Port delays and port congestion cause problems in the global supply chain, impacting all parties from carriers and shippers through terminal operators, freight forwarders, haulage and other transport providers, and end customers. Many factors influence the smooth running of port operations, including the weather and world events. However, one factor remains constant – a dependence on timely, high-quality information to mitigate port congestion and delays. In this, digitalisation and standards-based information exchange have critical roles to play. What is port congestion and what impact does it have on global trade? Port congestion occurs when ships must be held at or outside a port waiting to berth to load or unload cargo. It can have huge consequences for the onward supply of goods, and a material impact on port ecosystems. According to S&P Global and World Bank, at the end of 2022, the global average arrival time (which includes port area arrival to all-fast at berth) in the world was 11 hours. In Q3 2021, it peaked at 11.5 hours average. However, wait times can be longer than this, with vessels sometimes held up for days. Port congestion is bad news for everyone: carriers suffer schedule disruptions, ports must work to clear backlogs and manage scheduling of pilotage, tugs and other services, shippers’ goods are delivered later than planned. Onward cargo movement by road and rail is also affected, impacting haulage businesses. At the end of the chain, consumers suffer the effects of port congestion too. They face the disappointment of unavailable products and empty shelves in shops. What causes port congestion?Every complex system depends on all constituent elements operating smoothly to perform. Global supply chains are very complex, involving many stages, stakeholders, processes and systems. Delays and port congestion can result if anything goes wrong along the supply chain, or if something affects a port’s own operations. Significant factors that can lead to congestion and delays include:A lack of digitisationPort operations need meticulous planning for vessel arrivals, departures and events at port to run smoothly. Successful planning needs timely, quality information exchange; it is hindered by misaligned information. Yet, port call communication is often ad hoc, by telephone and email, which makes it incredibly difficult for all involved parties to plan, mitigate issues, and manage events to avert port call delays and congestion.The ‘network effect’Port operations can also be impacted significantly by events in other parts of the supply chain. In 2021, it was estimated that Britain had a lorry driver shortage of around 100,000 drivers, impacting haulage and ports’ ability to move cargo on.Weather-related delaysExtreme weather can have a significant impact on port operations, delaying vessels from arriving or departing and threatening continuing port operations. In September 2023, severe storms including Typhoon Saola and Typhoon Haikui halted some port operations.World eventsThe COVID-19 pandemic caused havoc in supply chains. An initial decline in manufacturing and demand for some goods was followed by an increase in demand. Cargo and containers were out of position and staffing issues caused by the health crisis were felt throughout the supply chain.Following on from the pandemic, the conflict in Ukraine compounded the pressures and impacts on ports. Cargo must be re-routed to navigate around affected regions, creating higher demand at alternative ports.Industrial actionIndustrial action can affect port operations if productivity reduces. In 2022, average vessel waiting times at the Port of Felixstowe increased during a period of workers’ strikes. Then, in 2023, the Canadian West Coast ports strike at one point saw a combined value of $7.5 billion of trade waiting offshore. How can we ease port congestion? Digitalisation can help optimise port calls and ease port congestion. If information exchange is improved, communicating parties are better informed and can take appropriate action at the right time for smooth port call events and operations. Process digitalisation and data standardisation can make an enormous difference here. Digital information exchange takes the guesswork out of how information will arrive. Digital standards provide a global language so that data can flow freely between the different digital systems that stakeholders use. The Just in Time (JIT) implementation framework enables ports, terminal operators and all who work with them to simplify and streamline information exchange to ease port delays and congestion. This delivers many benefits, including increased reliability, resilience and efficiency of port calls. Negotiation and planning of port call events is made transparent and more streamlined. Improved planning and exceptions management can reduce waiting times and equip vessels to regulate their speed to arrive just-in-time at port. This can lead to reduced fuel consumption to manage costs and improve sustainability. Optimising container shipping and port processes maximises the customer experience for all parties involved. When each interaction is simpler, clearer and more meaningful, carriers, shippers, port operators and more are better informed and able to plan.
How you can help
Digitalisation in container shipping processes will help bring efficiency, sustainability and customer experience benefits but it requires collaboration. Join the movement towards a more efficient and sustainable future for port calls, to ease delays and congestion:- Find out more about the urgency of port call optimisation and Just in Time
- Discover the DCSA JIT implementation framework.
