Posted on December 15, 2022
The Georgia Ports Authority expects to be able to use the current moderation in container volumes to catch up and finally clear the long backlog of vessels waiting outside the Port of Savannah. Port officials said that a dip in demand during November has allowed the Port of Savannah to begin clearing its vessel backlog with a forecast that they could be caught up within the next few weeks.
Like most major ports, Savannah experienced a surge in container volumes especially in 2021 and earlier in 2022. In October 2021, more than 20 vessels were waiting offshore and it prompted major carriers to seek alternatives. Both CMA CGM and Hapag-Lloyd suspended calls at Savannah opting instead for stops in Charleston and Jacksonville due to the large backlog. As shippers and carriers began to shift more cargo to the U.S. East Coast in the summer and fall of 2022, Savannah again saw its backlog increase.
Griff Lynch, Executive Director of the Georgia Ports Authority predicted that they will clear the current backlog by early January. He said the lull experienced in November has allowed Savannah to reduce its vessel queue to 17 containerships. That is down 43 percent from November 1, when there were 30 vessels at anchor.
The port experienced a decrease of 6.2 percent or 30,866 TEUs in November compared to the same month last year. The port moved a total of 464,883 TEUs in November, which contributed to the efforts to reduce the overall backlog.
“Container trade at U.S. ports is returning to a more sustainable growth pattern, which is a positive development for the logistics industry,” said Lynch. “Along with the addition of more than 1 million TEUs of annual capacity, a slight reduction in demand will mean faster vessel service as we work to bring a new big ship berth online at Garden City Terminal in July.”
The GPA cites the impact of inflation and a shift in consumer spending as being partially responsible for a reduction in manufacturing and subsequent container demand. Weather they said also played a role in the November decline with the Savannah River channel closed to the largest vessels for more than three days in November because of adverse weather conditions, including Tropical Storm Nicole.
“While we are planning for a moderation in the container trade, we expect volumes to remain strong, though shy of the historic highs of the past year,” said GPA Chairman Joel Wooten. “Announcements from automakers and other manufacturers coming to Georgia, as well as an array of their suppliers, will mean healthy increases in trade over the long term.”
They noted while volumes moderated last month, the port is still showing an increase of 28 percent over three years when compared to November 2019. They noted that the rate of growth is well above their pre-pandemic expansion, which averaged 4 to 5 percent annually.
Planning is also underway to provide for long-term capacity expansion to handle more containers in Savannah. In addition to projects adding container yards, the GPA recently unveiled a plan to relocate the current breakbulk operations from Savannah to the Port of Brunswick. The Port of Savannah will by 2026 provide two additional big ship berths and transform the 200-acre facility into a container-only operation.
In 2021, a boom year for containerized freight, GPA moved a record 5.6 million TEU – about 10 percent of all US containerized cargo volume. In recent months, the port has been approaching 600,000 per month, but port officials said they expected it would moderate based on the economic outlook.