Doing what needs to be done to rid intra-Asian ports of congestion that stymies their success
 With the intra-Asia market expected to grow four to six per cent a year, it is now vital to eliminate the congestion that threatens to make failures out of the success of ports' growing cargo volumes truly represent.
"Intra-Asia trade places requirements on ports and terminals for flexibility and efficiency. This creates challenges to terminal operations in yard shuffling needs, as well as transshipment and operational complexity," warned Hutchison Ports research Chief Helen Li.
Today, intra-Asian growth areas include Vietnam, Malaysia and the Philippines. Ports that are well-positioned to serve the trade because they are also sources of cargo and well able to contribute well-established networks, but are still prone to congestion.
In total, intra-Asia container volumes are set to rise from around 31 million TEU this year, climbing to around 34 million in 2020, according to IHS Markit forecasts.
Flexibility and capacity to enable the intra-Asia trade to carry more weight also means that infrastructure must be up to modern standards.
"Signs of growth in the region are encouraging," said International Monetary Fund Asia-Pacific chief Changyong Rhee. "The challenge now is to strengthen and sustain this momentum."
Certain commodities are seeing strong growth, for instance a 20 per cent increase in waste products, partly as a consequence of recent waste import restrictions into China, resulting in demand for new locations within Asia for waste handling.
Raw materials and industrial consumables are also expected to grow five per cent, reflecting Asia's continued importance in manufacturing and production.
"The intra-Asia trade is a complex and fast-moving trade with particular characteristics," said Hutchison's Ms Li.
Trade characteristics include high service frequency requirements for quick vessel turnaround time (less buffer in network schedules) transshipment connectivity requirements late instructions or last-minute changes, she said.
Port congestion at smaller Asian ports results in delays of up to seven days. Some intra-Asia carriers have said Bangkok, Chittagong, Kolkata, and Shanghai are among the worst affected ports, with berthing delays of almost a week.
While part of the problem has been caused by growing container volumes, carriers also point to inefficient operations and inadequate infrastructure exacerbated by bad and unstable weather conditions, particularly in eastern China.
Equipment has come under the spotlight and the lack of availability of quay cranes at many smaller Asian ports, which reduces the number of box moves per hour, results in even further delays.
However, handling smaller vessels also restricts the number of cranes that can be deployed. "Vessels catering specifically to the intra-Asia trade are smaller than those deployed on the main trades.
The smaller vessel sizes and shorter vessel lengths of intra-Asia vessels in the 1,500-TEU range makes it more difficult for terminals to achieve higher productivity, because operators would not be able to deploy as many cranes to service these smaller vessels," Ms Li said.
"In addition, these intra-Asia vessels may not necessarily require as many crane moves, which affects operational efficiency as the time required for berthing and unberthing would still be similar despite the relatively lower volume of moves."
Unlike most ports, Chittagong and Bangkok operate berths on a first-come-first-served basis rather than allowing carriers to book berthing windows. There is a total of 57 geared vessels and seven gearless ships registered to call with the Chittagong Port Authority (CPA).
An evaluation of live ship data in June seems to support this, particularly at Chittagong, where seven of the 15 container ships at anchor waiting to berth at the port had been anchored for four days or more. Five have been waiting for three days or more, and three have been waiting for two days or more, according to AISLive, the IHS ship tracking agency.
Chittagong has also ordered additional cranes, but they have yet to be commissioned, and while geared vessels can also use the general cargo berth and the new container terminal at Chittagong, there are still delays. The CPA has announced ambitious plans to develop new container terminals plus a deep-sea mega-terminal.
As both Chittagong and Bangkok are river ports, there are draft restrictions, which adds to the difficulties. So-called Chittagong max vessels are limited to a draft of between 6.5 metres and seven metres, while Bangkok can handle larger ships up to nine metres draft.
Bad and unstable weather conditions in China have caused carriers significant problems at Shanghai and Ningbo. Nonetheless, intense fog and strong winds affect port operations and vessel services from time to time in Shanghai, Ningbo and Qingdao, causing disruptions to normal port operations, resulting in vessel service delays. Port operations at Shanghai's Waigaoqiao and Yangshan facilities are also delayed by up to three days with limited opening hours for container yards.
To mitigate the time carriers lose to delays caused by congestion, bad weather and the knock-on effect of extended waiting time on other Asian ports, terminal operators work with carriers towards improvement in operations planning, handling efficiency and fine-tuning the capabilities to cater to the needs of customers.
Said Hutchison's Ms Li: "Our terminals co-ordinate with shipping line customers to make adjustments to the berth plan to spread out the workload as much as possible. We will alert shipping lines in advance to changes in our berthing situation so that they can make the required adjustments to their sailing schedules and port calls accordingly.
"We also continue to work with carriers to encourage optimal stowage which would allow shorter vessel turnaround times," she said.
Because of the fast-moving nature of the intra-Asia trade and the requirement from ports to maintain flexibility and efficiency, it is now more than ever essential for terminal operators to collaborate with carriers to mitigate delays and to help maintain schedule integrity.
To attain profitability, terminal operators like Hutchison Ports must respond to this demand for improved services by expanding its network of state-of-the-art infrastructure and services across Asia to better meet the needs of its regional customers.
"Hutchison Ports has a strong presence in Asia serving the intra-Asia trade. We are enhancing the capabilities of our facilities across the region, such as the development of Terminal D in Laem Chabang (Thailand), to serve growing volumes," said Ms Li.
On the port side of the intra-Asian trade, it has become clear that these steps are necessary if this sector is to attain financial sustainability it so clearly lacks today.
|
