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Railway Freight Survey Report

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Railway Freight Survey Report FINAL REPORT ON FREIGHT USER SURVEY Submitted to PADECO Co. Ltd. by Chartered Institute of Logistics & Transport (CILT) Sri Lanka 22nd November 2018 CONTENTS 1. Background 4 2. Objectives and Scope of the Assignment 4 2.1 Objective 2.2 Scope 3. Outputs 5 4. Work carried out under Different Scope of Activities 5 5. Survey Results 11 5.1 Product and Transport 5.2 Opinion of Rail Transport 5.3 Suggestions for Improvement 5.4 Overall View APPENDICES 17 Appendix 1 Questionnaire for Shippers Appendix 2 Questionnaire for Freight Forwarders Appendix 3 Total Survey Target Enterprises Appendix 4 List of Respondents Appendix 5 Table of Content Headings of the SPSS outputs 2 ABBREVIATION BCGS Bogey Covered Goods Steel CILT Chartered Institute of Logistics & Transport CCC Ceylon Chamber of Commerce CPC Ceylon Petroleum Corporation FCCSL Federation of Chamber of Commerce Sri Lanka HR Human Resource NCE National Chamber of Exporters NCCSL National Chamber of Commerce Sri Lanka OD Origin-Destination RMPCT Railway Master Plan Consultancy Team RDA Road Development Authority SLR Sri Lanka Railway SLFFA Sri Lanka Freight Forwarders Association 3 1. Background The Government of Sri Lanka has requested the Asian Development Bank to support the preparation of a Master Plan for Sri Lankan railway sector. The Public Investment Program 2017 to 2020 includes one of the stated goals to increase the market share of the railway from 1% to 5% through service and infrastructure improvements by 2020. Sri Lanka Railway Master Plan Consultancy Team (RMPCT) have requested proposals from interested parties to carryout the Freight User Survey/Questionnaire to understand the market potential for freight transport through rail. The Chartered Institute of Logistics & Transport (CILT) Sri Lanka was awarded with the contract to carryout the freight user survey for rail as scoped out by the RMPCT. This report contains activities carried out by the Consultants in respect of the terms of reference in the scope of assignment. The scope of activities carried out during the period from 19th September to 26th October 2018 is given below. 2. Objectives and Scope of the Assignment 2.1 Objective The assignment aims to identify the potential market for freight transport through rail by a survey questionnaire with potential enterprises and their expected volumes. 2.2 Scope The key project activities are as follows: I. Identification of sectors, industries and trade associations. II. Contacts with trade associations and revision of questionnaires. III. Prepare report on sectors/industries. IV. Preparation of revised survey methodology and forms. V. Contacts and arrange interviews with enterprises. VI. Recruitment and training of surveyors. VII. Conducting pilot interviews and an estimated 50 interviews, including 4 supervision of Surveyors’ during the survey. VIII. Typing questionnaires with a codification of origins and destinations corresponding to the zoning. IX. Checking consistency of the answers and processing of questionnaires in Excel database form. X. Preparation of report on survey results. XI. Delivery of the report on survey results. 3. Outputs The following outputs were expected from this survey. The survey/ questionnaire on SLR freight service demand aims at identifying: ! Potential market (current and future), in terms of enterprises and tonnage. ! The parameters to adjust the potential market estimation to available market, qualified available market, target market and penetrated market. ! The origin and destination of products and modes of transport, (to relate with the Road Development Authority’s (RDA) Origin-Destination (OD) matrices. ! Based on interviews, the potential scope for diversion of existing road traffic to rail, by industry and line segment will be ascertained. 4. Work carried out under scope of activities The process of conducting the survey included the following steps: I. Identification of sectors, industries and trade associations. Identification of sectors/industries was done based on the Table 1 under the terms of reference. The basis for this information was from Table 2 Summary of enterprises considered in the total population (Economic Census 2013/14, Department of Census and Statistics). 5 Table 1 – Total and Selected Enterprises for the Survey Total Target Sector Sub-sector Enterprises Survey Logistics operators 51 8 Supply Logistics Freight forwarders 57 9 Transporters Not selected for survey Commerce Wholesalers 24 3 and Distribution Main retailers 15 2 Cement production 5 1 Electricity and gas production 5 1 Chemical products 24 2 Vehicle production and assembly 6 1 Agricultural production and processing 22 3 Paper, carton production and processing 14 1 Steel, mining and mineral production and processing 21 2 Demand Other manufacturing industries Industry Rubber and Plastic production and processing 28 3 Fresh and processed food products 26 3 Garments and Textiles 34 3 Light engineering products 24 1 Leather and leather based products 6 1 Wood, Furniture and Confectionary items 19 2 Coconut and coconut based products 26 2 Tea and tea based products 27 3 Ceramics and porcelain products 8 1 Services Not selected for survey Total 442 52 6 Table 2 - Summary of Enterprises Considered in the Total Population Economic Activity / Industry Formal Establishments ISIC Description I Transportation and Storage (Formal Establishments with 22 200 & above Persons engaged) II Wholesale and retail trade, repair of motor vehicles and 171 motorcycle (Formal Establishments with 100 & above Persons engaged) III Industry (Formal Establishments with 100 & above 1,233 Persons engaged) B Mining and Quarrying 10 C Manufacturing 1,218 10-12 Food products, beverages and tobacco products 287 13 Textiles 53 14 Wearing apparel 399 15 Leather and related products 10 16 Wood and of products of wood and cork, except furniture; 14 manufacture of articles of straw and plaiting material 17 Paper and paper products 13 18 Printing and reproduction of recorded media 30 20 Chemicals and chemical products 105 7 21 Basic pharmaceutical products and pharmaceutical 5 preparations 22 Rubber and plastic products 79 23 Other non- metallic mineral products 97 24-25 Basic metals and fabricated metal products (except 30 machinery and equipment) 27 Electrical equipment 23 28 Machinery and equipment n.e.c. 5 29-30 Motor vehicles, trailers and semi-trailers, and other transport 19 equipment 31 Furniture 16 32-33 Other manufacturing and other industries 33 D Electricity, gas, steam and air conditioning supply 2 E Water Supply; sewerage, waste management and 3 remediation activities Total 1,426 Source: Own estimates based on Economic Census 2013/14, Department of Census and Statistics. II. Contacts with trade associations and revision of questionnaires. Meetings were held with the following personnel from the trade chambers. During these meetings, names and contact details of relevant industries and freight forwarders were obtained. The total population selected was from the enterprises in table 2, which was 1426. The enterprise list obtained from trade chambers were categorized as per the subsectors given in table 1. Out of the 442 enterprises, 52 were chosen for the survey. The survey questionnaire (Appendix 1 and 2) was shared with selected enterprises first and their feedback was incorporated into the questionnaire prior to sending to the full survey population. 8 Table 3 - Trade Chamber Contacts Trade Association Person Contacted Ceylon Chamber of Commerce Shiran Fernando, Chief Economist (CCC) Shenali De Silva, Research Associate National Chamber of Exporters Shiham Marikkar, Secretary General (NCE) National Chamber of Commerce Bandula Dissanayake, Secretary General Sri Lanka (NCCSL) Sri Lanka Freight Forwarders Rohan Induruwa, Secretary General Association (SLFFA) Federation of Chamber of Ajith Perera, CEO/Secretary General Commerce Sri Lanka (FCCSL) Meeting with CCC officials III. Prepare report on sectors/industries. Report on sectors and industries were submitted on 3rd October 2018 and presented to ADB on 9th October 2018. IV. Preparation of revised survey methodology and forms. Freight survey questionnaire for shippers and freight forwarders were developed and updated with the assistance of RMPCT Project Team Leader. Following these meetings, the study team identified the total number of enterprises and target number to be surveyed and the questionnaire was prepared for pilot survey interviews. 9 V. Contacts and arrange interviews with enterprises Contact lists were prepared with the selected enterprises and appointments were scheduled through individual contacts, trade organizations and chambers VI. Recruitment and training of surveyors. Surveyors were trained on 24th September on the questionnaire and the methodology was explained. Surveyor training in session VII. Conducting pilot interviews The following five companies were identified for the pilot survey. The survey questionnaire was modified based on the feedback received from the survey respondents. ! Abans Logistics Pvt Ltd ! Aitken Spence Cargo ! Ceylon Biscuits ! Cargills Foods ! Unilever Sri Lanka VIII. Conduct 52 interviews A representative sample for each of the industry/sector categories, were selected from the total population of 442 enterprises from which 52 were selected using stratified random sampling method. The total list of enterprises from which 442 enterprises were selected is in Appendix 3. Survey with the fifty two (52) companies, were carried out from 4th October 2018 to 26th October. The Companies
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