A private party

Governments in South America are often levelled with the same criticism: a failure to stump up sufficient cash to increase capacity and handling capability at ports. The result? Stagnating box businesses. Well they would be if the private sector hadn't repeatedly stepped in to supply the necessary investment needed to fund new terminals.

The privately-owned common user Port of Coronel, situated just 30km from Chile's second city of Concepción (population 900,000), opened for business on 3 June 2006. Initially equipped to handle dry bulk and break bulk traffic, the port's container terminal on Muelle Sur commenced container handling in May 2009, with throughput for the year reaching 117,000 teu.

And last year, there was a 19% increase in box traffic, despite an inevitable impact from the major earthquake that struck the area on February 27, with many local production facilities having to close for several months to effect repairs.

“Overall, this year, up to May, we have seen growth of more than 50% in container traffic, although this figure has been distorted by last year's earthquake. Real growth is, however, in excess of 20% and we are predicting that the end of year figure will be up by around 25% to 200,000 teu,” says managing director Javier Anwandter Hammersley.

He notes that, in recent years, Chile has seen a significant increase in containerisation and that Coronel, with its existing infrastructure and handling equipment, could easily handle 500,000 teu over the next few years. Indeed, it is the only port in the Bío Bío region of Chile equipped with two post-panamax gantry cranes, in addition to its two Liebher post-panamax LHM-500 mobile harbour cranes.

“We can offer the highest productivity in the region, averaging 87 moves-per-hour on vessels in 2010,” says Mr Anwandter.

At present, the container terminal has a single client: MSC, which includes the port on its Europe and North American services. Draught alongside the 800-metre quay is 12.6 metres, allowing MSC to deploy 5,000 teu vessels.

“We have only been handling containers for two years, but there are definite growth possibilities. Some ten container shipping lines serve this region, although lines and ports tend to sign contracts for periods of three to five years. There's no doubt that all of them are aware of what we can offer them and that they will undoubtedly consider us when they are evaluating future port calls,” says Mr Anwandter.

However, Coronel is faced with competition for traffic to and from Concepción, it being a cluster of three with the potential to serve the city and surrounding area. San Vicente-Talcahuano was particularly badly damaged by the recent earthquake, but is to be rebuilt with two deepwater container berths, while Lirquén posted growth of 12% last year, handling 231,636 teu.

Nevertheless, Mr Anwandter points out that Coronel is being developed as a multi-purpose port, not one whose success is predicated solely on the development of box traffic. As a result, in addition to the container terminal, Coronol has a finger pier to accommodate breakbulk vessels, which mainly handle timber and cellulose, as well as a terminal given over to imported coal and other bulk products, where vessels of up to 121,000 dwt can call.

Almost 1,500 km further north, the Port of Angamos, which forms part of the Mejillones Bay complex in Chile, handled 2.4m tonnes of cargo in 2010, an increase of 3.15% over 2009, which Rafael Lancellotti, operations manager of port authority Complejo Portuario Mejillones, says is mainly due to additional imports of steel bars and a boost in container numbers.

“We mainly handle outbound copper traffic, which amounted to 1.4m tonnes last year. However, in 2010, overall tonnage of this commodity fell by 5.9% due to production problems associated with the port's main customer, Codelco,” says Mr Lancellotti.

The recession had little impact on overall volumes handled at the port, given that copper export traffic tends to have a dynamic all of its own and the other major commodity – imported consumables for new industrial projects – has also escaped relatively unscathed.

“The result has been that new construction projects in the region have more than off-set the loss of cargo in more susceptible areas. So, in the last four years, we have witnessed an average annual increase in traffic of 3.3%, with the exception of 2009, when volume decreased by 2.7%,” says Mr Lancellotti.

Container traffic, while still modest, is on the increase. Last year, throughput totalled 127,312 teu, up 10.2%, due mainly to additional exports to Asia and extra transhipment.

“For this year, the aim is to boost non-copper-based containerised import-export traffic at Angamos Port. Here, in 2007-2008, we handled around 3,000 teu of containerised general cargo and in 2010 the objective is to increase this to around 15,000 teu,” he says, adding that the port currently receives nine monthly calls by CCNI and Hamburg Süd on Asia-Pacific services, while MSC makes weekly calls with its Europe service.

“We basically handle import-export traffic for Chile's II region and not transhipment boxes. Having said that, shipping lines do tranship some empty containers here, which are essentially being re-positioned,” says Mr Lancellotti.

He explains that Angamos Port's current role is that of a regional gateway, efficiently serving a cluster of local mining interest. However, the original intention was that it would act as a service platform for commerce and industry in the South American Centre-West Integration Zone (Zicosur) in its dealings with the Asia-Pacific region.

The Peruvian port of Callao, some 1,500km to the north, has something of a similar aim, although Mr Lancellotti stresses that, effectively, both ports serve completely distinct hinterlands and that they are not currently fighting for the same container traffic.

“If, in the future, the west coast of South America does need to establish a hub port, then both Angamos and Callao would want to assume that role. But any port wishing to attract transhipment traffic would have to fulfil a number of fundamental prerequisites to attract the attention of both shipping lines and the logistics infrastructure that goes with them. But there are other factors that neither port authorities nor local politicians can influence, by which I mean the location of the port itself in respect of distance from other ports, industrial areas and major residential zones.”

As for why shipping lines are attracted to Angamos Port, Mr Lancellotti points out that Mejillones Bay is well protected, which enables operations to take place throughout the year without disruption from heavy swells or strong winds. The infrastructure is modern and built to withstand earthquakes, while the terminal offers deep draft, with studies under way to deepen it even further.

“We can therefore attract vessels that cannot operate in other regional ports,” he says, adding that productivity is high and vessel turnaround times extremely competitive. On the landside, road and rail access is also good, suffering from no congestion and with much scope for expansion if necessary, free of urban planning constraints for industry in the long term.

It cost around $120m to build Angamos Port, in which a further $12m has been invested in cranes. A $4m dredging project is now under study, which is scheduled to commence in early 2012.

Angamos was built with a 5.5m tonne capacity for general cargo and containers, which is more than sufficient for the moment, given that only about 36% of the current capacity is being used and that under normal circumstances up to 65% of the available berth capacity could be used without prejudicing operations.

While Angamos Port concentrates on handling containers and general cargo, there are other terminals in Mejillones Bay specialising in the handling of both dry and liquid bulk. Between them, they accounted for traffic in 2010 of 5.7m tonnes, of which 1.9m tonnes was dry bulk. This divides neatly between imported coal for use in adjacent electricity generating station and mineral concentrates exported by companies in Bolivia.

The first vessel to call at the recently inaugurated TCBuen container terminal in the Colombian Pacific port of Buenaventura did so on January 27 this year. Currently, three shipping lines call: Maersk, CCNI and Hamburg Süd. General manager, Gabriel Corrales, explains that they use pre-booked berthing windows.

“Vessels calling here are operating on one of two routes: either Asia-Pacific (ASPA) or West, East, Central South America (WECSA),” he says, adding that the terminal had begun by offering lines average productivity of 18 moves an hour per vessel, although this has since been boosted to 48 moves and should reach 53 moves by the end of the year.

TCBuen is not the only terminal in Buenaventura to handle containers; SPRBun, the established port company, undertakes a variety of operations, encompassing dry bulk, liquid bulk, minerals, boxes, break bulk, new vehicles and so on.

“We are different in that we specialise wholly in the handling of containers, which is an attractive option for the shipping lines. In addition, within SPRBun, there are various operators involved in the box handling process, which tends to negatively impact on things like overall operational responsibility, efficiency and productivity,” says Mr Corrales.

He adds that available draft at TCBuen is 14 metres, while the competition only has 10.5 metres.

“I think it's also important to point out that we will guarantee berthing windows for vessels, which is something that our rivals still haven't been able to offer,” he says.

The terminal has been conceived of mostly in terms of import-export traffic, with its hinterland defined by the three largest cities in Colombia: Cali, Bogotá and Medellín. In its initial phase, it has a capacity of 250,000 teu, although a further three are planned, which should eventually result in TCBuen being able to handle 1.3m teu.

Vessels calling vary in length between 208 metres and 294 metres, with two quay cranes currently deployed, each of which is fitted with twin-spreaders allowing them to handle weights of up to 70 tonnes.