COMM0DITY traders, especially those dealing with cotton, have benefited from increased supply chain efficiency and lower costs by shipping their goods with Maersk Line
Cotton traders make use of Maersk's lower costs, supply chain serviceCOMM0DITY traders, especially those dealing with cotton, have benefited from increased supply chain efficiency and lower costs by shipping their goods with Maersk Line and storing them in its main transshipment port in southeast Asia, the Port of Tanjung Pelepas in Johor, Malaysia.
Commodities such as cotton have typically been shipped from source to destination directly with a container shipment from Africa to China taking 35 days. By shipping the cotton and storing it in the Port of Tanjung Pelepas, it is much closer to customers in Asia. Traders can react to customers' orders on much shorter notice, and the cotton can be sent from Malaysia to China in seven days.Traders can sell the short-haul cotton at a premium over the traded price, because of the quick availability of the cotton to buyers and the lower risk of price fluctuations. It is also easier for traders to get bank financing because of the shortened time between placement of orders and receipt of goods by customers.
Maersk Line also offers the option of storing the commodity as shipped from origin at Tanjung Pelepas. There is no need to remove the cotton for storage in warehouses, and then re-stuff it into containers for shipment to destination, said the company statement.
"Warehousing includes storage and re-handling fees, and is more expensive especially in land-scarce Singapore. Storing the commodities in containers at the spacious and strategically-located Port of Tanjung Pelepas is a more cost effective alternative. We have successfully helped a trader which ships 2,000 containers of cotton a year to save S$1.7 million (US$1.3 million)," said Bjarne Foldager, Maersk Line cluster manager for Malaysia, Singapore and Brunei.