Carriers warn of surcharge for Yantian delays
Shipping lines are growing frustrated by berthing and loading delays at the burgeoning port of Yantian and warn they may implement a congestion surcharge to compensate for cost and scheduling overruns.
Some carriers are seeing delays in excess of 24 hours at Yantian, on the eastern side of the Pearl River Delta, as China's fastest-growing major port begins to creak under the weight of its own success.
The development comes just weeks after operators at Yantian International Container Terminals (Yict) moved to ease the land-side congestion that was angering truckers who faced up to 12-hour queues to enter the port complex.
'The implementation of a surcharge on exports would be highly relevant because the carriers are being heavily delayed,' said a local shipping executive. 'Hutchison [Yict's manager and joint owner] has a strategy of allowing demand to trigger infrastructure expansion, but they appear to have been caught out this time.'
Yict, in which Hutchison Whampoa has a 48 per cent stake, saw throughput rise almost 57 per cent in the first eight months, already surpassing last year's total of 2.7 million teu (20 ft equivalent units).
At the current pace, it would move more than 4.2 million boxes this year, putting Yict on the verge of the global top 10 in terms of throughput, and carriers say that is stretching the port's berthing capacity to the limit.
However, Hutchison sources in Hong Kong at the weekend played down congestion concerns.
'We don't think we have a congestion problem at Yantian. The yard is only at 50 per cent capacity and there is only a berth shortage on the weekends, which is the same as at Kwai Chung,' said a Hutchison Port Holdings source.
'We are aware the lines are considering a surcharge and we are still waiting to hear back from them on the issue.'
Yict management partially alleviated land-side congestion last month by relocating some of the terminal's empty boxes to remote depots, curtailing the amount of trucks coursing through the gates of the main terminal, according to one haulier.
The move eased trucking congestion at the facility, which saw gate movements jump more than 50 per cent year on year in the first eight months.
But berthing congestion may prove to be more difficult to alleviate.
The first additional berth, from its Phase III expansion, is not scheduled to come on-stream until the end of next year.
'There is concern that, with no new berths available at Yantian for at least a year and volumes expected to be even greater next year, vessel scheduling could be further disrupted,' a conference executive said.
'Congestion surcharges are usually applied to get the operators to address the problem.'
Carriers moving the lesser volumes through the port, and therefore given lower berthing priority, are particularly concerned and effected by the delays.
Yict's priority customers, such as stakeholder Maersk Sealand and high-volume mover American President Lines, are not thought to be waiting as long for service.
The problem has been exacerbated by the 11-day closure of ports on the west coast of the United States earlier this month because as much as 80 per cent of exports that move through Yantian are ordered by American consignees.
Whether to apply for the surcharge will be discussed at the meeting on Friday of member lines in the Transpacific Stabilisation Agreement in Kuala Lumpur.
A 30-day waiting period is usual before approval so the levy cannot be put in place before December, when the holiday season rush traditionally fades.
'The pressure may ease a bit towards the end of the year,' the local shipping executive said.
'But come springtime, the volumes will rise again and if the problems remain at this level, we would definitely support a surcharge.'