Crisis at Southampton terminal

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A damaged crane at the nation’s second-busiest container terminal has triggered a month-long crisis – and cast a telling spotlight on the shortage of spare capacity at the UK’s main container ports.

Scores of ships have been diverted or delayed since January 18, when a boom being lowered over a ship collapsed on to the vessel. The Southampton terminal shut almost entirely for the 10 days it took to remove the ship, along with the debris from the accident.

The painstaking work since has focused on trying to understand what went wrong and ensuring other cranes of a similar age and design to the one that broke are safe. Five cranes, out of the terminal’s total of 11, are still out of action.

For shipping lines and their customers, the affair has caused huge disruption, inconvenience and cost at a time when they are under pressure from the impact of the credit crunch.

Many shipments have been delayed, either at arrival or departure point or because the goods have had to be shifted to another port for handling.

With the problems now expected to last well into next month, the Freight Transport Association, an industry body, has seized on the incident as ammunition in its fight for more container capacity in the south-east. The region’s ports are continually vulnerable to severe disruption as burgeoning demand for containerised goods, particularly from Asia, outstrips their ability to meet it.

Christopher Snelling, the FTA’s head of global supply chain policy, said that, while businesses had started to plan around the disruption, they were being hobbled by uncertainty over how long it would last. The delays would have been reduced if alternative ports had not already been operating at full pelt, he indicated.

“The UK’s main container ports are running over-capacity, when ideally they should be running at less than capacity,” Mr Snelling said. “This is why, when you have problems like this, you have problems with recovery time. They are overstretched.”

Hauliers had initially expected the disruption to last only a few weeks. “It has dragged on,” Mr Snelling said. “People have had to continue to make alternative arrangements.”

Campbell Mason, Southampton Container Terminals’ managing director, said about 35 per cent of the 85 visits from vessels that the terminal would have expected for January had been cancelled.

Many vessels, mainly smaller ones, have diverted to alternative ports such as Tilbury or Thamesport. Larger vessels have either had to wait in queues off the Isle of Wight for a berth at Southampton or carry on to continental European ports where smaller feeder ships are able to pick up UK-bound cargo.

The port was still handling only about 85 per cent of the volume expected for the time of year, Mr Mason said. He conceded it would be well into March before the situation returned to normal.

Felixstowe, the UK’s largest container port, has suffered occasional congestion like that at Southampton – due to a surge in traffic after a storm, for example – and is regarded as overstretched. It has been unable to accommodate any of the stranded ships because it has no spare capacity.

Mr Mason accepted that Southampton was operating close to capacity much of the time. But the disruption was all the more frustrating, he said, because it came as the terminal implemented an expansion programme to meet growth of 10 per cent a year in demand for container shipping into the UK.

Last year the first fruits of the expansion plan allowed the terminal to handle a record 1.9m twenty-foot equivalent units (TEUs) of containers, a 27 per cent increase on 2006.

A further improvement was expected this summer when new, higher-capacity cranes are due to come into operation.

“This is a very unfortunate and regrettable interruption to our capacity expansion programme, which was progressing very well,” Mr Mason told the FT.

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