UK’s link to the world: Liverpool’s new container terminal
The city of Liverpool has opened a massive £400m container terminal, dubbed Liverpool2, making the city the UK’s “link to the world”, according to Secretary of State for International Trade, Liam Fox. How did this come about and what is its significance for northern England’s economy?
Upon officially opening Liverpool2 last year, the UK’s Secretary of State for International Trade, Liam Fox, proclaimed: “The north is booming once more and the world wants in. And this is the gateway.”
He didn’t stop there, continuing that the people of Liverpool will “stare uncomprehendingly at the scale of this superport, awed by the vast ships that will be able to dock here”. The country, he assured the public, “stands on the verge of a bright new future and Liverpool is her link to the world.”
Mark Whitworth, chief executive of Peel Ports, which owns the Port of Liverpool, added his own Fox-esque statement: “Liverpool is back in the international game.”
That’s quite a status to live up to, but at ten years in the making, those at Peel Ports have had plenty of time to formulate their strategy. A strategy that has seen £400m pumped into expanding the UK’s largest transatlantic port, which they hope will create one of Europe's most advanced container terminals.
Futureproofing the terminal
“It's easy to build terminals for less money,” explains David Huck, port director, Peel Ports. “However, in this market you need to guarantee you are operating at the highest level. We wanted to make sure that Liverpool2 wasn't just a copy of what most ports have done for a number of years.” That means always looking to the future, adds Huck.
Liverpool2 allows the Port of Liverpool to handle two 18,000 twenty-foot equivalent unit (TEU) post-Panamax vessels simultaneously, a substantial increase on the previous 4,500 TEU. “In the future, could we handle deeper, bigger vessels? Potentially yes we could,” says Huck. “We could also retrofit future crane technology.”
However, for now the terminal has five huge ship-to-shore (STS) cranes and 12 cantilever rail-mounted gantry (CRMG) cranes, which will increase to eight STS cranes and 22 CRMGs over the coming months and years. There’s also a 16.5m deep berth, the equivalent of 3.7 double decker buses stacked on top of each other.
Since the November opening: “We've been putting ever increasing volumes through the terminal,” says Huck, “testing the algorithms, and getting the terminal teams used to operating in a new environment.”
This, he adds, is probably the most complex and difficult transition to Liverpool2. An upgrade on the technology and level of automation means changing how cargo is handled, from a straddle operation to a tug and trailer format. Peel Ports has invested £3m for a fleet of 30 tugs and trailers.
As for automation, Huck notes: “The CRMGs are approximately two miles away from the terminal and are operated remotely by joystick control. That's really what we're looking at over the next few months.” This constitutes a fundamental shift in how the port works.
There will be plenty of learning and fine tuning over the coming months. At the time of writing, Huck confirms that Liverpool2 is not operating at 100%, describing its current status as “advanced commissioning.”
So, when will the port reach 100% operational capacity? “Probably over the next couple of months,” he says. “It's very difficult to put an exact date on it, but we are ahead of our plan. We are already in full automation on some of the CRMGs and we have new crane simulators.”
Welcoming trade to Liverpool2
Any slight teething problems that this transition causes will, nonetheless, be worth it to get Liverpool “back in the international game” as Whitworth described earlier. But why did the city fall from such a status in the first place?
“Capability,” says Huck. “From a container perspective and before Liverpool2, the size of vessel we could handle was about 4,500 TEU.” With the era of mega ships well and truly here, the need to expand was obvious, adds Huck.
He continues: “Liverpool2 puts us back in the game. Now we can handle the bigger ships and the trade routes can return. The real driver has always been the market. There's a natural cargo base here in the north, with the Liverpool-Manchester corridor.”
This plays into the bigger point of what Liverpool2 means for the north of England and the government’s much-hyped idea of a ‘northern powerhouse’, which aims to boost investment and create economic growth in the region. In late January, Prime Minister Theresa May announced a £556m boost for the project, with £72m going to the Liverpool city region and £130.1m to Greater Manchester. Some local councils have voiced their concerns that Manchester in particular is receiving more investment per head than other regions. But, whatever the personal opinions are, it’s the business brain that leads on this issue.
Huck believes Liverpool2 has a “key part to play” in the overall agenda, adding: “The infrastructure is fairly strong in the north. The connectivity of Liverpool, Manchester, Leeds – you put those three together and there's a lot of power there in terms of size.”
Liverpool, therefore, is all about re-balancing the economy, adds Huck, although “it's not us saying we want to be the dominant force”. He also highlights the fact that Liverpool is on the west coast “directly facing the US”. Andrew Gossage, managing director at Ultimate Products, a branding, sourcing and distribution company, believes that if the UK and US strike a trade deal, “having Liverpool2 could be particularly useful”.
He adds: “It’s crucial for the north-west generally, and the north as a whole, to have a container terminal of this size and capability, especially as it opens up the potential for the trade links it should have, such as with the Far East.”
Guy Platten, CEO at the UK Chamber of Shipping, is equally positive about a potential boost to trade, labelling it vital for the economy that the world’s largest ships have the ability to call at UK ports.
“The potential for the region is huge,” he says. But in these uncertain times, with Brexit and talk of protectionist policies in the US, does such a development take on added importance? “UK trade should form a key part of the country’s industrial strategy,” explains Platten, who admits that exiting the European Union could change “the nature of trading relationships, the regulatory environment that manages them, and the reputation of the UK as an outward-looking, global nation”.
Platten and Huck agree that the maritime sector can be pivotal to giving some credibility to the oft-quoted phrase of the UK being “open for business”. Huck is also buoyed by what the next year or two will bring for Liverpool2. “Busy times, but also exciting times,” he says.