Constanta now targeting hinterland demand
When the Romanian Port of Constanta began to develop its container handling facilities, it had its eye on securing transshipment traffic, writes Alex Hughes
Constanta previously handled higher volumes of transshipment container traffic, but is now targeting import-export demand to replace the lost business. With DP World extending its concession, the port is also seeing competitors beyond just its localised region.
The argument was that the Black Sea region lacked a dominant box hub, forcing many shipping lines to use feeder vessels from ports in the Eastern Mediterranean rather than direct liner services to ports that, in many cases, lacked sufficient draft.
Initially, Constanta appeared to prove this argument about being the region's natural hub to be correct, attracting significant calls from many of the deep sea lines. However, DP
World Constanta was hit hard by the Global Financial Crisis in 2009, resulting in the terminal losing almost all its transshipment containers. Formerly, this activity accounted for a 75% share of overall demand, but is now down to less than 5%.
Nishal Sooredoo, analyst at Ocean Shipping Consultants, notes that DP World built up volumes very rapidly after it took over the terminal in 2003 but the global financial crisis and loss of transshipment traffic to other ports such as Piraeus and Istanbul occurred.
“This period also coincided with the emergence of ports in the Adriatic, such as Koper, Rijeka and Venice, which provided a new routing option to reach the Central European market, via rail,” he stated.
Cosmin Carstea, CEO DP World Constanta, responds by pointing out that, “The current focus, which is on import and export cargo, constitutes a healthy growth since it is based
solely on the evolution of the Romanian national economy.”
In 2018, the port handled a total of 668,016TEU, compared to 696,438TEU in 2017, a decrease of 4%. This decrease does form part of a short term decline, with the present level of traffic very similar to what was moved by the port in 2014.
The vast majority of the containers in Constanta are handled by the DP World facility. Explaining the drop off in traffic, Mr Carstea notes that over the past two years government policy has been to reduce the export of wood origin products (timber, logs) and these are commodities which comprised the majority of export cargo at the port so impacted negatively on throughput.
“So far, 2019 has seen a slight improvement over the same period last year, mainly correlated with Romanian purchasing power. As such, any impact on the national economy will impact container throughput in Constanta,” he says, especially that, nowadays, 95-96% of total traffic is in the form of origin/destination boxes.
The current capacity of the terminal is 1,000,000 TEU and there is sufficient land area for phased expansion to cater for volumes of over of 4,500,000 TEU.
So, where is future growth to come from?
While hinterland connections beyond Constanta can be something of a challenge, DP World Constanta stresses that it offers importers and exporters in Central Europe speedier and more cost effective access to the Far East market than movement via the traditional routing over North Continental ports, since it avoids congested intermodal bottlenecks in
To promote this routing, DP World is actively developing an intermodal network that expands from the port to assist shippers in the movement of their cargo. “In addition to that,
and with the scope of being a trade enabler for our customers, we are on the constant look out to offer value added services, ranging from sharing our global expertise to working towards offering logistic services within the terminal,” says Mr Carstea.
There is little doubt that DP World is committed to this project for the long term. Its Constanta terminal recently signed a concession renewal agreement with the Constanta Port Authority for another 30 years of operations. In support of this arrangement, DP World is continuing to invest, either by expanding yard capacity or ordering additional container
handling equipment and, in due course, bringing additional berths on line.
In terms of competition, Mr Carstea stresses that this does not necessarily come from other Black Sea Ports but rather the domestic nature of its current cargo profile means the North European Ports or Adriatic Ports (Rijecka, Koper, Trieste), or even Pireus, in Greece, are the main competitors.
Nevertheless, having once attracted large amounts of transshipment traffic, Constanta is well suited to handling larger ships. The draft varies between 14.5 metres and 16.5 metres, sufficient to handle vessels in the 10,000 TEU class, although currently there do not appear to be any known plans for the larger vessels to call at the container terminal.
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