Rotterdam volume rising despite Asia-Europe slowdown

Rotterdam volume rising despite Asia-Europe slowdown

Rotterdam, Europe’s busiest container port, handled 250,000 more TEU from January through March than during the first quarter of 2018. Photo credit: The port of Rotterdam.

First-quarter container throughput at the port of Rotterdam soared 7.3 percent compared with last year, despite slowing volume on the continent’s largest source of business, the Asia-North Europe trade.

Europe’s busiest container port handled 250,000 more TEU from January through March than during the first quarter of 2018, a result the port attributes to growing demand for feeder services as alliance members concentrate their mega-ship calls in Rotterdam.

A record 3.72 million TEU crossed Rotterdam’s busy wharves during the first three months, even as the overall volume of European trade with Asia, which comprised 43.7 percent of total EU trade in 2018, according to Container Trades Statistics (CTS), was flat in the first two months of 2019. March volume is not yet available.

Transshipment tailwinds

The growth in TEU volume followed a 6 percent year-over-year increase in 2018, when Rotterdam handled 14.5 million TEU, thanks primarily to a sharp rise in transshipment volume originating in Asia with destinations elsewhere in Europe, the port said in a statement. Because they are offloaded from one vessel and loaded onto another in the same port, however, transshipment containers are counted twice in throughput metrics, a factor that may be masking a decline in total volume.

Container volume on the Europe-Latin America trade also declined in January and February, according to data from CTS, falling 6 percent year over year in January and 3.7 percent in February.

The port said the ocean carriers operating in three large vessel-sharing alliances view Rotterdam as an important hub in their networks, which has led to an increased concentration of freight throughput. That pushed up feeder cargo through the port 15.1 percent to 7.5 million tons in the first quarter as carriers offered shippers more port combinations via Rotterdam.

Europe’s second-largest container port, Antwerp, has not yet released its first-quarter volume figures, but the Belgian hub has a concentration of alliance calls similar to Rotterdam and also reported a record throughput in 2018. Antwerp handled 11.1 million TEU last year, an increase of 6 percent compared with 2017.

Regional headwinds

Volumes of intra-European shortsea cargo at Rotterdam declined 7.8 percent to 7 million tons during the first quarter due to reduced trade with Russia and lower volumes moved to a Brexit-focused UK in January and February. Recent research from the United Nations Conference on Trade and Development (UNCTAD) found that the EU would lose roughly $35 billion in exports to the UK alone in the event of a “no-deal” Brexit.

An area for concern for Rotterdam, and for other northern range hubs on the crucial Asia-North Europe routes, is the growing trade imbalance between Asia and Europe that results in significant increases in empty container exports. Empties being repositioned have a low economic value for terminals and carriers.

According to the European Union statistics division Eurostat, the EU’s trade balance with China, its largest trading partner, widened to 37.8 percent in the January-February period from 35.5 percent during the same months in 2018.

IHS Markit predicts Europe’s economy will expand by about 1.5 percent in 2019, with adverse economic and political factors behind the continued deceleration in growth, including the negative impact of trade tensions on manufacturing and exports, and the appreciation of the euro against most currencies except the US dollar.

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.