Velocity at Valencia and best at Barcelona
West Mediterranean container ports are adding equipment and expanding terminal areas to continue to attract larger container ships, writes Alex Hughes.
The Port of Valencia has moved from being the third largest container volume port in Spain the take the number one position. In 2018, it handled a total of 5.2 million TEU,
equivalent to growth of 7.2% and for the first eight months of 2019, performance has been even better, rising 9.2% to 3.7 million TEU.
“We have recorded two years of impressive growth, which we attribute to shipping companies beginning to concentrate their activities in Valencia,” confirmed press spokesperson
Vicent Palací. He points out that the port’s hinterland, which covers the city of Valencia the Spanish capital Madrid, as well as important cities in Catilla-La Mancha, Aragón and Murcia, generates 60% of Spanish GDP.
“When you add our strong import-export traffic to our transhipment traffic, there are obvious economies of scale, which means shipping lines like calling here,” says Mr Palací.
He further confirms that Maersk Line, Mediterranean Shipping Co (MSC) and Cosco – the world’s three largest container shipping lines – all have major terminal presences in Valencia, so have incentives to bring transhipment on the vessels with gateway traffic.
Figures released covering the seven months to July, show that transhipment now accounts for 53% of total traffic, amounting to 3.2 million TEU. Interestingly, it is trade with the
US and Turkey that are seeing strong growth, while activity with China is down by 1%.
“Our connections are improving all the time,” says Mr Palací. “We recognise we are, nowadays, a hub port, but not just serving regional ports, but also those in the US, Canada, Mexico, Brazil, Africa, and North Europe, too.”
The port authority has backed future growth in the form of a fourth container terminal, for which MSC’s terminal arm, TIL, was the only bidder. The project will absorb total investment of €1.01 billion, of which €400 million will come from the port authority.
Once operational, it will increase total capacity at Valencia from 7.5 million TEU to 12.5 million TEU. Mr Palací confirmed that the concessionaire is not obliged to guarantee transhipment levels as part of the contract, but did outline the level of infrastructure to be offered.
“There will be 18m of draft at the new terminal, which means we will be able to accommodate 23,000TEU vessels. We are already receiving calls from 400m-long ships at our
existing terminals, so we feel Valencia is at the forefront of the container market in the Mediterranean,” he said.
Significantly, the concession does specify “at least” semi-automated operation in the new terminal, which is what TIL intends to implement. Mr. Palací says that automation
allows greater added value jobs to be created.
“In the past, vessels were loaded manually. Nowadays, the rising number of containers, as well as larger cranes and better IT back up is resulting in more employment thanks to rising levels of business,” he says.
Interestingly, the concession signed by TIL does allow the operator to exit the box terminal operation it has in Valencia’s southern harbour, meaning that the port would be in the interesting position of trying to find another concessionaire or amend the terminal’s use.
MSC did move terminals at the Port of Antwerp in 2015-2016, so has experience of such an undertaking. Asked about competition, Mr Palací concedes that Algeciras is Spain’s leading transhipment port, although stresses that the type of activity handled would not come to Valencia anyway.
He is right, with Algeciras handling relay transhipment (deep-sea to deep-sea vessel) and Valencia more hub & spoke activity. The Port of Algeciras enjoyed good volume growth in 2018, seeing a record year with total box traffic of 4.8 million TEU, up 9%.
By the end of July 2019, it had surpassed 3.0 million TEU, 8% growth year-on-year. For the full-year 2019 period, port authority president, Gerardo Landaluce, is forecasting total
container volumes of close to 5.0 million TEU.
“The main factors driving growth are our connectivity and the ability to operate several mega-ships simultaneously,” he confirmed.
In 2018, transshipment accounted for 4.1 million TEU (85% of total volumes), although the ratio between import-export and transshipment is gradually changing because 10 years ago gateway traffic was 5% of the port total, but for the January to July 2019 total the figure was 13%.
“Our main clients are Maersk Line, CMA CGM and MSC, although more than twenty shipping companies transship containers at our terminals,” confirmed Mr. Landaluce, although he did stress that the broadening of the traffic base coincided with the opening of the TTIA public terminal in the port a decade ago.
He also states a belief that Algeciras is very much a transshipment alternative compared to other Mediterranean ports and should be viewed as the reference hub in the Straits of Gibraltar. He adds that the port’s terminals are now extremely experienced and have some of the highest productivity rates in the region.
“We are also one of the few ports able to handle various megaships at the same time and at maximum load capacity,” he stresses.
Capacity continues to increase and when Phase B of the Isla Verde Outer Harbour project enters operational service 8.0 million TEU per annum will be offered.
“Our terminals are currently handling the largest ships afloat. We were the first European port where both the MSC Gülsün and the MSC Mina made stopovers. These both have 23,756 TEU capacity. Every week we also handle Maersk Line and CMA CGM megaships. Last year, for example, 122 vessels of greater than 16,000 TEU capacity called here,” says Mr. Landaluce.
Algeciras, he notes, is continually upgrading its facilities in line with the growth in size of vessel. Most of the work is concentrating in deepening draft alongside the berths, as well
as in increasing the structural capacity of the quay to allow it to support ever bigger crane loads. Quays in the Isla Verde Outer Harbour can already handle any container vessel currently in service with the largest possible cranes.
“Between August and December 2019, we will undertake draft improvement work on a stretch of the Juan Carlos I Pier to improve draft to 18.5m in preparation for the arrival of even larger vessels that will pass through the Suez Canal in 2020.”
Mr. Landaluce says that either automated or semi-automated terminal operational is becoming a fundamental factor in handling transshipment traffic passing through the Strait.
He says that in 2010 Algeciras was the first Spanish, and Mediterranean, port to introduce semi-automatic terminal handling, which was at TTIA and that performance has since been the benchmark for other terminals.
In 2018, Barcelona handled almost 3.5 million TEU, an increase of 17% compared to the 3.0 million TEU seen in 2017. Transhipment was the key driver, with a 37.1% improvement to reach just under 1.5 million TEU.
The port’s traditional role has been as a gateway facility, primarily handling imports to local hinterland markets, but following the strong transhipment increase in 2018, this activity
now equates to 42% of the port’s overall container total.
The position for the first seven months of the current year further endorses the trend. While overall throughput rose by 2.8% to 2.0 million TEU, transhipment increased by 7.81% to reach 873,192TEU, equal to 43% of Barcelona’s total container traffic.
Currently, the capacity at Barcelona is estimated to be around 5.0 million TEU annually and the port has already received container vessels larger than 19,000 TEU. However, both box terminals at the port - BEST (operated by Hutchison Ports) and APM Terminals Barcelona – are making investments in equipment and systems to accommodate the largest container ships now in service.
BEST, for example, received 139 vessels last year larger than 13,000TEU at its semi-automated terminal at El Prat, which opened in September 2012 and now has 11 ship-to-shore gantry cranes. Significantly, it has also been granted a further extension of 65,350m2 to its existing concession, meaning that when fully operational the semi-automated facility will occupy 100ha.
Since the introduction of France’s National Port Reform, the Port of Marseille-Fos has registered continuous growth in container activity, with an increase of 49% from 2011 when
944,047 TEU was handled to 1.4 million handled in 2018.
Christine Rosso, the port’s Head of Development, notes that growth in 2018 was 3.3% overall but already in the first two quarters of 2019 volumes are up by 6.0%.
“Growth in box traffic can be primarily attributed to two factors: port reform carried out by the state in 2008-2010, and the opening of two new container terminals (2XL) in that same period,” she said.
The additional capacity at newly-developed terminals will have improved operational capabilities, while also helping to eliminate a reputation for unreliability that the port had
acquired. Notable, terminal operators also invested in new cranes, recruited new dockers, and permanently enhanced productivity, she added.
“The port authority also pursued a policy of developing new services to connect our middle and long-distance hinterlands,” she explained, which helped to offset any slowdown in
Mediterranean traffic and changes to calling patterns of shipping lines and alliances. The result was that Marseille-Fos was one of the least negatively impacted Mediterranean ports,” the executive stressed.
Today, the port retains a key role in servicing North African and Far Eastern trades, having attracted back services to/from these destinations.
“We are now in a good position to act as a Mediterranean gateway to access European markets, historically addressed through northern range ports,” noted Ms. Rosso.
In terms of transhipment, around 5% of Marseille-Fos throughput is rotated in and out by sea, although drops to just 3% on East-West trades and 19% for north-south trades.
“Transhipment is evolving slowly, given that, in 2011, for us the figure was just 1% being generated on East-West services and 14% on north-south traffic,” said Ms Rosso, adding, “However, upgrades and changes made by terminal operators to boost productivity and introduce more cost-effective handling is allowing shipping lines to reconsider new opportunities for transhipment at the port.”
As far as the port authority is concerned, promoting transhipment helps to strengthen lines and increase the Marseille-Fos share of the overall Mediterranean loop, allowing
them to benefit from certain economies of scale from concentrating traffic in one area.
Historically, transhipment traffic has been more closely aligned to Mediterranean traffic, although the recent boost in transhipment activity at Fos, which was just 1% in 2016 and is now 3%, indicates a longer-term trend, albeit a slowly evolving one.
According to Ms Rosso, the adoption of port operating methods more closely aligned to what shipping lines need, means that Marseille-Fos is now in a more competitive position to compete for transhipment.
The port’s terminals are, she emphasises, in the perfect location to attract east-west, north-south and intra-Med traffic.
The largest vessels now calling are in the 16,500TEU range, although draft deepening in the coming years will make it possible to accept even larger vessels or allow existing ones to enter and leave fully loaded.
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