New Research Reveals Planning Delays a Major Contributor to Congestion in North European Ports

Transportation industry urged to engage more actively in the planning process

Antwerp, 14 June, 2005 - Global cargo transportation and logistics company Neptune Orient Lines (NOL) today released new research that reveals the enormous cost in both time and money of developing more port capacity in Europe to ease congestion at marine terminals.

Speaking at the TOC Europe Conference in Antwerp today, David Appleton, NOL’s President Europe, presented the findings of NOL commissioned research by Drewry Shipping Consultants.

The research shows the planning process alone for 12 north European terminal developments is costing an estimated €540 million, while delays and cancellations have meant a planned extra 11 million TEUs (twenty-foot equivalent container units) of capacity due to be available this year has not been built

“This has a direct impact on congestion,” Mr Appleton said. “Today we are seeing utilisation rates in terminals of as much as 99% and an overall average of 87% . If the projects had gone ahead as planned, we would now be experiencing about 68% utilization, and those ports that are operating at 95% or above would be in a far more manageable situation.

“Many of the costs of congestion would have been diminished or eliminated if we had a more efficient planning process.”

Mr Appleton said it was absolutely necessary that a planning process be thorough and involve all stakeholders, including the community, and he said there was an urgent need for the container industry, including both maritime and land-based carriers, as well as importers, exporters and related service providers, to shoulder more of the responsibility in making the case for additional container handling capacity in the region.

“We cannot simply expect the port community to carry this burden alone,” he said. “We must make it clear to all those involved that what we seek is reasonable. And we must demonstrate that these projects are well thought out and critical to economic growth in the local region, throughout Europe and internationally.”

The €540 million financial impact includes the cost of public inquiries, official planning submissions and legal fees, and represents both commercial as well as public money.

Mr Appleton said, “This is sufficient money to pay for the construction cost of an entire terminal handling facility of about 1.5 million TEU – a project the size of Bathside Bay in the UK, for instance.”

In terms of the future, demand forecasts based on conservative growth rates call for an additional 50% in handling capacity by the year 2010; 45 million TEU rather than the 30 million available in 2004.

The research shows that with the expansion plans currently approved, and assuming no further delays, there will be 55 million TEUs of capacity available by the end of the decade. This represents an average 83% utilisation rate, which is marginally better than the 85% that Drewry calculate is required to avoid widespread congestion during peak demand periods.

Mr Appleton concluded that there must be a concerted effort “by the industry to represent itself in a professional and coherent way to public stakeholders.”

“One way or the other,” he said, “these stakeholders will be impacted directly or indirectly by the congestion problem and the solutions to it. By engaging actively and effectively with them, approval may be reached more quickly. We may see European ports start to cope better with the development of globalisation: a development which shows no sign of reversing, or even slowing much in the years to come”.

For the script, click here.

For the powerpoint, click here.

For the original Drewry report, click here.

About APL

APL is a global container transportation company offering more than 60 weekly services and nearly 300 calls at more than 90 ports in Asia, Europe, the Middle East and the Americas. It combines world-class intermodal operations with leading-edge IT and e-commerce. APL is a unit of Singapore-based Neptune Orient Lines (NOL), a global logistics and transportation company. APL Web site: www.apl.com

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