Surging container shipping cargo demand in the wake of the pandemic has resulted in increased terminal capacity – but it still may not meet forecasted demand levels, Drewry has said.
Global container port capacity is projected to increase by an average 2.5% per year to reach 1.3 billion TEU in 2025 according to Drewry’s Global Container Terminal Operators Annual Review and Forecast report.
With global demand set to rise by an average 5% per annum over the same period, average utilisation rates will increase from the current 67% to over 75%.
At a world-wide level this expectation of tightening port capacity in a market plagued by congestion due to supply chain imbalances is a cause for concern, the consultancy said.
Eleanor Hadland, author of the report and Drewry’s senior analyst for ports and terminals, said, “The strength of the recovery in demand, aided by high levels of liquidity in the financial market, have enabled operators to bring forward their investment plans, resulting in a stronger capacity outlook post-pandemic.”
According to the outlook, the majority of the forecast additional capacity will be delivered at existing terminals, with greenfield projects still remaining a low priority for most global operators.
There are fewer greenfield automation projects in the pipeline, but retrofitting of existing terminals is on the rise.
The leading operators are also investing in digitalisation, recognising that this can increase the speed of movement of boxes through their facilities.
Hadland added, “Improving cargo flow is key. If via the roll-out of blockchain-based technology Global Terminal Operators (GTOs) can achieve higher volumes over the same asset base, this will drive improved returns on investment.”
Through 2020 the group of 21 companies classified by Drewry as GTOs were not immune from the market challenges imposed by COVID-19, with combined equity-adjusted volumes falling 0.8% compared to a global reduction in port handling of 1.2%.
These GTOs now handle over 49% of the global port volumes on an equity-adjusted basis, up from 45.6% in 2015. China Merchants Ports moved up to second place in the Drewry rankings in 2020, following a 13.4% increase in equity-adjusted volumes.