News / Box ships omitting Singapore call as port congestion hits critical level

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Congestion in Singapore, the world’s second-busiest container port, has reached a critical level, compounding the shortage of ships and containers.

Data from Linerlytica indicates that containerships have to wait up to seven days to berth in Singapore, recently seeing up to 450,000 teu of vessels in the queue.

And port congestion globally is worsening and has tied up 2m teu of ships, nearly 7% of the fleet, which is lending support to carrier rate hikes.

The bottlenecks at Singapore are mainly due to the diversions caused by the Red Sea crisis and shipping lines skipping the less busy Port Klang in Malaysia. In normal circumstances, ships can berth upon arrival in Singapore, or wait half a day at most.

Linerlytica’s report today says: “The severe congestion has forced some carriers to omit their planned Singapore port calls, which will exacerbate the problem at downstream ports that will have to handle additional volumes. The delays have also resulted in vessel bunching, which is causing spillover congestion and schedule disruptions at downstream ports.”

The consultancy says port congestion is expected to worsen in June, compelling liner operators to secure new containers and commit to chartering ships beyond September.

And ahead of box lines planned rate hikes for 1 June and 15 June, the port congestion is putting significant upward pressure on rates.

Asian ports are the most congested, with ports in South-east Asia accounting for 26% of global bottlenecks, while north-eastern Asian ports make up 23%.

As congestion in Singapore has a considerable impact on the reliability of Asia-Europe services, trading of China’s container futures closed at a higher price of $4,209/teu for the EC2406 contract, which expires on 24 June. The price is 6% higher than on 20 May and a 25% premium on the Shanghai Containerised Freight Index.

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