1. INTRODUCTION

Within the scope of this topic, it is possible to increase the activities of the Shiveekhuren Port in Umnugovi aimag and increase export figures year by year, but the strategic importance of implementing it in that environment is not considered as an important reason for the growth of cash flow, which shows the slow development of the dry port and the country.The demand for freight transportation has increased, but the current infrastructure has reached its capacity limit.

 Shiveekhuren port is one of the main gateways for Mongolia-China coal exports, and although the volume of transportation has been increasing year by year, the port area, control facilities, and road lanes have reached a level where they cannot fully meet the demand. The lack of capacity creates queues, extends export times, and causes economic losses. The demand for freight transportation has increased, but the current infrastructure has reached its capacity limit.

 Shiveekhuren port is one of the main gateways for Mongolia-China coal exports, and although the volume of transportation has been increasing year by year, the port area, control facilities, and road lanes have reached a level where they cannot fully meet the demand. The lack of capacity creates queues, extends export times, and causes economic losses.

The coordination between the operations of border organizations is weak. The lack of full coordination among customs, professional inspection, and border military operations leads to issues such as overlapping inspections, delays, and multiple approval stages. Therefore, integrated management and a one-stop system for these organizations are necessary.

Relying solely on road transport in logistics is a risky structure. At the Shiveekhuren border port, transportation depends almost 100% on trucks, which increases accident and safety risks, raises coal transportation costs, and causes excessive congestion at the port.

The current layout and technological processes of the port are inefficient; cargo registration, parking, and yard organization are non-transparent, non-digital, complicated for drivers, and create queues.

The condition of the border area roads and infrastructure development do not meet the requirements, and the poor quality of roads leading to the port, as well as the substandard hard surface of the site, reduce transport safety, cause vehicle breakdowns, increase costs, and lead to operational failures due to precipitation and seasonal effects, creating risks. Cross-border transport coordination and discrepancies in standards between two countries. The regulation of cross-border transport between Mongolia and China faces issues due to factors such as the number of vehicles, scheduling, and compliance with standards. There is a need to improve the mechanism for bilateral cooperation.Since it is impossible to study all the reasons for choosing this topic in one research work, I have further deepened my research within the framework of two issues.

• Research questions/hypotheses: The research work aims to answer the following two questions:
• Will the activities of stakeholders involved in port operations have a direct impact?
• Will transportation increase by adding advanced equipment to port operations?

1. THEORY RESEARCH

The research work aims to answer the following two questions: Will the activities of stakeholders involved in port operations have a direct impact? Will transportation increase by adding advanced equipment to port operations? These processes are increasingly being resolved through the supply chain (SC), which is distributed across the value chain of logistics. Supply Chain Management (SCM) is playing an increasingly important role in business practice. Supply chain management integrates all relevant internal parts of another company and external organizations — from raw material suppliers to merchants — into a horizontally connected. Based on an integrated strategy, it is possible to achieve shared goals and implement cost savings. To optimize the coordination of procurement, production, transportation, sales, and trade activities, it is important to exchange all critical data and interpret them uniformly.

This requires continuous information flow, high-level collaboration, and trust among participants. In this period when cost pressure in the market and demand for service quality from customers are increasing, it is no longer sufficient for a company to optimize its internal processes; it must also be competitive.However, it has become necessary for the company to focus on process optimization in a horizontal network that spans the entire logistics value chain. The goal is to align business processes from manufacturers, suppliers, transportation, warehouses, retailers, and partners to the end consumer, reduce costs, shorten transit times, and ensure the quality of products and services that meet customer demands. In recent years, the rapid expansion of global business and international trade has led to increased competition in the container port sector, which has become a notable characteristic. Liu 1995; Tongzon and Heng 2005; Yap and Lam 2005 [1].

In the context of globalization in production and consumption, new trends in international trade are making container transportation increasingly important. This has numerous technical and economic advantages compared to traditional transportation methods. Container ports located at the interface between sea and land transport play a central role in the container transportation process. The competition among container ports can be expressed as follows. Previously, the market for ports was perceived as monopolistic due to the fixed geographical location and concentrated congestion of the port. However, due to the rapid development of international container and various types of transportation, significant changes have occurred in market structures, leading to intense competition in many regions. Many container ports could no longer have an advantage with their own ships and deep draft channels, and had to compete with neighboring ports for cargo transport (Cullinane and Wang 2006) [2].

The fierce competition that defines the container port sector indicates an interest in measuring how efficiently its resources are being utilized, introducing subtopics. Theoretical research includes a detailed study of specific theories, theoretical foundations, research questions, hypotheses, and the developed research design within the subject area. Ports are a crucial link in the entire trade chain, so port performance has a significant impact on a country’s international competitiveness.

To maintain competitiveness and improve performance it has been noted that advanced technical equipment and investment in infrastructure are necessary to accommodate large ships with high average weight; on the other hand, port managers need to continuously evaluate operations, service supply, marketing, and sales processes. (Cullinane et al. 2006) [3]

However, physical expansion is limited in ports located in the city center due to land constraints and environmental issues. . Moreover, excessive and misdirected investments can create conditions for inefficiency and wastage of resources. Given such circumstances, it is crucial to optimally utilize internal infrastructure, maximize output with given inputs, and identify areas requiring improvement in inefficient ports (Le-Griffon et al. 2006) [4]. Moreover, excessive and misdirected investments can create conditions for inefficiency and wastage of resources. Given such circumstances, it is crucial to optimally utilize internal infrastructure, maximize output with given inputs, and identify areas requiring improvement in inefficient ports (Le-Griffon et al. 2006) [5].

In terms of container port performance, productivity and efficiency are the most important concepts and are often used to measure performance. Productivity plays a very crucial role in ports. This is because productivity has a significant impact on maintaining a competitive advantage and survival. Additionally, it serves as a useful tool for port administrations and operators in planning. Traditionally, the production capacity of container ports is evaluated through various experiments that calculate the productivity of cargo handling at the port and the operational efficiency of the container yard (Evers and Koppers 1996; Ashar 1997; Gehring and Bortfeldt 1997; Kim 1997; Kim and Bae 1998; Kim and Kim 1998, 1999; Robinson 1999; Avriel et al. 2000; Wilson and Roach 2000; Chu and Huang 2002; Imai et al. 2002).Traditionally, the production capacity of container ports is evaluated through various experiments that calculate the productivity of cargo handling at the port and the operational efficiency of the container yard (Evers and Koppers 1996; Ashar 1997; Gehring and Bortfeldt 1997; Kim 1997; Kim and Bae 1998; Kim and Kim 1998, 1999; Robinson 1999; Avriel et al. 2000; Wilson and Roach 2000; Chu and Huang 2002; Imai et al. 2002) [6].

In recent years, significant progress has been made in evaluating the performance of container port operations. If international container ports efficiently assess their operational performance and accurately identify their strengths, weaknesses, and opportunities, this information can be invaluable for port management in defining future competitive strategies and improving operational efficiency by utilizing resources more optimally. Analyzing the performance of each container port or terminal is of significant importance to the health of the port sector, the viability of players, and their competitiveness. Such analysis not only serves as a powerful management tool for port operators but also plays a crucial role in guiding regional and national port planning and operations. Measuring performance plays a crucial role in the development of a port (or other organizations).

Dyson (2000) [7] noted that measuring performance is essential for evaluating production and clarifies the current state and future outlook of the system. The measurement of performance affects the behavior within the system and helps move the system in the desired direction. However, incorrectly defined performance metrics can lead to undesirable consequences and cause the system to move in the wrong direction. The measurement of port performance has developed along with changes in the industry. The simplest and most widely used method in this area is to use multiple partial production indicators (Ashar 1997; Cullinane 2002) [8]. Because the port is primarily an organization that provides services for ships, cargo, and internal transportation, on one hand, it may provide sufficient service to ship operators, while on the other hand, it may provide unsatisfactory service to cargo or internal transport operators. Therefore, it is not possible to evaluate the performance of the port with a single indicator in general. The main drawback of using multiple partial indicators is that it becomes difficult to determine whether overall performance has improved or worsened when some indicators improve while others deteriorate. To overcome this, Talley (1994) proposed a consolidated indicator for evaluating port performance, which is the shadow price of variable port capacity per dollar of revenue.Similarly, methods such as calculating port cost functions (De Neufville & Tsunokawa 1981) [10], estimating total factor productivity (Kim & Sachish 1986), and establishing port performance and efficiency models using multiple regression analysis (Tongzon 1995)[11] have been proposed. Performance evaluation studies have asked participants to assign weights to different factors, but these are often prone to subjective influence. In contrast, DEA is a method without such weaknesses, allowing for evaluation with multiple inputs and outputs without requiring data classification.

This study aims to exchange information on the operational efficiency of major container terminals in China and South Korea using three DEA models: DEA-CCR, DEA-BCC, and DEA-Super Efficiency. Based on the efficiency evaluation, first, the causes of inefficiency will be determined based on the efficiency score. Then, using slack variable analysis, areas for improvement in inefficient terminals will be identified. After that, using return to scale analysis, whether the terminal is increasing, decreasing, or stable in terms of scale will be assessed. This study includes three types of analysis under the DEA model. In the technical efficiency analysis, if the technical efficiency is less than 1 (technically inefficient), it indicates that the inputs and outputs being used are inappropriate and there is a need to reduce inputs or increase outputs. Also, by comparing the values of technical and scale efficiency, the one with the lower value indicates the main cause of inefficiency. Slack variable analysis clarifies the utilization levels of inputs and outputs, and specifies how many inputs need to be reduced and how many outputs need to be increased to make inefficient DMUs efficient.

• RESEARCH METHODOLOGY

Shiveekhuren border crossing is an international road port located in the territory of Gurvantes soum, Umnugovi aimag, connecting Mongolia and China. This port is adjacent to the Ceke port in the Inner Mongolia Autonomous Region of China and is strategically located near major coal deposits such as Tavantolgoi and Nariinsukhait, making it an important gateway for the export of mining products. The Shiveekhuren port primarily exports coal, copper concentrate, and other mining raw materials, while imports account for a relatively small percentage. Within the framework of the Economic New Revival Policy and the Port Revival Policy, the Government of Mongolia issued Resolution No. 185 on July 2, 2021, deciding to establish a coal container transportation terminal at the Shiveekhuren border port in order to increase the capacity of Mongolia’s border ports. In accordance with this resolution, nine enterprises operating in the Nariin Sukhait group deposit have jointly initiated construction work since 2021. These enterprises include Mongolyn Alt MAK Khuren Tolgoi Coal Mining, Usukh Zoos, SGGS, Terra Energy, San Trans, Javkhlant Ord, Khur Erdene Bayalag, and EAI LLC. On June 10, 2022, they established a joint company called Shivee Khuren Terminal and commenced operations. Shivee Khuren Terminal’s export capacity is 17 million tons, equipped with a smart gate system, fiber optic internet network, RFID readers, concrete-paved area, a 40-meter long auto scale, tower lighting, forklift trucks, and fully equipped with 24-hour surveillance cameras. To ensure the comfort of terminal and customs government employees, a modern interior solution has been applied to a two-story office building for 41 people, which has been put into operation. In terms of organizational structure, the Shiveekhuren port operates with multiple entities such as state inspection agencies, port administration, freight forwarding companies, and mining export enterprises. This coexistence necessitates high levels of coordination and integration. However, inadequate information exchange and digitization, along with differences in working hours and inspection procedures, limit throughput capacity and extend downtime, becoming major contributing factors.

Table 1

Main Government Agencies

Approximately 2,100 – 2,700 people work at the Shiveekhuren border crossing, with 15–20% employed by government organizations and 80–85% by private sector companies

Table 2

Private sector organization

In recent years, although improvements have been made to the border control facilities, customs, professional inspection, one-stop services for border protection, and some sections of the road at the Shiveekhuren port, the capacity for cargo throughput remains below actual demand. In particular, the long waiting times for road transport and insufficient logistics organization for loading and unloading are reducing the overall efficiency of the port. The port’s operations are primarily based on road transport, with high border crossing traffic and seasonal characteristics (especially in winter).

Table 3

Personal private sector employees

In recent years, Shiveekhuren Port has undergone improvements to its border inspection facilities, customs, professional inspection, one-stop border security services, and some road sections, but cargo throughput capacity remains below actual demand. In particular, long waiting times for road transport and inadequate logistics for loading and unloading reduce the overall efficiency of the port. The port’s operations are primarily based on road transport, with high border crossing traffic and seasonality (especially in winter).

Table 4

Private sector employees

In terms of human resource capacity, port operations are still largely manual and highly manual, which reduces productivity and leads to working conditions, occupational safety and social issues. In particular, long queues of drivers, weak rest arrangements, and inadequate hygiene infrastructure negatively affect the sustainability of human resources. In addition, the lack of digital skills is hindering the full implementation of e-customs and smart port solutions.

Table 5

Structure by field of work

The port’s operations are primarily based on road transport and are labor-intensive, which places significant pressure on human resource management. According to the study, approximately 2,100–2,700 people from the public and private sectors work directly and indirectly at Shiveekhuren Port, with the majority, or more than 50 percent, being road transport drivers. Meanwhile, government officials such as customs, border protection, and professional supervision make up 15–20 percent of the total human resources, ensuring port security and law enforcement.

Given the above situation, the development of Shiveekhuren Port is not limited to increasing throughput capacity, but requires a comprehensive consideration of corporate governance, human resource management, transport infrastructure, and digital transformation. In particular, the practical implementation of railway connections, reducing the structure dependent on road transport, and introducing automation and integrated information systems in port operations are the main ways to increase human resource efficiency.

The Shivee Khorun Terminal investor uses the area as a percentage of the investment and is connected to a unified network for internal transportation and mine registration information transmission and reception. Shivee Khorun Port borders Sehe Port, and Mongolia carries out regular interstate cargo transportation from 16 mines through 8 temporary and permanent ports bordering China.

The main cargo in regular interstate cargo transportation is bulk cargo, i.e. dry and liquid cargo, as well as bulk cargo, minerals and mining, and the majority of this is coal transportation. The logistics development of the ports of the Inner Mongolia Autonomous Region, which are the main logistics routes for the joint implementation of the above activities by China and Mongolia, will directly affect the foreign trade and cooperation of the two countries. In the context of the development of foreign trade, the need for the development of port logistics along the border from China to Mongolia has increased year by year, and there has been a need to continuously continue the construction of port logistics and keep up with the growth of cross-border goods flows. It is believed that the way to develop logistics begins with determining the economic development prospects of the port.

 By contributing to the development of a favorable transit environment for Mongolian ports, it is believed that the development policy and construction of border ports will be optimally coordinated, and trade activities between China and Mongolia will be carried out efficiently. By coordinating the border ports of the two countries, it will be easier to cross the border for people, vehicles, and cargo. Coal export transportation is being carried out through Shiveekhuren Port. Border and terminal transportation is economically profitable, but due to the slow progress of transportation, which depends on proper planning and execution, the terminal transportation performance cannot be operated at full capacity.

Table 6

Transportation of Shiveekhuren Port

Recent shipping data for 2023–2025 show that the volume of cargo exported through Shiveekhuren Port, especially coal, is on a steady rise. While approximately 19 million tons of coal were exported in 2023, this volume increased to 24 million tons in 2024, indicating a significant increase in the port’s load and economic importance. However, the export volume is expected to reach 26 million tons in 2025, confirming that Shiveekhuren Port remains one of Mongolia’s main coal export gateways.

However, as the volume of transportation increases, the problems of overloading of road transport, downtime, and infrastructure adequacy are becoming more apparent. In other words, if the growth of exports does not develop in line with the efficiency and throughput capacity of the port, there is a risk of increasing logistics costs and increasing environmental and social pressures. Therefore, it is essential to further develop Shiveekhuren Port as a railway-connected, digitally managed logistics hub, and to reform its infrastructure and organization to accommodate the growth of transportation. This will be a fundamental condition for ensuring the stable operation of the port and increasing Mongolia’s export competitiveness in the medium and long term.

The operation of Shiveekhuren Port remains a labor-intensive system that relies on multiple organizations and a large number of human resources. The majority of the total workforce is comprised of truck drivers and yard workers, making the port highly dependent on trucking. Therefore, automation, digital skills training, and rail-to-logistics transition are essential to increase human resource efficiency.

Table 7

SWOT analysis of Shiveekhuren Port

Shiveekhuren Port has strong advantages based on location and export demand, but structural and organizational weaknesses related to road transport are limiting its performance. Therefore, comprehensive implementation of investments based on rail connectivity, digitalization, and public-private partnerships is a key way to increase the port’s competitiveness.

The results of the study show that the current operation of Shiveekhuren Port has the following difficulties:

1. Excessive dependence on road transport due to incomplete railway connectivity;
2. Different working hours and inspection procedures at Mongolian-Chinese border crossings;
3. Delays due to insufficient electronic and information exchange systems;
4. Environmental, dust, and local socio-economic pressures.

These issues increase export costs and negatively affect the competitiveness of the mining sector.

The Mongolian government has begun to focus on a unified border port policy, increasing port capacity, improving rail-port connectivity, and developing ports as logistics hubs (dry ports).

For Shiveekhuren Port, the creation of a railway connection, digitalization of customs operations, and the possibility of using public-private partnerships (PPP) are being seriously discussed, which are important conditions for further development.

CONCLUSION

1. Shiveekhuren Port is an important strategic gateway for Mongolia’s mining exports, but it is currently unable to operate at full capacity due to infrastructure, organization, and transportation constraints. Therefore, the development of the port needs to be considered within the framework of an integrated logistics system, not just a border crossing point.
2. Shiveekhuren Port is a strategically important road port for the export of mining products, especially coal, in Mongolia, and has seen a steady increase in transportation volume over the past three years. The volume of coal exported through the port is expected to reach 19–26 million tons between 2023–2025, indicating the increasing economic role and burden of the port. However, the growth in transportation has not yet fully matched the port’s infrastructure, organization, and human resource capacity..
3. Shiveekhuren Port remains one of Mongolia’s main export gateways, but there is currently a growth-based capacity-capacity gap. To address this gap, it is essential to develop the port from a traditional border crossing point to an integrated logistics hub, and implement policies based on public-private partnerships, investment, and human resource capacity-building.
4. It is necessary to establish freight logistics services to support business development by facilitating trade and transportation, and to optimize intercity distance and transportation planning.
5. The parties involved in port operations, such as the Buyer, Transport and Logistics Companies, Border and Customs, and other control agencies, can increase the overall efficiency of the port by openly exchanging information and working in coordination. Effective coordination between these parties will accelerate the flow of transport, reduce delays, accelerate cargo turnover, reduce costs, and raise the quality of port services to a new level. This cooperation between the parties involved is not only of continuous, but also of strategic importance for strengthening the competitiveness of regional trade and economy.
6. By introducing advanced technical and technological equipment into port operations and increasing capacity, there is a real opportunity to improve the speed of cargo transportation and sustainably increase export flows. The use of modern automated systems and high-capacity loading and unloading equipment will accelerate cargo turnover, shorten processing times, and thereby increase the financial flow of organizations, creating conditions that will have a positive impact on economic growth.