Big ships, poor terminal design plague ports in Asia - Greg Knowler, Senior Asia Editor | Jan 13, 2015 2:12PM EST The congestion that hit Asia hard in 2014 took many ports by surprise, and even as a new year begins there is no sense that terminal operators will find solutions soon to lengthy delays and productivity shortfalls. Manila was the first port to grind to a halt when an ill-considered daytime truck ban to clear the city’s congested streets last February left containers stacked up at the port. A year later, vessel arrival delays are still averaging six days. With no peak season for several years, strong export volumes from China spread the congestion around the region, affecting the ports of Incheon, South Korea; Shanghai; Hong Kong; Jakarta, Indonesia; Cat Lai, Vietnam; and Nhava Sheva, India. Just as in North America, part of the problem at the big gateways is that larger ships bring in more containers, create volume surges and need to stay longer. Other issues include dense fog in Korea and northern China that brings shipping to a standstill, or monsoon rain and regular typhoons in the Philippines. But another culprit is poor terminal design. Ports such as Keelung in Malaysia, Incheon, Cat Lai and Hong Kong have limited space and can’t cope efficiently with increasing volumes. Cat Lai is in the middle of Ho Chi Minh City, and the port of Manila is in the center of the Philippine capital city. Almost half the container vessels arriving at the ports of Ho Chi Minh City, Manila and Nhava Sheva between Oct. 15 and Nov. 15 were delayed by more than 12 hours, and one-third of the arriving ships faced delays of more than 24 hours, supply chain software provider CargoSmart found in a December study. Apart from disrupting schedules and frustrating shippers, port congestion in Asia has significant financial consequences for shipping lines in the intra-Asia trade. The carriers are chartering feeder ships more frequently and for shorter periods in order to maintain weekly schedules. With ships chronically delayed in port or awaiting berth space, the extra temporary tonnage helped plug gaps in carriers’ rotations, allowing them to fulfill weekly departure obligations to customers through late 2014. “The container volumes are strong in intra-Asia, but we are having to spend more money on schedule recovery than before,” said Robert Sallons, managing director of Cheng Lie Navigation. “On long-haul Asia-Europe services, carriers can recover schedules between ports, but that cannot be done in Asia, where the transit times are so much shorter. So we have to increase speed or slide services.” Hong Kong experienced critical congestion levels at its Kwai Tsing container terminals during the summer-fall peak season, but the reasons behind the bottlenecks were different to the issues facing the ports in Southeast Asia. As a transshipment hub, increasingly larger ships staying in port longer and generating greater volumes for loading and discharge are creating surges in containers that the terminals are struggling to cope with. In addition to the extra volumes, the new alliance structures are making the handling of larger ships more complex, driving up the number of inter-terminal truck moves to get cargo to feeder vessels or non-alliance members, and eroding port efficiency. The ports are frantically looking for congestion-alleviating measures, but it won’t be a simple process. Even if Manila finally clears the bottleneck of boxes during the low season, for example, there is no such solution for some of the worst traffic jams in Asia, through which the trucks must pass to reach the port. Vietnamese ports are in a bizarre situation. Of the seven terminals at Cai Mep, south of Ho Chi Minh City, only three have any customers, and its terminal utilization is a dismal 25 percent. Yet Cat Lai terminal is close to Ho Chi Minh City and is battling congestion because it’s closer to the hinterland and more attractive to cost-conscious shippers. In Indonesia, container terminals’ problems are the opposite of those in Vietnam: There aren’t enough dedicated container facilities and terminal berths to efficiently handle increasing volumes moving through Jakarta.
Posted on: Tue, 13 Jan 2015 22:39:39 +0000
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