Asia holds sway over container ports

Jose Paul | Updated on December 18, 2020

Though port development in India hasn’t been impressive, the govt is now taking proactive steps to modernise our ports

Standardised containers were first used to transport cargo by sea on April 26, 1956. During the last over six decades this containerised mode of transport has made a huge impact on global shipping. Lingering trade tensions and high policy uncertainty undermined growth in global economic output and merchandise trade in 2019. Trade volumes expanded by 0.5 per cent in 2019, down from 2.8 per cent in 2018, to 11.8 billion tonnes. In tandem, global container port traffic growth slowed to 2 per cent from 5.1 per cent in 2018.

In 2019, about 811.2 million TEUs (twenty-foot equivalent unit) were handled in container ports worldwide, reflecting an additional 16 million TEUs over 2018 (UNCTAD Review of Maritime Transport 2020). Though the container trade volume represents about 18 per cent of the global maritime trade, this fastest growing market segment accounts for almost two-thirds of the global maritime trade by value.

Ahead of US and Europe

Although containerisation originated in US, port development there did not keep pace with the developments in container shipping. When container ship size increased initially from 1,000 TEU capacity in the first generation and subsequently to 5,000 TEUs, 10,000 TEUs and 20,000 TEUs, major seaports in the US and Europe did not keep abreast of the technological developments in ship size.

In the first two decades of 2000, there has been significant improvement in the modernisation, deepening and widening of approach channels, construction of specialised berths and provision of high capacity quay cranes to accommodate the ever increasing ship size in Asian ports. The US and European ports lagged behind due to a number of regulatory and procedural delays influenced by environmental issues.

During this period Asian ports made substantial improvements in the modernisation of ports embracing new technology and were able to accommodate third generation and fourth generation container ships up to 25,000 TEUs. Many Asian ports provided excellent terminal facilities to accommodate the ultra large container vessels of over 20,000 TEUs with sophisticated double stack container quay cranes to enhance container-handling efficiency and improve berth productivity.

Large port construction and developmental programmes were taken up by many Asian maritime nations with a view to boost terminal facilities and attract container shipping lines. Governments in the Asian region were found to be taking proactive steps in funding new ports and terminals for container trade and were going ahead rapidly building logistic hubs.

In 2019, nearly 65 per cent of global port container cargo handling was concentrated in Asia — the share of China alone exceeded 50%.

The port of Shanghai in China is the largest container port in the world with annual throughput of 43.3 million TEUs in 2019. Chinese authorities released plans in November 2019 to accelerate its programme of constructing world-class ports incorporating smart management and operations technologies.

China has seven of the world’s top ten container ports by TEU trade with Shanghai, the largest, followed by Ningbo-Zhoushan, Shenzhen, Guangzhou, Qingdao, Hong Kong and Tianjin. Among the 20 largest container ports, nine are in China and the rest are in Europe and Asia.

Singapore on overdrive

For the last 10 years or so, Singapore remained as the world’s second largest container port handling 37.1 million TEUs. Port of Singapore Authority has developed an ambitious plan by creating Tuas Port, which represents the “future of the Singapore transshipment hub”.

Tuas Port is designed to meet and exceed the future demands of container shipping. It incorporates an intelligent data-driven operations management system, wharf and yard automation, full-electric automated guided vehicles, smart engineering and power management platforms. To be developed in four phases, Tuas Port’s first berths are scheduled to commence operations in 2021. When completed in 2040, Tuas Port is likely to be the world’s single largest fully automated terminal in the world.

The South Korean port of Busan is the sixth largest container port with a throughput of 21.9 million TEUs in 2019. The South Korean Government with private funding plans to invest more than $35 billion for developing 12 ports in the next 20 years to increase their ship-handling capacity.

The objective is to make Busan the world’s third-largest port by 2040 with capacity to handle 25,000 TEU capacity container ships.

The largest European port is Rotterdam in the Netherlands, which is in the 10th position handling 14.8 million TEUs, while another European port Antwerp in Belgium is at the 13th position handling 11.8 million TEUS. The US ports of Los Angeles, New York/New Jersey are at 21st and 23rd positions while Colombo in Sri Lanka and Ho Chi Minh City in Vietnam are placed at the 24th and 25th positions.

The ports in Dubai and Klang in Malaysia occupy the 11th and 12th positions, handling 14.1 and 13.5 million TEUs, respectively.

Development plan

The largest container port in India is Jawaharlal Nehru Port Trust in Mumbai, which at 33rd position handled 5.1 million TEUs in 2019, while the port of Mundra figures at 37th position, handling 4.7 million TEUs.

Compared with other Asian countries, port development in India has not been impressive. Smaller countries like Malaysia, Sri Lanka, Vietnam and the Philippines have developed their ports in such a way that they are far ahead of Indian ports. However, it is heartening to note that there is a great deal of awareness in the Ministry of Ports, Shipping and Waterways to accord high priority for port, shipping and waterways development.

The government has brought in a new Port Authority Bill, the Merchant Shipping Act and a Bill for development of coastal shipping. It has also formulated a detailed developmental plan under ‘Maritime India Vision 2030’ for qualitative and quantitative upgradation of Indian ports, shipping and waterways to be able to deliver holistic cargo solutions to customers and promote greater supply-chain efficiency.

The writer is a former acting chairman of JN Port, Mumbai, and a former chairman of Mormugao Port Trust

Published on December 18, 2020

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