European ports are locked in fierce competition against each other to assert their positions and retain their market shares amid global uncertainties.
Take the case of Hamburg port, which is often touted as the “gateway to Asia” thanks to its burgeoning trade volume with Asia and, particularly, China. That cozy position seems to have been shaken in its rivalry with Antwerp which has ousted Hamburg from the second ranking and pushed it to Europe’s number three port. For years, Hamburg port ran a neck-and-neck race against Antwerp for the title of the second largest port in Europe.
While Rotterdam and Antwerp, Europe’s first and second-ranking ports respectively, boosted their 2018 cargo volume, Hamburg port’s volume again fell below that of its two top European rivals.
Hamburg port’s 2018 general cargo volume fell by 1% to 135 million tonnes; its container volume, an important business segment, also declined in 2018 to 8.73 million TEUs.
Axel Mattern, the joint CEO of the Port of Hamburg Marketing (HHM) attributed the decline to the lower volume of empty containers, whereas in the case of filled containers the volume had remained stable. But Mattern sounded upbeat with the addition of four new liner services.
“With weekly sailings from Hamburg, these four transatlantic container services also link ports on the US East Coast plus others in Mexico,” Mattern told Asia Cargo News. “With the transfer of these The Alliance liner services, additional throughput volume on the order of up to 500,000 TEU is arriving on the Elbe.”
But Mattern reminded of the opportunities unfolding in rail transportation.
Complementing its seaborne services, there are over 235 connections by rail available now from Hamburg along the New Silk Road or the Belt and Road Initiative. “Having handled around 4.8 million TEUs for or from China, Hamburg is the main hub for China freight by a wide margin, compared to other locations in Europe” Mattern said. Hamburg is the central freight handling hub for transport along both the maritime and overland Silk Road.
Mattern sees tremendous growth potential by logistically linking the countries of the Baltic region with the Silk Road. “No other centre in Europe offers this variety of direct sea and rail services with China,” he emphasized. “The short distances between the high-sea and hinterland services by all carriers make Hamburg especially attractive as a hub for China trade,” he said, highlighting a dense network of around 2,000 container train connections, backed by good autobahn infrastructure and multiple transport possibilities by truck and inland waterway craft, and also the airport with an air-freight centre.
Nevertheless, facing stagnant traffic for years, Hamburg was ousted from its ranking as Europe’s second largest port by Antwerp and had to contend with ranking third, with its distance behind Rotterdam and Antwerp increasing each year. Rotterdam had a throughput of 14.5 million TEUs and Antwerp 11.1 million TEUs in 2018.
Hamburg port’s executives say the mantra for recovery lies in deepening the Elbe River. Michael Westhagemann, the Hamburg senator for economics, transport and innovation, toured Asia in March and made a strong pitch to big shipping lines about Hamburg’s infrastructure modernization and upgrading.
Westhagemann calls the Elbe’s deepening an “important step” towards asserting the port’s position, though also said that this was “not everything.” The port is, after all, a complex logistics network and should not be reduced to merely being looked through the prism of its container traffic.
“Hamburg offers in Europe the best rail connectivity,” he said. “Our rail traffic strength is as big as that of Bremen, Rotterdam and Antwerp combined.”
Some 45% of containers headed from Hamburg to the hinterland are transported by rail. More than 60,000 freight trains with 1.6 million freight cars were moved on the tracks of the port’s railway in 2018.
Hamburg port’s representatives have also been saying that Hamburg have utilized the protracted delay in clearing the Elbe deepening project – at a cost estimated between €700 and €800 million (US$780-900 million) – to upgrade the port’s infrastructure, further expand rail connectivity and push the digitalization process.
Jens Meier, the Hamburg Port Authority’s chief executive, speaking at the annual meeting of the port’s marketing arm, Hafen Hamburg Marketing (HHM), maintained that the megavessels will soon be able to enter the port along the Elbe.
Meier said that the port was preparing to receive the 23,000 TEU capacity ships in the foreseeable future. Shipping lines such as MSC and CMA CGM, he noted, have ordered large container freighter ships from shipbuilders and that the first of these vessels, with capacity to transport up to 23,000 TEUs, would be deployed this year. The largest ships handled in Hamburg thus far had a capacity of 20,770 containers; fully-loaded ships could not enter the port because of the Elbe’s inadequate depth.
Meier added that three of the four big container terminals at the port have already made preparations to receive the new mega freighter vessels. The Altenwerder terminal, on the other hand, would not be accessible to the mega ships because its bridge is too low. Hapag Lloyd, Hamburg’s shipping line, has already urged the port to take a quick decision on replacing the old bridge.
Port experts say that the big ships will increase Hamburg’s container volume. The number of containers handled at the port in 2018 fell by 1% to 8.73 million TEUs; this was the fourth successive year of stagnation in the volume of containers handled. The port handled 8.82 million containers each in 2015 and 2017, but in 2016 the number of containers rose to 8.91 million.
In container traffic, Hamburg trails far behind its two rivals Rotterdam and Antwerp.
Antwerp had another good year in 2018, its sixth consecutive year of strong growth. The port, the strongest driver of the Belgian economy, is the second most important port, after Rotterdam.
Antwerp port, which posted a 5.2% growth in cargo traffic in 2017, recorded a total transshipment of 235.2 million tonnes, achieving a new record. Its 2018 container traffic rose to 130.9 million tonnes (+6.4%) or 11.1 million TEU (+6.2%).
In an effort to sustain the growth in break-bulk and bulk cargo, Antwerp port has planned huge investments in infrastructure development which, according to Jacques Vandermeiren, the chief executive of the Antwerp Port Authority, will sustain the port’s role “as the largest economic driver of our country.”
“The port of the future must have adequate capacities and be accessible, sustainable, facilitating and secure to attract investors,” he said.
The port also wants to expand its so-called chemical cluster. The British company Ineos, for example, is investing some €3 billion (US$3.3 billion) and has concluded an agreement with the port to set up two chemical plants on the port’s land.
Ineos’ investment, the second major investment in recent months, will enable Antwerp to strengthen its position as a leading European chemical port. In October 2018, the Austrian group Borealis had announced that it was setting up a new plant on the port’s land at a cost of €1 billion.
Antwerp has also entered into a partnership with Abu Dhabi to jointly use distributed ledger technology (DLT). The pilot project is aimed at helping oversee supply chains with container transport and make them more efficient. The use of blockchain technology seems to be spreading rapidly in the logistics sector.
By Manik Mehta
Global Correspondent | Hamburg
