No clear path as ports weigh the options and implications

Chris Bain, chief operating officer of the Port of Napier, says there is no clear path which suggests 7,000 teu vessels would be a natural answer to the country’s need for a more efficient supply chain.

To make them work, more lines would have to group together in expanded consortia. Shippers may be faced with reduced port options and fewer service alternatives. Proposed hub ports would also face large logistical challenges. Feedering would have to accommodate New Zealand’s seasonal trades, the import/export regional imbalance, container equipment mismatches, high reefer requirements and cool chain integrity concerns.

His conclusion is that competition between the lines and for customers will probably result in an evolution of the current mix of shipping services, perhaps one large-vessel option augmented by coastal feeders as well as a range of mid-sized services using vessels in the 4,000-5,000 teu range that will continue to call at four or five ports.

Beneath that level, lines with smaller vessels (for example, the US trades, which tend to operate with vessels of 2,500-3,500 teu) will continue to support regional port calls.

The point Mr Bain is driving home is that while a hub port service could be important, it has not dominated the landscape because competitors will look to fill whatever void appears in the regional ports.

Operationally, he concedes that while there is a cascade effect happening, with larger vessels being displaced out of other trades and finding their way into the New Zealand scene, so far this has reached only the 4,500 teu, level which is accommodated at a regional port like Napier.

Because draught is only usually an issue at first port call in and last port call out, intermediate ports in the voyage pattern are less exposed to draught problems, and the physical dimensions of such vessels possibly could be accommodated without the port needing to delve deep for capex.

All of this leads Mr Bain to question whether New Zealand could still be well served by its logistics network while avoiding the need to invest hundreds of millions of dollars.

He draws an analogy with the airline industry, where the impact of massive Airbus A380s serving just a few routes has still to be quantified. Boeing, meanwhile, continues to build large-capacity aircraft that can fly to other destinations unable to handle the Airbus A380s. No one standard has prevailed, and customers still have a mix of options.

Could a similar situation arise with ports?