News / Port of Colombo: there's good news – and there's bad news

© Vof Vermeulen Perdaen & Steyaert | Dreamstime.com Port entrance of Colombo, emerging from the early morning fog

Sri Lanka’s Colombo Port has had the highest growth rate in container volumes among leading global hubs this year, thanks to incremental gains from Red Sea-linked vessel diversions, according to new data. 

Colombo logged a throughput increase of 23.6% year on year in H1 24, edging out California’s Long Beach, which reported a 23.3% rise in the same period. 

One of Asia’s busiest container hubs, Colombo has box four facilities: Jaya Container Terminal (JCT); South Asia Gateway Terminal (SAGT); East Container Terminal (ECT); and Colombo International Container Terminal (CICT), which is managed by China Merchants Port Holdings. 

“The first half of 2024 has been particularly impressive for the port of Colombo,” Sri Lanka Ports Authority (SLPA) said,   noting that ‘its own’ terminals, JCT and ECT, had led the growth, with domestic volumes there surging 23.6%, transhipment volumes up 15.5% and total throughput up 17.7%. 

“SAGT and CICT, operated by private entities, further enhance the port’s capacity and operational efficiency, making Colombo a preferred destination for major global shipping lines,” the authority added. 

But capacity constraints are cutting into Colombo’s ability to sustain the momentum, as the port saw a precipitous 20% drop in containership visits in June, resulting in a 5% decline in transhipment cargo flows, according to available data. 

As Colombo’s terminals struggled with volume spikes and jam-packed yards, transhipment containers had to spend up to 20 days on-dock, compared with the usual one week for clearance.  

Long berthing delays and congestion have forced vessels to skip Colombo calls, with spillovers in some part benefiting ports on the Indian coast, particularly Cochin and Ennore. 

As a result, DP World Cochin, also known as ICTT or Vallarpadam, hit an all-time throughput high in February, handling some 75,200 teu, up 38% year on year. And April-June transhipment movements at Cochin soared to some 50,000 teu from 22,000 teu, data shows. 

“The substantial growth of cargo handled by ICTT is a testament to the pivotal role it plays as a preferred gateway and a growing transhipment hub for cargo movement to and from markets in south India,” the company said. 

Colombo’s closest capacity boost is to come, from a 3.5m teu terminal project nown as West Container Terminal (WCT), targeted for commissioning at the end of this year or early next year, commissioned by Adani Ports in a joint-venture with John Keells Holdings. 

At the same time, greater regional competition is also around the corner, as Adani Ports works aggressively to lure more trial calls to its new Vizhinjam Port in southern India. Maersk and MSC appear to be especially bullish on the new port’s potential as an alternative to Colombo. 

“Some of the key advantages are a 20-metre draught, for berthing ultra-large container vessels with capacity of up to 24,000 teu, and its proximity to the busy east-west international shipping axis, about 175 nautical miles from Colombo,” Suni Vaswani, executive director of Container Shipping Lines Association (CSLA), told The Loadstar.  

“The opportunity for Vizhinjam could not have come at a better time,” he added.