The Port of Hamburg weathers the storm

The Covid-19 pandemic has been a major test for container shipping and seaports worldwide. Then came the temporary blockage of the Suez Canal. How are Hamburg and HHLA mastering this challenge?

The images were seen all over the world: The 400-metre-long container ship EVER GIVEN ran aground in the Suez Canal on 23 March 2021. For six days, it blocked one of the world’s most important waterways. At times there were nearly 400 ships waiting to pass through the canal, including numerous mega-carriers with hundreds of thousands of containers destined for European seaports. Although the backlog of ships was fully cleared within a few days of the canal reopening, European container ports will continue to feel the effects for some time.

This is because the delayed arrival of ships caught in the backlog will result in capacity bottlenecks with berths, empty containers and seaport-hinterland transport. For example, Rotterdam, Europe’s biggest port, handles around 80 ships of all sizes and specialisations on a normal day. An additional throng of 60 ocean-going freighters, including 56 container ships, is expected here in the near future.

Port of Hamburg ready for the “Suez wave”

The Port of Hamburg also anticipates greater capacity utilisation at all its facilities, and has taken pre-emptive steps. To alleviate the effects of the “Suez wave”, HHLA has activated an additional 100,000 square metres of storage space for containers, among other measures.

Read our interview with Thomas Lütje, Director of Sales at HHLA: “At the moment, there are no predictable schedules. We must act flexibly and assertively – and be ready at short notice!”

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All mega-ships heading for the river Elbe are on Hamburg’s radar as soon as they leave the Mediterranean Sea. Controlled by the Vessel Traffic Service Centre and coordinated by the Hamburg Vessel Coordination Center (HVCC), they will arrive in the Port of Hamburg in an orderly fashion. If capacity utilisation at the port is high, the ships will be asked to travel slowly and, if necessary, to drop anchor in the German Bight.

The Hamburg Vessel Coordination Center (HVCC) coordinates the arrivals of large vessels

Considering the preparations, Hamburg’s Harbour Master Jörg Pollmann is relaxed. “We’ll have a full house” is his assessment, but he does not foresee a backlog in the Port of Hamburg. One or two ships may have to slow down or speed up a little, he explains. “But that’s normal,” says Pollmann.

Challenging situation even before the Suez Canal blockage

Even before the mishap in the Suez Canal, global maritime container transport was under pressure, as were the ports. There were several reasons for this. On top of the coronavirus pandemic, there was extremely bad weather during the winter months. With the coronavirus reducing productivity at several ports – though not in Hamburg – some ocean-going vessels must wait longer to be loaded or unloaded. The strong demand for transport capacities has led to capacity bottlenecks, resulting in an increase in freight rates.

The situation is particularly challenging in North America. “At one stage, more than 20 ships are waiting just outside America’s biggest ports in Long Beach and Los Angeles,” says Rolf Habben Jansen, Chairman of the Hamburg-based shipping company Hapag-Lloyd, at the beginning of the week. In Northern Europe, the situation is especially critical in the ports of Rotterdam and Southampton.

On the import side, Hamburg will not be able to resolve the challenges alone. As a downstream port, Hamburg is dependent on the performance of previous ports like Rotterdam and Antwerp. If there are delays there, they will inevitably lead to further ship delays in Hamburg.

Impact on global supply chains

The impact of capacity bottlenecks on production in Germany can be seen in the automotive industry, among other areas. With car manufacturers experiencing a marked fall in sales at the start of the coronavirus pandemic, many semiconductor manufacturers supplied an increasing number of products to the consumer electronics industry. When vehicle sales picked up again in the second half of 2020, manufacturers encountered severe shortages. “Supply chains have thinned out considerably – and it will probably be some time before the situation settles down again,” says Jürgen Eder, Head of Logistics in the Production Division of the BMW Group.

Meanwhile, manufacturers of plastic packaging in Germany are struggling to purchase sufficient raw materials in the market. The supply shortages are primarily due to the absence of imports from the USA and Saudi Arabia. These are currently being rerouted to China in particular, says the German Association for Plastic Packaging and Films (IK). The IK adds that the situation is being exacerbated by the increased demand for packaging as a result of the coronavirus lockdown, particularly in the food sector.

Foreign trade provides a glimmer of hope

So what does the future hold? Positive signs in foreign trade point to light at the end of the tunnel. While foreign trade acted as a brake in the first phase of the pandemic, it has since proven to be a boon, says the President of Institute for the World Economy (IfW), Gabriel Felbermayr. “We are seeing very robust developments in Asia, particularly in China.” Chinese economic growth is pushing up demand, including for German goods, explains Felbermayr.

As a key export port, Hamburg is well-prepared. As in past months, it will continue to provide reliable ship handling operations – and to benefit from this development.