Sea Port Terminals, much like natural beehives, are hubs where ships swarm in to unload precious cargo. Every country has at least one international sea port terminal, except for landlocked countries. Ancient and modern civilizations are developed based on the advancement in maritime shipbuilding technology, and more importantly, having a functioning sea port terminal.
A sea port terminal has many functions, but the fundamental purpose of a sea port terminal is to offer an interface between land and sea transportation. Its use is amplified by the invention of multimodal cargo containers, where cargo loading and unloaded became drastically cheaper, more efficient. A sea port terminal can be viewed as a gateway to facilitate international commodity trade. Consequentially, the sea port terminal played a crucial role in globalization and impacted the way businesses source raw material, manufacture products, and deliver goods.
A Sea port terminal is the most important aspect of the global supply chain system. The World Bank administers a bi-annual survey called the Logistics Performance Index (LPI), and port infrastructure’s efficiency plays a significant role in that survey. As of 2018, Germany (4.37), Japan (4.25), and Sweden (4.24) have the top 3 ratings for logistics infrastructure.
This article is not intended to be a brief description of what a sea port terminal is, neither is it an in-depth study of how a sea port terminal operates. The goal is breadth over depth, we want to share with you, as concise as we can, all the key infrastructures of a sea port terminal, the stakeholders involved in a sea port terminal, and factors leading to a successful operation of a sea port terminal.
How does Sea Port Terminal Work?
To understand how sea port terminals work is to understand what a sea port does, a sea port terminal generally has the function to: –
- Multimodal freight operation (sea, rail, and road)
- Transshipment Hub
- Ship Services
Multimodal Freight Operation
Port Terminals are situated in geographically strategic locations that allows transportation accessibility of the sea and the road.
Sea ports that rise to prominence have two key features: –
- Belong to a country where economic input or output dictates the economy
- Geographically situated in the major trade routes of the world
To emphasize this point, 7 out of 10 busiest ports of the world are located in China, the world’s largest manufacturing economy, and exporter of goods. On top of that, they are also the second-largest importer of goods.
Major Transshipment Hub
An example of a port that relies purely on its geographical advantage is the Port of Singapore. The size of the United States of America is 13,673 times larger than the size of Singapore, yet Singapore is the house of the second busiest port in the world.
Located in the Straits of Malacca, which is the shortest distance a vessel travels to-and-fro the Bay of Bengal and the South China Sea. It is no wonder that Singapore is the perfect location that connects China and other regions in the Indian Ocean and the Arabian Sea.
The container throughput of Singapore is 37.2 million TEUs (Twenty-Footer Equivalent) according to Statistica.
The advent of transshipment is not an intuitive solution that shipping companies designed, rather a necessary operation that is birthed out of desperation.
UNESCAP detailed a case study of CMA CGM, a Mediterranean based shipping company that voyages as far as the Persian Gulf up to Kuwait from Europe, which requires the vessel to travel over 6000 nautical miles and take around 27 days to make the trip.
In modern times, these voyages are a common occurrence. However, this was the 1980s. CMA CGM could not profit from this particular voyage, as cargo flow is practically a one-way traffic; From Europe to the Middle East.
In order for CMA CGM to be profitable, it has to achieve two goals: –
- Voyage further into the Far East in hopes for more cargo
- Reduce voyage transit time, and consequentially, increase vessel turnaround time.
CMA CGM came up with a solution, which is to choose a port that is in between Europe and the Far East to serve as a transit point. The port of Mina Qaboos in Oman was chosen. CMA CGM then develops feeder vessels to deliver cargos from Oman to its surrounding Middle Eastern customers.
Since then other shipping companies take this approach into its strides and adopted this transshipment strategy as an important tool to reduce transit time and increase port coverage.
Both Port of Singapore and Mina Qaboos profit from being located in geographically strategic locations, that shipping companies use as a point for hub-and-spoke transportation.
Just like airports, seaports also provide supply services to ships that berth in that port. In this day in age, sea port terminals in different countries also compete with each other in the form of services provided to ship operators. For a ship operator, it does not make a big difference if two competing transit hubs, for example, Port of Hong Kong and Port of Shenzhen are relatively close by.
One of the key differentiators that determine if a shipowner/ship operator chooses one port over the other is the port’s ship services provided.
Bunkering is a process of supplying fuel to ships for its next voyage trip. Bunker fuel management strategies are important for ship operators to optimize profits by reducing unnecessary voyage trips.
Hence, choosing the right port for ship services to refuel is also a key strategy for the ship operators. As a simple example, a person decides to make a cross country road trip with his newly purchased car. The person has to take into consideration: –
- The total distance to drive
- The new car’s fuel consumption
- the most efficient route to each gas station without having to make unnecessary longer trips.
Bunker fuel management is essentially the same, ship operators has to decide: –
1. where to bunker
2. How much to bunker
3. How to adjust ship speeds along service routes
Of course, the quantity and quality of the bunker fuels provided, as well as the price of bunker fuels sold in each port also play a role. With the recent IMO 2020 Low sulphur fuel oil limits, ship operator also has to be cautious of what bunker fuel is purchased too.
Some modern ships operate with Liquid Natural Gas (LNG), busy transshipment ports such as the Port of Singapore provide LNG bunkering. That cannot be said for other sea port terminals.
2. Pilotage or Stowage
Sea vessels are gargantuan, the new classes of vessels called Ultra Large Container Vessels (ULCV) have a length of 400 meters, breadth of 58.8 meters, and depth of 32.5 meters.
The captain on board is effectively piloting a vessel that is roughly the length of the Eiffel Tower. To berth a vessel of that stature requires a team.
Sea Port Terminals are required by law to provide pilotage services to ship operators. Several tugboats are deployed and coordinated to nudge and steer vessels into the port pier.
3. Port Security
Terrorisms, Contrabands, Illegal Trafficking, and much more. These crimes find their ways into a country in various ways. One of them is via the sea port.
Therefore, port security is a priority shared by the port operator level, national level and international level.
The International Maritime Organization (IMO) and the International Ship and Port Facility Security Code (ISPS) acts as a guide to participating nations to structure its national ports with a high level of security in mind.
Although the administration of such security is done by the customs authority and port authorities. Ship operators also have vested interest in securing its most important asset in the business; its cargo vessels. A port facility is only complete when there is a high level of surveillance technology that allows all relevant authorities and ship operators a piece of mind.
4. Port Infrastructures
Broadly speaking, as the image above suggests, there is 2 sides to each sea port terminal: –
Sea port terminals vary greatly, the capacity of the quayside infrastructure plays a significant role in the efficiency of port operation and turnaround time.
The lesser time required to load or unload cargo containers, the more money is saved by the port operator and the ship operator.
Regarding quay cranes, some call it a container crane or gantry crane, is installed on the side of the dock.
At the port’s container yard, several types of yard cranes provide intermediary stowage and stacking. In other words, the container yard is a giant warehouse, run by different sorts of yard cranes, which stacks and moves containers in preparation of loading or unloading from the container vessel.
The types of yard side cranes are as such: –
- Rail-Mounted Gantry Crane (RMG)
- Rubber-Tired Gantry Crane (RTG)
- Straddle Carriers
- Reach Stacker
- Chasis-based transporter
We mentioned before that the modern-day sea port terminal is designed with multimodal transportation in mind. The intermodal ability of container terminals means that those containers can be transported via sea to land or rail with very minimal turnaround time.
Therefore, sea port terminals are connected on the landside by a network of railroads and roadways to facilitate inland transportation.
Design of a Sea Port Terminal
Mega container terminals around the world routinely handle more than 10 million TEUs of cargo and serve thousands of vessels per year.
In reality, more than 50% of sea port’s container throughput is destined for transshipment. Therefore, the design of a sea port terminal is edged towards maximizing container movements in the port’s container yard.
There are a few key salient attributes that make up a sea port terminal, which we deem are the “hardware” of the sea port terminal: –
- Terminal Layout
- Terminal Equipment
- Berthing Capacity
- Multimodal Interface
Naturally, there are also attributes that we deem are the “software” of the seaport terminal, or as most of us call it the operative planning of a seaport terminal: –
- Crane Assignment
- Berth allocation
- Stowage Planning
- Storage and Stacking Policies
The capabilities of both “hardware” and “software” make up the overall performance of the sea port terminal. There is a high dependence on each of the attributes listed above. For example, the operation of berth allocation is a factor of the berth capacity of a sea port terminal. Or, the crane assignment is a factor of the available terminal equipment in the sea port terminal.
As you can see in the image above, the sea port terminal’s berth, quay crane, and container yard are arranged as such reduce transit time.
Operational Flow of a Sea Port Terminal
Container vessels, with the help of tugboat pilots, are guided through the port canals until the vessel is alongside the port quay.
Quay cranes are deployed alongside the vessel by experienced quay crane operators. Efficient quay crane operators with the right equipment can unload up to 35 containers per hour. More advanced quay cranes and hoist 2 containers at the same time.
The quay cranes then load the container on a chassis-based vehicle transporter to transfer the container to the massive container yard behind the quay crane.
All of this movement is closely watched by sophisticated real-time monitoring systems and radar in a control tower.
The world has over 3700 sea port terminals, and 600 of which are designed for container handling. To date, there are 151 countries (excluding 44 land-locked countries) that share a coastline with the world’s 7 seas. Which means, there is an average of more than 3 container sea port terminals per non-landlocked country.
Sea port terminals, despite the high capital investment and land requirement, still remain a priority investment for any country. This signifies the importance that a country relies on an efficient sea port terminal for economic prosperity.
It is truly one of human’s greatest engineering spectacle, one that is etched deep into our history. More likely than not, sea port terminals will continue to advance technologically and continue to feature in the world’s history.