-
Global port congestion on average has worsened over the last seven years, but it is not because of underinvestment on the part of private operators, according to maritime and shipping consulting firm Drewry
-
Global average for ship waiting times has nearly doubled between the first 7 months of 2019 and the first 7 months of 2026
-
A larger share of a vessel’s time in port is being spent waiting for a berth rather than being handled at the terminal
-
The higher risk of port congestion is related to several industry trends and constraints, some of which are outside the control of port operators
-
Among the factors cited is increased automation and SMART port systems, which allows higher utilization levels and reduces the available buffer storage
-
Frequent disruptions, including weather disturbances, tariff changes, geopolitical tensions, and labor issues
-
Others are: government regulations that delay port investments, landside transport issues, and trend towards larger vessels, which increase volume peaks
Global port congestion on average has worsened over the last seven years, affecting both shipping lines and shippers, but it is not because of underinvestment on the part of private operators, according to maritime and shipping consulting firm Drewry.
In its latest Market Signals report on container shipping, the research firm said the “global average for ship waiting times has nearly doubled between the first 7 months of 2019 and the first 7 months of this year.”
Ship waiting times and total port call durations have increased from seven years ago, “but a larger share of a vessel’s time in port is being spent waiting for a berth rather than being handled at the terminal, pointing to congestion pressures before arrival alongside,” Drewry said in a news release.
Waiting for a berth was one of the contributing factors to the 31% jump in average time spent by a containership in a port between 2019 and this year, with significant variations by region.
In August this year, the average waiting days was 1.63, up 11% from last month while schedule reliability stood at 38%, down 5% from July.
“So, containerships are demonstrably less productive in ports and spend more time waiting for a berth than they were before the Covid pandemic,” Drewry said.
Lack of investments?
Drewry cited Vincent Clerc, CEO of A.P. Moller-Maersk, who said in the company’s financial presentation on August 13 that container port capacity is insufficient and causing congestion in several regions, including Europe, the East Coast of South America, West Africa and the Middle East, in a context of strong container export growth from Asia.
“This growth and increasing trade imbalances comes on the heels of about 15 years since the financial crisis, where investment into terminal capacity has lagged,” Clerc said.
However, Drewry contends that the higher risk of port congestion is related to several industry trends and constraints, some of which are outside the control of port operators.
It cited the following factors:
- Increased automation of terminal operations and SMART port systems, which allows higher utilization levels and reduces the available buffer storage.
- Frequent disruptions that cause port volume swings. These include weather disturbances, tariff changes, geopolitical tensions, and labor issues.
- Government regulations that delay port investments.
- Landside transport issues that cause or amplify the bottlenecks.
- Trend towards larger vessels, which increase volume peaks.
Drewry pointed out that port operators’ main objective is to increase port utilization and maximize return on investments.
Similarly, shipping lines focus on operating costs and on returns. This means carriers also contribute to the congestion as they maximize returns through blank sailings, ad hoc sailings and extra loaders.
Drewry’s analysis of port capacity, port throughputs and port utilization from its global databases show that, based on nine major container ports, terminal operators on average expanded capacity by 21% between 2019 and 2026, below the growth of 28% in volumes during the same period.
Singapore expanded its port capacity slightly faster than volume, while other major ports such as Shanghai, Santos, Jawaharlal Nehru Port and Qingdao did not.
In China and in Europe, the largely private-sector terminal operators have increased the utilization of their capacity, and increased capacity slower than volume. In the port of Rotterdam, capacity was kept static, as one of the smaller container terminals was closed down in 2020 when volumes declined and competition from larger terminals increased.
“This is normal, private-sector investment behaviour,” Drewry said. “Therefore, Drewry does not see a single, global trend towards ‘under-investment’ in port capacity but a stronger focus on asset utilisation, which increases the risk of port congestion.”
Terminal operators in most regions, Drewry opined, “are not failing to invest and will continue to invest in port capacity.” But ultimately, terminal operators cannot finance “buffer capacity” on their own. The container shipping ecosystem is currently built not for resilience but to optimize cost.
READ: Drewry’s World Container Index rebounds as transpacific rates rise
