Ports in Indonesia
Its Relationship and Impact
towards Logistics Cost
Content
The Problem : Quality of Infrastructure and the Logistics
Bottleneck
Marine Transport & Logistics : Links and Nodes
Connectivity
Accessibility : The Issues
Problem in Indonesia Port
Connectivity Cycle : Improve Connectivity and Decrease
Logistics Cost by Improving Links & Nodes Performance
Palaran Container Terminal Samarinda Project Case : How
to Reduce Logistics Cost by Improving Port Performance
Quality of Infrastructure
Global Competitiveness Report 2013-2014
Country
Port Quality
Road Quality
Singapore
6.8
6.2
Malaysia
5.4
5.4
Thailand
4.5
4.9
Indonesia
3.9
3.7
Vietnam
3.7
3.1
Philippines
3.4
3.6
Remarks : 1 = extremely under-developed, 7 = efficient by international standards
Even though they are key infrastructure for the archipelagic country,
Indonesian seaports are relatively small and outdated compared to other main
countries in South East Asia.
Connectivity to the hinterland : constrained with bad road condition and high
traffic density.
3
Road, Port & Logistics Flow
ROAD
Bottleneck
HINTERLAND
PORT
Bottleneck
VESSEL
LOGISTICS FLOW
RESULT :
Indonesia logistics cost is
27% from GDP,
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Logistics Cost Component
30.00%
25.00%
5%
20.00%
15.00%
10%
10.00%
5.00%
0.00%
12%
ADMINISTRATION COST
CIQP (Customs, Immigration,
Quarantine, Port) activities.
INVENTORY COST
49% Holding Cost
25% Risk & Damage Cost
26% Storage
TRANSPORTATION COST
72% Land
20% Water
1.5% Air
0.5% Rail
Total Logistics Cost di Indonesia 2011 : Rp. 1,829,669 Milyar
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Marine Transport & Logistics
Links and Nodes Connectivity
DESTINATION
Connectivity
ORIGIN
LINKS
NODES
LINKS
NODES
LINKS
Core concept of connectivity : How accessible is an area?
How easy to ship cargoes? How easy to move?
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Accessibility Index per Province
Connectivity Report on Domestic Shipping, Worldbank & ITS, 2012
Aceh
Sumatra
Utara
Riau
Sumatra
Barat
Gorontalo
Sulawesi
Barat
Kalimantan
Barat
Kalimantan
Tengah
Jambi
Sulawesi
Utara
Kalimantan
Timur
Kep
Riau
Sulawesi
Barat
Kep
Belitung
Sulawesi
Tengah
Papua
Barat
Maluku
Utara
Papua
Maluku
Sumatra
Selatan
Bengkulu
Kalimantan
Selatan
Lampung
Sulawesi
Tenggara
DKI
Jakarta
Banten
Jawa
Barat
Papua
Sulawesi
Selatan
Jawa
Tengah
Jawa
Timur
Bali
Map Legend:
Nusa
Tenggara
Barat
Nusa
Tenggara
Timur
Accessibility Index : Volume of seaborne trade compare to distance between point to
point. Impact of accessibility is highest logistics cost in the lowest accessibility index
area.
Accessibility Index per Province
VERY HIGH
HIGH
MEDIUM
LOW
300.00
250.00
200.00
150.00
100.00
50.00
Domestic Container Throughput
Volume in TEU/Month
Surabaya and Jakarta handle most of container boxes from and to many
destination. Disparity of throughput in JKT and SUB compare to other port
due to the center of production and industry still in JKT and SUB.
Frequency of Sailing
Source : ITS & World Bank, 2012
Surabaya have the main role as the center of logistics connection to distribute
the cargo to eastern part of Indonesia and Jakarta is the center of logistics of
western part of Indonesia.
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Impact of Low Accessibility in the Sea Freight
Source: Quotes from domestic logistic company, 2012
Impact of low accessibility index in Indonesia is higher sea freight from
Jakarta-Padang (1000 km) compare to Jakarta-Hamburg (10,000 km).
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Imbalance Trade
Surabaya
Eastern Indonesia Ports
Shipping Line space utilization : Headhaul vs Backhaul in Percent
Higher of freight to eastern of Indonesia due to imbalance trade between
headhaul and backhaul.
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Infrastructure of Indonesian Ports
Port
Problem
Draft (m)
Development Plan
Batam
6-8
Under-developed
Development of new container wharf
Belawan
7-9
Congestion
Additional wharf, dredging and terminal
equipment.
Development of New Port at Kuala Tanjung
Saturated and channel
sedimentation
Develop new port in upstream of Musi
River
4-6
Congestion and Channel
Sedimentation
Develop new port in Temajo, additional
equipment in existing terminal
Banjarmasin
4-9
Saturated and Channel
Sedimentation
Additional wharf and dredging
Samarinda
6-7
Saturated and channel
sedimentation
Channel dredging program and
Development of MultipurposeTerminal in
Palaran.
Makassar
3-12
Saturated
Develop Makassar New Port.
Kendari
7-9
Saturated
New Terminal development in
Bungkutoko.
Sorong
10-12
Limitation of Wharf and Yard
Additional Wharf and Container Yard
Palembang
3.5-8
Pontianak
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Demand on Deep Draft
Main problem of Indonesian port is the draft of the wharf still insufficient compare to
main port requirements (draft 15.2 m) and ASEAN Port requirement (draft 12.5 m).
With the low draft, port can only serve small vessel with low economic of scale. It will
impact in high sea freight level.
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Port Development Challenges
Labor regulation creates high
cost but low productivity
Concession Regulation still not
clear.
Low vertical & horizontal
coordination between
Government and DPRD
LEGAL
Land acquisition problem
ASPECT &
REGULATION
FINANCIAL
Limited Long Term Project
ASPECT
Financing : Long term Project
(50-75 years) financed by
short term loan (8 years)
Port tariff require approval
from Associations (INSA,
APBMI, ILFA) Ideally should
be decided by Regulator
Poor road connection to
hinterland creates high cost
Limited Navigation Aid
(provided by MOT) unable to
support 24/7 activity
SUPPORTING Limited Channel depth
(provided by MOT)
INFRA-
STRUCTURE
SOCIAL
ASPECT
Reluctance from existing
terminal stakeholders
(Stevedoring, Forwarding &
Trucking Company)
Reluctance from ORMAS / NGO
supported by Political Party using
Environmental & Social Issues
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Connectivity Cycle
Improve connectivity and decrease logistics cost by improve
the Links & Nodes performance.
Port
Productivity
and Efficiency
Vessel Port Stay
shorter
Turn Round
Voyage
decreases
Vessel Operation
Cost Decrease
Investment in
Port Increases
Cargo Volume
Increases
Sea Transport
Capacity
Increase
Sea Freight (FIO)
cost decreases
Demand
Increases
Goods price
declined
Logistics Cost
decreases
16
Project Case :
Palaran Container Terminal in Samarinda
New container terminal in Samarinda,
developed by BOT scheme and PPP
Project.
Captive market 170,000 teus in 2009
with 15% pa growth rate
Developed and operates by Private
Company, PT Samudera Indonesia Tbk.
Local government support for Access
Road and supporting facilities
Port authority support in access
channel maintenance
Exclusiveness to operate terminal
17
Project Case : Public Private Partnership
Palaran Container Terminal - Samarinda
OLD PORT
NEW PORT
18
Access Road Development
PREVIOUS CONDITION
2010
2011
Port highway access to hinterland
development
19
Reduce Administration Cost : E-Payment
Sophisticated terminal operation IT
System (ETOS), developed in-house
by Samudera Indonesia
Host-to-host Billing system in cooperation with Bank Mandiri
Benefits :
Minimize face-to-face payment
services and queues
Able to perform payment
transactions anywhere &
anytime by Electronic Payment
and/or ATM
Safer & more secure transaction
Bank reconciliation can be done
easily
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Palaran: Reduced Logistics Cost
Samarinda Port
(Old Port)
Variable
Palaran Port
(New Port)
Waiting Time
48 hours
4 hour
Port Service Time
12 hour per day
24 / 7
Gross Crane Productivity
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Port Stay
5-6 days
1-2 days
Dwelling Time
10 days
4 days
Around Trip Voyage (JKTSMD-JKT)
19 days
11 days
Potential call per vessel
per year
18 call
30 call
Freight Rate JKT-SMD
Rp. 9 Juta/teus
Rp. 4.5 Juta/teus
TPK Palaran can significantly improve productivity, reducing vessel operational cost
and resulting in decrease of shipping rates that will also reduce logistics costs, and
impact to the price of basic needs (penurunan harga kebutuhan pokok).
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Impact of Port Productivity
Improve 66% Sea Transport Capacity
by improving Turn Round Vessel
(TRV).
Reduce 50% Transportation/Freight
Cost by improving productivity
Reduce Administration Cost by IT
System implementation.
Reduce 60% Dwelling Time by
improving flow of goods.
LOGISTICS COST
Based on TPK Palaran experience,
the New Port Facilities impact :
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Sea-Toll Connectivity : Jokowis Proposal
ORIGIN
Improving Ports
connectivity
infrastructure
TOLL LAUT Connectivity
Improving
Ports
Infrastructure
Increasing Sea
Transport
Capacity
DESTINATION
National
Logistics
Efficiency
THANK YOU
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