About 350 upcoming expansion projects aim to supply 270m teu additional container handling capacity up to the year 2023, with chances for completion varying regionally from 40% to 70%

Planned capacity expansion

The planned capacity expansion is shown in DS Research’s Container Terminal Project Pipeline report. Credit: DS Research


This is the finding of DS Research’s 5th Container Terminal Project Pipeline report, which focuses on container terminal projects scheduled for completion in 2018 and beyond, their chances to get completed and industry growth.

“The purpose of project announcements is to attract interest from investors and potential customers. Therefore, what is announced usually exceeds what is actually built,” said analyst Daniel Schaefer. “At the same time, we expect that about 2/3rd of the expansion projects included in our project pipeline will in fact get completed, with execution rates ranging from 40% for North Africa to about 70% for South East Asia and Oceania.”

Capacity outstripping demand

Container handling capacity has increased at a relatively constant level of 40-50m teu per year, largely exceeding demand growth, the research stated. Reportedly, about 300 projects consisting of 185m teu new capacity have been built during the last four years, whereas container throughput increased by only 63m teu. As trade tensions grow and terminal utilisation rates are overall low, terminal operators tend to be more hesitant regarding new terminal investments.

DS Research expects container handling capacity to develop more in line with demand. Container port demand is forecasted to increase by 210m teu (4.3% CARG) until 2023, whereas container handling capacity is projected to increase by 260m teu (3.4% CAGR) in the same period of time.

Construction activities for specific regions and for terminal automation projects remain strong. Larger container terminal projects cluster at the US East Coast, the Mediterranean Sea, the Suez Canal, the Persian Gulf and the Strait of Malacca – moving away from Northern Europe and the Panama Canal. However, most of the listed projects are small or medium sized – about 75% of all projects scheduled for completion until 2023 include a capacity expansion of below 1m teu.

Mr Schaefer added that many global concessions are being let as multi-purpose terminals, with an increasing number of international operators.

Source: Port Strategy