More Vessels Divert from Felixstowe and Southampton
By Mike Wackett 01/10/2018 TheLoadstar.co.uk
Chronic congestion at the UK’s two largest container ports is forcing ocean carrier planners to make further last-minute ship diversions, causing chaos to the country’s supply chain. Landside congestion at Felixstowe and Southampton has added to the woes of the UK haulage industry, which is already suffering from an acute shortage of HGV drivers. Even before the botched implementation of a new terminal operating system at Felixstowe in June, which was the catalyst for the current congestion, the UK haulage industry was running on empty and reckoned to be short of more than 75,000 drivers.
Indeed, one hauler told The Loadstar, before the Felixstowe IT melts down, that he was “very worried” about his firm’s ability to cover all the contracted work during the busy peak season this year. “We just can’t get the drivers,” he said at the time, “even though we are paying over the odds, and to add to it all we are seeing a couple of our existing guys retire every month.”
Container lines serving the UK are trying to push shippers to use merchant haulage but if they are contracted to cover the delivery of containers they are hitting importers with a variety of extra charges. MSC, for example, has told some of its customers that it will charge them an additional £20 per Teu for line haulage, which it said was “to cover the cost of putting on extra haulage units”. An eleventh-hour diversion of a ship that results in thousands of boxes being landed at another port can cause weeks of delays to the arrival of goods, due to the fact that deliveries were programmed from the intended hub.
Due to the worsening congestion at Southampton, the Ocean Network Express (ONE) advised its customers late last week that the 20,180 Teu MOL Truth would no longer be making an import call at the south coast port on 4 October but would instead discharge its cargo at London Gateway. In a statement to The Loadstar today DP World Southampton confirmed that the MOL Truth would discharge its imports at London Gateway, but that the vessel would still load exports at Southampton at a later date.
It said: “DP World is uniquely positioned in the UK to offer shipping lines and cargo owners a two-port strategy, with both ports able to support one another, ensuring greater certainty and resilience to UK supply chains.” The terminal operator issued a ‘terminal alert’ on 27 September advising that its ship and landside productivity was being impacted by “very high stack levels”.
DPWS gave the reasons for its congested terminals as: too many empty containers; the pre-Christmas peak; vessels cutting and running and a lack of haulage. It appealed to its shipping line customers to ship out their empties; stop using the port for transshipping empty equipment and not to discharge containers for other ports without consultation. In fact, according to today’s DPWS stack report over one third of its some 18,000 teu on the quay for export consists of empty equipment.
One local source said that carriers had been regularly shutting out planned shipments of empty containers after the boxes had been transferred to export stacks, thus causing productivity to “fall off a cliff”. Meanwhile, the problems mount up for UK importers: The Ocean Alliance carriers advised cargo owners today that the 20,388 teu Ever Goods, scheduled to arrive at Felixstowe on 6 October will instead be diverted to Rotterdam.
APL, in a customer advisory said that UK imports would be transshipped to the CSCL Mars scheduled to arrive at Felixstowe on 13 October. For UK exporters who have booked for the Ever Goods there was no substitute vessel nomination and thus there could be a lengthy delay before shipment. APL said that “exports will remain on quay for the next sailing”.
Felixstowe box congestion spreads to Southampton, just in time for Xmas rush
© Peter Titmuss | Dreamstime.com
The UK’s two biggest container ports appear to have hit crisis level. UK retailers potentially face weeks of delays in getting their Christmas stock onto the shelves in time for the peak consumer spending rush. Moreover, UK exporters to Asia can virtually forget about getting containers shipped in November, due to carriers blanking a huge 11 eastbound voyages next month. Many of those sailings that survive will be ‘cut & run’, without loading, due to the congestion at Felixstowe and Southampton.
The traditional peak season influx of holiday goods often stretches container terminals to their limits, but this year the supply chain is at breaking point – despite one source’s assertion that overall numbers are actually down this year. The congestion problems that began at Felixstowe now appear to have spread to Southampton – partly due to the south coast port’s decision to accept extra business diverted from the Suffolk port. Moreover, it is said, the UK’s acute haulage shortage and the indiscipline of the carriers in their schedule integrity and container control have put “impossible pressure” on the Southampton terminal.
One local port source told The Loadstar today that “hardly any” ships were arriving in their berthing windows, and when they do get alongside, a large amount of time is consumed in transshipping containers, information often not advised to the planners until just before arrival. “The carriers just seem to have given up,” said the source. “I know there have been bad weather delays, but they have no interest in trying to regain schedules, plus they are taking last-minute decisions on what is to come off and what is to be loaded.” As landside and ship working productivity at Southampton has deteriorated, operator DP World has been obliged to issue several ‘terminal alert’ messages to customers. One large forwarder customer who visited Southampton yesterday told The Loadstar this morning the situation was “absolute carnage”.
In its latest alert today, DP World said that, from Monday it would reduce its export receiving window from the normal 10 days to seven days. It said it had also asked container lines to “ship as many empties as possible”, to “stop using Southampton to transship empties from the US to Asia” and “not to discharge cargo for other ports without prior consultation”. This ‘perfect storm’ began brewing at the UK’s largest container gateway, Felixstowe, in June when the Hutchison-owned port embarked on what proved a disastrous implementation of its in-house-developed NextGen terminal operating system (TOS).
A source told The Loadstar at the time the initial impact “was like a cyber-attack had hit the port”, with everything grinding to a halt. “At one stage we were reduced to pen and paper for stowage plans,” he said. Felixstowe put on brave face, suggesting the problems with working the ships was temporary and began issuing weekly status updates painting an improving picture. But sources at Felixstowe told The Loadstar recently “there was still no light at the end of the tunnel”, describing the situation as “complete chaos”.
Recently the port hired 30 tractor units from a major local hauler just to shunt boxes to their correct stacks. The port has been ‘silent’ since its last customer update on 24 August, and port users The Loadstar has spoken to, including carriers, forwarders and service providers, are not optimistic of any improvement anytime soon. As a result, several carriers have diverted Felixstowe-bound ships to other ports, or in certain cases pulled services altogether, with some opting to service the UK via feeders.