March 1st, 2021

Why we must invest in terminal automation today

Guest blog with Christopher Saavedra, Terminal design service manager at Kalmar.

If ports and terminals are to meet the growing list of requirements needed for greener operations, the deployment of increasingly eco-efficient solutions and implementation of different levels of automation are necessary. Christopher Saavedra, Terminal Design Service Manager at Kalmar, shares his market insights, and why he thinks sustainable designs and automation will unlock the maritime hubs of the future.

In previous years, automation’s increase in both prevalence and perceived value has been hard to miss. Before I joined Kalmar in early 2019, I held many different positions leading port automation projects. While the industry focuses on the big automation projects, in Rotterdam, Germany or Australia, there are many other terminals that have seen big gains from process and equipment automation. For example, terminals that use Optical Character Recognition (OCR) technology to help automate delivery and drop off containers, have reported an increase of gate transactions, reduction in errors and truck turnaround times. Despite these clear improvements, the reality is that many of the comparable industries, such as warehousing, are at a much more advanced state of adoption of automation.

Although I have already seen a huge change in the prioritisation and industry advancement of automation, the maritime industry remains at risk of falling behind and failing to reap associated benefits, such as improved safety, better customer service and a reduction of errors.

Automation and COVID-19

Over the last decade, we have seen the integration of automation in ports and terminals grow slowly in comparison to other sectors. This is largely due to the shipping industry’s conservative nature, siloed operations, and the avoidance of up-front capital expenditures. Likewise, the amount of global greenfield projects has decreased, and automation deployment and investment is still in some cases viewed as complicated, risky and expensive.

From my position at Kalmar, I can see that while process and equipment automation is becoming more widely used, automation’s growth is being constrained by a disconnect between perception and reality.

Take process automation as an example. Those who have not invested in it frequently cite a number of reasons: “There’s shortage of in-house capability,” “Our data isn’t good enough,” or “The technology has difficulty handling exceptions.”

None of these challenges are insurmountable. In my experience, most of them require very little to fix. When COVID-secure working practises were introduced in early 2020 and remote operations became a necessity, it quickly became clear from the productivity statistics who had invested in process automation.

When the next supply chain shock comes – and there will be others – the agile decision-making and adaptability that automation enables will lead to far greater commercial resiliency. The next unforeseen circumstance is unlikely to be a global pandemic, but it doesn’t have to be to cause significant disruption. A failure to invest in preparedness for future disruptions will be measured in workplace accidents, inefficiencies, and lower credit ratings.

Total integration

At Kalmar, we understand that sustainability and cost-effectiveness are critical for ensuring uptake, evolving ports and terminals globally. To maximise the return on investment, we take a holistic approach to our design projects, which consist of three phases.

During the first phase we assess different design layout options and propose tailored solutions based upon customer requirements. In the second phase, we distinguish the business case for these solutions; taking into account the cost, safety, operational and environmental benefits. Moreover, in the final phase, which is a proof of concept via simulation, we create a 3D concept model and compare our design against the customer’s KPIs.

We consider a wide range of eco-efficient and automated solutions in our designs. Besides the handling equipment offering, other energy efficient technologies, such as Midstream Lighting’s LED lighting solutions, often play a key role. For example, the right lighting is critical to the smooth and safe running of a port. However, most ports are still using high-pressure sodium, metal halide, or other antiquated technologies that underperform their specifications within months of installation.

Midstream’s LED lighting not only has a typical payback period of less than two years, but it also increases energy efficiency, enables a safer working environment, and has a multiplier effect on the value of a port’s other infrastructure investments. The design of the lighting needs to be also considered in combination of the equipment type and automation mode selection and must be built into the business case.

The terminal of today

Looking to the future, I expect to see owners and operators increasingly investing in eco-efficient solutions and different levels of automation, using technologies such as LED lighting to illuminate the path to greener operations. Especially with end consumers set to increasingly favour a low CO2 footprint in the overseas shipping of their products.
The ideal ‘terminal of today’ is therefore one, which is eco-efficient, flexible, optimised in all areas and led by data driven decisions. Setting the standard for the maritime hubs of the future requires us to nail process automation now, and increase efficiencies throughout the entire supply chain.

Christopher Saavedra guest blog Midstream Lighting

Christopher Saavedra, Terminal Design Service Manager, Kalmar

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