Maasvlakte II at the Port of Rotterdam.
LONDON – Rotterdam’s pioneering automated container terminals face tough challenges as they strive to hit ambitious productivity targets in their first full year of operations with the rest of the European waterfront looking on.
The year got off to a bad start, with every container crane in Rotterdam stalled for 24 hours last month as longshoremen downed tools to protest looming job losses due to accelerating automation at Europe’s top box hub.
And there could be more disruption unless terminal operators nail down a deal with unions over employment guarantees for 800 of the port’s 3,500 container workers whose jobs are at risk as robots take their place.
The two automated terminals, APM Terminals Rotterdam and Rotterdam World Gateway on the Maasvlakte II site, which began operations in the first half of 2015, shared the blame with slumping Asian and Russian trades for container traffic growing by just 1 percent in the first nine months of the year while total throughput rose by 5.4 percent.
“In the container sector, growth opportunities are currently still limited because the new terminals are not yet operating at full speed” to handle large volumes, port authority Chief Executive Officer Allard Castelein said.
Automation has dramatically changed the labor situation on the Rotterdam waterfront. The RWG terminal, with its fully automated cranes, is operated by a team of no more than 10 to 15 people on a day-to-day basis. Most of its 180 employees aren’t longshoremen, but IT specialists.
“It is a completely new way in container operations,” RWG’s managing director Ronald Lugthart said at the official opening of the 2.35 million 20-foot-equivalent unit capacity terminal in September. “We are in fact, an IT company that handles containers.”
The new super automated facilities are already breaking records as they build up speed. APM Terminals Rotterdam, which claims to be the world’s first fully-automated terminal, handled just under 1,000 containers during a 15 hour port call by the Madison Maersk, which was loaded with 17,152 TEUs with 10 tiers above deck stowage in late September.
APM Terminals, which spent 500 million euros ($550 million) on the new facility, says it will continue “ramping up operations and refining the terminal operating system” through 2016 as it targets 40 cranes moves an hour on a regular basis and ramps up annual capacity to 2.7 million TEUs.
Automation is spreading across Rotterdam, with the local Kramer group planning to invest up to 20 million euros on the world’s first automated depot for empty containers. The facility will be equipped with unmanned stacking cranes handling up to 125,000 containers a year, significantly reducing the average of 90 days boxes spend at depots.
Europe’s lead in terminal automation is a legacy of bullish investment decisions made when the dominant Le Havre-Hamburg port range was experiencing double-digit traffic growth that abruptly ended in the wake of the 2008 global financial crisis.
U.S. terminals could learn from Hamburg’s more advanced automated operations Labor Secretary Thomas Perez said after visiting Europe’s third-largest container hub in January. But “you can’t impose by fiat automation and expect it to succeed,” he told the Wall Street Journal, noting that Hamburg’s success was largely due to the direct involvement of its longshoremen throughout the automation process.
The London Gateway terminal has highlighted another benefit of automation, attracting around 25 ad hoc vessel calls in the past two months from neighboring Felixstowe, the U.K.’s top container port, that has struggled with stormy weather coupled with congestion caused by ships arriving “out of window.” DP World’s terminal can continue operations in gale force conditions thanks to its automated stacking cranes and has ample spare capacity as it has yet to secure a major East-West service.
Antwerp boosted traffic by 7.5 percent year-over-year in 2015 to 9.65 million TEUs, narrowing the gap with Rotterdam, which posted a 0.5 percent decline to 12.2 million TEUs. Hamburg, which has yet to publish full-year figures, is also tipped to post a significant decrease.
There’s no doubt automation is the way to go, especially on the Northwest European waterfront as it gears up to handle a growing armada of mega-ships. Terminals must invest in more automated ship-to-shore cranes to hit the 6,000 daily lifts ocean carriers seek for their new tonnage, according to Dynamar, a Dutch consultancy.
But even the most efficient automated terminal can’t cope with carriers’ poor schedule performance, which has led to bunching of ships and congestion, the impact of which will worsen as larger vessels are deployed on the Asia-Europetrades. The good news is that reliability reached an all-time high in the fourth quarter of 2015, with Asia-Europe one of the best performing trades, according to SeaIntel Maritime, a Danish analyst.
It also helps that carriers are closely connected to Europe’s top automated terminals. APM Terminals and Maersk Line, a major customer at its new Rotterdam facility, are both subsidiaries of the Maersk group. French carrier CMA CGM, which owns 10 percent of Rotterdam World Gateway, will acquire APL’s 20 percent stake when it finalizes the acquisition of its Singapore-based parent Neptune Orient Lines, to become joint largest shareholder alongside Dubai’s DP World. The other shareholders, Korea’s Hyundai Merchant Marine and Mitsui O.S.K of Japan, are also ocean carriers and each hold a 20 percent stake.
For all the benefits of quayside automation, Europe’s top terminals have yet to resolve the pressing problem of weak intermodal links that will grow as mega-ships become the norm on their key Asia trades. A typical 18,000-TEU ship calling at Rotterdam requires on the landside about nineteen 74-TEU capacity trains, thirty-two 97-TEU barges and 1,560 trucks with a 1.6 TEU capacity, according to the port’s business manager for containers Arwin Stehouwer.
Just as important as APM Terminals’ highly automated quayside operation are its dedicated barge terminal and on-dock rail terminal that are designed to ensure that 55 percent of containers it handles are transported to and from the hinterland by these two modes, lessening the port’s current over-reliance on trucks travelling on increasingly clogged highways.
Contact Bruce Barnard at brucebarnard47@hotmail.com.
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