As trade across APAC continues to grow, how can AI be the game changer for logistics?

“Optimising terminals with AI means we get better efficiency and utilisation of assets – and ultimately better customer service.”

Anders Dømmestrup, Executive Vice President for North Asia and Senior Vice President, Operations at DP World in Asia Pacific (APAC), is convinced that AI will play a crucial role in the future of logistics – and a wave of innovation is about to drive a step change for APAC customers.

Since the March 2024 rollout of a new AI-powered container-decking tool at DP World’s logistics centre in Busan, South Korea, he has seen bottlenecks ease and equipment used more efficiently.

This enables more precise container decking and improves the automation of managing fluctuating cargo flows through this key hub for customers. Through improved process automation the team can now be more responsive. And it is a vital step in future-proofing the region as volumes grow.

“As trade and logistics volumes expand, it puts pressure on traditional systems. And often those systems don’t have the logic to support that increased complexity,” he says.

Trade across APAC is continuing to evolve and grow, with AI technology increasingly being adopted in ports, terminals and warehouses. It is proving itself by optimising the use of equipment, making time savings, providing better forecasting and improving worker safety.

Ultimately this all combines to help customers optimise their logistics, bringing greater predictability, and allowing them to forecast more accurately.

And as applications for its use increase and systems become more integrated, 2024 is proving to be a tipping point for the use of AI in APAC.

Finding patterns in data

Some of the biggest benefits of the technology come from streamlining decision-making in warehouses, according to Riana Montisano, Vice President, Operations, Logistics at DP World APAC.

For example, AI can suggest improvements to warehouse layout, highlighting fast-moving products that need to be given prime warehouse space versus slower-moving products that need to be less accessible and could be moved.

This greater efficiency means warehouses can be more responsive to customer needs, resulting in cost savings for them down the line.

“How we set up the logic determines the success of our warehousing,” Montisano says. “If the logic isn’t set up correctly, operations will suffer. More and more warehouse management systems are using system learning that can suggest improvements. So, when we have good data, we will get good advice.”

DP World is also linking this systemic learning with its labour management system, meaning that when there are good forecasts about a day – for example, Black Friday – then meaningful suggestions will be automatically made about the additional resources needed. In peak periods, this kind of intelligence is crucial to ensuring smooth-running operations and avoiding delays that ripple down the line.

“AI is fantastic at taking infinite amounts of random data and creating patterns from it,” Dømmestrup agrees. “We can use that information to manage the flow through the system, redirect volumes within our yard and smooth out peaks and troughs.”

At ports and terminals, this could mean reducing the number of unnecessary moves, or shuffling in the yard. At Busan, machinery and equipment is also being used in a more efficient way and there is less ‘hanging hook’ time – when the crane is empty waiting for a truck to be available. This translates to quicker, more efficient handling for customers.

Consistent and reliable

In the realm of logistics, greater predictability and consistency is nirvana. And another way AI is contributing towards that is through predictive maintenance. This allows potential issues to be pinpointed before the affected machinery or process goes down – boosting supply chain resilience, helping to avoid any unexpected delays and improving the efficiency of how cargo is handled.

Meanwhile, there are also sustainability considerations from this greater predictability and performance – a waiting ship releases tonnes more greenhouse gases into the atmosphere, for example. Although the delay time may seem insignificant after many weeks at sea, this process, replicated many times over, does have a significant environmental impact.

Shifting attitudes

With the increased use of AI, attitudes towards it are evolving. Montisano notes that when AI was previously proposed as a solution, there were concerns about its cost and potential benefits. Now, customers are actively seeking automation and it has become a point of differentiation for DP World.

“As more and more people request and adopt AI, and it is increasingly integrated into systems, we will continue to refine our offering,” Montisano adds. “It’s a symphony of connected systems – that’s the trick.”

Currently, Busan is at the forefront of AI adoption among ports and terminals, but it is clear that AI in shipping and logistics is at a tipping point. The technologies in use at the port are already being replicated and rolled out in new locations, and increase in power as they connect and communicate with each other.

Throughout the supply chain, AI adoption is becoming more widespread as the benefits and potential of the technology are increasingly realised.

“Think of AI like your Excel spreadsheet – it could do magic, or it could do one plus one equals two. It really depends on how you use it,” Montisano says. “The question comes back to us – how can we, as the human, maximise AI? And part of the answer will come from experience through exposure.”

By working with partners that are actively using AI, customers will rapidly see the benefits – helping them to achieve an efficient, sustainable and resilient supply chain.