Freight News, Sea

Drewry sees slowdown in port growth

[ August 3, 2020   //   Chris ]

Container port expansion will contract at least 40% over the next five years in the wake of the Covid crisis and slowdown in port throughput, warns consultancy Drewry.

In its latest Global Container Terminal Operators Annual Review and Forecast it says that global terminal capacity is projected to grow at an average annual rate of 2.1% over the next five years, or 25m teu a year, well below the growth seen over the past decade, when the average annual increase was more than 40m teu a year.

Even this modest growth will be at risk should a resurgence in Covid cases cause further widespread economic lockdown, Drewry adds. 

Report author and senior analyst for ports and terminals Eleanor Hadland said: “Our five-year forecast for global container port handling has been cut back drastically due to the COVID-19 pandemic, and the risks remain heavily weighted to the downside.”

Operators and port authorities are actively reviewing delivery of planned projects in the light of the drastic slowdown in economic growth and uncertain short-to-medium-term outlook.

Hadland explained: “Major expansion projects and greenfield projects that are already under construction and due for commissioning in 2020 and 2021 may face minor delays due to interruptions to global supply chains during the first half of 2020,” added Hadland. “However, for projects which are currently at an earlier stage of planning, particularly where construction contracts and equipment orders have not yet been tendered, suspension or cancellation is more likely if market conditions remain poor.”

 Operators had already scaled back investment plans, with only limited greenfield projects in the pipeline. However, efforts by leading operators to automate terminals continue.

Tags: Drewry