The Singapore port is a major transshipment port used by Indian trade.
While there is no respite in the Middle East for the shipping industry that continues to face hardship due to the Red Sea route suspension, there is now tension in the South East due to severe congestion at Singapore port and China’s Shanghai/Ningbo ports has only aggravated the disruptions.
Data by Linerlytica show that 51 ships are at the Singapore port while 40 more are waiting at the anchorage. Similarly, at Shanghai/Ningbo port, 92 ships are at the port while 81 are waiting at the anchorage. Cumulatively, there are nearly 800,000 TEUs (twenty foot equivalent units) on board the ships at the two ports while another 650,000 boxes are on board the vessels waiting at the anchorage of the two ports.
Key factor
Bunching of vessels has led to major disruptions in the region and affecting the ship rotation. Ships with containers are waiting outside the two ports for over a week as against the usual availability of berth on arrival or waiting of just a day or two, said sources.
Indian trade uses the Singapore port as a major transshipment hub to supply goods in the region and connect the large ‘mother’ vessels to take the goods to Europe.
Due to the delay, many container ships are skipping the Singapore port. “We are unable to plan the exact date of supply of the cargo at the destination,” said P Mathan of Thaipan Global Trading, Chennai, which exports red chilli and onion to South East Asian countries using Singapore port as the transshipment hub.
Israr Ahmed, Vice-President, FIEO, said major disruption at Singapore is having a spill over neighboring ports like Port Klang, which is also a major transshipment port being used by Indian trade. It is estimated that nearly 7 per cent of the global ships are now caught up in this congestion. There are bound to be delays and cost implications for exporters, he said.
German shipping research firm Container xChange said due to the demand and supply situation, the average prices for 20-ft dry containers are rising at a similar pace in Singapore – from $950 in September 2023 to over $1,200 now.
Alternative ports
Several shipping lines have started omitting Singapore in favour of other regional ports. For instance, Mediterranean Shipping Company has diverted some transshipment operations to Indian ports, while carriers like ONE and OOCL are discharging Singapore-bound cargo at Port Klang in Malaysia. This shift is putting additional pressure on these alternative ports, exacerbating regional congestion and delays, the firm said.
The persistent congestion at a key hub like Singapore can impact global trade flows, affecting the movement of goods between Asia, Europe, and the Americas, said Christian Roeloffs, Co-founder and CEO of Container xChange.
Source: https://www.thehindubusinessline.com/economy/logistics/congestion-at-ports-of-singapore-shanghainingbo-escalates-disruption-in-global-shipping/article68296902.ece
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