Singapore Port Container Logjam Worsens Causing Vessel Delays

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  • Singapore’s port, already one of the busiest in the world, is facing a sustained period of congestion as vessel diversions to avoid the Red Sea push more container ships to the Asian maritime hub.
  • The attacks by Yemen’s Houthi rebels have resulted in shipowners opting not to transit the Suez canal and taking the longer route around the Cape of Good Hope at the southern tip of Africa.

Congestion at Singapore Port has escalated, leading to significant shipping delays and price surges, Reports CGTN.

Extended waiting times

Starting from the second half of May, the number of 20-foot standard containers waiting to dock has reached a peak of 480,000. Currently, container vessels are experiencing extended waiting times of up to seven days for unloading, compared to the usual half-day timeframe.

To address the situation, the Maritime and Port Authority of Singapore has taken measures to increase manpower and container handling capacity. This includes reactivating previously closed berths and yards at Keppel Terminal, with plans to introduce three new berths later this year. Experts warn that the port congestion in Singapore has reached a critical level, potentially indicating an imminent supply chain crisis. The primary cause of these bottlenecks is attributed to diversions in the Red Sea, resulting in increased shipping costs and causing ripple effects throughout the market. Patrick Fok reports.

It’s ranked the world’s second busiest shipping port and handles about a fifth of global trans-shipment traffic. But recent cargo congestion in Singapore is causing industry-watchers to sit up.

Red Sea crisis force ships to reroute

TAN HUA JOO, Director, Linerlytica “This is a highly critical situation we’re seeing in Singapore right now.”

Reports say there are nearly half a million containers stuck here. The reason: the Red Sea crisis, forcing ships to reroute round Africa and away from the Suez Canal on runs between Europe and Asia.

As Houthi threats extend further towards the Indian Ocean, the situation’s getting more severe and is hitting ports across Asia hard. Singapore’s seen as the epicentre of the crunch.

TAN HUA JOO, Director, Linerlytica “Typically the waiting time for getting a berth is less than a day, and in most cases it’s berthing on arrival, but right now ships are waiting up to a week.”

Making matters worse – what’s known in the industry as vessel bunching when ships sail off schedule and arrive here at the same time causing bigger jams.

Song Seng Wun is an economist but also a shipping enthusiast, and is out getting a gauge on things for himself. Global freight rates shot up by more than 30% last month alone because of the backlog. Those added costs for shipping goods will get passed on to consumers.

SONG SENG WUN, Economic Adviser, CGS International “So we are all essentially keeping our fingers and toes crossed now. If you are ship owners and container operators you’re starting to smile again in terms of returning back to profit. For consumers it’s a case of how high the spot rates will go up. Now it’s one third of pandemic levels. We may have Christmas goodies that may cost a lot more!

Volatility looks set to stay

For now, the volatility looks set to stay.

PATRICK FOK, Singapore “To ease the situation, Singapore port authorities have reactivated old berths and yards that were previously shuttered. They’ve also added more manpower to manage the build-up.”

In addition, they’re increasing capacity at one of its terminals by the end of this year. Industry stakeholders hope that’s soon enough to stave off major supply chain disruption.

MICHAEL PHOON, Exec. Director, Singapore Shipping Association “I think it really depends, if there are no further global shocks, no further upheavals that may impact the overall transport and logistical chain then I hope when we are in full alignment and the berths are operational, then hopefully things will ease off.”

But any unexpected interruptions could spell trouble worldwide.

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Source: CGTN