Port Strategy | EUPHORIA IN SHIPPING FINANCES MAY IMPACT PORTS -

Port Strategy | EUPHORIA IN SHIPPING FINANCES MAY IMPACT PORTS


OOCLA glut in profits has seen shipping lines go on a spending spree for vessels, but this will put pressure on ports




COMMENT: As the pandemic rolls back with vaccinations rolling out, the maritime industry
becomes overly optimistic from ports, terminals, carriers and shipbuilding, writes Ben Hackett.

The second half of 2020 turned the year into a phenomenal boon as freight rates rocketed and profits soared for container carriers. The lines claimed that it was due to unprecedented cargo demand from buoyant consumers going on an on-line shopping spree.

Yet when we look at the numbers in a bit more detail the boom in demand was limited to the second half of the year and the total increase was not that dramatic, only 1.7 per cent on the Transpacific, for example.

In Europe the Port of Hamburg’s container throughput declined 12 per cent to 8.5 million TEU overall with imports falling 8.2 per cent year on year in 2020. Rotterdam experienced a 3.2 per cent year on year decline in throughput to 14.3 million TEU in 2020.

Nevertheless, Rotterdam has commenced a quay lengthening project that will increase annual throughput capacity by four million TEU – or 28 per cent of Rotterdam’s annual box volume, according to Seatrade Maritime News. Antwerp managed to achieve a 1.3 per cent increase in container throughput to 12 million TEU for the first time.

With such small volume increases why was there a shortage of container capacity and containers? It can only be put down to being caught off guard by the resurgence of demand or the withholding of capacity to help encourage freight rates to go up, or both more likely.

The glut in profits spurred carriers to go on a spending splurge to buy second-hand ships and order new ones. According to Alphaliner, 267 ships with nearly one million in TEU capacity were sold. The larger carriers within the three alliances have also ordered a significant number of megamax ships with 24 rows of containers across, destined for the AsiaEurope trade.

This will certainly impact ports and terminals as they need to adjust quay lengths and cranes to deal with the influx of these vessels which will put increasing pressure on their ability to deal with ever larger interchanges per vessel call.

Expansion of terminals and new developments, such as the recently announced DP World/ Canadian investment in Indonesia are also in progress after a short hiatus. The pandemic was good business for some. Yet looking forward there are signs that long-haul routes may be impacted by the high freight rates and increased near shoring.



Source link

Subscribe to Infrabuddy Newsletter
Subscribe