¡¡¡¡Integration, either of operation and management relations or of cooperative use of resources, has become a common focus for port operators in recent years. Qingdao port, among others in China, is a good example, having made high achievements based on integration. The mid-February tour of major ports in local Shandong is now expected to bring in even more activity of integration-based expansion.

¡¡¡¡By Jan. 2008, the container terminal erected by Qingdao and Weihai port had accomplished a cumulative throughput of 438,000 TEUs over the past two years, showing an average growth rate of 49%. By the end of 2007, Riqing, another container terminal that in operation for only half a year, also chalked a total output of 430,000 TEUs. Such achievements however reflected only part of the success of Qingdao port¡¯s integration strategy.

¡¡¡¡1 + 2 > 3

¡¡¡¡In 2006 and 2007, Qingdao port entered into cooperation first with Weihai port, and then with Rizhao port to make full use of each other¡¯s advantages. Weihai and Rizhao boast excellent geographical locations, superb conditions for cargo marshalling/distribution and rich quay line resources, while Qingdao takes much pride in its worldwide network of shipping routes, brand image and marketing scale etc. Cheng Chuande, President and Chairman of Qingdao Port (Group) Corporation, said at the Qingdao-Rizhao cooperation project launching ceremony that, complementation of advantages and better planning would best contribute to the development of container transport in Shandong and render its port operation more efficient.
¡¡¡¡Complementation of advantages is important in the following aspects.

¡¡¡¡Expansion of cargo sources. Before coming together, the cargo sources of Qingdao and Weihai port were basically limited in an area with a radius of 120 kilometres centred at Weihai. Now the limits are pushed to between 120-150 kilometres to include such areas as Qingdao Development Zone, Mouping, Laishan and Fushan, and even further beyond to Longkou for certain products.
¡¡¡¡The container service newly opened by Qingdao and Rizhao port is called the ¡°Express Seaway¡±, which enables direct shipping from Rizhao to Qingdao, and has freight for goods from Heze and Jining etc cut by at least one third. Presently, lower cost has made the service more and more attractive to shippers and helped to expand their business quickly to Jiaodong and Southwest Shandong etc. 

¡¡¡¡Busier Operation. Following the launch of cooperation, shipping between Qingdao and Rizhao has increased from one voyage per week to one voyage per day, and monthly carriage has also grown from hundreds to more than 5,000 TEUs. Formerly, only one ship was deployed for two voyages per week, today, two ships ply the route for four voyages per week, with total capacity up by 125%. It is expected that annual transport will rise sharply from 33,000 TEU to 96,000 TEU between the two ports.

¡¡¡¡Sharing of Information. For years, information input was done by hand at Rizhao port. Now cooperation gains it direct access to the information centre of Qingdao port, which has installed the largest EDI system of all seaports in China. He Zhaoqing, Chairman of Riqing Container Terminal Corporation, said: ¡°Our cooperation is aimed not at what the other can do for me, but to learn from the other its experience, process of production, organisation and business control etc to our or mutual benefit.

¡¡¡¡Qingdao port is a classic example of quay line operation

¡¡¡¡Designed for an annual production of 100 million tons, Qingdao port actually has been turning out 200 million tons every year. In fact the port was already operating beyond its capacity in 2006. Only regional cooperation managed to help ease the problem a bit. In early 2007, DPW formally joined the three-country four-party (the other three parties being Qingdao port, COSCO, Maersk) cooperation in place of P& O Nedlloyd, creating better conditions for its continued advancement.
¡¡¡¡To Qingdao port, the phase-four project of Qianwan basin, launched by the four parties in Sept. 2007 is the final answer to the problem of terminal shortages, which brings all quay line resources formerly run by Qingdao port and DWP under the uniform control of Qianwan Container Terminal Co., Ltd. This new facility, measuring 2,640 metres in length, are believed sufficient for eight 18-20-metre deep water berths capable of a combined throughput of 6.4 million TEU per year. This will allow 15,000-TEU ships to be ushered in, with conditions reserved for 18,000-TEU ships in the future.
¡¡¡¡Only two months later however, on Nov. 16, share-holders of Qianwan Container Terminal Co., Ltd added one word to the company name and changed it to New Qianwan Container Terminal Co., Ltd to accept 3,408 more metres of quay lines along the basin¡¯s south shore, pushing the total owned by Qingdao port to more than 6,800 metres in the basin. Terminals built therein will be able to generate around 14 million TEU annually. Obviously, the project promotes the full use and efficient integration of Qianwan¡¯s quay line resources as well as its optimisation of function layout and general planning.
¡¡¡¡Doubtless, benign integration of resources assures big economic benefits and greater operation space for all related aspects. Therefore, in setting out its marine transport strategy, the CPC committee and government of Shandong province didn¡¯t hesitate to include a Northern China Int¡¯l shipping centre spear-headed by Qingdao port, supported by Yantai and Rizhao port, and based on the peninsula group of ports. Thence the integration of Qingdao port is nothing but part of the concrete practice of the government blueprint, especially in consideration of its relationship with neighbouring port groups.
¡¡¡¡The existing cooperation of Qingdao port indicates the formal creation of Shandong port groups based on Qingdao port. On Feb. 16, Qingdao port organised a senior inspection team to tour six major ports of local Shandong. A more ambitious plan of integration may soon be on the way.