How Do You Fix Port Congestion ?

How to solve port congestion

In 2021, port congestion has reached a unprecedented level, from China and other Asian countries to North America and Europe. As the new year starts, congestion seems to get worse, impacting reliability, available capacity and costs. Technology can help fix port congestion issues in order to improve vessels schedule reliability and get global supply chains return to a more normal state.

With growing global trade and vessel fleets, ports infrastructure must be ready to accommodate the traffic while ensuring operations safety and transparency. In the digital age, the maritime industry has to rely on technologies to correctly plan the activity, better manage resources, and improve communication.

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Digitize ports increase efficiency

Here are some positive effects of digital solutions deployment in ports to increase efficiency and overcome the congestion crisis:

  • Improved organization: with accurate information on all ships ETA, thanks to real-time ETA prediction system, the port can get its crewmen and equipment prepared. Dedicated tools help optimize working times and shifts in order to have the port services available 24/7. Whenever a vessel arrives, berthing and cargo discharge are as efficient as possible.
 
  • Smooth communication: working with data collected from various sources and translated into advanced analytics and dashboards is ideal to streamline communication between all stakeholders. Quick handling: automated cranes and vehicles allow to move containers in a shorter time frame. Automation eliminates time-consuming moves such as moving multiple containers to access a specific one assigned to one truck. Hence the on-site workers and machines are able to handle a higher number of freight. This avoids vessel queues at the dock.
 
  • Lower risk of accidents: sensors placed in all port areas and surroundings control all sources of hazards (heavy machinery, toxic gases…) and conditions (weather, wind, etc.). Combination of Artificial Intelligence and the Internet of Objects helps predict and prevent an accident. As the issue is being taken care of without delay, operations do not have to be stopped for days or worse.
 
  • Lower risk of equipment unavailability for maintenance or repair. Instead of waiting for a machine failure to occur (corrective approach), or periodically replace components whether there is a risk of a breakdown or not (preventive approach), maintenance is based on identified risk or condition (predictive approach). This is a less costly yet very efficient strategy.
 
  • Reduced impact of unforeseen events: while at sea or in transit countries, vessels might face natural disasters or local concerns (e.g. unstable political situation). Risk Management Modules give accurate prediction about dangerous areas and captains can be warned in due time.
 

On a wider scale, in order to put the right port management strategy in place, ports officials need to have clear and reliable metrics. Big Data-based solutions are required to make rigorous analysis, identify current challenges and adopt all necessary measures to solve pain points.

Redistribute cargo to alternative ports

Supply chain

Some countries such as the United States have multiple ports. The major ones like Los Angeles and Long Beach in California on the US West Coast and New York and New Jersey on the east coast are facing extreme congestion issues since they are beyond maximum capacity. Therefore, why not consider moving part of the traffic to less busy ports. Even with longer lead time, rerouting might be an alternative during the height of congestion.

Using tools such as Sinay’s ETA Module based on Artificial Intelligence, shippers can evaluate traffic conditions at different ports at ETA and if needed, choose which one is best for them. However, this option comes with two challenges: most of remote ports can only accommodate smaller ships and there has to be enough truckers to pick up the containers.

Rely on other hinterland means of transportation

Huge trucks flow might also cause congestion inside the terminal, at its exit gate and on roads leading to port. Apart from road, containers transportation to importers might be arranged via rail or inland waterways (e.g.: barges). Once more, container tracking solutions and centralized information services allow truly perfect coordination between the ports and other means of transport operators.

Ease port restrictions

In 2021, restrictions linked to Covid-19 cases or potential exposure have led to entire crews quarantine and very reduced flow. Now with the vaccine and other protections, logistics experts recommend minimizing labor disruption so as to preserve high operational efficiency.

Ports managers in some countries also have to reconsider the organization for empty containers that truckers are not allowed to bring back to terminals to avoid them sitting on quays for weeks or for months. This restriction reduces the number of truckers that can take new loads. Putting these empty containers in inland depots until they are needed for export could be a way to increase trucks and chassis fleet and quicken cargo release. Digital tools allow real-time tracking of these containers wherever they are.

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Impact of port congestion crisis on global economy

If port congestion is such a hot topic, it’s because of its impact on all industries (automotive, consumer goods…). Because of delays in raw materials and manufactured goods delivery, most countries around the world suffer from shortages. Stores lack certain essential goods, factories cannot produce, business is slowing down. 

Costs increase is also one of the disastrous consequences of port congestion for exporters, importers forwarders and truckers.

  • Freight rates have dramatically risen, which is passed on to final prices.
  • Because trucks spend hours queuing to pick up cargo, they can only do a trip per day.
  • Importers have to airfreight some goods to respond to the market demand.
  • Seasonal goods are not sold in time, meaning shortfalls.
  • Customers have to pay demurrage, a per diem penalty applied after a “free time” period if the container remains at the terminal, even though they are willing to get their goods and ready for it.

Conclusion

Though the port congestion global crisis is not easy to solve, adopting the best available technology and having all parties involved work together would allow overcome it. On another side, customers have to review their overall sourcing and supply chain strategy in order to reduce their dependency on ocean freight.

Frequently Asked Questions About: PORT CONGESTION

Port congestion can be explained in several ways: port infrastructure cannot deal with capacity, pandemic led to increased consumer spending, unforeseen events, and more.

In a general explanation, port congestion is due to a lack of digitalization.  

Port congestion happens when there are too many cargo ships that need to dock at berth to unload/load than a port can handle. 

In 2021, the major congested ports were West Coast Ports and Asia (particularly China) Ports.

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