Facing the Financial Crisis: Petrochemical Logistics Opportunities Outweigh Challenges

Petrochemical products are important raw materials for production and consumer products. Under the impact of the global financial crisis, what are the trends in the development of petrochemical logistics? What are the opportunities and challenges? What improvements should be made to transportation and service management?
Experts in the industry are the linkage development of the industry of China's petrochemical logistics, the construction of high-quality logistics team, and the solution to the logistics industry policy problems.
At present, China's economic situation is generally good, but due to the financial crisis in the industry and the economic recession in Western countries, the logistics industry of China Petrochemical Corporation is facing challenges and opportunities. At the Fourth China Liquid Chemicals Logistics Summit recently held, government officials, corporate executives, and related experts analyzed the status, characteristics, and development trends of domestic petrochemical logistics.
The country has introduced major measures to stimulate domestic demand, so that many countries in the petrochemical logistics industry have introduced major measures to stimulate domestic demand, so that petrochemical logistics is facing favorable conditions. With the gradual recovery of demand for petrochemical products, more and more petrochemical companies have entrusted professional logistics companies to participate in transportation. Some logistics companies have also attracted petrochemical companies to win-win cooperation with their services and preferences. This is more of an opportunity than a challenge to the chemical logistics industry. First, China's petrochemical industry, which is the foundation of the national economy, has not changed its trend of high growth. In 2007, the increase in gross output value was greater than the increase in domestic GDP. Second, the previous international oil prices continued to fluctuate at a high level, which promoted the rise of coal-to-oil, coal-to-coal ether, coal-to-olefin and other new coal chemical and biofuels industries. The total production capacity of liquid chemicals and liquid fuels reached tens of millions of tons. Looking for new transport carriers and logistics service providers. Third, the establishment of chemical parks in various provinces and municipalities, the construction of coastal city freight terminals and ports, the laying of regional oil and gas pipeline networks, and the networking of expressways, and the need for modern logistics to support them. Fourth, multinational petrochemical companies are seeking supply chain partners. There have been as many as 2,000 foreign companies in China Petrochemical. Most of them have implemented logistics outsourcing. Fifth, some domestic large-scale petrochemical enterprises are under pressure from rising costs and are also considering logistics outsourcing.
The data shows that the number of global logistics service providers grows at an average rate of 20% per year, and that the United States and China have the fastest growth in logistics output value. Since last year, China's petrochemical logistics industry has shown a new phase of rapid growth. Global logistics has entered the supply chain era.
The linkage development of logistics and manufacturing, collaborative innovation, multinational companies want to go where their business, logistics service providers to follow where one of the characteristics of today's world economic development is the joint development of manufacturing and logistics services.
A topic of common concern for the petrochemical industry and society is how to efficiently and safely realize the entire process from the manufacture, distribution, and delivery of goods, and create the greatest profits at a lower overall cost.
Wang Xiaopeng, general manager of Shanghai Sinotrans Chemical International Logistics Co., Ltd., said that multinational companies formed strategic cooperative partnerships with large-scale integrated logistics companies, which is the development trend of international petrochemical logistics; multinational companies are increasingly emphasizing supply chain integration, service outsourcing, and making themselves stronger. The main core business, and where you want your business to go, where logistics service providers follow. Wang Xiaopeng said that recently McKinsey conducted domestic market research on domestic and foreign petrochemical companies. The results show that foreign companies generally prefer large-scale logistics service providers with good reputation, good assets, complete qualifications, and strong investment capacity. In outsourcing content, they tend to choose logistics outsourcing. When domestic-funded enterprises are relatively small, they generally adopt a “small and complete” organizational model. Recently, some enterprises have called for the establishment of a symbiotic and mutually beneficial relationship between "manufacturing and logistics cooperation and innovation" and have received response from the industry.
Establishing a symbiotic relationship between the logistics industry and the manufacturing industry is also a matter of consideration for safe storage and transportation. There are more than 100,000 petrochemical companies in China, producing more than 50,000 petrochemical products. In particular, the total volume of production, use, transportation, and import and export of hazardous chemicals is large and varied. To ensure safe transportation is the focus of the state and society, and the management and control of hazardous chemicals is also increasingly stricter internationally. Wang Xiaopeng said that transnational corporations are most concerned about HSE and risk prevention. They believe that only a security accident for a single trip will cause the company's social reputation to decline. Therefore, the original distribution of the business of more than a dozen logistics service companies will be borne by one or two reputable supply chain service providers.
At present, only 30% of domestic vehicles are transported using professional vehicles to transport hazardous chemicals. The development of a strong logistics industry has become an imperative. Currently, the challenges faced by China's petrochemical logistics are mainly due to too few high-quality large-scale logistics providers. Experts called for building a first-class petrochemical logistics company and deploying first-rate logistics equipment, which is a top priority for the healthy growth of the petrochemical logistics industry.
Wang Xiaopeng said that at present, only 30 percent of domestic vehicles are actually transported with hazardous chemicals. Among them are the reasons why transporters illegally obtained illegal profits, and more importantly, they could not find a qualified hazardous chemicals team in the area. In the next year or two, multinational companies such as Bayer and BASF will multiply their production capacity in China, and ordinary warehouses and vehicles will not be able to store and transport hazardous chemicals such as TDI and MDI. Wang Xiaopeng said that when many foreign companies choose logistics providers, they first look at whether they have the resources and high credibility.
Zhao Guoqiang, general manager of British Baoke Logistics (Beijing) Co., Ltd. stated that ten years ago, they entered China and started as agents. Now the business has expanded to four major areas. The target market is large petrochemical enterprises and multinational companies, mainly engaged in liquid petrochemical logistics and Bulk cargo flow. IBP has identified the huge potential of Sinopec's logistics market and plans to transfer equipment manufacturing to China within one year to provide tank containers and other equipment for domestic and Asia Pacific logistics merchants.
Tank containers can play a safe, efficient, and win-win performance in multimodal transport. A standard tank container can load 45% more liquid cargo than a standard container full of drums, and is quick and easy, from the place of production to the user "door-to-door" in one step.
Cracking down on policies and reform problems, solving China's lagging supply chain management, inadequate logistics facilities and equipment, etc. The State Council's "Several Opinions on Accelerating the Development of the Service Industry" issued last year is a major favorable policy for the development of the petrochemical logistics industry. Wang Ming, deputy chairman of the Institute of Integrated Transport of the National Development and Reform Commission and deputy president of the China Logistics Association, pointed out that the domestic petrochemical logistics industry has a bright future, but faces many problems that need to be resolved on the way forward. Mainly manifested in: institutional management, the existence of irrational policies; the market is not standardized, serious security risks, more accidents; logistics companies generally small scale, service capacity and resistance to risk is weak; customer concept behind, recessive The cost is too high.
In response to the bottleneck encountered in the development of multimodal transport of domestic tank containers, experts have proposed that China’s railways accept dangerous goods according to the “Rangerous Goods Name of Railway Dangerous Goods”, but it is not in line with international standards. We hope to expand the railway tank container business and give full play to the advantages of all-weather railways, large transport capacity, long distances, low freight rates, and extensive network coverage. It is recommended that relevant state departments formulate supportive policies, and on the basis of adopting safety and security measures, the multimodal transport of tank containers should be mainly carried out by land and sea transport, and be converted into sea, iron, and inland water joint transport.
Regarding the establishment of a logistics risk management system, Gao Fuxing, general manager of Changjiang International Port Co., Ltd. of the Zhangjiagang Free Trade Zone, proposed that since the country's macro-control and tight foreign trade policies have affected this year, the capital chain of some traders has been interrupted, warning that we should consider establishing a cargo control system. Management system, including risk identification, risk analysis, risk planning, risk internal control management, etc.
In order to solve the problems of China's backward supply chain management, inadequate logistics facilities, and inadequate logistics equipment, Wang Ming and other experts put forward proposals for deepening reforms: through the integration of social logistics resources, the central government, local governments, foreign capital, and private enterprises must be motivated to achieve linkage development; Capital investment, to build a large number of high-quality petrochemical supply chain of large service providers; for petrochemical companies in the scale, the park, and production, the market has regional characteristics, the establishment of large port logistics information and e-commerce platform to achieve the Yangtze River Delta , Pearl River Delta and the Bohai Rim logistics area linkage; to adapt to service outsourcing needs, to encourage logistics business centralized procurement, warehousing, transportation (ports, railways) and distribution (highway), through the establishment of a station + transportation + warehousing model for petrochemical enterprises Production or sales provide supply chain services based on logistics parks, logistics centers and distribution centers; logistics associations carry out pilots for comprehensive assessment of logistics companies and qualifications of logisticians, collaborate with universities to develop talents, and advance senior logistics management personnel with international standards. .

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