Supply chain excellence ensuring global reach

Raeda Alzarooni has a busy morning of meetings ahead of her, figuring out, as always, the best way to deliver the approximately 7,000 tonnes of aluminium produced daily by the two Emirates Global Aluminium smelters to the furthest reaches of the globe.

A large map of The Americas on her office wall naturally brings attention to the scale of her role at EGA. Her job, as a senior manager in export logistics, is to ensure that the 2.6 million tonnes produced every year at EGA reaches over 100 different ports around the world as safely and efficiently as possible.

“Our role starts as soon as the material leaves the cast house,” she says. “The 7,000 tonnes per day is all moved by trucks to the two ports, Jebel Ali and Khalifa Port. We subcontract the loading and lashing to the port authorities, but our teams are there to scan the bundles and inspect containers and check that everything is okay. Aluminium is a sensitive product and for example, the billets – the solid tube-shaped blocks – have to be scrapped if there is a scratch deeper than 2mm, because they are used for extrusion. So, we insist we always have the same highly skilled teams at the ports to handle our products to ensure consistency.”

She explains how the aluminium, which EGA produces in a variety of shapes for different applications, is loaded onto huge container ships, run by the world’s biggest shipping lines.

“We don't usually do bulk deliveries, which is where you book an entire vessel, as you’d need to be sending 20,000 tonnes in one delivery to make it financially viable. And we don't make to stock; our product is made to order and needs to move as quickly as possible.”

She points to the map once again to demonstrate where the ships sail once they leave the UAE. To reach the West coast of the United States, such as Long Beach or Seattle, the vessels will first travel to various ports in Asia, particularly Bangkok, Thailand, Kaohsiung,  Taiwan, Nagoy, Japan and Busan, Korea. They stop at these ports to unload some of their cargo and take on more containers before journeying on to the U.S. The total journey time to America takes between 35 and 45 days.

The passage to Northwest Europe, perhaps to Amsterdam or Rotterdam, takes between 27 and 35 days. These vessels stop at trans-shipment ports, depending on the shipping company, before heading through the Red Sea into the Mediterranean and multiple stops in Europe.

Once the aluminium reaches a port, it is unloaded and moved by road to its final destination, EGA’s customer. Once again, Raeda’s department has teams checking the process to ensure that it runs to clockwork. “We constantly evaluate their performance to see that it meets our requirements.” She herself travels often to Europe to evaluate logistics performance, as well as to iron out any of the many issues that can arise due to bureaucracy, new regulations or circumstances beyond their control.

The worst thing that can happen, of course, is for a ship to sink or catch fire, though this is thankfully rare. More commonly, bad weather will force a port to close, meaning Raeda must quickly formulate a plan to divert the product to another port and onto the customer. And these are not the only issues. “We constantly have to monitor fuel prices to see how it affects shipping pricing.”

A big question in this regard is being posed by new International Maritime Organisation (IMO) regulations to introduce low sulphur fuel from January 2020. And then there are economic challenges around the globe. If a region’s economy slows, fewer container ships might visit its port, reducing shipping options. “These issues haven’t directly affected us recently, but we feel them. We have to watch carefully,” says Raeda.

In many ways her role can be compared to that of an airline manager – constantly making judgements based on myriad factors such as international markets, fuel prices and economic fluctuations. “As I said, we produce to order, not to stock, so on-time delivery is very important, especially for the auto industry. The supply chain is very sensitive,” she says, agreeing with the comparison. “At the moment I don't have enough vessels to meet my customers’ dates, so I have to look at other options. For example, instead of going to Rotterdam, I might go to Antwerp as the cargo will arrive faster and then I will truck it from there. This is an everyday challenge and we are constantly mapping and remapping to ensure that the process runs smoothly.” 

However, Raeda is not complaining about this daily logistical exercise. In fact, she loves it. “It's never a routine and every day we learn something new,” she says with a broad smile. “Your brain never stops thinking, because you are constantly solving problems, and making sure that this problem doesn't happen again. I love the challenge and I love to think out of the box. But I must stress that we brainstorm as a team and come up with a plan. This is very important. We work as a team to come up with solutions.”

Asked about recent challenges, she mentions a nice problem to have – EGA sold more than anticipated to a particular global region, and now has to find extra containers to meet the demand. “I ship to this particular region with only two lines, but we have extra commitments. So where do I get this extra space? It forced me to check with a bulk carrier and different shipping lines that I have never worked with before.”

She says this process hasn’t been helped by mergers in the shipping industry that have reduced the available market options. “Today, I work with eight vendors, whereas I used to work with 20 vendors. It's how you structure the deal. You’ve got to make choices over the commitments you are prepared to make. You can protect yourself, but it will cost more, so you constantly monitor the situation to make those choices.”

So far, she is evidently doing well in this regard, as she explains how EGA is managing to control its shipping costs effectively compared to industry benchmarks – which is a credit to her team’s planning work.

Before she leaves, Raeda once again stresses that the support of her commercial, documentation, vendor costing and operation teams are all vital to the smooth running of EGA’s exports. She says those 60 people are a big factor in why she has stayed at EGA for 21 years; with the first decade spent in sales and marketing and the last ten years in supply chain and logistics. “EGA actually called me when I graduated with my degree in business administration. Since then, they kept me active and busy, and always challenged me to better myself. I have learned a great deal about this industry and I still love it. And I know there is plenty more to learn for the future.”

And with that she excuses herself to dash to another meeting. Another 7,000 tonnes of aluminium will be ready for shipment to all corners of the globe before her day is over. There is work to be done.