30% export shipment delayed as container handling collapses at Ctg port during Eid closure

Infofgraphics: TBS

The long government holidays for Eid-ul-Adha have severely affected container delivery and handling at Chattogram Port. A shortage of workers has caused delays of up to a day in loading and unloading containers from ships. As a result, about 30% of export shipments have experienced schedule disruptions.

Normally, over 5,000 imported containers are unloaded daily from ships at the port, but this figure has halved under current circumstances. Container delivery has dropped by more than 80%. Export shipment schedules have been thrown off due to the late arrival of containers at the port.

Before the Eid holidays, the Chattogram Port Authority and Customs held a joint meeting and took 10 decisions to keep operations running. However, businesspeople say the measures failed to deliver results.

On top of that, the imposition of a fourfold increase in storage rent has added up to their losses. In response, traders are now demanding a waiver of storage rent for the 10-day Eid holiday period.

The extended Eid-ul-Adha government holiday began on 5 June and will continue until 14 June.

An analysis of data on container delivery and handling at Chattogram Port shows a sharp decline during the Eid break. On 5 June, 4,122 TEUs were delivered, 9,720 TEUs handled, and 5,411 TEUs of imported containers were unloaded from ships. But after that, delivery numbers dropped: 3,505 TEUs on 6 June, 521 on 7 June, zero on 8 June, 437 on 9 June, and 1,381 TEUs on 10 June.

Unloading import containers also fell sharply during the holiday. While 5,544 TEUs were unloaded on 6 June,  the number of containers was 2,835 on 7 June, 308 on 8 June, 2,113 on 9 June, and 2,311 on 10 June.

Container delivery and handling data are recorded from 8am one day to 8 am the next. So, the 10 June figures reflect activity from the morning of 9 June to the morning of 10 June.

The port yard can hold 53,518 containers, with optimal operational capacity between 30,000 and 35,000 TEUs. As of 10 June, the yard held 38,052 TEUs.

Chattogram Port Authority spokesman and Chief Personnel Officer Nasir Uddin said all port operations are ongoing and the port is fully prepared to support container deliveries.

Schedule disruption for 30% of export shipments

Due to the labour shortage during Eid, export goods could not be brought from private inland container depots (ICDs) to the port in time, terminal and berth operators reported. As a result, the containers could not be loaded onto ships as scheduled.

Out of the port's 12 container jetties, six are operated by Saif Powertec at NCT and CCT. Saif Powertec Executive Director Nazmul Haque told The Business Standard that because the containers did not arrive at the yard on time, they could not be loaded onto ships as per schedule. These containers were instead shipped to transshipment ports about 48 hours later on the next available vessels.

According to the ICD owners' association BICDA, about 2,200 export containers are usually loaded onto ships each day. But due to the shortage of workers, containers could not be loaded, and at least 30% of export-bound containers missed their scheduled vessels. 

The time needed for ships to load and unload at jetties has also increased. Normally, it takes 48 to 72 hours, but during the Eid holiday, with fewer workers and container congestion, it is taking 72 to 96 hours.

The situation, however, is expected to normalise within a day or two.

A senior official at the Chattogram office of a major global shipping company, speaking on condition of anonymity, said the delay in unloading and reloading is incurring an extra cost of $15,000 to $20,000 per ship depending on its size. This additional cost will ultimately be reflected in product prices.

The official said the government holiday should not have exceeded five days, as the long break is already impacting port operations.

The Chattogram Port Authority raised the existing storage rent by four times starting 10 March. The increased charge applies to containers that remain at the port beyond four days after being unloaded from ships. This decision was made to prevent artificial supply shortages during Ramadan.

Since then, stakeholders in port operations have been demanding withdrawal of the increased charges, but the port authority has not reversed its decision.

Traders point out that delivery and handling usually decrease during Eid holidays every year. But this time, the 10-day continuous break and the fourfold rent penalty have made the situation unbearable. 

They argue they are not responsible for the disruption, so they should not be penalised with the increased storage rent. They demand both the withdrawal of the fourfold charge and a complete waiver of storage rent during the 10-day Eid holiday.

Mahfuzul Haque Shah, former director of the Chittagong Chamber of Commerce and Industry, said, "It was unjust to impose the fourfold rent on all traders. Reduced delivery capacity has been used as a pretext to penalise all businesses. We urge the port authority to withdraw the decision. 

"If a trader intentionally delays container delivery, the port can take action against that specific party. But delivery is not possible if supporting agencies remain closed during Eid. The port authority should create a policy to ensure all stakeholder organisations remain operational during holidays."

According to the Chattogram Port Authority, after the four-day free time, the storage charge per day was $6 for a 20-foot container and $12 for a 40-foot container during the first seven days. These charges gradually increase to $24 and $48 respectively by the third week.

Under the new fourfold rate, importers now have to pay between $24 and $96 per day for 20-foot containers and between $48 and $192 per day for 40-foot containers.

Shamsul Azam, a director at BKMEA, told TBS, "The increased rent is forcing exporters to pay extra to release raw materials for the garment industry. At a time of crisis for the garment sector, this decision should be withdrawn immediately."

Mohammad Belal, secretary general of the Chattogram Garments Accessories Association and vice-president of the Bangladesh Importers Association, said, "Imposing the fourfold rent is economically self-destructive. Multiple letters have already been submitted requesting a rent waiver."