After a lackluster January and February, the Port of Virginia is once again posting gains as March volumes increased 9% over the same month of 2017. As the Port of Virginia works diligently to increase service and efficiency, they’re aware of how infrastructure improvements can slow down the port’s workflow as construction delays are inevitable. However, as container shipping itself comes off of a banner year in 2017, over capacity stemming from megaships and fleet expansions gives pause to premature celebrations.
According to AJOT.com the port handled 252,230 TEUs, an 8.7% increase (20,082 more units) year over year, driving total growth for 2018 to 4.4%. Numbers in January and February were decidedly lower as extreme winter weather conditions caused delays and two full days of work stoppage, impacting total counts. As truck appointments and infrastructure improvements continue to make the port more efficient and more capable of handling over sized ships, the yearly growth looks poised to surpass 2018, leading to a seventh year of growth.
Sadly, not all container shipping scores are as bright as though of our home port. Shipping itself is balanced precariously on numbers that are being driven by a slow uptick in rates, though many shippers are fighting back to get cheaper services. An increase in bunker costs since last year has many shippers working with carriers to offset these hikes, leaving the carriers without a sufficient income stream to offset the rising prices for fuel. According to American Shipper, “Larger customers have been rejecting surcharges such as the low-sulfur-fuel surcharge and frequently demanding contract rates with bunker adjustment factor included, thereby eliminating carriers’ ability to pass on fuel price fluctuations. Consequently, carriers will have to step up other efforts to manage expenses and lower the cost base.”
We at Nelson International feel that the best way to survive any tumultuous years is by increasing efficiency and expanding smartly as the Port of Norfolk has in the past. Their careful preparation and focused improvements have prevented even the unforeseen weather issues from deeply impacting their numbers and we look forward to watching their success throughout 2018.
