Port Congestion Sets New Record at 4.3M TEU in Stranded Volume
The volume of container capacity stranded due to port congestion has reached a new record high, reports the analytics firm Linerlytica. Mounting delays in China and Asia and persistent delays in Europe are resulting in a shortage of vessels and capacity and contributing to the increases in freight rates, reports Linerlytica.
It calculated that the volume of container capacity delayed due to congestion reached 4.31 million TEU this week, which surpassed the prior peak of 4 million TEU reached in 2022 during the surge in container volumes after the COVID-19 pandemic. Linerlytica, however, notes that with carriers continuing to introduce new ships and delay retirements, the container sector has grown overall during the past four years. In 2022, the stranded capacity represented 15.7 percent of the sector’s capacity versus 12.6 percent currently, despite the increase in the total TEU capacity stranded.
The consultancy Sea-Intelligence pointed out in its monthly reports that schedule reliability and the length of port delays had stabilized in the industry in recent months. Its data shows that only about two-thirds of container vessels are on schedule. It puts the average delay at above five days.
Recent typhoons that moved through Asia and impacted operations at China’s major ports have been contributing to the increases in stranded volumes and delays. Linerlytica reports there is currently more than 1.5 million TEU capacity at anchor off Shanghai. It also reports large volumes waiting at Singapore, Busan, Colombo, and several Chinese ports. Mumbai currently has the highest ratio of queue to berth.
The industry was already operating with little excess capacity even before the delays began to build. Linerlytica calculates that there are 55 ships (out of a fleet of over 5,400 active vessels) idle, representing 0.5 percent of the total fleet and a capacity of just 164,000 TEU. The result is a shortage of vessels.
The shortages and lack of capacity, however, have been financially positive for the industry. Linerlytica points to freight rates that are 156 percent higher since the start of the Iran war. It notes it has also contributed to a firming of charter rates for container vessel owners.
Another concern is the potential for the backlogs and waiting time to build at the Panama Canal as it reduces both the number of daily transits and the maximum draft for vessels. During the last round of restrictions, container vessels were forced to offload portions of the cargo and ship boxes across the Isthmus by train to comply with the draft restrictions. The Panama Canal Authority said it would be giving preferences to the large container ships with the largest container volumes, but still the delays are expected to build going into the fall season due to the emerging drought from the El Niño in the Pacific.
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Vessels diverting around Africa and away from the Suez Canal and Red Sea were also impacting capacity due to the longer transit times. Linerlytica believes this is one of the reasons specifically driving Maersk to restore routes to the Red Sea corridor. Maersk and Hapag-Lloyd announced they would be moving some of the routes under the Gemini Cooperation back to the Suez Canal and Red Sea, and just today MSC Mediterranean Shipping Company advised customers that it would begin shifting some routes back to the Suez Canal and Red Sea corridor. Suez Canal officials have highlighted that the shift can reduce transit times by up to 14 days and also save on fuel costs.
Chinese port operators have worked to quickly restore their operations after the storms, which should release some of the stranded capacity as well as the continuing introduction of new ships. The forecast, however, is that congestion will continue to be a challenge and contribute to stranded volumes. Carriers, including Maersk, revised their financial outlooks for 2026, moving to more positive forecasts based on the strong freight rates and their near-term expectations for the market.
