Congestion supports southern Europe ‘gateway’ argument

Congestion supports southern Europe ‘gateway’ argument

Congestion at North European ports, mainly Rotterdam and Hamburg, is supporting the call to shippers and shipping lines to consider using southern ports as gateways to serve European markets.

In an interview with CM during TOC Europe, Daniele Testi, marketing manager for Contship Italia, the Italian port and logistics provider, seized upon the fact that gateway Italian ports, especially La Spezia, can provide competitive and rapid direct routes into the markets of Germany, Switzerland and Austria.

His remarks coincide with a report from Drewry that describes the current congestion at Rotterdam and Hamburg as “significant” and, “an echo of the issues last seen during the boom of the early/mid 2000s ahead of the global financial crash”.

The situation at the two northern ports is partly because terminal capacity is being affected by work to upgrade existing facilities, such as installing new cranes at the ECT Delta terminal.  However, in addition, terminal capacity continues to be strained by much greater peaks in volumes created by larger container ships, a situation worsened by deteriorating carrier schedule reliability.  In the case of Hamburg, these factors have doubled the average dwell times for export containers.

Detailing the expansion taking place at the Italian port, Testi stressed: “La Spezia tries to be ready ahead of the game in order to offer the market what it will need in the future, rather than wait for the demand and then react”.  He added that this strategy makes the port different from others in Italy, which included the recent announcement of the merger of Speter SpA, the main multi-purpose terminal operating in La Spezia with its La Spezia Container Terminal.

To be ready for increased demand, the port is currently in the midst of a €200m (US$273m) upgrade of infrastructure and equipment, with completion expected by 2018, at which time its capacity will be close to 1.8m teu.  This will include commissioning two new ship-to-shore gantry cranes in May next year, the first in Italy with an outreach of 23 rows to handle 16,000 teu ultra-large container vessels.

In addition, improvements are being made to the port’s rail operations, where to date this year 36% of the total container traffic was moved by rail via Contship Italia’s Melzo dry-port near Milan; this compares with 32% during 2013.

Work will start shortly on upgrading the rail facility in conjunction with the port expansion, including extending the rail tracks to accommodate longer trains, with the aim of increasing rail movements of container to 50% by 2018.

With a current throughput capacity of 300,000 teu per year, a €20m (US$27m) investment is also to take place at Melzo, where the yard will be increased by 100 sq m; four internal rail tracks will be lengthened from 550 m to 750 m to accommodate international trains.  Testi believes this will allow a 30% increase in the number of trains handled, from 5,700 to 8,000 per year.

Supporting these infrastructure improvements has been the introduction of Customs pre-clearance of containers in transit to La Spezia, speeding up the seamless transfer of boxes from ship to train, thereby avoiding delays and congestion.

“Using rail, which currently accounts for the movement of around 60% of all pre-cleared boxes, we are sure that Italian gateway ports can play a role for the south Europe markets,” Testi contends.

“It is not only a question of transit time or saving money but reducing CO2 emissions, which meets the major policy commitment of the large shippers who will see the southern port corridor as an alternative.”

“Europe needs a cultural change, recognising the role of its transhipment hubs in southern ports.  It’s not a question of Spain verses Italy, but Europe verses the rest,” he suggested, identifying North African ports as the main competition.