The Squeeze is on
Ports must address the congestion problem to survive. Patrik Wheater reports from a recent BMT briefing.
If they fail, they could "threaten their hinterland economy and lose traffic to more rapidly expanding competitors." This was the stark warning issued by British Maritime Technology Ltd (BMT) at its recent transportation briefing, Ports Under Pressure.
Russell Smith, md of BMT Maritime Consultants, says: "There is huge pressure on the logistics chain. Shipping has addressed the issues and reacted quickly. But it has been harder for land-based infrastructures?and the one cloud overhead, which potentially promises to transform into a torrential downpour, is the issue of port congestion, " which BMT expects to worsen over the next few years.
When maritime trade boomed the squeeze was first felt by the shipping industry, which responded with a glut of newbuild orders. But with the influx of new ships and the subsequent bottleneck at ports and terminals, the spotlight now beams down on the intermodal link.
Highlighting the geographical areas of concern, Richard Szuflak, BMT Maritime Consultants' European operations director, reports: "Manufacturing countries such as China are experiencing major congestion problems as they seek to unload ever increasing volumes of iron ore, coal and raw materials necessary to feed their industrial complexes."
Export ports in South America, Australia and South Africa are also "bulging at the seams." Australian ports alone are seeing queues of up to 50 bulk carriers waiting to load of iron ore.
Elsewhere, Indian ports are reportedly in a "mess". Africa is also experiencing long queues, with Mombasa suffering particularly "heavy congestion". Los Angeles and Long Beach which account for 70% of all US west-coast trade, have experienced queues of up to 94 container vessels. Lines are considering if it would be quicker to transit the Panama Canal and off-load on the east coast, Szuflak claims. European ports and terminals are also under immense pressure to keep up with the increasing flow of traffic. "We're seeing containers bound for France ending up in Antwerp or Genoa", because of container capacity problems.
Road congestion was considered to be a major problem, particularly in the UK, which sees almost 1.2 million TEU's per annum trucked through the southern container ports up to the north. The shortsea shipping solution to this problem was given further credence when BMT chief executive Roger Swann divulged that a major study carried out by BMT Transport Solutions for 15 EU governments concluded that a 45% increase in trade volume will take place in Europe within the next ten years, "putting further pressure on strategic transport corridors."
"Awareness of this is perhaps why major manufacturers and large retailers are shifting away from just-in-time delivery strategies. They simply cannot risk delays due to congestion problems which could cause production lines to grind to a halt or shelves to be empty, " says Swann. "Instead, there is a move towards guaranteed supply agreements whereby businesses are willing to pay a little bit more if their logistics company can ensure that the delivery chain works without a hitch, " he adds.
It was stressed that port development in Europe will continue to struggle to keep pace with demand "simply because of the very long lead times required in these countries to convert infrastructure requirements into reality". BMT says this is largely the result of the extensive assessment processes required in such developed economies with respect to the development of new port facilities with public enquiries, environmental approvals and the like all combining to add years of delay to infrastructure development.
BMT as a maritime solutions provider is focusing heavily on the creation of knowledge and technology banks in order to help improve operations, reduce transportation and operational costs, while BMT Transport Solutions can model complete logistics chains to provide business intelligence relating to a number of available transportation options.
