Terminal and Port Congestion

Introduction / Background

Globalization with the rapid growth of global economies has increased the volume of cargo shipments around the world due to high economic growth. The increase in economic development has raised the demand of consumers and has set other economic trends that have resulted in the expansion of container shipment, terminal operations, and local transportation. In this paper, terminal handling quality and the future scale of container handling in main ports will be discussed.

Container terminals are used for storage of cargo, management, and loading and unloading of cargo from containers. Container terminals are normally categorized into five types, which are public terminals, carrier-leased, dedicated terminals, terminal-operator, and operation terminals. The preference of choosing the port by ship owners depends upon the performance of the terminal, especially the container terminal (Cordero, 2014).

The quality of the terminal has a direct impact on customers’ decisions, for instance, in Europe, there are choices of different container ports for container carriers, which can fulfill the demand of customers (Lynch, 2018). These choices of container ports positively affect the quality factor of the container terminal for targeting potential customers.

Globalization and large-scale movement of shipment containers have transformed the operations of container ports and shipping lines in the recent years. Supply chain and logistics processes have also revolutionized in these years, which has forced container ports and shipping lines to rearrange and optimize their functionality (Cordero, 2014).

The container transportation is a streamline chain process, and this streamlined chain requires detailed planning. Port congestion is caused due to the inflexibility of ports, and it requires a lot of funding to achieve quality in container handling (Cordero, 2014). However, innovative options for handling container terminals are not yet introduced by any European country.

The reason is that improving the quality of handling systems requires a lot of funds, and the outcomes of such standards are not recognized by terminal operators. The quality aspects, which are of major concern, include time, flexibility, control, safety, and security. The quality of service also depends upon some important activities that include ship-oriented, yard-oriented, and other terminal services (Konings, Priemus, & Nijkamp, 2008). Presently, customers are demanding better performance despite door-to-door transportation systems involving large vessels, high-tech terminals, and intermodal and computerized information systems.

The reliability and low costs are the major issues of door-to-door transportation. However, the intense competition and the failure to control the capacity have increased prices, which requires companies to develop strategies and methods for cost reduction (Konings, Priemus, & Nijkamp, 2008).

Pros and Cons of Quality Handling in Container Terminal

Pros

1. It affects time, flexibility, speed, reliability, frequency, safety, and security of the terminal process (Cordero, 2014).
2. The quality of service is improved through delivering terminal services in line with the quality expectations and perceptions (Federal Maritime Commision, 2015).
3. Due to efficient handling of container carriers, the number of transport companies and importers/exporters has increased (Federal Maritime Commision, 2015).
4. It has enabled suppliers to communicate with their customers directly.
5. Critical interval performance tends to improve the conditions for terminal operators.
6. It allows companies to form a well-defined platform, which can be used for communication (Konings, Priemus, & Nijkamp, 2008).

Cons

1. It requires additional cost for quality enhancements (Konings, Priemus, & Nijkamp, 2008).
2. Internal repairs are also very costly.
3. Increased costs result in low sales.
4. It is hard to fulfill all requirements of customers in door-to-door transportation (Konings, Priemus, & Nijkamp, 2008).

Pros and Cons of Container Handling in Main Ports

Pros

1. The increase in container volumes has affected the demand for greater terminal capacity (Cordero, 2014).
2. It has increased cargo shipments all over the world.
3. It allows traders to achieve business growth (Konings, Priemus, & Nijkamp, 2008).
4. Due to globalization, the number of consumers using shipping services has increased.
5. The use of large vessels and a large number of cargo has reduced the business cost.
6. The increase in the demand for port facilities adds value to the land.
7. Online information systems also provide better tracking of shipments (Federal Maritime Commision, 2015).
8. The increase in coastal shipping will minimize the growth of carbon combusting fuels and other pollutants, which are caused by trucks and other vehicles (Konings, Priemus, & Nijkamp, 2008).
9. Safety and security in port operations are preferred.

Cons

1. Additional costs are incurred to control illegal immigrants, drugs, and dangerous shipments from entering the state.
2. Monopoly is created due to the formation of alliances and mergers that has decreased the number of global players.
3. The increase in ports facilities causes environmental issues and preservation of nature and wildlife is disturbed.
4. Cost escalation is one of the major issues in the development of ports.

Conclusion

Quality of handing containers on ports is a major perspective, which requires both time and money. Although there are many factors that have expanded the scale of shipping transportation services, it will be very difficult to handle the increased container traffic in the near future unless new ports and optimized solutions are adopted.

References

Cordero, M. (2014). Why fixing port congestion matters. Web.

Federal Maritime Commission. (2015). U.S container port congestion & related international supply chain issues. Web.

Konings, P. N., Priemus, H., & Nijkamp, P. (2008). The future of intermodal freight transport. Northampton, UK: Edward Elgar Publishing.

Lynch, K. (2018). Port congestion a growing concern in international trade. Web.