IAPH World Ports Tracker Q4 2022

WORLD PORTS TRACKER

EDITION 4 (Quarter 4, 2022)

An IAPH Report prepared by: Professor Theo Notteboom and Professor

Thanos Pallis

WHAT IS THE IAPH WORLD PORTS TRACKER?

We are pleased to present the fourth edition of the World Ports Tracker, an IAPH initiative to monitor and evaluate critical developments in the global port industry as they evolve. The IAPH World Ports Tracker provides ports with a timely understanding of the challenges that emerge regionally and globally.

The tracker relies on a combination of two sources: survey-based results on cargo and passenger markets in ports and container port performance data. The first edition was released in May 2022, introducing this new data tool, which elaborated on the non-survey part of the tracker exercise based on four container port metrics. The second edition was released in July 2022 and presented the analysis of the first survey data, which had been collected in June 2022. The third edition of the IAPH World Ports Tracker was presented in November 2022 and combined survey-based results with container port performance data for the first time. This fourth edition also considers both sources.

The survey part presents the analysis of data collected in early March 2023. The IAPH World Ports Tracker survey includes questions revealing the trends in the container market, the other cargo markets (breakbulk and bulk), and the passengers/cruise business. Some of these questions ask about the current status of the ports, while other questions reflect the short-term expectations of port managers for the next quarter or the next twelve months. Along with a question on staff availability, these questions are answered by ports during every quarter of the year. In this survey the addition of three questions dealing with more general issues and strategic and operational considerations for seaports were included. These questions were focused on dealing with port investments, changes in the land use in port areas and new terminal capacity extensions becoming operational in the next 12 months. These three questions will feature in the surveys only once a year, at the end of each year.

The survey was sent out in early March 2023 to all IAPH members. The closing date for survey responses was 10 March 2023. A total of 77 valid answers were received, only one reply less compared to the November 2022 survey round. North Europe, the Mediterranean, South East Asia & Oceania and North America are the leading regions with 16, 14, 11 and 10 responding ports, respectively. The Middle East and Sub-Saharan African port regions offer the least responses in this edition (Figure 1).

The non-survey part of the IAPH World Ports Tracker analyses quarterly container port statistics based on S&P Global Port Performance Program data. These statistics focus on four container port metrics, i.e., the number of vessel calls, the evolution of vessel size, the evolution of call size (number of TEUs handled per call), and port moves per hour, aggregated per region. This data report covers the period from Q1 of 2019 to Q4 of 2022, thus covering the last pre-pandemic year as well as the COVID-19 years of 2020 and 2021. The data analysis is based on an index-based evolution (Q1 2019 = 100) in nine different port regions. This report presents the evolution of the respective indexes on a year-on-year basis per region - comparing the calls in Q4 2022 with those of the same quarter of the year before, thereby avoiding any seasonality bias. This part of the analysis also discusses the trends

LatinAmerica North Europe

Carribean EastAsia SEAsia& Oceania

SubAfricaSaharan 9% 10% 21% 6% 13%

18%

14%

8%

Figure 1

5

per region, focusing on the changes that happened in the most recent quarters of 2022 and the level of volatility that might have occurred in the three years under examination.

Revealing the most recent trends, the IAPH World Port Tracker enables ports to understand better the available prospects and the challenges they might need to address. Via quarterly updates, the IAPH World Ports Tracker will guide ports and stakeholders in their efforts to improve services and develop their strategies. In addition, a summary of the report features in the IAPH Ports & Harbors magazine, with the full report circulated to the IAPH membership.

THE RESULTS AT A GLANCE

Before engaging in a more detailed analysis, the overall results of the survey and non-survey parts of the IAPH World Ports Tracker are summarized in dashboard-like tables.

Dashboards I to IV present the IAPH World Ports Tracker survey and non-survey results. The survey-based exercise covers the trends in world ports as of the beginning of the first quarter of 2023 (Q4 2022). The latest results for the world are also compared with the world results of the November 2022 survey (Q3 2022). The dashboards also report on the survey results at a regional level, using five responding ports as a critical threshold. You can find comprehensive data and a more detailed regional analysis of responses to the survey questions for cargo and passenger markets later in this report.

HIGHER % is better

>0%

of vessel calls:

By: Theo

Dashboard I Trends in World Cargo Ports (March 2023)

Dashboard I summarises the trends in the number of vessels calls in the different cargo markets. Compared to the November 2022 survey, there are slightly more cargo ports reporting year-on-year growth in the number of vessels calls across all vessel types, except for other cargo vessels. The increase is the highest for container vessels (from 41% in Q3 2022 to 53% of respondents in the last quarter of 2022) and bulk carriers (from 43% to 50%). In general terms, the Americas record the lowest shares of ports with a growth of more than 2% in vessel calls on a year-on-year basis. Sub-Saharan Africa and Southeast Asia & Oceania present the highest shares.

Dashboard I - Trends in World Cargo Ports (March 2023)

Ports around the world are, on average, slightly less optimistic than three months ago about the expected container traffic evolution in the next twelve months.

49% of ports expect a growth of at least 2% in the container throughput, while this figure amounted to 52% in the November 2022 survey. The traffic volume expectations remained fairly much the same for dry and liquid bulk cargo and saw a slight rise for other cargo. The regional figures reveal that the shares of responding ports expecting traffic volume growth above 2% in the next year, across the board, are lowest in North America, North Europe and East Asia, and the highest in Africa.

Evolution: (year-on-year) in container ports (index based evolution / Q4 2022 vs Q4 2021)

Evolution: (Long-term) in container ports (index based evolution / Q4 2022 vs Q1 2019)

*In Oceania the size of such calls in 2009 was very small, thus the increase of the

By: Theo

Dashboard II

Trends in Container Ports (March 2023)

Dashboard II summarises the non-survey part of the IAPH World Ports Tracker using index-based changes in container ports per region between Q4 2021 and Q4 2022 for all four indicators. The index-based evolution of the vessel calls per region reveals that in Q4 2022 and on a year-on-year basis, four regions show doubledigit growth in the number of container vessel arrivals compared with the calls of Q4 2021, i.e., Africa, Middle East & India, South East Asia and Oceania. Only northern Europe saw a decline in container vessel calls (-6.3%). Taking a longer-term perspective, vessel calls are down compared to Q1 2019 in all regions except for Africa and Middle East & India where there was no change. Northern Europe (-24.5%), North America (-21.6%), and South East Asia (-19.5%) record the steepest declines in container vessel arrivals compared to the pre-COVID-19 period.

Dashboard II - Trends in Container Ports (March 2023)

Between Q4 2021 and Q4 2022, the share of container ships of 8,501+ TEU capacity calling in Africa increased by a hefty 20.6%. A strong increase in this share was also recorded in North Europe (+12.6%), Oceania (+11.1%) and Middle East & India (+10.2%). Only one region recorded a noticeable decline in the share of 8,501+ TEU vessels: South East Asia (-5.6%). Oceania went from only 1.8% for 8,501+ TEU vessels of all container vessel arrivals in Q1 2019 to 12% in Q4 2022. In the same observation period, double digit growth was observed in North America, Latin America, South East Asia and North-East Asia. In the past four years, the share of 8,501+ TEU vessels decreased in only two regions, i.e., Africa (-16.5%) and Middle East & India (-5.5%).

Notteboom - Thanos Pallis

The last quarter of 2022 brought a sudden drop in call sizes in all port regions compared to Q3 2022. This was most pronounced in North America (-15.9%), Latin America (-8.5%) and Northern Europe (-8.3%).

On a year-on-year basis, all regions recorded a drop in average call sizes, with the strongest declines recorded in North America (-19%) and North East Asia (-16.9%). The drop was the smallest in Northern Europe with -2.9% since Q4 2021. The picture looks very different when focusing on medium-term changes compared to Q1 2019. Despite significantly smaller call sizes observed in Q4 2022 compared to the previous quarter, most of the nine regions still show major increases in average call sizes compared to the prepandemic year 2019: North America (+18.1%), Latin America (+17.1%), North East Asia (+21.2%), South East Asia (16.9%), Oceania (19.3%) and Northern Europe (+15.1%).

The regional data on port moves per hour demonstrate that four of the world’s port regions had to accept a decline in Q4 2022 compared to the same quarter in 2021. While one might expect otherwise, the deployment of larger vessels did not go hand in hand with higher terminal productivity in all regions. Middle East & India is the only region recording a double-digit decline in port productivity on a year-on-year basis (-11%). On the other hand, South East Asia (+10.3%), North America (+8.6%) and Africa (+6.2%) record the highest rise in average port moves per hour in the past 12 months. When considering the trends in the past four years, it becomes clear North America (-33.4%) and Oceania (-31.2%) witnessed significant changes in port moves per hour, initially partly caused by port congestion and reduced schedule reliability. The best performers in terms of productivity increases compared to Q1 2019 are Middle East & India (+7.1%), Latin America (+6.6%) and North East Asia (+5.5).

Interpretation: LOWER % is better

100% >0%

Warehouses/distribution facilities:

Percentage of ports with underutilised capacity or capacity shortages

Staff availability:

Percentage of ports reporting moderate to severe shortages

Dashboard III Trends in World Cargo Ports (March 2023)

Turning back to the survey results, the situation in hinterland transport shows very mixed results (Dashboard III).

Compared to Q3 2022, the share of ports facing delays in trucking in Q4 2022 is down to single digit figures.

The situation remained unchanged for container transport by rail, and has strongly improved for rail transport of bulk/breakbulk flows. The inland transport situation for barges has somewhat deteriorated for all cargo types, although the share of respondents referring to delays is relatively small. The survey results indicate rail delays in North America and inland barge delays in North Europe. The situation in warehousing and distribution facilities shows a sharp drop for containerised cargo compared to Q3 2022. However, the share of ports reporting underutilisation of facilities or capacity shortages has seen smaller changes in the other cargo segments. East Asia faces the biggest challenges in terms of underutilisation or capacity shortages in the warehousing and distribution market, while South East Asia and North America seem to face the least issues in this field.

Dashboard III - Trends in World Cargo Ports (March 2023)

The situation in terms of the availability of truck drivers shows a major improvement when compared to Q3 2022.

However, Central and South America and North Europe show as the port regions where truck availability concerns are still significant. The availability of dock workers and technical-nautical staff has hardly changed compared to Q3 2022.

100% >0%

Interpretation: HIGHER % is better

Number of passenger vessel calls: Percentage of ports with >2% growth Q3 2022 vs. Q3 2021

Cruise activity expectations: Percentage of ports with >2% growth expectation in the next 12 months

Note: empty cells =

By: Theo

Note: empty cells =

Dashboard IV

Trends in World Passenger Ports (March 2023)

In the passenger markets (Dashboard IV), the share of ports reporting an increase in cruise vessel calls remained fairly stable compared to Q3 2022, while this share increased from 43% to 49% for ferry calls.

Dashboard IV - Trends in World Passenger Ports (March 2023)

In March 2023, slightly fewer ports expected growth in cruise vessel calls in the next twelve months (65% in March 2023 vs. 69% in November 2022 and 71% in June 2022). At the same time, a significantly higher share of ports (i.e., 77% in March 2023 vs. 73% in November 2022 and 64% in June 2022) foresees growth in cruise passenger movements in the next twelve months.

TRENDS IN CARGO PORTS: EVOLUTION OF VESSEL CALLS

What was the trend in the number of calls in the most recent quarter of the year (Q4 2022) compared to the same period of the past year (Q4 2021)? We asked ports to provide their estimation distinguishing between four merchant vessel categories: container vessels, dry bulk carriers, tankers and gas carriers, and other cargo vessels.

3.1. Overall survey results

Considering the global population of seaports, Q4 2022 revealed about 53% of respondents experiencing a positive trend in the calls of container ships, i.e., a year-on-year growth of more than 2%. For dry bulk carriers, tankers and gas carriers, and other cargo vessels these figures amounted respectively to 50%, 45% and 38%.

A total of 19% of the responding ports actually realised a growth of more than 10% in container vessel and bulk carrier calls. The percentage of liquid bulk ports recording in Q4 2022 a double-digit percentage growth is 16%.

The number of ports that in Q4 2022 recorded a lower number of calls compared to the same quarter of the year before has been significant. About 27% of the ports reported a drop in container vessel calls. This percentage is quite similar to the conditions that occurred for the other vessel types. However, in the latter cases, the share of ports reporting a decline of more than 10% is much higher: 19% for tankers and gas carriers, 13% for other cargo vessels, 12% for dry bulk carriers and only 8% for container ships.

2 Evolution of vessel calls (Q4 2022 compared to Q4 2021)

of vessel calls per type of vessel (Q4 2022 vs. Q4 2021)

Figure 3

By: Theo Notteboom - Thanos Pallis

By: Theo Notteboom - Thanos Pallis

3.2. Regional Perspectives

The regional analysis focuses on the four regions with the highest number of respondents, i.e., North Europe, the Mediterranean, North America and Southeast Asia & Oceania.

The Southeast Asia & Oceania port region shows the most positive figures for container vessel calls, with about 60% of the ports expecting growth above 2%. North America offers the least promising figures regarding trends in the number of container ship calls: only one-quarter of North American container ports record more than 2% growth, mainly caused by a decline in trans-Pacific trade volumes.

For dry bulk vessels, all regions, except for North America, show fairly similar results in terms of the share of ports, pointing to an increase in vessel calls. However, big differences are observed regarding the share of respondents reporting a decline in vessel calls of more than 2%, ranging from 0% in South East Asia and Oceania to 38% in the Mediterranean.

For tankers and gas carriers, 67% of the respondents In South East Asia/Oceania realised an increase in liquid bulk vessel calls, compared to ‘only’ 40% for North Europe and 50% in North America. The share of ports expecting a (sharp) decline is the highest in North America (also at 50%).

4

Container vessels

Dry Bulk

Tankers and Gas carriers

Other cargo vessels

Increase of calls Stable number of calls Decrease of calls

By: Theo Notteboom - Thanos Pallis

Figure

Evolution of vessel calls per type of vessel in selected world regions (Q4 2022 vs. Q4 2021)

TRENDS IN CARGO PORTS:

VOLUME EXPECTATIONS IN THE NEXT TWELVE MONTHS

One of the survey questions aims to reflect the short-term prospects for cargo volumes in world ports for the next twelve months: “In the next twelve months, do you expect the cargo throughput at your port to increase or decline?”. The answering scale includes three positive growth categories (>10%; +5 to +10% and +2 to +5%), three negative growth scales (-2 to -5%; -5 to -10%; and < -10%) and one reflecting a rather stable cargo traffic situation (-2 to +2%). Also, a distinction is made here between containerised cargo, dry bulk, liquid bulk and other cargo (conventional general cargo and breakbulk). The traffic expectations use TEU as a basis for container volumes and metric tonnes for the other goods categories.

4.1. Overall survey results

The overall results show that 14% of respondents expect a year-on-year annual growth rate in container volumes of more than 5% for the next twelve months. About 40% of ports do not expect major changes in the handled TEU volume, while about 11% are preparing for a volume decline.

In the dry bulk market, one quarter of the ports expects growth in calls over 5%, with one in ten ports forecasting a mostly modest volume decline. For both liquid bulk and other cargo flows, 22% of ports forecast growth of more than 5% in the next twelve months, with about one out of ten predicting a volume decline. In the ‘other cargo’ category, quite a few ports expect a positive volume development for project cargo, mainly related to energy transition projects.

Cargo volumes in world ports for the next twelve months: Expectations as in early March 2023.

Containers (TEU)

Dry bulk (tonnes)

Liquid bulk (tonnes)

Other cargo (tonnes)

By: Theo Notteboom - Thanos Pallis

Figure 5

4.2. Regional perspectives

The regional analysis reveals that the port system in South East Asia and Oceania shows a high 78% of respondents count on a minimum container volume increase of 2% over the next twelve months, while only 11% are preparing for a TEU drop.

The bleakest prospects can be found in North Europe and North America, where about three quarters of the respondents see TEU volumes stagnating or even slightly declining over the next twelve months.

The Mediterranean port region shows the lowest share of ports expecting a TEU drop of more than 2% in the next twelve months.

The Mediterranean port region has the highest volume expectations in the dry bulk market: a significant 63% of respondents indicate an increase in handled dry bulk tons of at least 2%, but only 6% of the ports forecast a traffic boom of more than 10%. Three quarters of respondent ports in North America expect no major changes in dry bulk volumes, with the remainder evenly spread between growth and decline.

Drawing overall conclusions about the liquid bulk market is difficult without considering the specific circumstances of each responding port in relation to the energy transition, its energy exposure to the war in Ukraine and the associated investments and actions of the liquid bulk market players in the port’s market. Still, there are significantly more ports expecting volume increases in liquid bulk compared to the group of ports counting on volume drops. None of the surveyed ports of the South East Asia and Oceania region and North America expects tanker and gas traffic to decline over the next twelve months.

The “other cargo” category includes mainly breakbulk and conventional general cargo. This category thus consists of a myriad of different cargo flows such as project cargo (for example, power generation equipment, equipment for the oil and gas industry, mining equipment, and heavy machinery), iron and steel products, non-containerized forest products, reefer vessel trades and break-bulk shipments of smaller lots such as big bags, skidded, and palletized cargoes. This diversity in goods, and the different market prospects that go with each specific commodity and trade flow, might explain why the spread in growth expectations is relatively large when comparing port regions.

Figure 6

Cargo volumes in world ports for the next twelve months: Expectations in selected port regions as in early March 2023.

Container vessels

Dry Bulk

Tankers and Gas carriers

Other cargo vessels

By: Theo Notteboom - Thanos Pallis

TRENDS IN CARGO PORTS:

VESSEL ACTIVITY AND PRODUCTIVITY IN CONTAINER PORTS

This section of the report provides an in-depth analysis of vessel activity and productivity in container ports. The analysis is based on quarterly container port statistics compiled as part of the S&P Global Port Performance Program. We focus on four container port metrics covering the period from Q1 of 2019 to Q4 of 2022, i.e., the number of vessel calls, the evolution of vessel size, the evolution of call size (number of TEUs handled per call), and port moves per hour, aggregated per region. We start the analysis with an ‘in focus’ discussion of container port productivity expressed in port moves per hour, followed by a regional analysis of the non-survey data results.

5.1. In focus: Port Moves Per Hour

On a year-on-year basis, port productivity in Q4 2022 increased in five of the world regions. The most substantial growth in average port moves per hour was recorded in South East Asia (+9.8 index points compared to Q4 of 2021), followed by North America (+5.3) and Africa (+5.0).

The year-on-year productivity drop was the biggest in the Middle East and India (from an index of 120 to 107 or -13.2), Latin America (-5.6) and Oceania (-4.4). The long-term picture is somewhat different (Figures 7 and 8). Compared to the beginning of 2019, the number of port moves per hour stands higher in the Middle East & Asia (+7.1%), Latin America (+6.6%), North East Asia (+5.5%), South East Asia (+4.3%) and the Mediterranean (+2.6%). However, some other regions have recorded significant drops in average port moves per hour. The situation remains particularly concerning in North America (-33.4% compared to Q1 of 2019) and Oceania (-31.2%) despite a significant overall improvement in terms of ship waiting times and schedule reliability in Q4 of 2022. Also on the negative side, port moves per hour in Africa stand at -13.4%, while productivity in Northern Europe remained relatively stable at only -1.6%.

In North America and Oceania, a significant increase in the share of 8,501+ TEU vessels in total vessel calls occurred over the same period. Oceania served only a few vessels of such size in late 2019, i.e., less than 1% of all container vessel calls. In North America, the share of 8,501+ TEU vessels in total container ship calls increased from 24.4% in Q1 2019 to 31.4% in Q4 2022. In Africa, the 13.4% decline in average port moves per hour has been accompanied by a decrease of the share of 8,501+ TEU vessel calls by about 17%. Conversely, South East Asia, North East Asia, and Latin America ports recorded more moves in Q4 2022 than in Q1 2019, even though the share of 8,500+ TEU vessels in total vessel calls has increased. In Europe and the Mediterranean, the share of 8,500+ TEU vessels has increased at a marginal scale since early 2019. In both regions, the number of port moves per hour also remained fairly stable: -1.6% in Northern Europe and +2.6% in the Mediterranean. Different productivity trends were recorded in the Middle East: the comparative share of 8,501+ vessels slightly decreased from 30.8% in Q1 2019 to 29.1% in Q4 2022, while the handled moves per hour increased by 7.1%. Apparently, these results suggest there is no clear association between the changes in productivity and the increase in the size of vessels that call ports in a world region.

Most regions witnessed a significant drop in average call sizes in Q4 2022, although the call size figures remain above the Q1 2019 figures.

Throughout 2021 and the first half of 2022, ports in all world regions were confronted with an increase in the number of containers they handled per vessel call. The scale of the increase of the size of calls (i.e., number of vessels that are handled per container ship call) was larger when the share of the ultra large container ships increased: the bigger increase of call size between early 2019 and Q3 2022 took place in North America (plus 41%), followed by Latin America (plus 27.7%), North East Asia (plus 27.4%), and Northern Europe (plus 27.7%). However, the last quarter of 2022 strongly reduced these growth rates to only 18.1% for North America, 17.1% for Latin America, 21.2% for North East Asia and 15.1% for North Europe. The regional analysis provides more details on the most noteworthy developments.

World Regions with increased container ports productivity, Q4 2022 vs. Q1 2019 (Port Moves Per Hour per region)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

World Regions with decreased container ports productivity, Q4 2022 vs. Q1 2019 (Port Moves Per Hour per region)

By: Theo Notteboom - Thanos

Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 7

Figure 8

5.2. Regional focus: Africa

The African container port network includes large gateway ports and an extensive array of small and medium-sized ports in the East, West, and South of the continent. The large-scale transshipment hubs in Northern Africa are not considered here as they have been included in the Mediterranean region.

A decline in the number of container ship calls in African ports marked the last quarter of 2022. The number of vessel calls is again at the level of Q1 2019, while Q3 2022 was marked by a 5.6% increase in vessel calls compared to the start of the observation period. Still, the year-on-year increase amounted to some 10%. This means that, within the most recent quarter, only 0.5% more container ships called in Africa than at the beginning of 2019. The number of calls had gradually decreased to reach its lowest point during Q2 2020.

The share of 8,501+ TEU vessels in total vessel calls modestly increased on a year-on-year basis from 6.3% in Q4 2021 to 7.6% in the last quarter of 2022. However, the longer-term trend reveals that since 2019 the larger vessel share has declined by 16.3%.

Compared to Q1 2019, the average call sizes in African ports in Q4 2022 remained the same. The average call sizes peaked at +17.4% in Q3 2021 compared to early 2019, but since then shows a downward trend. On a year-on-year basis, the size of vessel calls in Q4 2022 was about 13% lower than in the same quarter of 2021.

A small positive change in the port moves per hour in African ports was also recorded in Q4 2022. This key indicator was 5% higher on a year-on-year basis. Yet this does not equal a full recovery and a return to the levels of four years ago. Indeed, this key performance indicator was lower during each quarter of the 2019-2021 period than at the beginning of 2019. Especially since the pandemic outbreak (in Q1 2020, the index was 95.8) and until Q2 2021, port moves per hour in African ports declined continuously. However, some adjustments were noted since then, with the index standing in Q3 2022 at just 5% below Q1 2019 but then falling again to an index of 86.6 in Q4 2022.

Figure 9

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in Africa; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Figure 10

Evolution of Port Moves per Hour (Ports in Africa; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

5.3. Regional focus: Latin America

During 2022, the number of container ship calls in Latin America remained relatively stable with a slight upward tendency. However, the total number of calls that occurred during each of these quarters was lower than the respective total in any quarter since 2019 (Figure 11). In Q1 2020, the number of calls in Latin America started to decline gradually. However, the return to the early 2019 levels in Q4 2020 proved to be temporary. In Q4 2022, the number of container ship calls remained the same on a yearon-year basis and about 9% below the level of early 2019.

Latin American ports do not receive calls from the largest container ships in the world (i.e., vessels over 20,000 TEU capacity), as such vessels are deployed in other regions. Yet, during the last three years, the share of 8,501+ TEU vessels, as a percentage of the total container vessel calls in the ports of the region, increased. Throughout 2019, about 27% of all vessel calls involved these larger units, while by Q4 2020, this figure had risen to 31.8% (+15.2% compared to Q1 2019), a small decline compared to the record 32.4% reached in Q3 2022.

The observed increase in calling vessel capacity has been associated with an increased size of unitised cargoes handled per call. As a result, between Q3 2020 and Q3 2022, the average vessel call at Latin American ports evolved from an index of 102.9 to 127.9. However, Q4 2022 brought a sudden drop to 117.1, the lowest index value since Q2 2021.

Despite these substantial changes in the frequency, size of vessels, and call sizes, Latin American ports managed only marginally to increase their productivity. This is reflected in the evolution of the average port moves per hour recorded in the region since early 2019 (Figure 12). This average has been modestly higher than in Q1 2019 in each quarter of 2019-2021. However, the average port moves per hour in Q4 2022 in Latin America was only 6.6% above the Q1 2019 level and remains below the index value of 112.1 achieved a year earlier.

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 11

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in Latin America; index-based: Q1 2019 = 100)

Figure 12

Evolution of Port Moves per Hour (Ports in Latin America; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

By: Theo Notteboom - Thanos Pallis

5.4. Regional focus: The Mediterranean Sea

Since the beginning of 2019 and until Q3 2021, the number of container ship calls, the call size, and the share of 8,501+ TEU vessels in ports of the Mediterranean Sea remained almost stable. In Q1 2022, some divergence could be observed combining a decline in vessel calls with an increase in the other two indicators (Figure 13). However, by Q4 2022 the three indicators converged again close to the index 100 level. On a year-on-year basis, the number of vessel arrivals increased by around 4%. The average call size dropped from an index of 110.7 to 101, while the percentage of the calls made in Mediterranean ports by container ships of 8,501+ TEU capacity remained almost the same. Compared to Q1 2019, the changes remain minimal.

Despite the disruptions in the maritime and other supply chains in the region following the outbreak of the COVID-19 pandemic, Mediterranean ports have managed to keep their productivity at more or less the same level (Figure 14). Notably, this index reached its peak in Q3 2020 (+8.8% compared to Q1 2019), as it started increasing in the first quarter of that year. In 2021 the growth was halted. On a year-on-year basis, the port moves per hour in Q4 2022 in the Mediterranean ports were at the same level as in Q4 2021 and almost the same as in Q1 2019 (+2.6%). Still, this implies a gradual increase compared to the low index of 93.6 in Q2 2022.

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 13

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in the Mediterranean Sea; index-based: Q1 2019 = 100)

Figure 14

Evolution of Port Moves per Hour (Ports in the Mediterranean Sea; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

By: Theo Notteboom - Thanos Pallis

5.5. Regional focus: Middle East & India

The container port network of the Middle East and India spans a large number of Arabian, Persian and Central Asian countries, as well as seaports in Pakistan, India, Sri Lanka and Bangladesh. In addition, the region is home to transhipment and many small, medium-sized and large gateway ports.

The three indicators in Figure 15 hardly changed throughout 2019 and 2020, except for some modest alterations in Q2 2020, when COVID-19 was officially declared a pandemic. The changes in late 2021 and early 2022 are more noticeable. On the one hand, a gradual decline can be observed in the number of vessel calls and the share of the larger container ships. On the other hand, the call sizes witnessed a small upward trend. However, the above changes were partly undone by the time we reached Q4 2022. Compared to Q1 2019, the number of vessel calls is 1% higher, the share of large ships is 5.5% lower, and the average call size is 3.3% lower.

The Middle East and India is the only region in the world that managed to substantially increase the port moves per hour in 2021 compared to the base quarter Q1 2019 (+20%, see Figure 16). These are relative figures showing the development path. These figures say nothing about container handling productivity in absolute figures compared to other regions. Thus, in contrast to most other regions, COVID-19 and the associated supply chain crisis - on average – did not result in lower moves per hour figures in container ports located in the Middle East and India region. However, after an upward trend in the period 2019-2021, productivity levels declined in 2022 with a year-on-year change from a record index of 120.3 in Q4 2021 to 107.1 in Q4 2022. Nevertheless, from a longer-term perspective, the average moves per hour are still 7.1% above the Q1 2019 level.

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in the Middle East and Asia; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Evolution of Port Moves per Hour (Ports in the Middle East and Asia; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

By: Theo Notteboom - Thanos Pallis

Figure 15

Figure 16

5.6. Regional focus: North America

The North American container port system consists of gateway ports in the United States and Canada along the West Coast, the East Coast and the U.S. Gulf Coast. In the past four years, this port system has witnessed a combination of larger vessels and bigger call sizes, with significant drops in vessel calls and port moves per hour (Figures 17 and 18). However, each variable followed its distinctive path. Vessel arrivals only started to decline in late 2019. In early 2020, the decline in container demand in relation to North America led to blanked sailings and idled vessels, particularly on the trans-Pacific route. Since the summer of 2020, container throughput figures in most North American ports strongly recovered following the start of a period characterised by strong demand. However, the number of vessel calls still continued to drop. In Q1 2022, the number of vessel calls was about 30% lower than in Q1 2019. Since then, the curve has been moving upwards to reach an index figure of 78.4 in Q4 2022.

Growing terminal capacity issues at some of the continent’s major gateway ports combined with the emergence of a global supply chain crisis not only prevented a rise in the number of vessel calls but also triggered a sharp decline in the port moves per hour in late 2020 and the whole of 2021.

While port congestion in the region eased by the end of 2022, terminal productivity figures did not significantly improve. On a year-on-year basis, port moves per hour evolved from an index of 61.4 in Q4 2021 to 66.6 in Q4 2022, thus still far below the average productivity levels in early 2019.

At the same time, North American ports are welcoming more large container vessels in relative terms, although the share of 8,501+ TEU vessels seems to have reached its peak in late 2020, with an upward trend observed in 2022 to reach an index of 128.7 by the end of the year.

Call sizes have been rising since late 2019 with many ports announcing records in this field. In the first three quarters of 2022, the average call size levelled off at some 40% above the Q1 2019 figure. However, this was followed by a sharp drop in Q4 2022, leaving the average call size only 18.1% above the Q1 2019 figure. This sudden decline is undoubtedly one of the most remarkable observations with respect to North America, as it sharply contrasts with the very minor changes in the other three indicators compared to the previous quarter of the year.

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in North America; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 18

Evolution of Port Moves per Hour (Ports in North America; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

5.7. Regional focus: North East Asia

The North East Asian container port system covers Japanese, South Korean, mainland Chinese and Taiwanese ports. While ports in mainland China serve a vast hinterland through long-distance inland transport corridors, the cargo generating effect of the coastal provinces still forms the backbone of the ports’ container throughput. Japan, the Republic of Korea and Taiwan are island or quasi-island economies, implying a significant role in short-distance inland corridors, coastal shipping and sea-sea transhipment. North East Asia is home to several major port clusters with some of the largest gateway ports in the world.

The number of vessel calls in North East Asian ports has dropped 19% since early 2019, but the changes have remained fairly small since late 2019 (Figure 19). The call sizes increased significantly to peak in Q4 2021 (+46% compared to Q1 2019). Throughout 2022, call sizes have gradually dropped to reach an index of 121.2 in Q4 2022. The combination of fewer vessel calls and much larger call sizes has not been caused by a strong upscaling in vessel sizes. Indeed, the share of 8,501+ TEU vessels in Q3 2022 was only 17.3% higher than in early 2019, with a peak of +25% in mid-2020. In relative terms, the share of 8,501+ TEU ships in total container vessel calls increased to 39.1% in Q3 2020 compared to 31.3% in Q1 2019 and 36.7% in Q4 2022, the highest share of all port regions around the world.

The port moves per hour in North East Asia fluctuated only mildly throughout the analysed period. A gradual decline followed an initial 20% increase by mid-2020 to below the 100-marker in Q3 2021. In the second half of 2022, productivity levels remained 4 to 5% above the Q1 2019 level. The apparent easing of port congestion in some of the main ports in the region in late 2022 thus did not result in significantly higher productivity levels.

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in North-East Asia; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 20

Evolution of Port Moves per Hour (Ports in North-East Asia; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

5.8. Regional focus: Northern Europe

The North European port system features established large ports, as well as a series of medium-sized to smaller ports. Each of these ports have specific characteristics in terms of hinterland markets served, nautical conditions and location. The large container ports in mainland Europe have a cargo mix combining large gateway flows with substantial sea-sea transhipment volumes in relation to the Baltic, U.K./Ireland and the Mediterranean. Also, the U.K. is home to some large container ports as well as a large number of smaller container facilities.

Figures 21 and 22 show the changes in the indicators considered. First, the clear strong upward trend in the average call sizes was abruptly reversed in Q4 2022. In Q3 2022, average call sizes were 25.5% above the Q1 2019 level, while in the last quarter of 2022 this figure dropped to 15.1%. The growth in average call sizes over the past few years was mainly caused by a significant rise in call sizes of over 6000 TEU after the outbreak of COVID-19. Particularly for vessels in the 20,000+ TEU class, a few North European container ports reported records of close to 25,000 TEU handled during a vessel call.

By late 2022, weakening trade volumes on some main east-west trade routes (particularly in relation to the Far East) did not result in fewer vessel calls but implied fewer containers handled per call.

Thus, the exceptionally high call sizes during the COVID-19 pandemic induced a global supply chain crisis that seems to make way for more moderate call sizes despite an increase in the share of 8501+ TEU vessels throughout 2022.

Secondly, the rise in call sizes since Q2 2020 went hand-in-hand with a gradual decline in the port moves per hour. This development suggests that productivity in North European ports (primarily in the bigger hubs) has been negatively affected by poor schedule integrity of the vessels, longer container dwell times and overall terminal capacity shortages as observed from late 2020 till early 2022. However, the decrease in port moves per hour remained relatively small when compared to the North American situation. All that time, the share of the larger container ships remained fairly much the same in North Europe, fluctuating between 26 and 31% of all vessel calls. However, this share increased throughout 2022. Q4 2022 brought the highest share of 8,501+ TEU vessels in total container vessel calls, i.e., 32.2% or 7 percentage points higher than in Q1 2019.

Thirdly, vessel calls have gradually decreased since mid-2019, with some stabilisation at an index value of 75 throughout 2022. Thus, this implies we are looking at a combination of fewer vessel arrivals, a slightly increased share of the larger container vessels in the total vessel arrivals, an upward trend in call sizes stopped abruptly in Q4 2022, and lower moves per hour.

Figure 21

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in Northern Europe; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 22

Evolution of Port Moves per Hour (Ports in Northern Europe; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

5.9. Regional focus: Oceania

The container port system in Oceania includes the ports in Australia, New Zealand and some smaller port facilities in Pacific Island economies. Figure 23 only includes two of the three indicators. The share of 8,501+ TEU vessels was not included given a significant increase from 0.7% (index 100) in Q1 2019 to 12% in Q4 2022 (index 1714) of all container vessel calls, showing that this ship class is finding its way to Oceania.

The increasing share of larger ship sizes went hand in hand with a 32% increase in average call sizes by Q4 2022 and a 16% decrease in the number of vessel calls. As a result, in Q4 2022, vessel calls were 11.7% lower compared to Q1 2019 and average call sizes were 19.3% higher. However, the latter figure implies a rather significant drop compared to the same quarter in 2021 when the index still stood at 133. Thus, similar to many other regions, the average call size is moving closer to pre-pandemic levels.

The quayside terminal productivity grew slightly with ship size and call sizes. As a result, the port moves per hour in Q4 2022 were 6.6% higher than in early 2019 and remained fairly stable throughout 2022.

Figure 23

Evolution of Number of Vessel Calls, and Call Size (Ports in Oceania; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Figure 24

Evolution of Port Moves per Hour (Ports in Oceania; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

By: Theo Notteboom - Thanos Pallis

5.10. Regional focus: South East Asia

The South East Asian container port system stretches from major economies such as Indonesia, Thailand, Malaysia, Singapore, and the Philippines, to small island economies. Moreover, given the region’s distinct geography, South-East Asia is home to some large transhipment hubs connecting intercontinental services to intra-regional container services and major gateway ports.

Throughout the observation period, South East Asia witnessed a significant decrease of 19.5% in the number of vessel calls. This drop was already initiated in late 2019 but further deepened during the COVID-19 years. However, the vessel call number is on the rise in 2022 after reaching its lowest index level of 68.3 in Q4 2021 or -31.7% compared to early 2019.

As observed in many other regions, the call sizes saw a strong upward trend (+44% by Q4 2021). However, average call sizes started to decline in early 2022, and this downward trend further accelerated in Q4 2022. By the end of last year, average call sizes were only 16.9% above the Q1 2019 level.

In early 2019, about 17% of vessels calling at the South East Asian port system were larger than 8,501 TEU. By late 2020, this share had risen to 22.9%, which represents a 34-percentage-point increase. In Q4 2022, the share of 8,501+ TEU vessels in total container vessel calls decreased slightly to 20.4%, although this is still 19.3% higher than in early 2019.

The port moves per hour went up in the early months of the pandemic (+17% between Q1 2019 and Q2 2020). However, the global supply chain crisis resulted in decreased productivity figures in late 2020. The year 2021 closed with a 5.5% decrease in port moves per hour compared to the first quarter of 2019. Terminal productivity improved in 2022, although the figure for Q4 2022 is only 4.3% above the Q1 2019 level.

Evolution of Number of Vessel Calls, Share of Container ships of > 8.500 TEU capacity, and Call Size (Ports in South-East Asia; index-based: Q1 2019 = 100)

By: Theo Notteboom - Thanos Pallis

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

Evolution of Port Moves per Hour (Ports in South-East Asia; index-based: Q1 2019 = 100)

Source: DatacollectedandprovidedbyS&PGlobalPortPerformanceProgram.

By: Theo Notteboom - Thanos Pallis

Figure 25

Figure 26

TRENDS IN CARGO PORTS: HINTERLAND TRANSPORT SITUATION

The survey also explores the evolution of hinterland transport conditions in ports around the globe. In particular, the IAPH World Ports Tracker survey investigates to what extent the responding ports are facing delays and disruptions in inland transport operations by truck, rail, and barge (where available).

Multiple causes produce these delays or disruptions in inland transport, including low availability of transport equipment such as containers, chassis, or wagons; congestion or disruptions in terminal operations; low availability of personnel such as truck drivers; and heavy congestion/capacity issues in the inland transport network. These can negatively affect inland transport operations in/out of the port and hinterland areas. In view of recognising potential differences in market dynamics per cargo type, the survey distinguishes between container transport and bulk and breakbulk cargo transport.

The collected data suggest substantially improved hinterland conditions in ports within the last three months of 2022, at least insofar as incidents of major delays and disruptions are concerned.

Container supply chains seem to face less pressures today than those recorded earlier in 2022, thus bringing the market closer to conditions in which both users and service providers can plan and better predict the length of maritime supply chains. When it comes to inland container transport, about 5% of the responding container ports report delays (6-24 hours) in road transportation, while no ports are facing major disruptions (> 24 hours). The previous issue of the IAPH World Ports Tracker had recorded respective percentages standing at 6% and 5%, respectively.

There still remains a considerable way to go before hinterland transportation connectivity normalises, along with optimisation.

In Q4 2022, one out of three container ports (34%) experienced some minor delays (< 6 hours) in road transportation to/from the port, equal to a ten percentage points increase since Q3 2022. The percentage of ports that did not register delays continues to be at just over 60% of all - in the last quarter of 2022, it reached 61%, which equates to a statistically-insignificant difference of less than 2% lower than the respective percentage recorded in Q4 2022.

Major delays and disruptions continue to be present in some rail services and are more evident in the barge markets linked with ports. Yet, compared to the immediate past period, in Q4 2022, rail services in world ports improved considerably: 70% of the responding ports’ trains serve trade exchanges without any delays (+14% compared to the previous period). On the other hand, delays (6-24 hours) or major disruptions (>24 hours) happened in approximately 9% and 7% of ports, respectively, with both percentages being lower by 2% compared to the previous reporting period. Minor delays (<6 hours) occurred in just 11% of all responding ports (-15% compared to the last period).

The share of ports not encountering any delays in inland transport continues to amount to 61% (-2%) for trucking but increased to 70% (+14%) for rail and lowered to 67% (-14%) for transportation by inland barge.

Figure 27

Evolution of hinterland transport conditions in ports (Q4 2022 vs. Q4 2021)

By: Theo Notteboom - Thanos Pallis

The picture is similar in the case of inland transportation activities for bulk and breakbulk cargo. Over 6% of respondents are not facing truck transport delays, over 65% show no problems in rail operations, and 67% reported no delays in inland barge transportation in the last three months of 2022. Breakbulk/bulk inland transport is hampered by delays of over six hours for only 5% of ports in the case of trucking (7% less than the immediate past quarter of the year), 19% for rail, and 23% (14% more than the immediate past quarter of the year) for barge transport.

The findings demonstrate that the situation in inland barge operations is, on average, slightly more disrupted than in the case of other means of hinterland transportation.

Nonetheless there are rather significant differences among the port regions, as indicated in the related Dashboard III. Middle East & Central/South Asia and Sub-Saharan Africa are where the most considerable challenges occur when considering inland container transport by truck. North American and Mediterranean ports have avoided major disruptions, but minor delays (< 6hrs) occurred in half of the ports. Minor delays (< 6hrs) also happened in all reporting Latin America & Caribbean ports. Yet, the region avoided any of the major and/or significant disruptions that had been noted in the previous measurement. The number of responses per region for rail is, in some cases, low, yet overall ports are facing minor disruptions as regards such services. A considerable number of delays (6-24 hrs) were reported in North America, the Mediterranean, and Sub-Saharan Africa. One in three ports in North Europe reported minor delays in barge operations.

The situation for breakbulk/bulk cargo shows some regional differences, though it has to be noted that the sample is relatively small for reaching definite conclusions in all regions. Latin American and Caribbean ports report minor delays in trucking and, when they occur, in rail services. The conditions have been more efficient in all parts of Asia; only a few ports in the Middle East & Central/South Asia reported minor delays of trucks. Ports in Sub-Saharan Africa face some challenges in truck services. Minor rail delays were observed in the Mediterranean and North American ports. The Mediterranean is also the region where most issues with rail-related services were experienced, yet these have been of a minor scale, i.e., delays ranging between 6-24 hours. North European ports reported no delays or only minor delays (in the cases of barges) in inland waterway transport of breakbulk and bulk cargoes.

TRENDS IN CARGO PORTS: CAPACITY UTILISATION IN WAREHOUSING AND DISTRIBUTION ACTIVITIES

Another question of the survey zooms in on the current capacity utilisation of warehouses/distribution facilities in world ports. In view of capturing the particularities associated with different goods flows, this part of the survey distinguishes between the warehousing/distribution situation for containerised goods, dry bulk, liquid bulk, and other cargo (conventional general cargo and breakbulk). Warehousing and distribution activities in ports may change due to demand and inventory (re)stocking of traders, importers, and retailers. Tank storage parks for liquid bulk, and oil products in particular, might see shifts in their utilisation degree caused by changes in oil prices, the demand for oil products, and the strategies of major traders.

There is an improvement overall in storage availability for containerised cargo. The survey results show 27% of ports reporting an increase or major increase in the utilisation of warehousing and distribution facilities for containerised goods, and a further 16% reported minor increases. Only 3% reported capacity shortages, which is substantially lower than the percentage of ports that reported such shortages in the previous quarter of 2022 (13%).

The percentage of respondents reporting an under-utilisation of warehousing and distribution facilities has increased in Q4 2022 to 14% from 11% in Q3 2022. Yet, at the beginning of 2023, such underutilisation was minor in all cases. This is an improvement from the previous measurement when the IAPH World Ports Tracker recorded few ports (3%) facing rather severe under-utilisation.

In the other goods categories, the share of ports with under-utilised capacity has also lowered. At the beginning of 2023, this share ranges between 11% and 13%; the respective range three months earlier stood higher (between 14% and 20%). While one quarter of the ports observes an increase or major increase in the utilisation degree of dry bulk storage facilities, 8% of ports face capacity shortages. The latter percentage is 3% less than the respective one recorded three months earlier. In the liquid bulk market, 18% of surveyed ports face (major) increases in facility use, with another 4% confronted with a lack of warehousing and distribution services capacity.

The regional analysis reveals a minor under-utilisation in Mediterranean and East Asian container ports. In a few ports in the Mediterranean Sea, this under-utilisation is severe. The capacity shortages that the previous issue of IAPH World Ports Tracker noted for North America and North Europe have, in the former case disappeared, and in the latter case, lowered to 8% (from 43%). No ports are pointing to severe underutilisation or any discontinuation of such services.

Containers

Dry bulk

Liquid Bulk

Other cargo

By: Theo Notteboom - Thanos Pallis

Figure 28

Warehousing and Distribution Services: Capacity Shortages and Under-Utilisation per market (Q4 2022 vs Q4 2021)

Latin American and Caribbean ports reported a significant improvement in the dry bulk sector compared to the previous quarter; in the most recent months, any capacity underutilisation in these ports was only minor. Similarly, minor underutilisation of warehousing /distribution facilities for dry bulk cargoes was recorded by 29% of Southeast Asian ports and by 17% of North European ports. The Mediterranean is the only region where ports (13%) reported severe underutilisation and capacity shortages (6%). The only other regions where cases of capacity shortages occurred was the Middle East and Central and South Asia.

Any phenomena of underutilisation of liquid bulk storage facilities are present in East Asia and North Europe. Minor capacity shortages are sporadically found in North America, North Europe, SubSaharan Africa, and East Asia. Ports in Latin American and Caribbean as well as ports in the Middle East and Central and South Asia region remain free of any challenges related to underutilisation. For the very diverse “other cargo” category, capacity shortages were detected in some Latin American and Caribbean as well as East Asian ports. At the same time, minor under-utilisation has been primarily present in ports in North European ports that responded to the survey. The survey results indicate that under-utilisation in the rest of the world has been very low, and capacity shortages are non-existent.

Figure 29

Warehousing and Distribution Services: Capacity Shortages and Under-Utilisation in selected Regions: (Q4 2022 vs. Q4 2021)

Containers

Dry Bulk Liquid Bulk

Other cargo vessels

By: Theo Notteboom - Thanos Pallis

TRENDS IN WORLD PASSENGER PORTS

In this section of the tracker, questions are raised to those ports receiving cruise and passenger vessels around the world. The cruise and ferry sectors were the shipping segment most impacted by the COVID-19 pandemic, so measuring sentiments and trends of cruise and ferry ports around the world in the post pandemic period in these reports gauge the degree of recovery this sector is experiencing.

Passenger ports continued to surge following the collapse in all passenger-related activities in 2020 and 2021 due to the COVID-19 pandemic. As a result, traffic growth in passenger ports in 2022 has been almost widespread.

With the resumption of cruise activities in the post-pandemic period, the number of cruise vessel calls in most world cruise ports continues to increase.

Compared to the same quarter of the previous year, in Q4 2022, 45% of the ports participating in the survey experienced a double-digit percentage growth of such calls. A further 22% of the responding ports experienced single-digit growth. Reports of a speedy return to pre-pandemic levels continue to emerge and are supported by the number of calls in world cruise ports.

On the other hand, the ‘re-booting’ of cruise shipping has happened for most but not all cruise ports. For 8% of the reporting ports, the number of calls in Q4 2022 was lower than in the same period of 2021 by more than 10%, even though not all cruise lines were in operation in late 2021. Furthermore, a single-digit contradiction in the number of cruise calls was observed in 2% of the participating ports. Monitoring these trends further will enable us to conclude whether this is due to the slow application of the new protocols for facilitating safe cruise passages or evidence of redeployment of cruise ships by cruise lines and a respective restructuring of the itineraries offered to cruise-passengers.

Significant increases in cruise calls in the last part of 2022 occurred in all parts of Asia.

As the post-pandemic opening of several Asian economies happened later than elsewhere, cruises in these regions also restarted later than in other cruise markets worldwide. The surge continues in all cruise markets without any exceptions.

Notably, no North American port reported a decline in the number of cruise vessel calls in the last three months of 2022 compared to the same period of 2021. On the other hand, the two European cruise markets, the Mediterranean and North Europe, respectively, are the two cases where some ports experienced a double-digit percentage decline in the number of cruise ship calls on a year-on-year basis. The only other regions where any cruise port experienced any decrease in calls are Southeast Asia and Oceania, which is a region where the re-opening of the Chinese economy took place later than the rest of the globe, and Sub-Saharan Africa.

An even more positive trend is revealed when observing the evolution of ferry calls. Of the responding ports, and within the period under examination, 29% realised a more than 10% growth in ferry calls. A further 20% experienced single-digit growth. The percentage of passenger ports recording a decline in ferry calls in Q4 2022 is 12%, with just 3% of all reporting ports realising a drop of ferry calls exceeding 10%; the respective number of passenger ports that registered a decline the previous quarter of 2022 was 20%, with 20% of all reporting ports realising a drop of more than 10%. The improvement in this shipping sector is notable. Nonetheless, the long-term prospects in both cruise and ferry activities in ports will be defined by the trends to be observed in the coming period and following the total return in operations of all vessels that remained idle due to the pandemic.

30

Cruise vessels Ferries

By: Theo Notteboom - Thanos Pallis

Evolution of cruise and ferries calls in passenger ports (Q4 2022 compared to Q4 2021)

EXPECTATIONS IN CRUISE PORTS FOR THE NEXT TWELVE MONTHS

In this section, the tracker includes a question for ports on prospects for cruise and ferry traffic in the coming twelve month period, in order to gauge fleet deployment, seasonal changes between regions and potential redeployments depending on demand

The industry-wide estimation is that the positive trend of cruise activities in the second half of 2022 will continue in 2023. However, this is expected to happen at a slower pace than in the recent past.

In March 2023, the percentage of cruise ports expecting the number of cruise vessel calls they will serve in the next 12 months to increase has reached 66%. This percentage is slightly lower than in November 2022 (68%). Most importantly, 29% of ports participating in the survey expect the scale of this growth to be a double-digit percentage. The respective share in the previous issue of the IAPH World Ports Tracker reported stood at 40%. At the same time, 23% of the ports expect the number of cruise ship calls to remain relatively stable (i.e., between 2% growth and 2% decline), four percentage points higher than in November 2022. Only a few ports (12%) expect fewer cruise calls in the next two months, while 8% expect this decline to stand at more than 10%. Notably, all the ports of the latter category are located in North Europe, and one case is in the Mediterranean market – an additional hint that the return of cruise operations might be followed by a rethink of the itinerary programs of cruise lines or even the deployment of some cruise vessels in different regions than before. Reports are already forecasting that a more extended cruise season in terms of scheduled vessel calls and passengers visiting cruise ports port will be accompanied by some restructuring of the cruise itineraries offered.

The optimism is also present when the focus turns on the number of cruise passengers that are expected to visit the responding cruise ports in 2023.

The magnitude of the anticipated growth of cruise passenger movements is relatively higher than expectations for the number of vessel calls, a phenomenon that has occurred since the restart of cruise traffic in post-pandemic conditions and post-pandemic operating protocols. An identical percentage of the respondents (29%) expect the growth of cruise passengers to be hosted in the next 12 months to be more than 10%; 47% expect an increase of cruise passengers to be hosted at the port to range between 2% to 10%. Expectations of growth in the number of cruise passengers visiting the respective ports have been higher than those referring to cruise ship calls. A key reason for this is that in 2022 the operating capacity of cruise vessels was around 65% of the original capacity. This is expected to increase in 2023, and thus some of the reporting ports estimate that the amount of cruise calls might not increase, but the calling cruise ships will carry more passengers.

Only 10% of cruise ports expect the number of cruise passenger movements in 2023 to be lower than in 2022. In the following 12 months, cruise ships will continue to operate, redeployed on old and new itineraries, implementing new protocols and further adjustments to the new normal for the industry in the post-COVID-19 pandemic era.

The survey revealed that ports in the more traditional, and thus major cruise markets, (i.e., the Latin American and Caribbean, Mediterranean, North Europe and, to a lesser extent, North America) are predicting single-digit percentage growth of cruise passengers for the next 12 months, and to a lesser extent, double-digit percentage ones. This can be explained as the restart in these markets occurred in

either late 2021 or the first half of 2022. Therefore a considerable share of activities has already resumed. On the other hand, in several countries in East Asia, or Southeast Asia and Oceania, cruise activities resumed in late 2022. As a result, ports in Asia expect significant upticks in cruise traffic passengers visiting the port and the destination in the coming quarters.

It is worth noting that in East Asia, where the complete opening of China (both for incoming and outgoing tourists) happened only recently - and a full-scale international cruise season, including foreign vessels resumed in March 2023 - it is assumed that cruise vessel calls in 2023 will exceed the levels recorded in the pre-pandemic year in 2019. Even though some European ports are preparing for a rather stable number of calls, an increase in passenger numbers is expected due to higher occupancy rates of cruise ships. Many of the forthcoming trends in the passenger markets remain dependent on the developments on the COVID-19 pandemic front.

Cruise ships calls and passenger movement in world cruise ports for the next 12 months: Expectations as in early March 2023.

Cruise vessels

Cruise Passengers

By: Theo Notteboom - Thanos Pallis

Figure 31

STRATEGIC AND OPERATIONAL ISSUES IN PORTS

Question 8 of the survey addresses the staff availability issues in world ports by focusing on three categories of port-related workers: dock workers, truck drivers and staff working in nautical-technical services (technical personnel of towage companies, pilots, mooring specialists, lock operators, etc.). The section also includes three annual questions related to investments in ports, capacity expansion and land use.

10.1. Staff availability

The availability of the needed port-related workers is an important strategic and operational consideration in world ports. The importance of monitoring gaps in the availability of port workers, administrative personnel, and related workers – such as truck drivers- was further highlighted by measures to fight COVID-19 that affected the availability of all different types of port-related workers. However, the IAPH-WPSP Port Economic Impact Barometer on the impact of COVID-19 on world ports in the period April 2020 to April 2021 demonstrated that by the end of that period, the level of impact limiting ports’ capacity to operate was relatively small: initial shortages were addressed. Since then, shortages have been decreasing. However, staff availability issues resurfaced in early 2021 in some parts of the world, contributing to supply chain disruptions.

The March 2023 survey results reveal that the vast majority of responding ports face insignificant shortages of operational workers. The total of responding ports that recorded no shortages in the case of dock workers remains over 70%; 80% of the responding ports recorded no shortages in the case of personnel offering technical-nautical services. Some ports reported that due to the increasing number of projects and activities, skilled technical workers are brought from outside the port on a daily/project basis.

A significant improvement is noted regarding the availability of truck drivers in ports worldwide. In Q4 2022, 71 % of ports reported the absence of shortages of truck drivers, compared to 62% of the ports that participated in the previous survey referring to Q3 2022.

Those facing severe shortages were also fewer (7%), with the other 27% of the participating ports facing moderate shortages of truck drivers.

Notably, all shortages of truck drivers were reported by either North European ports (20% of them facing moderate to severe shortages), or in the Mediterranean (19% of them facing moderate shortages). On the other hand, no regional differences were recorded as regards the availability of dock workers or the personnel offering technical-nautical services.

By: Theo Notteboom - Thanos Pallis

Figure 32

Staff availability in World Ports (Q4 2022 vs. Q4 2021)

10.2. Investments in ports

Decisions on investments, including implementing plans, are a subject of strategic and operational importance for ports and all current and potential service providers, port users, and stakeholders. The issue is examined by this edition of the IAPH World Ports Tracker. We have asked ports at the beginning of the calendar year to reflect on the progress of two types of investments they are planning.

The first type of investments examined are those devoted to advancing infrastructure. The overall picture is on the positive side. In 2022, such investments were executed as planned in four out of ten ports (42%) and incurred only minor delays in the other four (39%). Considerable delays occurred in 10% of the reporting ports. A tiny percentage of the ports that participated in the survey (4%) cancelled or shelved their existing infrastructure development or upgrade projects that they had planned by the end of the year. This percentage is similar to that of ports that succeeded in advancing their investments faster than anticipated (3%). The number of ports that did not have any infrastructure development plans for 2022 stands at 8%. A noteworthy observation is the global nature of these trends: the survey did not identify delays or cancellations of port investments in any particular region of the world – the observed cases were only sporadic and were present in all five continents.

Beyond upgrades of existing infrastructures, reported investments included, among others, new container terminals (in some cases with advanced forms of automation) and investments targeting intelligent digitalised infrastructures. In addition, reporting ports also mentioned the development of investments focusing on the expected increase of the demand for electric vehicles, investing in constructing facilities and developing processes such as pre-delivery inspecting centres for operating state-of-the-art terminals that will serve automotive and commercial vehicle trades.

The second type of investments examined are those focusing on improving the sustainability of the ports. While all port investments target aspects of economic, environmental and social sustainability, some of them are being developed with sustainable operations as their explicit goal. Some of these investments include advancing sustainable ports by reducing emissions, introducing electrified equipment and vehicles or planning onshore power supply (OPS). The survey revealed a positive trend in world ports. During 2022, most of these investments were executed as planned (50%) or were subject only to minor delays (37%). However, significant delays were incurred in 10% of the reporting ports. Regarding the causes for these delays, some ports referred to national policies on related issues, i.e., uncertainty regarding governmental proposals and policies on reducing emissions or linking such policies with investment initiatives.

Figure 33

Situation for the majority of the investments that ports had planned for 2022 (%, as in early March 2023)

Infrastructure Investments

Sustainability Investments

By: Theo Notteboom - Thanos Pallis

10.3. Capacity Expansion

The choices made regarding the expansion of port capacities are related to investment decisions. The IAPH World Ports Tracker survey explored the priorities of ports, and the forthcoming changes in the available capacity for all types of port activities. In particular, one of the survey questions aims to reveal which particular markets are prioritised by ports for expansion or upgrades to their capacity, and whether the capacity expansion will become operational in the immediate future.

One of three reporting container ports (33%) point to major container terminal capacity expansion or upgrades becoming operational in 2023. Notably, these cases include ports everywhere in the world except the reporting North European ports. Similar upgrades and expansions are taking place in the breakbulk market and will be operational in 25% of the reporting ports. Such projects are reported worldwide but more frequently in Sub-Saharan Africa. Capacity upgrades or expansions are less frequent in the liquid market (11%).

Passenger ports reported fewer initiatives; perhaps the major implications and standstill of activities experienced during the pandemic have stalled plans to expand infrastructures and capacities, at least until passenger markets (cruise or coastal shipping) return to the ‘new’ normal. Still, 15% of cruise ports plans to operate either new capacity or an upgraded version of the current levels. The number of ports progressing capacity expansion and/or upgrades in non-cruise port activities is 8%.

By: Theo Notteboom - Thanos Pallis

Figure 34

Ports where terminal capacity expansion or major upgrade will become operational in 2023 (%, per market, as in early March 2023)

Terminal Capacity Expansion or major upgrade to become operational in 2023

10.4. Land use

The final question of this edition of the IAPH World Ports Tracker survey examines the trends in land use in ports. Growing maritime transportation, containerised or not, is increasingly integrated into complex supply chains. These supply chains demanding capacity and additional space, either for accommodating cargo flows or developing logistics and distribution activities. At the same time, ports are places where land is allocated to industrial activities, real estate, and energy production or even used for urban/city functions. World ports were asked to reveal any significant changes in land use that are expected to unfold in 2023.

Some rather significant land-use changes will reportedly occur in the coming months. 42% of the ports stated that they intend to devote more land to logistics and distribution activities; this is the most frequent port land-use change to occur in 2023. The second most frequent change is the intended/planned expansion of the land used for accommodating container shipping trades; such developments are expected to happen in 34% of the ports. One in four ports intends to expand the land available to serve bulk cargoes (22%) or other cargoes (27%).

For many ports, the shifting of transported commodities drives such transitions. In others, the driving force is service providers or third parties, i.e., stevedore companies setting up a logistics yard. Another driver is the internal re-organisation of parts of the port to increase available space for specific activities and/or to achieve a higher operational flexibility.

Devoting more land to energy production is another trend for the foreseeable future. One third of ports reported that more space would soon be used for non-fossil energy production, while 11% will use more available land for fossil energy production.

One in four ports plans to devote more land to non-energy-related industrial activities. One in five ports refers to increased land use for either commercial real estate (22%) or urban/city related functions (22%).

Do

By: Theo Notteboom - Thanos Pallis

Theo Notteboom

Thanos Pallis

THE AUTHORS

Theo Notteboom is Professor of port and maritime economics. He is Chair Professor North Sea Port at the Maritime Institute of Ghent University and a Professor at Antwerp Maritime Academy and the Faculty of Business and Economics at the University of Antwerp. He is co-director of Porteconomics.eu, vice-president of the International Association of Maritime Economists (IAME) and a member of the IAPH Risk and Resilience Committee.

Thanos Pallis is Professor in port and maritime economics and policy at the Department of Port Management and Shipping, at the University of Piraeus, Greece, and director of the University’s Laboratory for Integrated Port Economy. He is co-director of Porteconomics.eu, immediate past president of the International Association of Maritime Economists (IAME) and a member of the IAPH Risk and Resilience Committee and of the IAPH Cruise Committee.

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