Red Sea crisis shifts call patterns at transshipment hubs

Transshipment ports face challenges from shifting call patterns amid Red Sea crisis

Key transshipment ports, such as Singapore, have witnessed a sharp rise in congestion due to the impact of Red Sea carrier service diversions.

According to Drewry’s Ports and Terminals Insight, this has resulted in fewer vessel calls but larger average exchanges, contributing to increased yard congestion.

Port productivity has also taken a hit in recent months. The time spent by ships waiting before berthing at high-volume ports tracked by Drewry increased 43 per cent between 3Q23 and 2Q24 – to over 400,000 hours.

Singapore is in a microcosm of transshipment ports around the world, where changes to carrier service patterns in response to the Red Sea crisis, have impeded container terminal operations, reported Drewry. As such, the port is experiencing a density of shipping containers in its terminals close to the records of the pandemic period.

In the five months to May throughput at the port grew 8 per cent year-on-year (YoY), representing a strong start to the year but not enough on its own to challenge existing handling capacity.

However, the rerouting of container vessel services away from the Red Sea in response to the Houthi attacks on shipping resulted in a 22 per cent increase in average parcel sizes in the period between January and May, with a significant knock-on impact on port productivity, according to Drewry’s Ports and Terminals Insight. 

Drewry estimates that the average time taken to handle 1,000 TEU rose 10 per cent over this period to 0.32 days, meaning that the average time to complete the recently enlarged exchanges for a typical ULCV (>18kteu) leapt 41 per cent, from 1.1 days in January to 1.7 days in May.

READ: Maersk reshuffles transshipments to Algerian ports

“The port congestion we are seeing today differs from that of the pandemic period,” stated Drewry’s Ports and Terminals Insight.

“Back then systemic supply chain disruption primarily impacted gateway ports due to the combined effect of unexpectedly high cargo demand and inland transport congestion.

“However, this current crisis is hitting transhipment hubs as carriers have made major changes to individual exchanges handled at these hubs.  Meanwhile, aligning mainline-mainline vessel transfers has proved difficult due to the high number of blank sailings, while aligning mainline-feeder services has been affected due to congested yards, off-window arrivals and prioritising mainline vessels over feeder vessels.”

READ: Transshipments at Port of Colombo soar for third consecutive month

Drewry expects congestion at major transhipment ports to remain high, but some easing is anticipated as carriers add more capacity and restore some of their disrupted schedules.

Last month, it was reported that the Maritime Port Authority of Singapore (MPA) saw a considerable increase in container volumes and ‘bunching’ of container vessel arrivals in recent months.

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