The three major freight forwarders: encountering congestion at major Asian ports

Three of the largest logistics companies in Asia Pacific - DHL Global Forwarding, Dachser and Toll - are currently facing the ongoing difficulties in the region's major ports.

Niki Frank, CEO of DHL Global Forwarding Asia Pacific, pointed out that some Asian ports have experienced significant delays due to a variety of factors, including the Red Sea crisis. At present, the return time of ships to Europe has been extended by 20 to 30 days, which has led to long container stays at the port of origin, increasing the density of the yard, and thus causing port congestion.

Frank further said that in some major Asian ports, the waiting time for ships to berth has reached three to four days, while the cargo transfer time at most major transshipment ports is as long as two to three weeks. He worried that the situation does not seem to show signs of improvement in the short term.

 In May, the traffic congestion problem in Asia became particularly prominent. Hapag-Lloyd reported at the beginning of the month that the waiting time for ships in the port of Singapore was two to four days. By mid-May, the company reported that the waiting time for eastbound routes had increased to six days and the waiting time for westbound routes had reached three days. Currently, the Hamburg-based carrier said that the traffic situation in the region has not improved.

In addition, the shortage of containers and frequent bad weather in the region have further exacerbated the current chaos, making the operation of logistics companies more challenging.

Two weeks ago, Francis Goh, COO of X-Press Feeders in Singapore, had described the situation as “a serious problem with no signs of improvement in the short term”. Similarly, the severity of the delays has been noted by Dachser, a large logistics player.

Roman Mueller, Managing Director for Asia Pacific at Dachser Ocean & Air Freight, said: “Since the Lunar New Year in February, many Indian trade vessels have switched to westbound routes to accommodate longer transit times via the Cape of Good Hope. This has led to a shortage of vessel space, increased blanking of sailings and delays in loading containers from China. In addition, bad weather has caused berthing delays at Chinese ports, resulting in delays of at least 5-7 days for incoming vessels.”

“These delays have further led to service disruptions, with some services being cancelled and others unable to call at ports due to longer turnaround times. Capacity is under great pressure, with routes to Vietnam, Thailand and India, for example, experiencing delays of a week or more,” he went on to explain.

Mueller pointed out that a combination of factors has led to the deterioration in service quality. According to him, transshipment ports such as Busan, Shekou, Port Klang, Tanjung Pelepas and Singapore remain "severely congested" with cargo backlogs of 2-3 weeks.

The Port of Colombo in Sri Lanka is "under great pressure" due to ongoing terminal maintenance and closures. In addition, Ennore and Kathupalli terminals in southern India have also been affected by recent power shortages, resulting in operational disruptions.

Earlier this week, Linerlytica released its latest report, which indicated that up to 450,000 TEUs of ships were waiting to berth outside the port of Singapore, with an estimated waiting time of up to seven days. This situation has forced some shipping companies to cancel their scheduled port calls in Singapore.

This situation was confirmed by Toll Group, headquartered in Singapore. Matthew Warrington, president of Toll Global Forwarding, said that the company had experienced delays at major ports such as Shanghai, Singapore and Jebel Ali. Traffic congestion is affecting the entire supply chain, which in turn affects businesses, consumers and the economy around the world.

Warrington believes that solving this problem requires the joint efforts of the entire industry. He said: "The major players in the shipping industry need to cooperate and implement strategic measures. Investing in port infrastructure and technology, optimizing ship schedules, improving communication and coordination between supply chain partners, and strengthening risk management strategies are all important steps to alleviate container shipping delays."

To mitigate the impact, the logistics company said it would do its best and advised customers to book as early as possible: "We encourage early communication and recommend that customers give 3-4 weeks' notice to book shipping space."