SHAMSUDDIN ILLIUS
Media: The Business Standard
Original URL: Tardy Chattogram port makes business costly
Publication Date: 15 January, 2020
Average turnaround time for vessels in Chattogram port highest in five years
The time required for vessels to unload and re-load containers, also known as average turnaround time, at Chattogram Port has increased to 2.88 days (69.12 hours) from 2.65 days (63.6 hours) in the last five years, causing sufferings for businessmen as expenses have surged.
In addition, a vessel’s wait-time at the outer anchorage before it is taken to the pier, a process known as berthing, jumped to 4.18 days from 0.80 days between
2014-15 FY and 2018-19 FY.
It is notable that in 2014-15 FY a vessel had to spend 3.45 days in the outer anchorage and berth. The time increased to 7.06 days in 2018-19 FY. In other words, the delay before vessels make the next voyage has increased.
The delay at the port, which handles 90 percent of foreign trade, enormously impacts the economy, including the country’s most competitive export product– readymade garments.
Stretching the turnaround time also pushes up production and freight costs, which in turn imposes extra expenses on businessmen.
Businessmen have to pay between Tk8.5 lakh and Tk12.7 lakh per day to the port authorities as demurrage for a vessel’s overstaying in the port.
They cover the extra costs by demanding higher prices for their commodities, with consumers eventually suffering the consequences.
Talking to The Business Standard, AM Chowdhury Selim, vice-president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that delay caused by the port is affecting production costs.
“There is a time-frame for each order. Delays at the ports are causing foreign buyers to turn their backs on us,” he said, adding that products should be delivered within hours, not days.
Reports show that the average turnaround time between July and November in the current 2019-20 FY was 2.72 days (65.28) hours. The highest was recorded in 2018-19 FY when it hit 2.88 days (69.12 hours).
In 2017-18 FY, vessels had to wait for as long as 5.30 days (127.2 hours) to berth at the outer anchorage, a record high in the last five years.
According to the 2018 report of the United Nations Conference on Trade and Development (UNCTAD), the median global turnaround time was only 0.7 day (16.8 hours) for a container vessel.
The report noted that Bangladesh was lagging behind compared to India, whose turnaround was recorded at 0.9 day (21.6 hours).
Ahsanul Hoque Chowdhury, president of Bangladesh Shipping Agents Association, told The Business Standard that waiting time at the port increases freight costs, and extra charges put pressure on businessmen.
“Quick transportation of goods means saving money,” he said.
Ahsanul said the capacity of the port is being overshot and suggested that the Chattogram Port Authorities (CPA) take steps to make transportation of goods both cost effective and quick.
“The CPA should shift the delivery import containers elsewhere and provide faster delivery,” Ahsanul recommended.
He also complained that some businessmen, who do not own warehouses, use the port as storage for their goods, and take deliveries only after getting buyers.
Another reason behind increased ATT is the presence of customer open containers in the port yard. It is something which happens nowhere in the world except Bangladesh, he said.
When contacted, Mohammad Omar Faruk, secretary of the CPA, told The Business Standard, “Large vessels can now berth in the port. Earlier only 8.5-metre draft vessels could berth in the jetties, but now 9.5-metre drafts can also berth in port jetties.” He added that larger vessels take a longer time to load containers.
In the last five years, the number of vessels handled by the port has also gone up. In 2014-15 FY the port handled 2,566 vessels while in 2018-19 FY it increased to 3,699.
Photo: Minhaj Uddin
“In 2019, the port handled around three million TEUs (twenty-foot equivalent units) export and import containers, which are almost double that of 2014. The growth of handling containers is increasing every year,” said Faruk.
Meanwhile, exporters have alleged that though handling in the port has increased, its capacities have not. The port has only 12 jetties for handling this flow of vessels.
Md Ruhul Amin Sikder, secretary of Bangladesh Inland Container Depots Association, said, “There is no alternative to increasing the port’s infrastructure. It has become a necessity to increase the capacity of the port considering the present situation.”
Rear Admiral Zulfiqur Aziz, chairman of the CPA, said 52 percent of the construction work of Patenga Container Terminal (PCT) has been completed, and it is expected to start operations this year.
“Once the terminal is launched, three container vessels and an oil tanker will be able to berth at a time,” he told The Business Standard.
The CPA chairman said that the port has been expanding its capacity, including its ability to handle the increasing number of containers. Moreover, the Bay terminal and the Matarbari terminal are also under construction.
