Manila port congestion affects regional hubs, says Philippine Ports Authority

Manila port congestion affects regional hubs, says Philippine Ports Authority

HONG KONG — The Philippines Ports Authority (PPA) estimates there are about 20,000 containers being held up at the ports of Hong Kong, Singapore and Kaohsiung that cannot enter Manila because of the congestion choking the terminals.

However, the volumes handled by the hub ports of Asia are so great that if containers destined for the Philippines are being delayed, the numbers are not enough to cause any disruption. A spokesman for Hongkong International Terminals in Hong Kong told JOC.com there was nothing unusual in Manila-bound cargo, and the reaction from Singapore was the same.

There appears to be a gradual easing of the port congestion that has plagued the two main Manila port terminals since the peak-time truck ban was imposed in February. Utilization in the container yards of Manila International Container Terminal (MICT) and Manila South Harbor (MSH) has decreased to almost 80 percent, regarded as a manageable percentage.

Juan Sta. Ana, PPA general manager, said the congestion clogging Manila’s terminals had declined but the peak season would increase volumes.

He said the number of laden containers stacked up at Manila terminals reached 99,000 TEUs and occupied about 105 percent of the yard of MICT and MSH.

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Sta. Ana said in a statement that the total of empty containers also reached a high of 22,000 TEUs as a result of the truck ban imposed by the City Government of Manila from February 24 to the end of May of this year. There are now an estimated 12,000 empties in the port.

The Cabinet Cluster on Port Congestion, a government body, has opened up additional empty container depots near the Manila ports, including a 10-hectare empty lot inside one of the yards, to house empty containers temporarily. The depot will be maintained by ICTSI and Asian Terminals Inc. (ATI) and operated from midnight to 5 a.m. to allow trucks to freely enter and leave the port.

A significant percentage of the products being delayed in containers are perishables, and PPA has ordered ICTSI and ATI to come up with a list of shipments containing food items and other perishables and to prioritize their release in order to reduce the inflationary effects of congestion on food items in the market.

Sta. Ana explained that some of the food products were about to expire because the congestion had extended delivery times.

“Congestion continues to decline at the Ports of Manila, but we cannot wait until conditions normalize before delivering these food items,” Sta. Ana said. “Likewise, we are asking shipping lines to also prioritize food items first in hauling cargoes currently stacked at different foreign ports.”

He also added that the two port operators had designated dedicated areas for food shipments inside their ports for the items while waiting for customs clearance and delivery.

ICTSI is reportedly putting up a container yard within the next one to two months to accommodate an expected surge in cargo volume in the run-up to Christmas and to house empty boxes being shipped out by foreign shipping lines.

Empties are one of the greatest problems the port and city face. Manila handles 900,000 empty 20-foot containers a year, mostly through ICTSI’s flagship Manila International Container Terminal, the largest facility in the capital city at a port complex located near the city center.

Empty containers have choked the Port of Manila since a truck ban was imposed on Feb. 24, ironically in an attempt to clear the city’s congested roads, which have long experienced chronic gridlock. Eight-wheeled trucks and vehicles with a gross weight of more than 9,920 pounds were banned from the city’s streets, but the congestion simply shifted from the streets to the container port, which handles roughly 3.7 million TEUs per year.

Attempts to ease the container congestion have had little effect, despite increasingly creative measures. A 24-hour express lane was opened by the city for trucks to use, followed by a six-month suspension of the truck ban. Then the port began to offer up to 90 percent rebates on docking fees to container lines that wouldn’t call at Manila on weekends, but would stop at the nearby Batangas instead.

Batangas Container Terminal, managed by ATI, reported a 254 percent increase in container throughput in the second quarter of the year as it captured trade diverting from Manila. The listed port operator said its container throughput in the first half had already beaten the volume handled in all of 2013.

Contact Greg Knowler at gknowler@joc.com and follow him on Twitter: @greg_knowler.