Norwegian company Wallenius Wilhelmsen specialises in the international shipping and logistics of rolling equipment, including cars, agriculture, mining and construction equipment. They own and operate the world’s largest fleet of 125 Roll-on/Roll-off (RoRo) vessels, service 15 trade routes, operate 60 processing centres and 8 marine RoRo terminals.
Industries worldwide have experienced a rollercoaster ride navigating the post-COVID world, but it’s not all doom and gloom — businesses are working to stabilise and are increasingly confident about the future. For Wallenius Wilhelmsen, this means addressing complex global supply chain issues and exploring solutions for their valued customers. We spoke with Senior Vice President of Logistics Services Kim Buøy to get the latest on this critical industry.
What have been the key disruptors to the global supply-chain?
We can trace the current disruptions to three major factors. Firstly, the Covid pandemic, which resulted in severe manufacturing disruptions globally, including labour (and stevedore) shortages, production of semiconductors and delays in building ships.
Secondly, environmental challenges have resulted in higher infrastructure cost, the need to future-proof any new investments, higher fuel prices, new environmental regulations and issues, such as water levels in the Panama Canal. Finally, geopolitical factors, such as war in Ukraine, trade wars and disruptions in the Middle East have all played a part.
What is the current status of the global supply chain?
There is still an imbalance between available RoRo ship capacity and market/cargo demand. This is still impacting shipping capacity to Australia, resulting in less frequency and reliability of shipping options, particularly for agriculture equipment, such as tractors and combine harvesters coming from Europe and the Americas.
Port delays are still a major issue on the east coast of Australia, with some vessels having to wait for up to two weeks. There are two drivers for these delays — including the build up of cargoes on the wharf failing bio-security surveys from the Department of Agriculture, Fisheries and Forestry (DAFF); and delays in moving cargo off the wharf due to limited trucking capacity.
New environmental regulations coming into effect from January 1st are also representing challenges for
the current global fleet This includes, among others, requirements to clean the hull prior arriving into Australia and measures to reduce emissions.
The ongoing war in Ukraine, the situation in the Middle East and other geo-political issues are also impacting the reliability of the global supply chain.
What steps have you taken to help mitigate the disruption?
We are working hard to address these issues through several avenues. Last week, we signed a contract to build four new vessels, with options of eight more. The vessels will be ready to run on methanol and have capacity to carry 9,300 units. The first vessel will be delivered in 2026.
We have a global task-force working on a range of initiatives towards the target of offering a carbon neutral supply chain by 2027. We are expanding our terminal capacity in Europe (Zebrugge) and US East Coast (Brunswick); we are investing in technology/ systems to better optimise our assets and supply chain; and we are investing in electrifying our Terminal and Trucking Fleet, where such equipment is available.
In Australia, we have, among others, also recently opened our new processing facility in Brisbane, including increasing processing and storage capacity by 30 percent. We have invested in equipment (including eight hoists) to improve the bio-security process at Melbourne International RoRo Automotive Terminal; and we have invested in a DAFF quarantine- approved facility at Laverton in Melbourne.
Wallenius Wilhelmsen wants to be active in shaping the industry, rather than sitting back and doing nothing. Consequently, we are investing a lot in systems, people and processes to make sure we can remain in the forefront. This is also why we have named our new class of vessels “The Shaper Class”.
What does the next 12 months look like?
If we look at the market, given recent developments in the Middle East, we expect ongoing volatility and we need to be flexible. We will see an accelerated focus on the environment and the need to decarbonisation the supply chain. Tight capacity in vessels and port congestion will persist.
We anticipate incremental improvements to the supply chain and timelines for getting products to Australia — but unfortunately, getting back to normal in the next 12 to 18 months seems unlikely due to the significant lag in vessel capacity, ongoing port congestion and the highly volatile global market.
Visibility and transparency within the supply chain are increasingly critical. We’re enhancing our systems to offer customers better insight into bottlenecks, enabling them to plan effectively. Predicting issues is the challenge, but preparation and flexibility are essential to mitigate impacts on businesses. With a global network spanning all continents, our customer service department maintains ongoing communication with customers, providing updates to support you as best we can.
Global supply chains are not getting any less complex, and the geo- political issues are only increasing.
To ensure our future success we all need to work together. Frequent and transparent communication is key. Let’s continue to talk, share and do more of it — it’s the only way. For a lot of grain growers, annual planting decisions are guided by familiar routines and the long-range weather outlook.
To learn more, visit walleniuswilhelmsen.com