• Colombia: ‘In December we return to the Cargo level of 2019’

    Colfecar projects that transporters will again mobilize up to 9.9 million tons at the end of the year. The association asks to suspend toll payments.

    https://www.portafolio.co/ – From today, until Friday, the transporters will meet at the annual congress of Colfecar, in this virtual occasion. In the space the discussion will revolve around transformations are taking place in the sector and its role for the country development.

    Nidia Hernández, Executive President Colfecar, explained to Portfolio how the sector is developing in the framework of the economic reactivation, and what are the challenges to continue operating.

    What are the results for the transport sector after the pandemic?

    It is remarkable the transporters commitment, thanks to the transport of cargo there was no shortage during the time of pandemic. The operation had to change, they came with a slow process of digital transformation, the pandemic forced agents to digitize in operational, commercial, administrative and labor aspects.

    Regarding mobilization and operation of cargo, April was the most difficult month, there were decreases of 30.7% in the tons mobilized; by May some sectors of the economy began to open, that allowed the load to increase by 17,12%; already by June and July the recovery became more evident and its growth was around 8%. In December, we expect cargo to return to 2019 levels estimated at 9.4 to 9.9 million tons.

    How much loss did have to suffer?

    Thanks to the measures taken by the Government in the reduction in the price of fuel and exemption from tolls in April and May, the sector did not show any cost overruns in the transportation of road cargo. However, many companies were affected as their vehicles were still. The transport companies reported decreases in their operation of between 30% and 60%, in addition it is estimated that their turnover decreased during the second quarter by 29.7%, something never recorded in the sector.

    How many tons of cargo is being transported?

    According to the National Register of Cargo Forwarders, 8.94 million tons were transported in August, 8.96 million tons in July. April’s performance was the lowest in recent years, accumulating only 6.5 million tons. The growing trend coming since May stalled is August, but we expect with the opening of trade and passenger transport in September the recovery will be more noticeable.

    It has been asked to suspend toll rates again. How much do they weigh on transport costs?

    The toll item has a weight of 11.57% within the Colfecar Transporter Cost Index. The relief seen in April and May was very important for the sector. These aids, aimed at transporters, are those that allow the road freight transport to stay afloat.

    How have you been with the courier companies?

    Revenues in the postal sector during first quarter of 2020 increased by 2.29% compared to 2019. This sector has been driven by the increase in e-commerce, which has shown increases in its share between 50% and 80% during the pandemic. In the mail service an increase of 8.62% was presented.

    Despite the good outlook in the subsector, there are problems with messaging apps, as they do not comply with insurance, contracting or tax conditions, as legally constituted companies do, which means competition on unequal terms.

    What are the main challenges in the logistics sector?

    Conpes of National Logistics Policy, which was launched at the beginning of this year, identifies three fronts: modern and adequate infrastructure for intermodal logistics; optimization of trade terminals and formalities in foreign trade; and improve institutional supply in the transport and trade sectors.

    How competitive is the cost of a ground freight in Colombia?

    Many factors influence the cost of freight. Depending on the country you can find costs, subsidies, subsidies or additional taxes. Colombia’s probation allows for room for negotiation in countries such as Chile and Mexico, which is attractive to many investors.

    We know that the biggest costs in Colombia are fuel, wages and tolls, a situation that makes us less competitive, but without a doubt the condition that most affects the country is its complicated geography and its slow development of multimodal infrastructure that is relevant to improve competitiveness in such a rugged geography.

    What are the remaining tasks for the country to promote multimodal transport?

    Among the main challenges for multimodal is the development of specialized logistics infrastructure, needed especially in cargo exchangers and in critical areas of mobilization. It is necessary a correct coupling of the different modes of transport, for this it is necessary the support and accompaniment of the National Government.

    Access to clear and quality information is a fundamental challenge to achieve the step towards multimodal transport, this allows to structure markets, plan operations, make better decisions and encourage companies to participate.

    See the original article at: https://www.portafolio.co/

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