European terminals struggle

Wednesday, 27 February 2008

THE on-going boom in the containerised trade from the Far East to Europe has put extreme pressure on north European ports, and the monitoring of vessel movements for this analysis of the Japan/South Korea trade suggests that the situation is becoming increasingly difficult.

In most cases, ships were spending at least a day longer than scheduled to complete their circuits of north European calls, and in some instances several days more than planned. By July, the delays were getting worse.

The problem is not just one of inbound cargo volumes, as every container coming in has to go out again, usually moving back to the Far East full of air. This is an essential flaw of container shipping, and one that has been underlined by the sheer pace of growth in recent years.

The scale and duration of this expansion could hardly have been foreseen, and most ports have had difficulties adjusting. Should it continue for much longer, it is difficult to see how lines and terminals will cope.

Shipping lines followed various strategies to tackle these delays – there were many examples of ports being skipped to save time, and the order of calls was often amended to minimise hold-ups.
Taking a longer-term approach, some responded by adding a ship and extending round-voyage times, or by removing ports from their schedules. Although this in itself will not affect volumes, it should at least help to keep these operations on a tighter rein.

In the circumstances, it astonishing that several lines have managed to turn in such a high standard of performance. Of the 10 operations in this trade, only two were far off track, and six averaged under 0.5 calendar days behind schedule at the base ports used in this survey.

The two poorest averages belong to the MSC Lion service and the Grand Alliance EU4, but at least efforts have been made to remedy the situation.

In the case of MSC, an extra week was added to the Lion round-trip time in April, along with a few adjustments to port calls. In recent weeks further alterations have been made, with three ports axed to relieve the pressure.

The Grand Alliance lines have taken the drastic step of suspending the Southampton call on the EU4 – not a permanent solution, but a move that should at least help in the drive to restore punctuality in the coming months.

The same grouping’s EU1 performed with much more credit, although delays at the European end of the trade lengthened noticeably in July.

The “K” Line/[Yangming] JES/AE2 skipped the Kobe call on two occasions to save time, and the whole Japanese circuit was omitted on another occasion due to a vessel switch. There was also no sailing one week in June – the only instance in this survey of a sailing being omitted.

All the other operations covered deserve some praise. In mid-table, the Maersk AE2 and UASC AEC tied at Busan, with Maersk’s result being spoilt by one ship arriving six days late at Busan in April.
UASC did suffer some delays in Europe, and Thamesport was frequently switched to a later position in the loading circuit (this is reflected in the actual transit times to Busan, which were much shorter than the scheduled one). It might be noted that the line has just removed a Mediterranean call from the westbound schedule, freeing up more time.

The Hanjin-run FEX proved to be even better to Busan, but did skip Felixstowe on one occasion, while the New World Alliance came in second to Japan. The latter was hampered by one sailing on which the ship was delayed at Le Havre – the Kobe call was left until after Tokyo, explaining the higher average recorded for this port in the table.

This left the field open for Maersk Line to grab the top position for schedule reliability to Japan on its AE1 loop – although for shippers to Nagoya (not a base port for this analysis) it should be noted that the port was left until after Tokyo on three occasions. The result at Nagoya would thus have been less impressive.
The New World Alliance lines have the consolation of topping the list of carriers to Busan, with an excellent timekeeping performance. The grouping also dropped the Le Havre call from this loop in April to provide more slack, although ironically the two late arrivals occurred after this took place, as the scheduled arrival time at Busan was moved forward from Monday am to Sunday pm.

Once again, some excellent transit times from the UK were recorded. To Japan, the New World Alliance JEX took the crown with some ease, while Maersk’s restructuring of the AE2 in the spring ensured virtually unbeatable times to Busan.