More bunkering services in MENA

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TODAY: More updates on Iraq’s Development Road Project + VC activity for supply chain startups fell in 1Q 2023

Good morning, wonderful people. It’s an eventful end of the week in the logistics world, with plenty of updates from the maritime, trucking, and aviation industries in the region.

THE BIG LOGISTICS STORIES- The Saudi Ports Authority (Mawani) has inked an agreement to establish a SAR 2 bn integrated bunkering center in King Fahad Industrial Port in Yanbu. Over in the UAE, Al Futtaim Auto & Machinery Company (FAMCO) launched a new range of heavy-duty freight trucks with operational and fuel efficiencies.

HAPPENING TODAY-

Jordan shoots down drug-carrying drone from Syria: The Jordanian army says it has intercepted a drone carrying crystal methamphetamine on Jordan’s side of the country’s border with Syria, Reuters reports. Jordan has blamed pro-Iranian militias, which it says are protected by the Syrian army, for smuggling Gulf-bound drugs across its border. However, Damascus has denied complicity with any Iranian-backed militias. While Syria has become a hotspot for drug trade over the course of the war, Jordan has often been used as a key transit route to Gulf countries, particularly for Syria-made drugs, Reuters writes.

Turkey + Azerbaijan corridor a “problem” with Iran, Erdogan says: “Zangezur Corridor is a problem with Iran; this upsets Ankara and Baku,”TRT quoted Turkish President Recep Tayyip Erdogan as saying yesterday following his visit to Azerbaijan. Erdogan arrived in Baku on Monday and held a joint press conference with the President of Azerbaijan, Ilham Aliyev on Tuesday, during which the two heads of state expressed his desire for the Zangezur corridor linking Azerbaijan to its Nakhchivan exclave and to eastern Turkey by bypassing Armenian checkpoints, Turkish state news agency Anadolu Agency reports.

WATCH THIS SPACE #1- Countries will send proposals to Iraq for Development Road Project: Iraq’s Transport Ministry concluded its meeting with technical committees yesterday over its USD 17 bn Development Road Project, it said in a statement, without disclosing which countries the technical committees represented. Iraq will now be waiting for each technical committee to submit a proposal for the nature and proportion of their intended contribution to the project, Transport Minister Razzaq Al Saadawi said, according to an Iraqi Ministry statement.

WATCH THIS SPACE #2- Qatar will help build the International North-South Transport corridor (INSTC) linking Russia and India through Iran, Sputnik quotes Qatar’s Russian ambassador Dmitry Dogadkin as saying. The two countries are discussing jointly building one of the branches of the corridor, Dogadkin told Sputnik News, without clarifying. “We are ready to jointly implement ambitious infrastructure projects, including the North-South ITC,” Dogadkin said during a speech in Doha celebrating Russia Day.

Background: The project was rebooted back in May, when Russia and Iran agreed to build the Rasht-Astara railway, completing the 7.2k-km corridor. The origins of the project go back to a September 2000 treaty signed by partner countries, which failed to get off the ground. Recent supply chain disruptions, sanctions on trade with Russia and Iran, and trade agreements between countries connected by the proposed trade corridor have given new impetus to the project.

DATA POINT #1- VC activity has seen a strong decline in the supply chain tech sector in 1Q 2023, with transaction value dropping 81.8% y-o-y to USD 2.4 bn, according to a report. The number of investments fell 19.4% q-o-q and 49% y-o-y. The freight tech segment saw the highest drop, with investment values decreasing 81.8% q-o-q, and the number of transactions reaching just one-third of the number of investments made in the previous quarter. Enterprise supply chain management, on the other hand, saw the smallest quarterly decline, according to the report, which measures the total value of transactions at USD 312 mn.

DATA POINT #2-Volume of containers handled at Saudi ports at its highest since 2020 in May: Container volumes handled during the month stood at around 710k TEUs, the highest monthly throughput since 2020, according to a Saudi Ports Authority (Mawani) statement. Outbound containers increased by over 28% to 224.7k, while inbound containers rose 36% to 236.4k. Overall cargo throughput, however, fell 6.12% y-o-y to 25.6 mn tons in May. Some 1k vessels passed through the kingdom’s ports, compared with 896 in May 2022.

DATA POINT #3- Iraqi Kurdistan’s losses reach USD 2 bn amid halt of oil exports to Turkey since late March, Reuters reports, based on its calculations. Iraq halted imports of 450k barrels per day (bbl / d) via a pipeline that passes through northern Kurdistan to the Turkish port of Ceyhan on 25 March. The two countries are looking to hold technical talks by the start of next week to resume exports, two sources in the know told Reuters, though “this does not mean exports will immediately restart as this decision requires high-level political talks,” the sources added.

Background: Turkey was orderedby the International Chambers of Commerce to pay USD 1.5 bn worth in damages to Baghdad for receiving unauthorized oil exports from the Kurdistan Regional Government from 2014 to 2018. Turkey is currently looking to negotiate the size of the damages, sources told Reuters.

MARKET WATCH-

Oil supertanker rates surge amid a jump in Middle East cargoes: Crude supertankers saw their second-largest daily gain in three years on the back of the rising number of cargoes from the region, Bloombergreports. The spike was unexpected given recent decisions by Saudi Arabia and the UAE to cut output, though Bloomberg notes the supply cuts don’t include sales of barrels already in storage. Rates for ships carrying 2 mn barrels of crude from the region to China rose by USD 20k a day on Monday, Reuters says, citing figures from the Baltic Exchange.

A signal for a tight VLCC market: “According to brokers, the increase is due to a flurry of cargo in the Middle East for late June loadings, combined with limited available ships,” Clarksons Securities analysts wrote in a report cited by Bloomberg. “While it remains to be seen how long-lived the bull run will be, considering the expected reduced volumes in July, the rate spike illustrates how tight the VLCC market is and helps to clear the tonnage list in the region.”

Kuwait increases July crude prices for Asia: Kuwait has increased the official selling price of Kuwait Export Crude (KEC) to Asia by USD 0.25 to USD 1.95 above Oman/Dubai quotes, while the price of Kuwait Super Light Crude (KSLC) was raised by USD 0.35 to USD 2.15 above Oman/Dubai quotes for July, Reutersreports.

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CIRCLE YOUR CALENDAR-

The Terminal Operators Conference Europe (TOC) kicked off on Tuesday in Rotterdam, Netherlands and will wrap today. The event — led by DP worldand hosted by the Port of Rotterdam — brings together port and cargo supply chain professionals, as well as leading decision makers, policy experts and solution-providers to network and discuss how to digitize and improve their port operation strategies.

The Helishow Dubai kicked off yesterday at the Museum of the Future in Dubai and will last till today. The event is a platform dedicated to the manned and unmanned aerial vehicle technology and operations, and helicopter industry. The event enables the international VTOL community to meet and interact with customers including state delegates and trade visitors from across the MENA.

The Multimodal logistics event kicked off Tuesday in Birmingham, England and is running till today. The event brings together cargo owners and shippers to discuss improving supply chains and finding innovative solutions for transport and logistics issues.

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

Mawani inks agreement for bunkering center in Fahad Industrial Port in

Mawani to establish integrated bunkering center in Yanbu: Saudi Ports Authority(Mawani) has inked an agreement with Alba Nova and Trafalgar Oil to establish a SAR 2 bn integrated center for bunkering in Saudi’s King Fahad Industrial Port in Yanbu, in partnership with the Saudi Energy Ministry, according to a statement. The statement did not disclose the timeline for the completion of the center or the kickoff of operations.

The details: The 393k sqm center will serve as a location for storing, trading, and mixing petroleum products. The center will be situated in King Fahad Industrial Port, which has 34 berths, 10 terminals, and the ability to hold a capacity of over 210 mn tons and receive vessels carrying up to 500k tons, according to the release.

The center will be established over two phases:Each phase of the project will have 144 tanks with the capacity to hold up to 8.6k cubic tons per tank, totalling 1.2 mn cubic tons in capacity upon completion, according to the statement. The tanks will be able to hold diesel, gas, heavy fuel, and other petroleum materials, the statement said.

This is all part of Saudi Arabia’s plans to boost its logistics infrastructure: The kingdom is planning to supply 10 mn tons of fuel to vessels transiting through and arriving to its ports, as well as increase the number of logistic zones across the kingdom by 2030, the statement said.

JEDCO unveils Jeddah airport expansion plan, including brand new logistics area

King Abdulaziz International Airport (KAIA) unveils USD 31 bn expansion plan: Jeddah Airports Company (Jedco) unveiled a plan to transform KAIA in Jeddah into one of the world’s largest airports, Meed reports. The expansion, which is scheduled to be completed in 2031, aims to increase the airport’s capacity to accommodate 114 mn passengers annually. The project includes the expansion of Terminal 1, the construction of a second terminal, as well as the development of a fourth runway, a new logistics area, a new baggage handling facility, and a new Hajj and Umrah terminal.

Logistics area: Jedco plans to develop a new logistics area, adjacent to the airport, covering more than 3 square kilometers adjacent to the airport. The area will include customs and service buildings as well as several leasable warehouses for private sector use, Meed reports, without clarifying the handling capacity of the area. The construction of these facilities will be implemented in phases, with an expected completion date in 2029.

Terminal 1will undergo infrastructure improvements, including the addition of new gates, air bridges, parking aprons, new baggage conveyor systems, and lounges in a bid to increase the airport’s passenger capacity by 15 mn. A new baggage handling facility will also be constructed next to the terminal to support the airport’s capacity expansion.The project is scheduled to start this year and is expected to be completed by 2026.

The construction of Terminal 2 aims to triple the airport’s total capacity to 114 mn passengers a year from 40 mn currently. The project involves the development of a brand-new terminal building equipped with multiple gates, taxiways, aprons, roads, utilities, and advanced baggage handling systems. The estimated cost of the terminal exceeds USD 10 bn, according to Meed, and construction is set to commence in 2026, with a target completion date in 2031.

Some “significant infrastructure relocation” could be needed to make way for a fourth runway, which Jedco plans to start construction for in 2025 and complete by 2029.

FAMCO rolls out new line of heavy-duty Volvo trucks for UAE

Al Futtaim Auto & Machinery Company (FAMCO) has launched a new range of heavy-duty Volvo freight trucks for buyers in the UAE, according to a statement. The latest range of Volvo FH, FM, and FMX designs come with improvements to safety, productivity, driver comfort, and fuel efficiency. They also offer gains in terms of operational savings and sustainability, the statement said.

The line’s flagship FH model features enhancements to driver safety and comfort, including an improved and more spacious driver cabin, featuring a dashboard that provides navigation assistance, transport information and camera monitoring. The Volvo FH also exhibits key improvements to fuel efficiency that help save up to 8% of fuel in a 100-tonne application, according to the statement, as well as new features designed to cut back on downtime and up efficiency.

The FM model exhibits improvements to driver comfort and visibility, including significant upgrades to the vehicle’s sleeper cabin, FAMCO continues. Other improvements to driver experience include a revised dashboard with an interactive, high-res 12-inch display, improvements to batteries and tyre-pressure monitoring.

The Volvo FMX — the line’s most robust model — features a gross vehicle weight (GVW) of 58 tonnes, making it the biggest GVW on offer in the Middle East, as per FAMCO’s statement. Aside from the baseline improvements to driver comfort, safety, visibility and performance, the Volvo FMX also comes with a redesigned cab platform that includes a new front section with easily replaceable parts. The latest FMX model also sees upgrades allowing it to carry more tonnage and maneuver more easily than previous iterations, changes that are in line with the FMX’s heavy duty uses in construction and mining.

FAMCO and Volvo have also partnered on software and maintenance, co-developing a support infrastructure that ensures timely deliveries of parts and skilled servicing to reduce downtime for deployed vehicles, the statement adds.

Morocco’s national carrier is looking to bolster fleet + add new routes

Royal Air Maroc is finalizing steps to acquire new long- and medium-haul aircraft ahead of an anticipated spike in Morocco’s tourism, Bloomberg reported. The national carrier is also angling to expand its network and add “many new routes” to destinations in Africa, Europe, and the Americas, Royal Air Maroc CEO Abdelhamid Addou told Bloomberg.

A bolstered fleet is pivotal to realizing the carrier’s ambition of going global, Addou said. It is also key to achieving Morocco’s full potential as a target for tourists and to expanding Air Maroc’s base at Casablanca into a transit hub for sub-Saharan traffic, which holds high promise, he explained.

Royal Air Maroc plans to fund its aircraft purchases through debt, Addou added, but declined to comment on whether this would involve a bond issuance. It is also unclear what proportion of the new aircraft and routes that are in the drawing books are slated for freight operations.

Qatar issues new customs duties on imported goods

Qatar’s Finance Ministry has updated its customs duties, with the newest introductions published in its Official Gazette this week, according to documents picked up by news outlet Asharq. The updated legislation concerns custom fees applied to imported and exported goods that enter or transit through Qatar’s customs. The most important updates are set out as follows:

Trucks and vessels will have to pay a customs fee of QAR 200, plus a QAR 25 fee per parcel, with a maximum fee of QAR 200 per customs declaration;
Storage and preservation fees for refrigerated and non-refrigerated goods are set at QAR 150 per truck for each day after the first 24 hours upon their arrival to the customs office;
An additional storage fee for refrigerated and non-refrigerated goods of 1% of the value of the goods for each day it stays in storage, with the maximum amount of fees not exceeding half of the value of the goods.

Qatar Airways Cargo is the first airline to complete and receive the IATA suite of perishables certifications. PLUS: Six logistics outfits made it in Forbes’ top 100 listed MENA companies list

Qatar Airways Cargo + Qatar Aviation Services become world’s first to complete suite of IATA perishables certifications: Qatar Airways Cargo and Qatar Aviation Services Cargo (QAS) have received the International Air Transport Association (IATA) Centre of Excellence for Independent Validators in Perishable Logistics (CEIV Fresh) certification, according to a press release. The certification highlights the cargo carrier’s ability to provide efficient and safe transportation solutions for perishable goods throughout the entire supply chain, including operational and technical aspects to ensure they maintain their quality and freshness, according to the release.

Not its first: The cargo handler has also attained IATA’s CEIV Fresh, CEIV Lithium Batteries, CEIV Live Animals, CEIV Pharma, and the environmental management system certification (IEnvA), according to the press release.

Six MENA-based logistics outfits are featured in Forbes’ list of the Middle East’stop 100 listed companies for 2023. High inflation and global turmoil which rattled global markets have had their impact on the region, sending the 2023 market value of the Middle East’s top 100 listed companies dropping 5% to USD 3.8 tn so far in 2023. The same companies however saw their sales jump 38.5% in the same period to top USD 1.1 tn and also saw their incomes increase 37.7% to USD 277.7 bn. Here’s the rundown:

The UAE’s AD Ports Groupranked 55th in the Middle East;
Kuwaiti logistics giant Agility came in right behind it at 56th regionally;
Qatari shipping and maritime company Nakilat ranked 67th regionally;
National Shipping Company of Saudi Arabia (Bahri) came in at number 70 in the region;
The region’s largest budget carrier,Emirates-based Air Arabia, ranked at number 87;
Qatar Navigation (Milaha) just made the cut at number 99.

Warehouses are getting humanoid robots

Robot developers are pushing the boundaries of what robots can do in warehouses: Companies are beginning to explore new ways to improve logistics operation beyond the use of disembodied arms, moving trays, and other machines, The Wall Street Journalreports. Several companies including Agility Robotics, Figure AI andBoston Dynamicsare creating human-like robots tailored for use in distribution centers to move around warehouses, reach items on high shelves, pick things up, and move boxes — pushing physical limits on automation in the industrial sector. Developers say their devices will help warehouse operators fill up roles in which there are labor shortfalls, and eliminate the need to redesign warehouses around machines’ capabilities, according to WSJ.

DP World to integrate SeaRates platform with Singapore’s C P World for small cargo owners. PLUS: News from Ecombo, AD Ports and Khalifa Port

FREIGHT-

DP World +C P World partner to provide small cargo owners with easy booking and shipment tracking: DP World’s online platform for cargo owners SeaRates and Singaporean logistics solutions and customs clearance provider C P World are integrating their platforms to digitize global trade logistics for small cargo owners, according to a press release. The partnership aims to provide streamlined logistics processes, real time information on container availability, pricing information, and enhanced efficiency to customers moving less than a full container load (LCL), according to the statement.

The service will be offered to SMEs, startups, and individuals, DP World COO Mike Bhaskaran said in the statement. The partnership will provide SeaRates customers with “access to exclusive ocean freights and schedules in over 30 countries,” which will be “advantageous for customers with seasonal or promotional products,” Bhaskaran added.

STARTUPS-

Egyptian social e-commerce network Ecombo is planning to raise a USD 10 mn investment round by the end of 2024to accelerate its growth in the Gulf region, Daily News Egypt reports. Its expansion strategy includes tapping into the Saudi and Omani markets within the coming days, Ecombo CEO Fares Senior said. The company, which has achieved sales of USD 1 mn in one year after starting with an investment of USD 500, has already acquired several warehouses in Oman and Saudi Arabia to serve as distribution and sale centers for its products.

CUSTOMS-

AD Ports inks agreement to boost Abu Dhabi’s digital customs services: AD Ports Group’s digital subsidiary, Maqta Gateway, inked an agreement with the General Administration of Customs in Abu Dhabi and the Abu Dhabi Department of Economic Development to offer digital customs services through the Advanced Trade and Logistics Platform (ATLP), particularly through the inspection and clearance services unit, according to a statement. The agreement aims to enable smooth customer experience for Abu Dhabi traders at eight border crossings in Abu Dhabi by allowing merchants and stakeholders to monitor the process of goods clearance.

ALSO WORTH KNOWING-

Khalifa Port’s CSP Abu Dhabi Terminal has received the M/V OOCL Spain,one of the world’s largest container vessels with a capacity of 24k TEUs. (Statement)

Airbus is delivering more aircraft than Boeing so far this year

Boeing is trailing behind Airbus on aircraft deliveries this year: Boeing delivered over 50 airplanesto buyers in May, up from 35 in April, but the aerospace giant still lags behind rival Airbus in terms of aircraft handed over this year, CNBC reports. This puts Boeing’s total aircraft deliveries for the year at 206, behind Airbus’ 244 deliveries so far this year, the business newswire reports. The aircraft manufacturer has suffered from several setbacks this year, as it attempts to keep pace with rebounding demand due to the busy summer travel seasons and the effect of the lifting of covid-19 restrictions.

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