Port congestion outside the ports of Long Beach and Los Angeles in California has significantly impacted the global container transport capacity. According to an October report by C.H. Robinson, nearly 12% of the total capacity of container ships worldwide is blocked due to port congestion, the highest level in the past four years.
Impact of Port Congestion on Global Capacity
This port congestion particularly affects East Asia, Northern Europe, and the Indian subcontinent, leading to a reduction in the actual capacity available for transport. While the supply of ships generally appears healthy, port congestion and the actions taken by shipping companies to improve schedules have significant effects on the timing and availability of capacity.
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As a result, the maritime transport market has become increasingly imbalanced, forcing greater attention to port selection, transfer exposure, availability of containers, and the ability of shipping companies to restore schedules when problems arise.
Additional Challenges on Routes Between Asia and North America
The pressures from port congestion are particularly evident on routes between Asia and North America. Transport space is limited ahead of the Golden Week holiday in China, and planned blockages are expected to reduce effective capacity until mid-October. This could pose significant risks for early post-holiday voyages as factories resume operations and export volumes increase.
The future of this situation depends on the strength of the return of cargo volumes after the holidays. If the return is strong, preferred voyages may fill up and support recent rate levels. However, if the return is weak, space may return to normal by late October.
Overall, the big picture reflects usable capacity rather than the total fleet capacity. With more than one-tenth of the global ship capacity constrained by port congestion, shippers need to pay closer attention to port selection and transfer conditions.
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