Logistics and supply chain industry trends Oman - Mahmood Sakhi Albalushi- March 2023.pdf

Mahmood Sakhi Albalushi
CEO
Al Madina Logistics Co.
Al Madina Dry Port Terminals
Bayanat Technology
CEO
Bayanat Technology
Logistics and supply chain Market
Oman and the World
March 2023
1

2
Oman’s Logistics Strategy
Oman’s Logistics Landscape
Shipping & Seaports
The Market Trends
Logistics & Supply Chain Basics
Topics

Mahmood Sakhi Albalushi 2023 Logistics and supply chain – Oman and Global
Oman
The Logistics Hub
Locally, Regionally, and Globally
Oman Logistics
Strategy 2040
(SOLS2040)
2015
3

Macro-Environment
Global & Regional
Economic Outlook
Competitive
Advantage
Socio-Economic
Development
Fiscal
Framework
Oil & Gas
Social
&
Sustainability
Themes
Economic
Sectors
Core
Diversific
ation
Enablers
Manufacturing
Logistics Tourism Fisheries Mining
Financial Services
Education Healthcare
Utilities
Business Environment
Private Sector Development/SMEs
Environment Protection, Sustainable
Development and Prevention of Natural
Disasters
Employment
Science, Technology &
Innovation
Regional Development
ICT
Other Social
Development
Youth
Machinery of Government and E-Government
Oman’s 9th & 10th Development Plan
Sources: Oman Development Plans
4

Market
• New Markets.
• Exports & Re-Exports.
• Attract New FDIs.
• Leverage FTAs.
Human Capital
• Employment Legislations.
• Industry-academia Collaboration.
• Logistics as Career.
• Int’l Best Practices.
Technology
• Enhance IT Infrastructure
• Enhance IT Regulations
• Leverage Technology
Trade Facilitation
• Licensing Processes.
• Operational Processes
• Finance Mechanism & Trade Conduct.
• Economic & Free Zones, FTAs
- Infrastructure
- Internet Quality & Cost
- Public Sector Efficiency
- Regulations
Sultanate of Oman Logistics Strategy 2040 (SOLS2040)
2015
Strategy Main
Objectives:
5
To monitor and support the
implementation of the
Oman Logistics Strategy 2040
Working on:
- developing logistics
capabilities.
- Making Oman a global
logistics hub.
Sources: SOLS2040, MoTCT, OCL

30,000
80,000
200,000
300,000
0
50,000
100,000
150,000
200,000
250,000
300,000
2015 2020 2030 2040
Jobs Opportunities
*O: 20,000
E: 60,000
*O:15,000
E:52,000
* Actuals
Sources of data: SOLS2040, NCSI
Workforce
targets vs actuals:
% T&S in
Private Sector
6%
% of Other
Sectors in
Private Sector
94%
91,772
1,608,728
Total Private
Sector
Workforce
2022 % of
Omanis in
T&S
24%
% of
Expats in
T&S
76% 69,110
22,662
-
20,000
40,000
60,000
80,000
100,000
120,000
2015 2016 2017 2018 2019 2020 2021 2022
Omanis in Transport&Storage Expats in Transport&Storage
Workforce in Transport & Storage Workforce in Transport & Storage
6

2014
R.O. 1.5b
2020
R.O.
3.0b
2030
R.O.
8.0b
2040
R.O.
14.0b
Logistics Contribution to GDP
* R.O.
1.2b * Actuals
Sources of Data: SOLS2040, NCSI
SOLS 2040 GDP KPIs
1,046
1,146 1,193 1,215 1,212
1,273
1,927
10% 4%
2% 0%
5%
51%
4% 4% 4%
4%
4% 4% 4%
-10%
0%
10%
20%
30%
40%
50%
60%
-
500
1,000
1,500
2,000
2,500
2016 2017 2018 2019 2020 2021 2022
Oman Transport & Storage GDP
Transport&Storage Growth T&S Transport&Storage % of GDP
7

Main SOLS 2040: Oman LPI
Sources of Data: SOLS2040, LPI
0
10
20
30
40
50
60
70
2007 2010 2012 2014 2016 2018 2020 2030 2040
Oman LPI Rank
30
10
20
46
0
20
40
60
80
0.00
1.00
2.00
3.00
4.00
2007 2010 2012 2014 2016 2018
Customs
score rank
0
20
40
60
0.00
1.00
2.00
3.00
4.00
2007 2010 2012 2014 2016 2018
Infrastructure
score rank
0
50
100
150
0.00
1.00
2.00
3.00
4.00
2007 2010 2012 2014 2016 2018
Int'l Shipments
score rank
0
50
100
150
0.00
1.00
2.00
3.00
4.00
2007 2010 2012 2014 2016 2018
Quality of Logistics Services
score rank
0
50
100
150
200
0.00
1.00
2.00
3.00
4.00
2007 2010 2012 2014 2016 2018
Tracking & Tracing
score rank
0
50
100
0.00
2.00
4.00
6.00
2007 2010 2012 2014 2016 2018
Timeliness
score rank
Logistics Performance Index
8

Oman
The Logistics Hub
Oman Logistics
Landscape
9

Potential Investment Opportunities:
- Logistics Services,
- Supply Chain Services,
- Bonded Facilities,
- Dry Ports
- Distribution Centers,
- Oil Storage Farms,
- Air Cargo,
Special Economic Zones Free Trade & Industrial Zones
Industrial Estates
Logistics Parks
Bonded Warehouses
Air Cargo Hubs Distribution Centers
Dry Ports
Oil Storage Farms
Oman – Logistics Clusters
Economic Zones Authority
Asyad Group
Airports
Sources: MoTCT, Free Zones, Madayn, Oman Airports
10

Almadina Logistics: Dry Ports & Bonded Facilities
Muscat Container Depot
(MCD) is the 1st Inland/Dry
Port in Oman, established in
2010.
Located at Barka.
It also includes:
- CFS Services.
- FCL Inspection Services.
- Bonded Services.
Mazunah Dry Port is the latest
project by Almadina Logistics.
Located at Mazunah Free Zone
on the border with Yemen.
Almadina Logistics developed
Sohar Logistics Hub to provide
comprehensive inspection services
for all export and import goods.
Khazaen Dry Port is joint
venture with Asyad Marafi and
other investors to develop and
operate a dry port in Khazaen
Economic City.
Source: Almadina Logistics
11

Sohar Logistics Hub: Unique Inspection Hub
To Improve the quality of food and related
products, Sohar Logistics Hub is a unique dry
port and one-stop-shop to handle all such
shipments.
SLH helps enhance Oman’s position in logistics
and increased exports.
Source: Almadina Logistics – Sohar Logistics Hub
12

GCC Railway Intermodal Logistics:
Passenger: 200km
Cargo: 120km
Oman Rail – New Intermodal Transportation Mode
Sources: MoTCT, Asyad Group, Oman Rail
13
Established a new entity:
UAE-Oman Rail Company
Phase I: AbuDhabi – Sohar

Oman
The Logistics Hub
Shipping & Seaports
14

Source: Atlas du Monde Diplomatique, ISEMAR
Major Trade Routes, Internal & External Logistics
49%
51%
53%
47%
10
%
90
%
12
%
88
%
26%
74%
71%
29%
Internal Trade External Trade
Internal Trade vs External Trades
15

Oman’s Exports, Imports and Re-Exports
Non-Oil Export
Net Import
Re-Export
% of Import
7%
Re-Export
Import
23%
21%
26%
19%
23%
20%
19%
16%
22%
9%
7%
0%
5%
10%
15%
20%
25%
30%
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022e
Non-Oil Exports, Imports & Re-Exports
Non-Oil Export Import Re-Export Net Import Re-Export % of Imports
Source: NCSI, Author Analysis
16

Resilience of Salalah & Sohar Ports Performance
Resilience Performance by
Omani Ports despite the
Covid-19
Sources of Data: Salalah Port & Sohar Port annual reports
-
200,000
400,000
600,000
800,000
1,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Sohar Port - TEUs
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Salalah Port - TEUs
17

Major Seaport Clusters: Oman’s Logistics Potentials
Sources of Data: Ports Annual Reports, Port Management
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
Ports TEUs Handled
2011 2012 2013 2014 2015 2016
18

Major Shipping Lines Alliances
Market
Share
Capacity TEUs
No of Ships
HQ
Shipping Lines
The Alliance
16.9%
4,097,898
705
Denmark
Maersk Line
2M Alliance:
16.0%
3,860,388
579
Switzerland
MSC
32.9%
12.5%
3,022,882
503
China
COSCO & OOCL
Ocean Alliance:
12.5%
3,015,485
570
France
CMA CGM
30.3%
5.3%
1,279,412
195
Taiwan
Evergreen
7.2%
1,730,615
240
Germany
Hapag-Lloyd
The Alliance:
6.5%
1,577,156
218
Japan
ONE
19.3%
2.6%
623,148
92
Taiwan
Yang Ming
3.0%
719,026
72
South Korea
HMM
Alliances are
changing the name of the
Game.
Controlling 82.5%
Source: Logistics Management
19

800
2,500
3,400
4,500
7,100
8,100
9,600
12,500
15,000
19,000
19,100
21,400
22,000 +
-
5,000
10,000
15,000
20,000
25,000
1960 1970 1980 1985 1996 1997 2001 2004 2006 2013 2015 2017 2018
Ship TEUs Capacity
Source: Data from Annual Reports, IPH World Report, Ports Statistics, JOC
Evolution of Containership Sizes & Ports
20

New Challenges: New Intermodal Modes
21

New Challenges: New Intermodal Modes
Chinese One Road, One Belt
22

Container Freight Prices: New Disruption
Covid-19 Impacts:
Extraordinary hikes in the
shipping freight charges,
And great decline.
Sources of data: Shanghai Index, UNCTAD
-
2,000
4,000
6,000
8,000
10,000
12,000
Jan-16
Mar-16
May-16
Jul-16
Sep-16
Nov-16
Jan-17
Mar-17
May-17
Jul-17
Sep-17
Nov-17
Jan-18
Mar-18
May-18
Jul-18
Sep-18
Nov-18
Jan-19
Mar-19
May-19
Jul-19
Sep-19
Nov-19
Jan-20
Mar-20
May-20
Jul-20
Sep-20
Nov-20
Jan-21
Mar-21
May-21
Jul-21
Sep-21
Nov-21
Jan-22
Mar-22
May-22
Jul-22
Sep-22
Nov-22
Shipping Freight Rates for Containers
Shanghai Index WorldContainerIndex
23

Oman
The Logistics Hub
The Market Trends
24

GCC E-Commerce
Sources of data: A.T. Kearney, IATA
0
5
10
15
20
25
2015 2016 2017 2018 2019 2020 2021 2022e 2023e 2024e 2025e
GCC E-Commerce ($Billion)
Saudi UAE Qatar Kuwait Bahrain Oman
Saudi
34%
UAE
36%
Qatar
9%
Kuwait
15%
Bahrain
4%
Oman
2%
2015
Saudi
45%
2020
UAE
31%
Qatar
9%
Kuwait
9%
Bahrain
4%
Oman
2%
2020
Saudi
42%
UAE
34%
Qatar
10%
Kuwait
6%
Bahrain
5% Oman
3%
2025
2025e
2020
2015
Country
21
11
1.8
Saudi
17
7
1.9
UAE
5
2
0.5
Qatar
3.2
2
0.8
Kuwait
2.3
1.4
0.2
Bahrain
1.5
0.6
0.1
Oman
50.00
24.00
5.30
GCC
25

GCC E-Commerce
Source: A.T. Kearney Analysis
26

Air Cargo Growth
640
580 550
1,770
1,260
920
830
3,010
-
500
1,000
1,500
2,000
2,500
3,000
3,500
Standard-body
Conversions
Medium-widebody
Production
Large-widebody
Production
Total
Global Air Cargo Freighters Growth
2015 2035
70%
Source of data: Boeing Report
38%
25%
11%
7%
5%
4% 10%
Middle East Air Cargo Partners
2,335,000 Tons
Europe
Asia Pacific
North America
South Asia
Middle East
Africa
Other
27

Oman Airports: Air Cargo
Muscat Airport continues
to grow.
New Airport in 2018.
Salalah Airport remained
almost the same despite
the new airport and cargo
building.
New Airport in 2015
-
50,000
100,000
150,000
200,000
250,000
300,000
2012 2013 2014 2015 2016 2017 2018 2019
Muscat Int'l Airport-Air Cargo MT
-
500
1,000
1,500
2,000
2012 2013 2014 2015 2016 2017 2018 2019
Salalah Airport-Air Cargo MT
Sources of data: Oman Aviation Authority
28

Logistics and Supply Chain Disruption
• Forces:
• globalization,
• outsourcing,
• product proliferation,
• customer demands,
• communication capabilities, etc.
• Examples:
• high tech,
• fashion, etc.
• Sourcing:
• Product design,
• network design, and
• coordination capabilities drive competitive
advantage
VMI with
major supplier
Logistics
Services
Provider
Contract
Manufacturer
Other
suppliers
Joint product
design team
Alliance with
competitor who
complementary
services
Global Procurement
Plant for
specialize
d products
Risk pooling
contract with
major
customer
3PL
warehouse
Other
customers
Joint venture
in an
emerging
market
Strategic
carrier
Supply
intermediary
Collaborative
forecasting
team
Covid-19 Impacts: Re-designing the Logistics & Supply Chain
29

More Efficient Ports: Ghost Ports
Shipping 2020 & Beyond: Navigating uncharted waters
30

Source: DP World
DP World Innovation: ASRS for Containers
(BOXBAY)
31

Oman
The Logistics Hub
Logistics & Supply
Chain
Basics
32

Value Chain: Logistics as Competitive Advantage
33
Cost
Profit
Selling
Price

SCOR: Supply Chain and Logistics Management
34
Information
Technology
Analytics
Forecasting
Planning

Bullwhip Effect: Supply and Demand Complications
- Reduce the Bullwhip effect
- Increase collaboration in the supply chain
- Understand Trends, Respond Fast
35

Supply Chain Management and Risks
36

Planning & Managing Uncertainties and Risks in Logistics
Low
Low
High
High
37

10 Top Logistics Industry Trends & Innovations
Source: StartUs Insights
38

Bayanat Technology: IT System is the Core
• Total real-time visibility.
• Total real-time supply chain control
• Total real-time cold chain control.
• Paperless Operations.
Logistics Management System
Logistics Management System
Powerful ERP
systems
Source: Almadina Logistics
39
Analytic Dashboard
Analytic Dashboard

Logistics & Supply Chain Career
40
Industries Career Growth
Source: City Guilds

CEO
Bayanat Technology
CEO
Bayanat Technology
Logistics and supply chain Market
Oman and the World
March 2023
LinkedIn: Mahmood Albalushi
Twitter: @Mahmoodsakhi1
Email: mahmoodsakhi@yahoo.com
LinkedIn: Mahmood Albalushi
Twitter: @Mahmoodsakhi1
Email: mahmoodsakhi@yahoo.com 41

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