HITRANS – Whisky Logistics Study Presentation toFTA Frank Roach 14 June 2011.

HITRANS – Whisky Logistics Study

Presentation toFTAFrank Roach 14 June 2011

Whisky Logistics Research | 17/05/11

Structure of our Presentation

Introduction Background Methodology Consultation Spreadsheet-based Tool Results Implications for the Whisky Industry Commission Deliverables


Background

MVA Consultancy and Caledonian Solutions were commissioned by HITRANS to review the current and future logistics requirements of the whisky industry and the corresponding impacts on the strategic transport network in the HITRANS area

The study is designed to:

collate information on current logistics of the industry, focusing on the movement of products to, from and between facilities in the HITRANS area; and

forecast how the relevant supply and demand may change over time and the likely impact of these changes on the transport infrastructure


Study Area - HITRANS

HITRANS is the Regional Transport Partnership for Highlands, Western Isles, Orkeny, Argyll and Bute and Moray

Home to 75% of Scotch Malt distilleries, producing almost 90% of all Scotch Malt Whisky

Keen to ensure adequate infrastructure and logistical support is provided for this important Scottish industry


Current Ownership of Distilleries

‘The Big-5’ Diageo(25)

Chivas (12)

Edrington (4)

Grants (3)

Whyte and MacKay (3)

plus a large number of smaller 1-2 distillery operators


Methodology

3 Strands to our Approach

Strand 1 – Consult with key stakeholders involved in whisky-related logistics, documenting specific issues, constraints and opportunities which impact upon the industry

Strand 2 – Investigate the logistical requirements of the whisky industry, including movements of barley, malt, spirit, byproducts and fuel, develop a tool to predict future requirements based on growth scenarios and predict the corresponding impacts on the strategic transport network

Strand 3 – Present results via map-based formats which can be displayed and interrogated interactively via the freight section of HITRANS website


Stakeholder Views - Road-based Issues

Majority of transport movements are undertaken by road Due to geography; and Flexibility

Haulliers use the main trunk road network, understand problems occur and are generally content to work round these

Problems noted with the alignment of the A95 between Aviemore and Aberlour and lack of safe overtaking/dualling on the A9

Importance of keeping the strategic routes open in winter noted

Issues with empty running

From 2024 requirement to replace or refurbish all tankers to ‘bottom fill, bottom discharge’

A83 ‘Rest and be Thankful’ and other network-reliability issues

Fuel costs

Speed limits

Access roads/links


Stakeholder Views - Rail

Currently no whisky-related freight movements undertaken by rail in the HITRANS Region

2010 SWA Transport and Safety Group set up to investigate appetite for modal shift to rail, identifying potential constraints

Rail freight requires critical mass - industry-wide or major player co-operation needed to make feasible)

Elgin appears to be the most appropriate rail head (but requires further investment/development)

Rail is constrained by the requirement for road shunts at either end of journey

No subsidy available to cover the increased costs and hence currently no effective financial incentives to move to rail


Stakeholder Views – Sea-borne

Critical aspect of the industry needed to access, supply and unload goods from island distilleries

Apart from Islay, all island-based distilleries rely on commercial ferry services

Islay imports much of its barley by coastal freighter, other products are ‘road-based’ via the commercial ferries from Kennacraig (NB these are affected by the current ‘closure’ of Port Ellen) Limited capacity on ferries – problematic for future growth

Reliability issues affect hauliers and in turn the industry

Empty-running a particular issue


The Spreadsheet Tool

Bespoke tool working back from published maximum capacity figures

Uses 14 distinct geographic clusters

Identifies volumes of inputs/outputs and likely number of transport journeys required

Allocates these movements to the strategic transport network

Chaff

Draff and Pot Ale

Bulk Spirit

Casked to warehouse

Dark Grains

Grain

Fuel

Malting

Distillery


Area Clusters

13 distinct area clusters

Additional area representing Invergordon Grain Distillery

Allows similar characteristics to be modelled

Tool allows each area cluster to be investigated individually rather than the study area as a whole

Vehicles placed onto links rather than every individual origin/destination


Routes

20 distinct links

Additional link representing Islay Ferry

Vehicles placed onto links rather than every individual origin/destination

Allows flow of vehicles and materials to be charted across the network

Each link ‘clickable on GIS-based mapping (viewable via HITRANS website)


Routing Assumptions

Routing assumptions based on consultation and our knowledge of the industry

Forecasts total flows (volumes and vehicles) using all of the key links of the network

Tool allows growth assumptions to be varied by location

Also allows user to vary assumptions regarding ‘recycling’ of by-products

Reported using GIS-based mapping (viewable via HITRANS website)


Typical Outputs


Key Results

Route Daily Whisky Flow

AADT HGV % Whisky % of HGV’s

A9 Invergordon 96 11015 8% 11%

A9 Aviemore 136 7568 14% 13%

A95 Grantown on Spey

377 7483 10% 50%

A83 Tarbet 8 2462 8% 4%

A82 Loch Lomond

11 10138 6% 2%


Implications & Recommendations

Whisky industry will need to consider how significant future growth will be catered for

This will determine corresponding future traffic growth on relevant key transport links

Growth of freight traffic on many of these routes will have significant impacts on the rest of HITRANS economy

Continue to investigate options for modal shift – but ‘realism’ required

Capacity of ferries is likely to become a crucial constraint

Local and National Authorities need to recognise the value of the industry and support where necessary

In particular, the need to invest in winter maintenance and other measures to maintain network reliability


Any Questions

?


Contact us

Name: Chris PatersonTelephone number: 0141 225 4415Email: [email protected]

www.highlandrailfreight.com

Office address: 7th Floor, 78 St Vincent Street, Glasgow, G2 5UB.


Document control SheetProject title: HITRANS – Whisky Logistics Research

MVA project number: C3A43000

Document type: Working Presentation

Directory & file name:

Document ApprovalPrimary author: Chris Paterson

Other author(s):

Reviewer(s): David Connolly, Alan Wolstenholme

Formatted by:

DistributionIssue Date Distribution Comments

HITRANS – Whisky Logistics Study Presentation toFTA Frank Roach 14 June 2011.

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