December 2016 Port of the Month

Glimmer of light for Bangladesh's desperate apparel shippers as port plan makes headway

 

There may be a gleam of light in the tunnel for shippers exhausted by years of chronic congestion at Bangladesh’s major container gateway of Chittagong if the country goes ahead with plans to build a new deepwater facility to service its garment exports.

The Asian Development Bank (ADB) has set aside some $1.9bn for a project that could hugely increase Bangladesh’s container handling capacity and bring much needed relief to major retailers struggling to control mounting supply chain costs.

Projects to radically expand Bangladesh port capacity have been mooted for up to two decades, but few have managed to get beyond the drawing board, as each has become successively mired in dispute, corruption and political impasse, and left Chittagong, a port which handles around 2m teu a year, operating far above its designed capacity.

Current port capacity continues to lag well behind the demand curve driven by strong growth on imports and exports through Chittagong, and throughput growth has exceeded its five-year plan.

However, the Bangladeshi government has now contracted a consortium comprising Hamburg Port Consulting, fellow German firm Sellhorn Engineering and local company KS Consultants to draw up a feasibility study for the creation of a new greenfield port called the Bay Terminal, on the Bangladeshi coast at Patenga.

This would offer considerably deeper water than the 8.5-9.5 metres available at Chittagong’s existing quays, which limits the port to only handling feeder vessels.

lf the decision process and construction phase move quickly forward, the terminal has a chance to be completed by 2021.

If so, this could ultimately take annual handling capacity in the country up to 6.1m teu by 2030, although port customers said that there would additionally be a need for investment in hinterland infrastructure, as well as other modes of transport.

On any given day there are a number of containerships waiting to berth, according to the daily vessel list produced by Chittagong Port Authority. For example, on 2 November, there were 10 – either at berth or anchor – which had been waiting to begin cargo operations for anything between two days and a week.

At the recent TPM Asia event in Shenzhen, Tim Wickmann, chief executive of Maersk intra-Asia subsidiary MCC Transport, identified Chittagong as the worst-performing port in the carrier’s network.

“Bangladesh is the worst place for us,” he added. “The ports are swimming in containers and cargo is still coming in. It’s impossible to get a berth – the wait is three-to-six days.”

 

Source: http://theloadstar.co.uk/glimmer-light-bangladeshs-desperate-apparel-shippers-port-plan-makes-headway/