No brexit blues for UK/Turkey trade
Despite Sterling's volatility, trade volumes on its UK/Turkey services continue to grow, says leading British freight forwarder Davies Turner.
February 27, 2017
By PLA Editor
Turkey is expanding both as a market for British products and a major supplier to the UK regardless of the uncertainties brought about by current developments and future changes in the UK’s trade relations with the wider world.
However, chairman of Davies Turner, Philip Stephenson said, while overall volumes of traffic continue to increase, the gap between northbound imports from Turkey into the UK and southbound exports from the UK to Turkey continues to widen – despite recent Sterling weakness against the Euro which may yet boost exports in the medium term.
This has prompted Davies Turner to redouble its efforts to develop cross-trade connections between other European countries and the wider world with Turkey, in order to keep trailers filled and costs to shippers down, says Stephenson.
He added, “Certainly, exchange rate volatility since the Brexit referendum has impacted on our costs but as a company we have absorbed these where possible and continued to honour our freight agreements or contracts with clients despite some unavoidable cost pressures, which we continue to review.”
Stephenson believes that Turkey will remain a major supplier to the UK market through the next few years of the re-negotiation process which may yet culminate in a British association agreement with the EU similar to that which Turkey negotiated several decades ago.
Over recent years, Turkey has developed into an established and trusted supplier to UK retailers, wholesalers and traders. Quality is high, as is value for money and Turkey’s relative proximity to the UK facilitates rapid repeat orders. All of this helps reduce risk for British retailers and improves their cash flow.
Stephenson added, “Above all, Davies Turner’s joint services with this key market provide shippers with supply chain security thanks to our competitive, fast and reliable services.”
Davies Turner has, together with its Turkish partner Ekol Logistics, developed multimodal services between the UK and Turkey utilising ferry, rail and road services. As well as being a major logistics operator, Ekol operates its own ferry links from Istanbul and Izmir to Trieste and Marseille.
Stephenson explains, “The success of both the multimodal and direct overland services still means almost 90% of business on this trade lane will use the intermodal routing with the added advantage of being good for the environment. The frequency of the ferry departures and of the rail connections both of which will soon increase further should result in ever more reliable and responsive services.”
Door-to-door overland, express, airfreight and direct sea containers are all available, opening up a wide range of choices for Davies Turner customers – and, moreover, the flexibility to switch rapidly from one type of service to another as circumstances dictate.
Meanwhile in the UK, Davies Turner is about to complete a construction project more than doubling capacity at its main Scottish hub, as well as purpose-building another 145,000 sq ft logistics warehouse at Bristol, all financed through its own reserves.
Ekol is developing its own ferry port and customs facility near the Bosporus in Turkey, coupled with Customs-controlled warehousing which, says Stephenson, “will change the face of logistics and international transport within the Istanbul region and beyond, taking countless trailers off the congested road network, and hopefully speeding up local transit times.”
Turkey also functions as a major hub for neighbouring countries including Iran where Davies Turner has long had business. There are hopes that trade will once again take off in the whole region. Davies Turner has kept open its office in Tehran for nearly 50 years and in addition to its direct services from the U.K and Ireland, offers a daily full load and groupage service to Tehran via Istanbul.
“Having our own representation with one of our most experienced managers in Tehran as well as our own delegates based in Istanbul enables us to keep abreast of developments there,” says Stephenson.
Davies Turner can also route traffic via Turkey to Northern Iraq and has plans to further develop services to Kazakhstan following improvements to rail links in Central Asia connecting with both China and Europe.