviation executives, and regional decision makers. The event will highlight current innovations and new technologies, while emphasizing this year’s "Sustainability and Innovation," theme.

The UAE will host The Electric Vehicle Innovation Summit from Monday, 20 May to Wednesday, 22 May in Abu Dhabi. The event will see industry leaders come together to discuss sustainable mobility and tapping into groundbreaking advancements in electric vehicles while engaging with key decision-makers.

Check out our full calendar at the bottom of this email for a comprehensive listing of upcoming news events and news triggers.

Arcapita and Rikaz partner to develop new Riyadh logistics park

Bahrain-based asset manager Arcapita and Saudi real-estate developer Rikaz are partnering up to develop a 3 mn sqm logistics park in Riyadh, according to a statement. The park, dubbed the Node, will kick off the first 400k sqm phase housing grade A warehousing facilities, the statement notes. The timeline and investment value for the logistics park was not revealed.

Strategically located: The Node will be situated in eastern Riyadh with access to King Khalid International Airport, the second and third ring roads, Khurais, Dammam, the Eastern ring road, bringing tenants within easy reach of their customers, the statement added.

Rikaz is doubling down on GCC-based logistics real estate: Rikaz currently manages USD 1 bn in industrial real estate across the GCC, with plans to ramp up its GCC logistics portfolio to USD 2 bn by 2025, the statement said. The company’s current logistics real estate portfolio comprises more than 3.5 mn square feet of built-up area, across 30 properties, and leased to 80 regional and global tenants.

Mubadala eyes stake in London’s Heathrow Airport

UAE sovereign wealth fund Mubadala is considering purchasing a stake in London’s Heathrow Airportafter being approached by Paris-based buyout firm Ardian, Bloomberg reports, citing sources with knowledge of the matter. Negotiations are ongoing and no final decision has been reached, the sources said, adding that Mubadala could decide not to go ahead with the acquisition.

Why did Ardian approach Mubadala? Spain-based infrastructure firm Ferrovial agreed in November to sell its 25% stake in Heathrow in November, with a 10% stake going to Saudi sovereign wealth fund the Public Investment Fund (PIF) and the remaining 15% acquired by Ardian through separate vehicles. Shareholders accounting for another 35% stake in the airport have invoked tag-along rights, requiring that they be included in the sale consideration and thereby upping the Heathrow stake on offer to 60%. PIF does not want to increase its 10% share, but Ardian is considering increasing its stake seeking additional partners to snap up the additional 35% stake, Bloomberg writes.

GCC-based sovereign wealth funds are heavily established in British logistics infrastructure,with many choosing to invest in the sector as part of a general drive to diversify non-oil incomes, Bloomberg said. Qatar Investment Authority currently holds a 20% stake in Heathrow, and UAE-based port operator DP World manages ports and terminals at London Gateway and Southampton, with the trend raising concerns in the UK surrounding the strategic implications of Middle Eastern ownership of key infrastructure, the outlet said.

FedEx Express expands regional footprint with new Dubai World Central hub

FedEx Express expands regional footprint: Air cargo express delivery giant FedEx Express has kicked off a new Middle East, Indian Subcontinent and Africa (MEISA) hub at Dubai World Central (DWC) Airport in Dubai South, according to a Dubai Media Office (DMO) statement. The hub marks a long-term investment of upwards of USD 350 mn in terms of infrastructure and technology and looks to boost the UAE’s trade and advance a government drive to diversify the country’s non-oil economy, the statement said.

The details: The 57k square meter (sqm) hub incorporates advanced technologies such as automatic sort systems which look to streamline package processing and distribution, realizing gains in efficiency, accuracy, and speed, the statement said. The hub also features two AI-equipped automated high-speed x-ray machines, boosting efficiency and security. The facility also has a 170 sqm cold storage space to accommodate temperature-sensitive cargoes. The hub’s strategic location at DWC will enable it to leverage the regional aviation and logistics ecosystem, the statement added.

The hub is also a boon for sustainability: The facility is inline with Dubai Municipality’s Green Standards, and features solar power and an energy management system. FedEx will also deploy electric-powered vehicles with charging infrastructure for pickup, deliveries, and employee movement, the statement also said.

Sullex to establish USD 150 mn cool-chain logistics city in Giza

Egypt-based cold chain developer Sullex is set to establish the first integrated city for logistics, chilled, and frozen food industrial services in Egypt, according to a statement picked up by Daily News Egypt earlier this week. The smart temperature-controlled logistics city, dubbed Sullex-TRC, has a USD 150 mn investment ticket and will cover 510k sqm at a site in Egypt’s Giza Governorate, the statement said. The timelines for the project’s development and operation were not revealed.

The details: Sullex-TRC is slated to become a regional hub for the production and trading of frozen agricultural produce, pharma, and chilled products that include meat, poultry, and dairy, the statement said. The gated logistics city will comprise some 60 chilled and frozen food factories — with areas beginning from 1.25k sqm — and 13 smart temperature-controlled warehouses with storage capacity for up to 10k pallets.

Tackling waste and boosting exports: The new hub looks to cut initial capital expenditures by manufacturers by some 50% while reducing Upper Egypt’s agricultural waste by 30% by preventing spoilage due to improper cold storage. It will also open up new export markets, Sullex Managing Director Abeer Taha said in the statement. The hub will also look to produce energy from renewable resources in a bid to align with goals for sustainable development, Taha added.

Who will the Sullex-TRC cater for? The city will serve both small-scale farmers and large agricultural companies, Sullex Chairman Andrew Daniel said in the statement. Sullex-TRC will also provide services including sorting, packaging, tracking agricultural products, refrigerated transport, customs clearance, and assistance in globally marketing local products, Sullex Managing Director Abeer Taha added.

Sullex-TRC is also strategically located: The city is located along Cairo’s main road axes and is nearby collection points for Upper Egypt’s agricultural produce. The hub’s proximity to industrial zones, seaports, airports, and land ports places it within easy reach of export markets in the GCC, North Africa, and Europe, the statement also said.

US + allies warn China against export dumping

The US has warned China against dumping goods on global export markets, indicating that Washington and its allies will respond if China pursues dumping as a quick fix for industrial overcapacity, the Financial Times reports, citing US officials. US policymakers are mostly concerned about the dumping of EVs, solar panels, lithium-ion batteries, and other clean energy products, the FT said. The EU has also been putting Chinese exports under increased scrutiny, undertaking an investigation last year into state subsidies for China’s EV sector that threaten to “price out” their European rivals. For its part, China has countered with its own investigation into European trade, while pointing out US protectionism for their domestic EV industry, the FT also said.

Swissport moves into Al Ula, Morocco + Libya eye restarting flights, Egyptian railways are getting upgrades to signaling

AVIATION-

Airport ground services and air cargo handling operator Swissport has added Al-Ula to its KSA network, according to a statement. Swissport will start by handling two weekly flights to and from Amman, and it expects to handle an increased number of flights as airlines increase flight frequencies in Saudi Arabia.

Morocco resuming flights to Libya? A delegation from Morocco’s Royal Air Maroc visited Libya’s Mitiga international airport to assess security conditions ahead of an expected resumption of flights between the two countries, Morocco World News reported earlier this week, citing the Libyan Airports Authority. The visit follows a meeting between Moroccan Transport and Logistics Minister Mohammed Abdeljalil and his Libyan counterpart Salem Al Shahoubi, who discussed resuming flights and strengthening economic ties between the countries, the newswire reported. Morocco halted flights to Libya back in 2015 over security concerns.

RAIL-

World Bank Vice President for Infrastructure Guangzhe Chen attended the inauguration of a projectto install signaling systems along Egypt Beni Suef-Assiutrailway line, according to a statement. The World Bank official discussed with Egyptian officials the latest developments in the project to develop signaling systems on a number of lines. Signaling systems have been installed on the 208 km Cairo-Alexandria line and the 250 km Beni Suef-Assiut line, and work is still underway to install signaling systems on the Assiut-Nag Hammadi line, the statement said.

OTHER STORIES WORTH KNOWING THIS MORNING-

Iran + Turkmenistan discuss linking Turkmenbashi and Amirabad ports: Iran and Turkmenistan are looking into resuming a regular shipping line between Amirabad and Turkmenbashi Ports. (IRNA)
TCI inks strategic agreement with Arabco International Group: Transcargo International (TCI) has signed a strategic agreement with Arabco International Group for the establishment of a bulk cement storage facility at Port Said port. (Statement)

Russia’s crude oil delivery woes with India continue + The world's first chemical tanker ship with sails has departed from Antwerp

Tankers carrying India-bound Russian crude still idling off Asia:Twelve tankers carrying around 15 mn barrels of Russian Sokol crude set for delivery in India have been idling off the coasts of Malaysia and South Koreafor over a month, Bloomberg reports. Indian refiners did not receive a single Sokol shipment in December due to payment issues, and India’s oil imports from Russia declined that month to their lowest since January 2023. There were hopes for the situation to ease, with three vessels heading back to India earlier this month, and a fourth now signaling its destination as Visakhapatnam Port India. However, the majority of the cargo ships show little sign of moving.

Background: Russian Urals oil fell below the Western USD 60 cap amid increased freight rates caused by new US sanctions on shipowners and a decline in global oil prices in November. Freight rates for Urals oil shipments from Russia's Baltic ports of Primorsk and Ust-Luga to India rose to USD 9.2-9.5 mn per tanker per voyage at the start of this month, up from USD 8 mn a week earlier.

REMEMBER- A price cap of USD 60 per barrel on shipments of Russian oil mandated by G7 countries and Australia came into effect in February 2023. The regulation seeks to curb revenues that Moscow can divert to its war in Ukraine while also ensuring relative stability in global oil supplies.

MT Chemical Challenger, the world's first chemical tanker ship with sails, has departed from Antwerp for Istanbul in a bid to cut emissions by using wind power, France 24 reports. The sails — similar to aircraft wings — reduce fuel consumption by using wind power to propel the vessel and are expected to cut fuel consumption by 10-20%, slashing CO2 emissions by 850 tonnes annually.

Not the first wind-powered ship: A dry cargo ship with metal sails set sail last August from Singapore to Brazil to study how wind energy can cut carbon emissions. The vessel was retrofitted with 37.5-meter wind sails and is expected to cut fuel costs up to 30% on new-build vessels.

OTHER STORIES WORTH KNOWING THIS MORNING-

Indian port union refuses to handle Israeli equipment: The Water Transport Workers Federation of India, which represents some 3.5k workers at 11 ports, has said its workers will not load or unload Israel-bound military equipment. (Economic Times)

Calendar

FEBRUARY

22-24 February (Thursday-Saturday): International Freight Forwarders Conference, Dubai, UAE.

26-29 February (Monday-Thursday): World Trade Organization's 13th Ministerial Conference, Abu Dhabi, UAE.

27 February (Tuesday): TradeTech Forum, Abu Dhabi, UAE.

28 February (Wednesday): Industrial and Building Technology event, Dubai, UAE.

28 February-1 March (Wednesday-Friday): MENA Transport Congress and Exhibition, Dubai, UAE.

29 February (Thursday) :Future-Proof Technologies Conference, Dubai.

29 February (Thursday): Gulf Aviation Networking Event (GANE), Dubai.

29 February (Thursday): Future-Proof Technology Event, Dubai.

MARCH

3-5 March (Sunday-Tuesday): Sustainable Green Blue Infrastructure Conference 2024 (Marlog), Green Plaza Mall, Egypt.

4-8 March (Monday-Friday): Logistics & Transport Management 2024, Dubai, UAE.

5-6 March (Tuesday-Wednesday): ShipTek International Conference & Awards 2024, The Address Dubai, UAE.

5-6 March (Tuesday-Wednesday): MRO Middle East, Dubai Trade Center, Dubai, UAE.

6 March (Wednesday):The Gulf Ship Finance Forum, Waldorf Astoria Dubai International Financial Centre, UAE.

6 March (Wednesday): The Logistics Middle East Awards, Dubai, UAE.

7 March (Thursday): Truck and Fleet Conference 2024, Dubai, UAE.

12-14 March (Tuesday- Thursday): IATA World Cargo Symposium, Hong Kong International Airport, Hong Kong.

20 March (Wednesday): Construction work scheduled to begin on the 162 km Rasht-Astara Railway in Iran.

APRIL

24 April- 1 May ( Wednesday-Wednesday): Abu Dhabi Mobility Week, Abu Dhabi.

27 April- 1 May (Saturday-Wednesday): Iran Expo 2024, Tehran International Permanent Fairground, Iran.

28 April - 29 April (Sunday - Monday): World Economic Forum, Riyadh, KSA.

29 April- 2 May(Monday-Thursday): GLA Global Logistics Conference, Dubai, UAE.

30 April- 2 May(Tuesday-Thursday): Autonomous E-mobility Forum, Doha, Qatar.

April: Driftx. Abu Dhabi, UAE.

MAY

2-3 May (Thursday-Friday): Geneva Dry, Hotel President Wilson, Geneva, Switzerland.

2-4 May(Thursday-Saturday): The International Conference on Logistics Operations Management: smart, sustainable and green logistics (GOL), Marrakesh, Morocco.

3-5 May (Friday-Sunday):2024 IEEE 15th international conference on Logistics and Supply Chain Management, University of Sousse, Tunisia, Tunis.

7-9 May (Tuesday-Thursday): Annual Investment Meeting (AIM) Congress, Abu Dhabi, UAE.

14-15 May (Tuesday-Wednesday): Seamless Middle East, Dubai World Trade Centre, UAE.

14-16 May (Tuesday-Thursday): Airport Show, DWTC, Dubai, UAE.

20-22 May (Monday-Wednesday): The Electric Vehicle Innovation Summit (EVIS), Abu Dhabi, UAE.

21-23 May (Tuesday-Thursday): WAGA 2024, Riyadh, Saudi Arabia.

JUNE

2-4 June (Sunday-Tuesday):IATA Annual General Meeting (AGM) and World Air Transport Summit, Dubai, UAE.

19-21 June (Wednesday-Friday): World Freezones Organization’s Annual International Conference and Exhibition, Bari, Italy.

OCTOBER

6-8 October (Sunday-Tuesday): Routes World 2024, Bahrain.

7-9 October (Monday-Wednesday): AFSIC – Investing in Africa, London.

22-24 October (Tuesday-Thursday): Asean Ports and Logistics 2024, Johor, Malaysia.

NOVEMBER

11-14 November (Sunday-Thursday): ADIPEC Maritime and Logistics Exhibition and Conference, Abu Dhabi.

13-15 November (Wednesday-Friday): The Bahrain International Airshow, Sakhir Airbase, Bahrain.

DECEMBER

10-12 December (Tuesday-Thursday): Middle East Business Aviation, Dubai World Central, Dubai, UAE.

20 December (Wednesday): The 5th Iran-Senegal Joint Economic Cooperation Commission, Dakar.

EVENTS WITH NO SET DATE

1Q 2024: Construction of phase 3 of Agility’s logistic park in Abidjan, Côte d'Ivoire to be completed.

1Q 2024: Egypt’s Transport Ministry to launch pre-qualification tender for Cairo-Alex freight railway.

1H 2024: Civil Construction subcontracts for construction firms in Oman for implementation of the Abu Dhabi - Suhar rail link to be announced.

2H 2024: Bahri’s barges for Saline Water Conversion Corporation (SWCC) to begin initial and commercial operation.

King Salman Energy Park is set to become operational.

2025

Mid-2025: Iraq will complete phase one of the construction of the Grand Faw Port.

DHL and Aramco’s logistics and procurement hub in Saudi Arabia will commence operations.

AD Ports-operated Safaga Port’s multi-purpose terminal will become operational.

Phase 3 of APM Terminals Tangier MedPort to be complete and operational.

1Q 2025: Sadr Park’s Logistics Center in Riyadh to be completed.

1Q 2025: Phase twoof Jafza Logistics Park to be completed.

2027

4Q 2027: Oman’s Musandam Airport construction to be completed.

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