Feature, Freight News, Sea

Port storage space fills up as crisis bites

[ April 17, 2020   //   ]

Many ports are reporting an increase in warehousing utilisation and distribution facilities for foodstuffs and medical supplies, according to a survey by the International Association of Ports and Harbors (IAPH).

IAPH’s second World Ports Sustainability Programme COVID19 Economic Impact Barometer surveyed 90 ports around the world, with Africa, South America and the Caribbean being better represented than in the first survey. Some 35% reported an increase demand for warehousing and distribution facilities for foodstuffs and medical supplies, with some seeing capacity shortages.

The situation for consumer goods has almost remained the same. In the dry and liquid bulk markets, almost two thirds of the respondents saw no changes in utilisation levels.

Several ports reported an increase in port and terminal utilisation due to an increase in the imports of essential goods, such as grains. Stockpiling by importers has also led to a major increase in capacity utilisation for these commodities. Other ports reported strategic storage of liquid bulks by traders in anticipation of price increases.

The most critical situation is in the automotive industry, with dealers failing to collect new cars due to a collapse in sale which in turn has led to overcrowding of storage areas.

On the other end of the spectrum, conventional cargo storage has dipped significantly, a phenomenon which has been reported before the COVID-19 outbreak. Ports have also reported dips in liquid bulk cargo, especially for imported fuels and power generation-related products due to low consumer demand, a lack of industrial production and mild weather.

Survey co-author Professor Theo Notteboom commented: “In the coming weeks we foresee major changes taking place in cargo flows as we begin to see the impact of blank sailings, especially in the container shipping sector on the main Asia-Europe and Transpacific trades. This will cascade into other trade lanes as well, so its vitally important for us to view the overall impact on port calls, operations, restrictions, port staffing, hinterland transportation and storage as well as future prospects for international trade to and from ports.”

His colleague Professor Thanos Pallis added: “Vessel calls, utilisation of warehousing and distribution factories, and connections to hinterland have been affected in many different ways. Workforce practices and procedures have changed.”