Carriers divert Indian cargo to avoid congestion worries at Colombo
With capacity still a nagging concern at Sri Lanka’s Colombo port, container lines are devising ...
HD: DIY RE-PRICINGZIM: A RISING TIDE LIFTS ALL BOATSTSLA: CHINA THREATDAC: KEY REMARKSDAC: SURGING GM: SUPPLY CHAIN WOESMAERSK: ROTTERDAM TEMPORARY SUSPENSION OF OPERATIONSATSG: OWNERSHIP UPDATERXO: COYOTE FILLIP GONEGM: SUPPLY CHAIN HITBA: CUT THE FAT ON THE BONER: STEADY YIELDMAERSK: SELL-SIDE UPDATESDAC: TRADING UPDATE OUT SOONTSLA: FEEL THE PAIN IN CHINAWMT: GUESS WHATXPO: SURGINGAMZN: LOOKING FORWARD
HD: DIY RE-PRICINGZIM: A RISING TIDE LIFTS ALL BOATSTSLA: CHINA THREATDAC: KEY REMARKSDAC: SURGING GM: SUPPLY CHAIN WOESMAERSK: ROTTERDAM TEMPORARY SUSPENSION OF OPERATIONSATSG: OWNERSHIP UPDATERXO: COYOTE FILLIP GONEGM: SUPPLY CHAIN HITBA: CUT THE FAT ON THE BONER: STEADY YIELDMAERSK: SELL-SIDE UPDATESDAC: TRADING UPDATE OUT SOONTSLA: FEEL THE PAIN IN CHINAWMT: GUESS WHATXPO: SURGINGAMZN: LOOKING FORWARD
A nagging capacity strain at Sri Lanka’s Colombo port, which caused considerable congestion issues in early 2024, has come back to haunt container lines and shippers using the busy South Asia hub.
A confluence of factors seems to have contributed to the latest bout of disruption, with fears the delays will last at least through the month, according to industry sources in Colombo.
“Inter-terminal activity is painfully slow, and yards are alarmingly choked with containers,” one ship agent told The Loadstar. Brisk inter-terminal transfers (IITs) are critical for container transhipment operations.
The source noted: “Vessels are often incurring delays of up to three days to berth.”
With no specific official updates on the logjam, sources believe sporadic vessel bunching and some slackness by importers in picking up cargo after Customs’ intensified inspections have added to the capacity pressure at the port.
Sri Lankan ports minister Bimal Rathnayake recently said the congestion had cost the port some 30 missed vessel calls in the past few weeks, while another official added: “Transporting containers between terminals has been a persistent challenge due to congestion. This backlog often delays the booking of berths for ships, further compounding the problem.”
Additionally, Sri Lankan Customs officials noted that they were being forced to compromise on compliance because of infrastructure limitations, examining, on average, only 35% of imports, the rest cleared without physical scrutiny.
“Volumes have gone up, but the facilities have never been improved or increased,” a customs spokesperson said.
On the throughput front, Colombo ended 2024 on a solid note, benefiting from unusual transhipment volume gains linked to the widespread Red Sea linked diversions.
Yearly throughput numbers hit all-time highs across Colombo terminals, despite the capacity pressure that forced vessels to seek alternative berths at other ports in the region, particularly on India’s east coast.
According to the Sri Lankan Ports Authority (SLPA), port volumes for 2024 soared 12% year on year to 7.7m teu.
“Looking ahead, the port’s capacity is projected to double to 15m teu by 2026, driven by improved logistics infrastructure designed to support global trade opportunities,” said the SLPA.
In an interim measure to mitigate the capacity crisis, SLPA last year advanced the installation of new cranes at the east container terminals and pushed Hambantota Port, managed by China Merchants Port Holdings, to accommodate some calls by smaller containerships.
But upcoming capacity from Adani Group’s new concession at Colombo, CWIT, expected to go live in a couple of months, is the key to remediating that capacity crunch more effectively.
At the same time, Colombo is facing growing regional competition from new port developments in India, particularly Vizhinjam, which continues to see a flurry of sailings from MSC for container relays, including three simultaneous dockings recently — a significant operational feat for ports equipped with a single terminal.
Other Indian ports, such as Tuticorin and Cochin, have stepped up efforts to draw in more mainline calls, and, with new global carrier networks set to launch soon, there will be widespread port call changes.
The Gemini Cooperation will consolidate operations at Ennore, near Chennai, for southern India calls, while MSC will concentrate on Colombo and Vizhinjam for Indian hub activity.
Comment on this article