Strike at Felixstowe Could Send More Business to Competing Ports

The expected strike at the Port of Felixstowe could disrupt the UK's supply chains, but it may also create a new opportunity for neighboring ports with less congestion, according to a new report from VesselsValue.

Felixstowe is the UK's largest container port, handling about four million TEU worth of cargo per year, and it is a critical link in the chain for Britain's imports and exports. It also experiences more congestion than its neighboring peers. Though hardly comparable to the weeklong waits found outside many large U.S. container ports, Felixstowe saw average waiting periods of up to 40 hours in March, and today it has a longer average waiting period than Southampton and London Gateway. Both offer near-immediate berthing within several hours (or less), according to VesselsValue. 

"Logistics planners and supply chain managers will be keen to monitor how the situation at Felixstowe develops," said Vivek Srivastava, Senior Trade Flow Analyst at VesselsValue, in a research note Thursday. "Alternatives exist for lines and shippers with any degree of flexibility."

Felixstowe welcomes more ultra large container vessels than Southampton and London Gateway combined, but both of the latter two ports do have berths that can accommodate ULCVs. Lines could also divert to Wilhelmshaven, Germany, then load UK-bound freight onto feeder vessels. Many smaller UK ports receive a substantial amount of feeder traffic (Immingham, Tilbury, Teesport, Liverpool, Hull, Belfast and Grangemouth), and they could see their fortunes rise if more East Asia-to-UK cargo ends up getting transshipped through large ports in continental Europe. 

This arrangement has happened before. After a recent occurrence of congestion, the 2M alliance diverted their AE7 East Asia service from Felixstowe to Wilhelmshaven. "Depending on ship type, other UK ports may also be considered," said Srivastava. 

In 2018, the rollout of a new terminal operating system (TOS) software platform at Felixstowe led to severe disruption at the port. In response, the 2M alliance relocated their TA4 service from Felixstowe to Liverpool, then diverted the AE7 service to London Gateway. The TA4 rotation remained permanently in Liverpool after Felixstowe's software issues were resolved.