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CYs remain congested but new depots being constructed

Image by Michael Gaida from Pixabay

More container yards (CY) are being built to accommodate more empty containers as existing and new depots in Metro Manila and nearby areas remain congested, according to the Container Depot Alliance of the Philippines (CDAP).

As of March 5, utilization at CDAP members’ container yards averaged 107%, new CDAP president Roger Torres told PortCalls in text messages. He noted that all CDAP-member depots are operating beyond capacity, with only one recording a 95% utilization rate.

CDAP members, totaling 11 operators, have a total CY area of 21.2 hectares. As of March 5, members’ total inventory was at 24,600 twenty-foot equivalent units (TEUs), greater than its 21,600-TEU capacity, according to Torres.

He said new depots with a capacity of 10,000 twenty-foot equivalent units (TEUs) opened by several CDAP members in the previous months to alleviate congestion have also become full or beyond capacity after three weeks of operation.

“Some CDAP members are now in the process of opening a six-hectare CY of around 10,000 [TEU] capacity to ease the congestion problem,” Torres said. The new container yards will be operational by the middle of April at the earliest or in the middle of May at the latest.

No relief yet for truckers

Confederation of Truckers Association of the Philippines chairman Ruperto Bayocot, in a text message to PortCalls, said a 40-hectare container yard is also being put up in Carmona, Cavite to accommodate more empty boxes this month.

Bayocot noted that truckers are not yet feeling any relief as returning empty containers to container yards remain difficult to do.

Asked whether the improvement in utilization at Manila’s international terminals will also ease congestion in container yards, Torres said it should, but noted it may still take weeks or even months to decongest the empty depots.

Utilization at container terminals

Last March 8, Customs commissioner Rey Leonardo Guerrero said yard utilization at Manila South Harbor (or Port of Manila or POM) and Manila International Container Port (MICP) was at 63% and 73% respectively, which means the two terminals are no longer congested.

“Unless more new depots are opened with an equivalent number for TEUs as those directly returned and being stored before at MICP and POM, then we are afraid it would take a while before an improvement or lower utilization could be realized or achieved in the CYs,” Torres explained.

He noted too that even if foreign shipping lines continue to evacuate empty containers, ongoing importation activity means more empty containers will still be entering the country.

The Philippines is an importing country with only one export for every four imports, which means that three boxes are left as empty containers.

“Really, we believe more spaces are necessary to decongest the CYs,” Torres pointed out.

Deal with carriers

Earlier, CDAP, together with the Association of International Shipping Lines, Alliance of Concerned Truck Owners and Organizations, and International Container Terminal Services, Inc. have agreed on measures to address high utilization at the Manila port. One of the measures is for CDAP to identify areas that may be leased to increase empty container storage capacity by 10 hectares. ICTSI will cover the cost of the lease on a market rate basis.

Asked how much container yard space is needed to ensure efficient handling of all empty containers in Metro Manila, Torres said “it’s hard to guesstimate” but noted that if POM and MICP could load at least 10,000 TEUs per week for repositioning, “then maybe [a] 15,000-TEU space would bring down the level of utilization in the CYs to an acceptable level.”

Lingering issue

The return of empty containers is a long-standing issue that has especially escalated last year due to a confluence of events, including high yard utilization at container terminals due to the peak season; limited capacity of outside depots; and trade imbalance—all of which have caused a knock-on effect on the supply chain.

Concerned government agencies, international shipping lines, and Manila port operators have been implementing several measures and intend to enforce more in order to further address the issue of empty container management. – Roumina Pablo


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