Dry bulk vessels frequently call at new & unfamiliar ports. Harbor Lab is helping vessel operations teams evaluate their port agency and cost options more easily than ever before, writes Antonis Malaxianakis, CEO and founder, Harbor Lab.
How many different ports does a tramp dry bulk vessel call at every year and therefore how many relationships with port agents does a typical dry bulk operator need to manage? The simple answer is that every year a typical dry bulk vessel will call at a handful of ports at which it has never or rarely called at before and need to work with new counterparts to ensure an efficient, safe and cost-effective turn-around.
There are currently over 1,700 dry bulk cargo handling ports globally, out of a total of around 4,300 ports which are capable of handling 10,000dwt plus sized vessels. A typical versatile handysize vessel might undertake 15-20 voyages per year and a voyage might involve more than two port calls. Not all port calls involve cargo being loaded and discharged: there will also be port calls for bunkers to be taken on or repairs undertaken. Shipbroker Clarksons Research estimates that in 2018 the world’s top 20 ports accounted for 22% of all dry bulk vessel calls. Depending on the size of the shipping company, a vessel operations team might have a core of perhaps 10-20 ports which it knows intimately and at which its vessels call at regularly. In these ports the team members will know the right people, have long- standing relationships with good port agents and will probably be able to secure better rates for everything that the port call involves. But what happens at one of the other ports where the vessel might only call a couple of times in its life? Is the ship operator confident that it is really working with the right partners?
This is the problem which Harbor Lab was created to address and something which I saw during my time as a member of the Thenamaris and Product Shipping & Trading disbursement accounting teams. The software we have developed brings transparency to the shipowner and supports their decision making at ports where they are less familiar. It is also there to help improve the agent/owner relationship. This relationship is a critical dynamic which we are seeking to support and particularly important in the area of disbursement accounts.
Disbursement accounting is traditionally an administrative-heavy function that leaves in its wake complex calculations and communications trails through paperwork, phone-calls and emails.
Harbor Lab’s Disbursement Accounting Tool brings together shipowners and agents through a port directory and delivers visibility and efficiency to the entire process of selecting, nominating or appointing an agent, evaluating rates and checking port costs. Shipowners and operators can see the costs associated with each vessel call and can make choices based on this information: this can result in significant savings.
Streamlining processes ensure transparency across the board and makes all players accountable for what they do. Technology is now being incorporated across the supply chain to create more simplified and transparent procedures. Since 2019, data exchange between the port and ship is required in an electronic format as mandated by the International Maritime Organization’s (IMO) updated Facilitation of International Maritime Traffic (FAL Convention). At its most recent meeting in June, the committee also made it mandatory for public authorities to establish and maintain a ‘single window’ for electronic exchange of information for the stay, arrival and departure of ships in ports.
The digitalization of disbursements accounting is therefore a logical next step in an increasingly tech-heavy shipping environment.
With Harbor Lab’s solution, data and calculation methods are gathered and validated directly from ports around the globe by our team of port analysts.These are then digitalized through the online platform that is built on dynamic programming techniques and sophisticated formulae.
The cloud-based software is further supported by our recently-launched Port Cost Estimator that in seconds and in just one click calculates the cost for port expenses at a specific vessel’s port call.As a cloud-based technology, all users can access the tool on a web-browser, making it extremely simple to use on-the-go.
Crucially, these tools are designed to save ship operators time, money and reduce their back-office paperwork as all correspondence and quotes are held in the system and bring transparency to port costs. From the agent’s side it creates a level playing field as small agents can present their fees and capabilities alongside larger or more established businesses. Already our platform has attracted 1200 agents and vendors since it went live in March last year.
The information available through Harbor Lab’s platform is valuable for operators, no matter whether their vessel is heading for a regularly-called at or a one- off port. For those ports which the operator knows well, Harbor Lab’s platform gives them visibility of the official tariffs and expenses they should expect to pay and is an opportunity to negotiate on price and service. If it’s an unfamiliar port to the operator, then it provides accurate port data so that there are no surprises when finalizing fees with the agent.
At the same time, we have put the ship operator back in control, as they can oversee their expenses in house through their own disbursement accounting teams, or outsource the disbursements to Harbor Lab’s team of experienced analysts.
I believe that ship’s agents will continue to work alongside every type of ship in the years to come. The shipping industry’s general shift towards digitalization and the desire for more transparency and accountability will, however, inevitably result in more streamlined processes.And through Harbor Lab’s tools, port disbursements accounting is one area that is ready to be transformed.