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HomeOpinionPort Congestion - causes, consequences and impact on global trade

Port Congestion – causes, consequences and impact on global trade

As previously explained, a port is a place within a harbour where a ship can dock for the purpose of handling commercial cargo or passengers or taking care of the ship’s requirements..

Ports play a very crucial role in transporting various types of goods and some ports are classified based on the cargo that they handle..

Port is also a place where water and land meet and therefore there are trains and trucks that come into the port for the purpose of delivery (for exports onto a ship) or picking up cargo (from imports off a ship)..

While some of the ports may handle only specific cargoes, a vast majority of the ports around the world handle multiple cargoes within the same port.. These demarcated areas handling different types of cargoes are known as Terminals..

These days’ majority of the ports around the world have dedicated Container Terminals for the handling of containers..

Port Congestion and its causes

Port Congestion is a situation wherein a vessel arriving at a port for the purpose of cargo or other operations is unable to berth and has to wait outside at anchorage for a berth to become available..

Port congestion is a major challenge faced by many ports globally and can occur due to various reasons like

  • port or terminal is booked to more than its capacity ;
  • delays caused by bad weather which results in vessels lining up outside ;
  • industrial action or strikes ;
  • war ;
  • pandemics like the COVID-19 ;
  • lack of port handling equipment ;
  • slow productivity ;
  • lack of yard space ;
  • restricted port access ;
  • location of port ;
  • vessel bunching ;
  • hinterland connections ;
  • trade wars

evolution of container ships - port congestion - shipping and freight resourcePort congestion is quite common in container terminals around the world and many are attributing it to the increase in of container ships which has grown 1452.68 % in the last 50 years..

One of the benefits of the ULCVs (Ultra Large Container Vessels) were said to be economies of scale..

In order to achieve these economies of scale and to avoid a long port stay, terminals were pressed to use more gantry cranes and labour to complete the loading and discharging operations quicker..

However, the increase in containers coming off a ship also requires the container yard (CY) to be able to clear the containers with the same speed..

If the CY is unable to handle this influx due to slow productivity or insufficient chassis (like in some US ports) then the movement of containers out of the yard will be slow which means that the container yard will reach capacity quite quickly..

Added to this, when truckers come to pick up import containers when the container yard is full to capacity, there could be multiple movements/shuffles within the terminal to get to the containers, the truckers want..

port congestion Los Angeles
Congestion in LA

These issues can create a backlog on the shore side operations which affects the productivity of the port/terminal, resulting in the ship on the berth working longer and the ships waiting outside for the berth to wait longer while other vessels keep adding to the queue..

We spoke about ports having to add more gantry cranes to complete operations quicker, especially on the ULCVs.. But this also has limits because when the vessel sizes increased, it did not increase so much in length but in beam and height.. Beam stands for the width of the ship..

For example, the Panamax vessels of the 80’s had a beam of 32m capable of stowing 12 containers across and had a length of around 294m..

The largest ULCV currently, the MSC Gülsün is almost double that beam at an impressive 61.5m capable of stowing 24 containers across but is only 400m long.. So as you can see, the size of the vessel did not increase much in terms of length but only in terms of width and height..

This lack of increase in length means there is not enough space to add on more gantry cranes to carry out a quicker operation..

Congestion can also happen due to pandemics like the COVID-19 that we are seeing currently.. In February 2020, the average wait time for container vessels at Zhoushan in China (the 3rd largest container port in the world) touched more than 60 hours which is unusual for that port..

Many ports around the world affected by COVID-19 have trimmed down their workforce to avoid transmission of the virus.. This means less people available to handle the same number of ships and containers which lowers the productivity levels drastically, in some cases by more than 60-70%..

Congestion need not be only for ships and for berths.. Some specialised containers like reefer containers also faced consequences of port congestion in terms of space/infrastructure..

During the COVID-19 outbreak in China, some of the ports like Shanghai, Xingang etc had to either turn away reefer containers or charge congestion surcharge as the terminals were running out of electric plug points to plug in the incoming full..

Port congestion can also be caused by industrial action or labour disputes like the big one in the Los Angeles-Long Beach port complex a few years ago.. This port complex on the West Coast of North America handles around 40% of the US imports and the labour dispute caused queues of more than 30 vessels waiting to berth..

In some cases, trade wars could also cause port congestion.. JOC reported that “Carriers have deployed 34 extra-loader vessels since November to handle an unusual surge in imports as retailers and manufacturers front-loaded shipments to stay ahead of threatened Trump administration tariffs on more than $200 billion of imports from China.

Compounding the issue, terminal operators were unable to deliver containerized imports to local distribution centers because the more than 1.5 billion square feet of industrial space was filled beyond capacity. Overflow containers were parked on chassis in the warehouse yards and wherever else space could be acquired, contributing to a severe chassis shortage in Southern California.



Some ports like Manila have other reasons for port congestion, like an overrun of empty containers eating up valuable yard space in the port..

Due to trade imbalance in the Philippines, Manila had a lot of full import containers coming in, but not enough export cargo going out and therefore empty containers were piling up in the ports and terminals..

port congestion - shipping and freight resource
Manila International Container Terminal

At its peak in 2019, it was reported that about 8,000 empty containers were piled up at the container yard of the Manila International Container Port, some for extended periods of time, prompting Customs to limit the allowable stay of the containers inside the yard from 120 days to 90 days “to free up space on the port container yards”..

The issue of port congestion caused by empty containers is not unique to Manila.. Countries like Kenya, Nigeria, Côte d’Ivoire, UK have all experienced port congestion due to empty container excess..

Port congestion can also result in reduced tonnage capacity on certain trades forcing shipping lines to declare blank sailings.. Shipping lines or ship operators cannot afford to keep the ships waiting at anchorage for days on end due to port congestion..

Ship charters costs thousands of dollars per day to the ship operator and a ship and containers only generate money when they are active and moving.. They would rather choose to skip a congested port..

Cargo rollover is also one of the consequences of port congestion because some of the lines might resort to cut and run (decision to cut short the operation of a ship due to delays) in order to maintain schedule integrity and the ships cannot stay any longer at an unproductive port..

Cargo rollover can also happen due to poor forecasting between Carriers and BCOs..


cargo rollover


While port congestion can happen due to a variety of reasons with far reaching consequences, all of this has only one common factor and that is “additional cost”..


So what is the true cost of port congestion?

Whatever the causes for port congestion, someone somewhere is paying the cost as a consequence of it..

Prime example of this unforeseen and additional costs was demurrage/detention costs that merchants had to pay due to congestion caused by labor disruptions at the main USA gateway ports of Los-Angeles/Long Beach on the West Coast and New York-New Jersey on the East Coast in 2014/2015..

Such additional costs need not only translate to money because in the case of port congestion, costs include time loss, additional resources such as labour and fuel, loss of business and 3rd party losses..

3rd party losses, because costs that are incurred by one party due to the port congestion could affect another party who may not be connected.. For example a truck waiting in a queue due to port congestion may be holding up someone else’s business, someone who needs the truck, someone who is willing to pay the trucker for the movement but cannot.. So the trucker and the customer both are losing..

Port congestion also restricts the number of trips a trucker can do in a day as the turn around time for the truck suffers greatly and impacts on the trucking company or worse, the drivers, some of whom could be independent operators contracted to a trucking company..

In the case of the Manila congestion, customers were subjected to a double whammy because they were forced to drop off the empty containers in depots far away from the city which increased their transport cost and they were also hit with additional demurrage and detention charges because they couldn’t turn in the containers on time due to truck shortage and long queues..

The impact of port congestion is far reaching and affects all industries resulting in slow down in business, lack of inventory in stores, customers having to airfreight certain essential goods to alleviate shortages, especially of the consumer goods.. Seasonal goods may not arrive in time or may not be exported in time..

Exporters, importers, shipping lines, hauliers, forwarders, terminal operators are all affected by port congestion and have to contend with additional costs when ships and cargo does not move efficiently through the terminals..

Based on the various factors above, it is quite tricky and difficult to pinpoint the real cost of port congestion.. All we know is that port congestion is bad for global trade..



Globalisation led to containerisation which led to an increase in global container trade which has grown at an average rate of around 9.5% since the 80’s.. If we look at the figures from the turn of this century, global container port throughput has increased 254% between 2000 and 2018..

port congestion - shipping and freight resource
Source : The World Bank Data

Situations like port congestion can put the brakes on such growth if it is not handled effectively.. But this is not a problem just for the ports to address..

While ports and terminals have a bigger role to play in order to alleviate such issues, the onus rests on all stakeholders in the supply chain to assist with the situation..

Digitisation and investment in new technologies along with suitably skilled personnel are becoming increasingly important for the modern ports to be able to handle the modern and large ships..

For an effective long lasting solution, all parties in the supply chain need to be part of the solution to avoid port congestion.. Shipping lines, truckers, rail operators, port authorities, logistics service providers, IT specialists, all need to be involved.. Customers of the port need to be able to forecast and maintain their volume commitments in order for the ports to be able to plan their capacity requirements..

Only once containers start flowing smoothly between the ports and the hinterland and vice versa facilitated by all the stakeholders in the chain, port congestion can be contained..


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Hariesh Manaadiar
Hariesh Manaadiarhttps://www.shippingandfreightresource.com
I am Hariesh Manaadiar, the Founder of Shipping and Freight Resource.. I have been in the dynamic shipping and freight industry for over three decades and have worked in several sectors.. I share my experiences and knowledge of the industry through this blog for those looking for help in the industry.. Stay subscribed for more free useful content about shipping, freight, maritime, logistics, supply chain and trade..


  1. Hi Mr Hariesh,

    I manage logistics at a small factory in SUDAN that produces school exercise books and photocopy paper A4. We import raw materials from Indonesia and India. we receive about 25 containers (20ft) and 20 containers (40ft HC) per month. Our Port of discharge is Portsudan. There was a political strike in the port for almost 45 days during Septemper 2021. The strike took place while vessels were offloading. a number of containers were offloaded at the port of discharge and the rest were returned to the nearest transshipment port of Jeddah because closure of the port.

    When work resumed after 45 days we received a heavy charge of detention and PSS (peak season surcharge) according to the shipping line for 2 bill of lading contains 23 containers 20ft. 12 containers were offloaded and 11 were returned. we then received several PSS charges for coming bill of lading, the ones were scheduled to arrive during September October November and December. all because of this strike for 45 days. A particular shipping line we had the goods shipped with told us to 4500 usd per 20ft container and 9000 usd per 40ft container all under PSS charge.

    My question is, is the consignee the only party obliged to bear this PSS charge due to the strike which caused congestion and detention of containers? i mean what is our right in this situation as a consignee? What are the obligations of the port authority and the shipping line and the shipper?

    I would much appreciate your help and advice

    Many Thanks

    Moiz Khidir
    Logistics manager

  2. Hariesh, I mentor 8th grader kids who are working on the “Port Congestion” project. Your article summarizes port congestion issues in a very easy to understand language. I am going to share this article with them.

    Thank you,

    • Wow, very interesting to hear Sheela that 8t Graders are working on port congestion.. In which country is this..?? Pls let me know if you need any further details for their project, would love to help..

  3. Hi Hariesh, I have a question in a deal based on FOB the buyer nominate a vessel to loading port. The vessel arrives at loading port but for some reason it is delayed to anchor because of bad weather or lack of tug boats or guide pilot who is liable to the cost of such delay busy or seller or shipping line

  4. If I may ask

    In case of port congestion and a passenger vessel is forced to anchor while another berthing vessel is just loading cargo, which is the priority? the passengers or the cargo being loaded?

    Thank you

    • Hi John, passenger vessels and cargo vessels use different berths.. Many of the ports that have Cruise/Passenger services usually have a Passenger Terminal where no cargo activity takes place..

  5. Hi Hariesh,

    Insightful piece. It should be also mentioned that logisitcs coordination/communcation between different inter-related port stakeholders needs to be as collaborative and transparent as possible. Withholding of key operational planning information and projections as to planned vessel berthing, cargo availability, terminal loading/unloading working schedules, etc. has direct ripple effects thoughtout the entire port and hinterland supply chain. As the old adage goes: Garbage in, garbage out.

    Keep coming up with the excellent articles content!

    Jack Arthur
    Vancouver, B.C., Canada

  6. Very informative, indeed. But, I still have one question. Can this phenomena affect the price of goods and commodities in the market? If yes, then how?

    • Hi Berlen, it could because if there are storage, demurrage, detention charges due to congestion, those costs will be passed on by the logistics service provider to the ultimate consignee who will then need to adjust his product’s pricing in the market..

  7. Great piece as always Hariesh. However please help me with this question.

    How does warehouse contribute to port congestion and what should warehouse operators do to curtail such challenges at the ports?
    thank you

  8. Due to that costly congestion, I am not surprised to notice that air freight is becoming a better choice for certain
    local manufacturing to maintain the chain supply running on schedule

    • Furthermore, Port congestion can be avoided or reduced if the logistic chain operators check prior to booking the functionality at the port of destination;; thus allowing the supply chain to chose another routing alternatives

  9. This article very much useful for research work, for case study on logistics and ports and to minimize time & money very informative thank you sir

  10. Excellent condensation of a large and complex problem. Can you follow up with some metrics on the congestion costs in the yard and at the gate? My clients, port authorities, are looking at follow on congestion costs like pollution, truck congestion on the highways, and blockages in port cities, especially in Europe, that have gone from being industrial hubs to being tourist destinations.


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