Global container port congestion is rapidly worsening despite headlines of easing traffic at the twin ports of Los Angeles and Long Beach.
Logistics giant Kuehne+Nagel’s digital platform, seaexplorer, has developed what it terms as a Global Disruption Indicator, which tallies the cumulative teu waiting time in days based on container vessel capacity in disrupted hot spots. The specific hot spots covered include Los Angeles, Long Beach, Seattle, Vancouver, Prince Rupert, Oakland, New York, Savannah, Hong Kong, Shenzhen, Shanghai, Ningbo, Rotterdam and Antwerp.
The teu waiting days (TWD) indicator works whereby, for example, one vessel with a 10,000 teu capacity waiting 12 days equals 120,000 teu waiting days.
As of February 14 the total teu waiting time at the hot spot port areas covered by seaexplorer stood at 12.32m days. Yesterday it had shot up to cross 15m days for the first time (see chart below). Under normal, pre-pandemic circumstances, the waiting time would be less than 1m teu days.
No light at the end of the tunnel
“No light at the end of the tunnel,” commented Otto Schact, executive vice president of sea logistics at Kuehne+Nagel via LinkedIn yesterday, going on to note the heavy disruption now also on the US east coast where, for instance, in front of Charleston alone there are more than 30 vessels waiting.
“There is no let up in US port congestion despite the receding queue at the port of Los Angeles/Long Beach since the end of January. The diversion of transpacific capacity from Asia away from LA/LB to other US gateways since December has pushed up total vessel capacity waiting at the other US ports to over 1m teu with no improvements expected in the coming weeks as vessel departures from Asia continue apace even during the post Chinese New Year period,” container analysts at Linerlytica reported earlier this week.
“Stronger than expected US retail sales in January along with low retail inventories will likely keep Asian manufacturers, ports and carriers busy for the next few months,” a new report from US platform project44 forecast.
Data from Korean liner HMM shows continued high levels of port congestion in both Europe and North America, rendering 12.4% of the global vessel capacity unavailable. Putting this in perspective the normal, pre-pandemic state of affairs in the market is that 2% of global capacity is trapped in delays somewhere.
Danish supply chain research company Sea-Intelligence has predicted that an increase in March and April in the number of vessels scheduled to deliver cargo from Asia to North America will add to port congestion for two reasons.
In March and April, the number of vessels scheduled to depart Asia – and subsequently arrive on the North American west coast – will increase sharply and surpass a 40% increase compared to the pre-pandemic normality.
Further, as more ships are deployed, the number of smaller ships increases. In simplified terms, it is less efficient to handle two 5,000 teu vessels than it is to handle one 10,000 teu vessel, once the time to get to and from berth is factored in.