Industry Insights: Logistics
Logistics companies see Malaysia’s potential as a growing distribution hub for the region
Steinweg Group expects Malaysia to grow its transshipping volumes:
“Malaysia's position as a transshipment center is critical for the Asia-Pacific region. After Singapore, Port Klang is the second-biggest port in the area. Industry demand has already exceeded Singapore's production capacity. In the last decade, many olefins, originating mainly from the Middle East, passed via Singapore to export destinations in Southeast Asia. Now, a great deal more of the same material is passing through Port Klang. A similar pattern may also be found in the trade of more complex, packed chemicals. Our expansion strategy centers on Southeast Asia, as it estimates that by 2030, 60% to 65% of global chemical trades will occur there.”
Josef Müller, Director Business Development, Chemicals, Steinweg Group
Leschaco inaugurated a new general and dangerous goods warehouse facility in Malaysia:
“Inaugurated in 2021, the 128,000 sft warehouse has three times the capacity of what we managed before. The warehouse was specifically designed for chemicals including DGs, with everything from the makeup of the walls, which need to withstand certain heat intensities, to the containment installations inside the warehouse to prevent outside spillage. Moving forward, we already have plans to increase capacity for 2024 and beyond. Also, Leschaco Malaysia is focused on increasing our footprint in Johor, where we currently have a sales office.”
Lothar Lauszat, Managing Director, Leschaco Malaysia
Talke Logistics chose Port Klang in Malaysia for its first warehouse in the region, currently under construction:
“We identified a gap in the market for world-class facilities to handle palletised chemicals in containers as well as DGs. We therefore decided to build a DG facility to start with, and, as a second phase, build a general warehouse catering to petrochemical products from polymer resins to specialty polymers coming from the US and the Middle East. The construction is underway for an 18,000 m2 facility made of seven chambers – four of which are temperature controlled - with a total capacity of 26,000 pellets. The warehouse can handle both non-DGs and DGs, with the only exception of Class 1 (explosives) and Class 7 (radioactive). Additionally, one area will also be dedicated to drumming, labeling, and repackaging for cargoes that come through ISO tanks. Strategically located within the port, the warehouse will serve the regional distribution of chemicals coming from the US, Europe, the Middle East, and, to some extent, China, into the domestic market and the wider region, including India, Australia, and Far East Countries.”
Vijaya Kumar Puspowanam, Managing Director, TALKE Logistics Malaysia
Manuport Logistics consolidates its position in Southeast Asia through the opening of an office in Singapore, while also looking to expand in Malaysia, Thailand, and Japan:
“Southeast Asia is becoming increasingly important to us. In Singapore, we have a JV with SPI Marine, a parcel tanker broker. We are now excited to open our own office, officially inaugurated on the 21st of April this year. Once we control a sizeable volume in a region, as we do now in Singapore, we prefer to establish a direct presence and capture more EBITDA internally instead of working through intermediaries, like a brokering agency. Already with large volumes in Penang, Malaysia, as well as in Alabang, the Philippines and Semaring in Indonesia, we will next be moving into these three countries, before creating similar setups in Japan and Thailand. These expansions will be realized through a mix of organic growth and M&A.”
Guy Pasmans, CEO, Manuport Logistics (MPL)
CLLB is working to position Malaysia as a hub for DGs, chemicals, and capacity building in ASEAN:
“Malaysia is the only country in Asia that mandates industries to contribute 1% of their staff salary into a fund utilized for training. I believe the country has a real potential to become a logistics hub for DGs (dangerous goods). Malaysia’s regulation is probably the most advanced in ASEAN, after Singapore, so it makes sense to develop training programs in other countries to harmonize standards across the region. The DG regulatory framework in Malaysia is driven by International regulations and the highest level of compliance and enforcement of DG is via air transportation. For the maritime sector, despite having the IMDG Code mentioned in a number of the countries Port Authority By-Laws, only a few authorities actually enforce the compliance of the rules. When it comes to road transport of DG, in Malaysia the rules developed are incomplete. Storage of DG regulations for 3rd party logistics providers need also to be fully developed.”