The
comparative modernity of northern Europe's road and rail networks has
long made it a clear favourite for pickup and delivery over the more
primitive links available to Mediterranean ports.
But times they are a changing. There has always
been the obvious turnaround back-to-Asia advantage of landing cargo at
Med ports. It obviously beats going round the Iberian Peninsula,
crossing the stormy Bay of Biscay to the northern range along the
congested English Channel.
This has been so much part of conventional
thinking that it gave rise to the marketing zone called the "Blue
Banana" that takes in north west England through the Benelux along with
the German Rhineland.
Later versions of the schematic map, take in
southern Germany, Alsace-Moselle in France in the west and Switzerland
and northern Italy.
Lately, there have been changes. Much in the
way Asian cargo has been diverted from California via Panama to the
east and Gulf coasts of America from California, there has been a
notable shift to the Mediterranean ports from Europe's Northern Range.
There have been several contributing factors,
but the latest being the increase in regulatory hassle that might be
minimised by unloading at one EU port rather several.
Whatever the reason, containerized trade
between Asia and the Mediterranean surged for the third straight month
this year with demand growth far outstripping growth on the Asia–North
Europe route.
Container Trades Statistics (CTS) show volume
shipped from Asia to the East Mediterranean and Black Sea jumped 39 per
cent year on year to 297,000 TEU in June, while Asia–west Med volume
rose 21 per cent to 279,908 TEU. By contrast, Asia–North Europe volume
grew just 3.1 per cent to 915,284 TEU for the month.
According to Sea-Intelligence Maritime Analysis, European imports “have clearly rebounded” after a year-long depression.
“This marks the fourth consecutive month of
growth into the continent and saw a year-over-year growth of 3.9 per
cent,” Sea-Intelligence noted, adding that total growth in imports to
North Europe and the Mediterranean from Asia reached 12 per cent in
June, “which certainly qualifies as a market rebound.”
Volume growth has been particularly robust in
the Asia–East Mediterranean trade, rising 38 per cent year on year in
May and 38.5 per cent in April. Shipments from Asia to the west
Mediterranean rose four per cent in May and 21.7 per cent in April, CTS
data shows.
While the Asia–Mediterranean volume comparisons
are flattered by the weak demand last year, second-quarter volume on
the trade lane has overtaken cargo carried by container lines in the
same period of pre-Coved 2019.
From April through June, shippers in the West
Mediterranean brought in 812,000 TEU from Asia, almost six per cent
more than in the same three-month period in 2019, while Asia–East
Mediterranean/Black Sea volume of 901,000 TEU was up 7.1 per cent.
Asia-North Europe volume, on the other hand, fell 3.7 per cent to 2.6
million TEU in the second quarter.
Said CTS chief executive Nigel Pusey: “After a
weak start to the year, every month since March has shown a strong
increase in volume into the Mediterranean.”
That “normalisation” of volume has dragged rate
levels down from the record highs of last year, but Asia–Mediterranean
pricing continues to hold up far better than its northern counterpart,
even with a seemingly successful August rate increases on the
Asia–North Europe trade.
Reasons for favouring Med ports over the
traditional Northern Range option have been apparent for decades. In
the year 2000, the Port of Barcelona sent delegations to the Far East
to woo beneficial cargo owners (BCO) to choose the Catalan ports to
discharge its Asian EU-bound cargo, citing the quick turnaround. But
the disadvantages could not be concealed, that the rail line in Spain
were of a different gauge than those of the EU necessitating costly
intermodal transfers.
While that was a deal-breaker for most BCOs,
there were other discouraging factors. Spain was a little too far west
to be a useful alternative as it required a longer overland journey.
Why not Marseille with its access to the French wine trade or Genoa
with its proximity to Vienna, Turin, Milan and Budapest.
But there have been many changes since those
Barcelona press conferences in the year 2000. Rail gauges have been
mitigated. Rail freight from China now runs through Duisburg, Germany
and extends all the way to Madrid. There has been much road and bridge
buildings and tunneling since. Harbors have been dredged. Even the US
west coast to east coast switch has played a part. That's because cargo
collected in Singapore and Colombo runs west via Suez rather that east
via Panama through the Med to reach the US east coast.
In the year 2000, the biggest ships ran to
10,000 TEU; in the year 2023, they run to 24,000 TEU. Another factor is
the wealth of the world has increased enormously. Few noticed, but the
UN's global goals to eradicate extreme poverty set for 2020 were
actually achieved in 2012. This has impacted the size of consumer
culture worldwide, increasing the number and value of goods sold.
There is also the phenomenon of way porting
that has developed since the volume of US east coast-bound cargo
started to build. At first 10,000-TEU ships could only access northern
range ports and too few ports on the American eastern seaboard could
dock them. So they dropped off their US-bound boxes at Red Sea and Med
ports to be picked up by smaller ships that could access more harbours
than what all considered megaships back then. But that has become less
important since because of extensive dredging worldwide.
A beneficiary of the trend is the Port of La
Spezia, equidistant between Livorno and Genoa on the north-eastern
Italian coast with its growing rail connectivity and its ability to
handle the biggest ships.
Another selling point for carriers is that
there is a saving of 2,000 nautical miles from Suez to La Spezia,
compared to turning the ship around in Rotterdam. With the current
carbon craze, there is far greater importance placed on environmental
impact than there was 10 years ago.
Bigger ships can now access the recently
dredged port, with a 15-metres alongside its Fornelli East pier and the
objective is to go to 16 metres at the new Garibaldi berth.
"As for the south-Europe hinterland, we are
currently offering Austria, Switzerland, and southern Germany via our
intermodal platform in Milan, allowing customers to take advantage of a
range of benefits when routing their cargo via La Spezia Container
Terminal," said Contship Italia CEO Matthieu Gasselin.
The MSC Nicola Mastro is the first 24,000
-TEUer to touch an Italian gateway. This ability to address all
operational needs and confirms the competitive factors of the "Spezia
System".
Said Mr Gasselin: "To stay competitive, it is
crucial to anticipate market demands. The fact that the Nicola Mastro
chose the La Spezia Container Terminal gateway confirms our readiness
for the future. I thank MSC for their trust in the 'Spezia System' and
all colleagues for their excellent teamwork in this record-breaking
circumstance."
One can see without difficulty how the La Spezia story may multiply in
other areas of the Med going forward, much in the way Savannah,
Georgia, became models for similar development along America's Eastern
Seaboard nearly 20 years ago. |