Key European ports are expanding capacity and operational efficiency in order to handle ultra large container ships (ULCS) more effectively
Port of Hamburg passed a milestone last year after it was given the green light to dredge the River Elbe. This has been an ongoing issue for many years. The River Elbe needs dredging to boost the movement of ULCS through the port. Dredging the River Elbe by 1 m will allow more ships to enter and exit the port at the same time.
Port of Hamburg Marketing chief executive Axel Mattern told Container Shipping & Trade “It is quite a process, to prepare for the river and dredging activities. The processes are divided into dredging and building the box where the larger vessels, up to 22,000 TEU, can pass each other.”
The benefits of this work are clear: it will double the number of big ships that can enter the port. The work will be finished in 2021.
Speaking about the need for this, Mr Mattern says “It is absolutely urgent but we are quite happy as the decision has been made and it is quite an emotional thing – you can feel it – the logistics industry and shipowners are much more positive for the future and are planning their liner activities differently.”
It will reap further benefits in the future. Mr Mattern explains. “2019 looks like it will be similar to 2018, where it is a very hot and dry year so there is not a lot of water in the river system, which is very difficult for producers and manufacturers relying on river barges to Rotterdam and Antwerp.”
He says there is a large chemical shipper that would love the opportunity to switch more volumes to Hamburg to combat this situation. Mr Mattern says “This will be much easier when we have finished with the dredging as to export heavy chemical cargo, you need the draft.”
Hamburg wins services
The port has already had some very positive news this year: Hapag-Lloyd and ONE moved four transatlantic liner services from Bremerhaven to Hamburg in January. Mr Mattern comments “This was a nice decision for Hamburg and does not interfere with the dredging, as US liner ships are much smaller.”
This will increase volumes at the port by 55,000 TEU in 2019 compared to 2018. Mr Mattern says “For the first three months there has been a significant growth in total volumes with more than 5% already seen. We are especially happy the US traffic is linked to hinterland traffic as they are mainly containers transported to Hamburg or its hinterland.”
He singled out Austria as having an “intense” trade with the US. “Austria is very well connected by rail to Hamburg and we see growth in the rail figures in 2019 as well as in total handling.”
The Port of Valencia is also focusing on catering to larger vessels. It is building a new part-automated north container terminal that will have capacity for 5M TEU. It is expected the project will take around six years to build.
The port authority says the new terminal’s aim will be to “exploit the strengths of Valencia as an import/export and transit port with a capacity of around 5M TEU, complementing the existing terminals’ capacity to accommodate the expected container traffic at the port of Valencia by 2050.”
And the new project will allow it to receive ultra large container ships of up to 24,000 TEU.
Elsewhere, Port of Antwerp had a strong year in 2018 – it saw a year-on-year 6.2% increase in its deepsea box volumes, hitting 11.1M TEU.
Antwerp Port Authority director of international relations Luc Arnouts puts it down to the growth in ship size and the subsequent increase in demand for a “cargo-generating” port.
He says “The scale and size of ships are increasing. These big ships need cargo volumes and cargo-generating ports are outperforming ports that have less cargo generation. We have a very large integrated chemical cluster, ships are coming to the port where there is a huge industry, which gives us cargo-generating power.”
Furthermore, he points out Antwerp’s captive area is “much bigger” than the port itself due to its links to the hinterland. “Bigger ships prefer big hubs that can guarantee cargo flow. That is why the biggest ports outperform mid-sized ports,” he sums up.
Another factor behind the boost in its volumes last year is that on the east-west tradelane, Antwerp Port won two new services where it is the first port of call. Mr Arnouts explains “The greatest flow of volumes from the Far East to north Europe will come to the first port as most of the goods' transit is time sensitive so we have a nice balance between export and import cargo.”
The port saw a slight growth in its Asia volumes in 2018 but the Chinese restrictions on exporting plastic waste had “quite an impact for all the ports”, Mr Arnouts said, explaining that exported plastic waste used to be a considerable volume.
Nevertheless, a growth opportunity for the port is China’s Belt and Road initiative. Mr Arnouts says “This is enriching the choice for supply chain management with maritime, rail or air, as at the Port of Antwerp we can offer all possibilities.”
Another priority for the port is to solve the problem of inland barge congestion. In Q2 2017 all port stakeholders joined forces to try and solve this issue. There have been regular workshops and a focus on better planning, such as ensuring information arrives earlier for barge and terminal operators. One major initiative is to ensure that a minimum of 30 containers are on a barge heading for one of Antwerp’s deepsea terminals, to allow the barge to better organise unloading and loading.
As part of this, consolidation hubs have been installed outside and inside the terminals.
But Mr Arnouts says “It is a nice concept of consolidation to increase efficiency, but it remains a difficult one [inland barge congestion]. The minimum call size on its own is not solving problems of congestion, we need to evaluate this and in practice sit round the table again.”
He explains “At the container terminals deepsea container ships get priority as they need to be handled in their windows of time, and barges are often the victim of that.”
To solve this, he says that the port authority might have to think about dedicated barge quays and berths and further increase volumes for consolidation.
Ireland feeder boost
Port of Cork has container growth plans firmly in place: it is building a new container terminal that should open in Q1 2020. Port of Cork harbour master and chief operations officer Paul O’Regan says “Our main objective is to move the terminal from an upriver position where it is restricted by the size of vessel that can be taken at the terminal, to a facility near the mouth of the harbour which gives much greater scope to take larger vessels and also provides a much larger footprint for the new terminal.”
He sums up “The primary objective is to grow the container trade in the Cork region and handle larger vessels as feeder vessels are getting larger. It really is two-fold, the business needs to grow and there is a physical need as the current terminal is too small.” He explains that at the current terminal, vessels are restricted to 160 m in length and to capacity of 1,200 to 1,300 TEU. By contrast the new terminal will be able to take a leap forward with vessels up to 230 m long with a capacity of 3,500 TEU. The new terminal will have capacity for 330,000 TEU. The old terminal will be used for other types of cargo once the new container terminal opens.
The new terminal is needed as there has been a growth in Port of Cork’s container volumes. Mr O’Regan explains that Ireland is traditionally fed by feeder services to Belfast, Dublin and Cork with connections to hub ports including Antwerp, Liverpool, Southampton and Rotterdam.
He comments “We see these connections continuing and I imagine we will see a growth in the amount of services we are getting and probably on scale too.”
The port’s container volumes are growing at about 5 to 6% a year. Mr O’Regan says “We are experiencing a growth spurt.”
The port last year achieved 230,000 TEU versus 175,000 TEU in 2012, so “we have really good growth levels, primarily driven by agriculture and pharmacy.” The main pharmacy area is only around five miles from the port.
Mr O’Regan says “The challenge is to balance imports and exports. Ireland is predominantly an import market and that creates an imbalance in equipment. But since 2015 our agricultural sector is much stronger and there is a 50/50 split, so it is very good for operators. The biggest challenge in Ireland is the very strong growth in the container market with no new facilities coming on line. Current facilities are in areas where there is no capacity to grow, so that is what we are bringing to the current market. Our new terminal is built on a greenfield site and will introduce capacity not available in other ports.”
Main markets for Cork include the US, China and the UK. Mr O’Regan comments “Brexit creates some unknowns. We have built in a lot of contingency planning from the point of view of capacity, with overflow areas, where trucks can park longer.”
One particular growth area is the reefer market. Mr O’Regan says “The reefer market growth is huge, and we cannot keep up with the pace reefer goods are being transferred to reefer containers.”
The current terminal has 350 reefer plugs, which will go up to 500 plugs in the new terminal with 120 extra for spare capacity.
The port is also focused on being more efficient and is the first container terminal in Ireland to launch a vehicle booking system. The system is being trialled and has already speeded up gate times for hauliers using it.
Snapshot CV: Luc Arnouts, Antwerp Port Authority
Luc Arnouts obtained a master's degree in law at the University of Antwerp and a master's degree in general management at the University of Ghent. He has been active in the port and logistics sector ever since. He started his career and gained operational experience in stevedoring, warehousing and ocean freight forwarding at the logistics company Group Katoen Natie from 1986 until 1992. In 1992, he moved to SGS-Group Belgium as general manager of SGS-Van Bree. Aviapartner became his new employer in 2000, where he held the position of vice president cargo handling Europe. In 2007, he took up a new challenge as chief commercial officer at the Antwerp Port Authority.