Shipping Port Congestion: Causes, Effects, and Solutions for Shippers

Port congestion is a major challenge in global shipping, causing delays, driving up costs, and creating ripple effects throughout supply chains. In this post, we’ll take a deep dive into port congestion—what it is, what causes it, and most importantly, how you can mitigate its impact on your business.

Current Global Port Congestions

The first step in tackling port congestion is staying informed. That’s why we’re committed to providing our customers with the most up-to-date information on port conditions around the world. Keep an eye out for our monthly port congestion updates, where we’ll share real-time data, expert insights, and actionable recommendations to help you make proactive decisions about your shipping strategy.

Latest Weekly Port Congestions

Want even more timely information? Freightos Terminal integrates dynamic port congestion data into our dedicated dashboard, giving you a real-time view of the situation on the ground. Don’t get caught by shipping congestion surprises, by accessing real-time intel to keep your cargo moving.

What is Port Congestion?

So, what exactly is port congestion? In simple terms, it’s when a port has more ships waiting to load or unload than it can efficiently handle. Picture those mega-ports you’ve seen in photos, with rows upon rows of colorful containers stacked like Legos. Now imagine all the ships carrying those containers stuck waiting offshore, unable to snag a spot at the port’s limited berths.

When congestion strikes, vessels often have to anchor outside the port or drift in designated areas until space becomes available. These delays can stretch from days into weeks, throwing off meticulously planned shipping schedules and causing containers to miss their planned connections to trucks, trains, or other ships. The result? A cascading series of delays can leave your cargo stuck in transit limbo.

What Causes Port Congestion?

Port congestion can spring from a variety of sources, often intertwined in complex ways. Some common culprits include:

• Demand surges: An influx of imports, whether due to a seasonal rush or a sudden shift in consumer behavior (like the e-commerce boom during the pandemic), can overwhelm a port’s capacity.
• Labor issues: Ports rely on skilled workers to keep cargo moving. Labor shortages, disputes, or strikes can dramatically slow operations.  
• Extreme weather: Hurricanes, typhoons, and other severe weather events can close ports or damage critical equipment and infrastructure.
• Equipment shortages: Moving containers onward from ports requires chassis—specialized trailers that trucks use to transport containers on roads. When chassis are in short supply, containers pile up.
• Insufficient storage: If warehouses near the port are full, containers may have nowhere to go, leading to a backlog.

The tricky thing about port congestion is that it’s often not just one factor, but a combination of issues that compound each other. A demand surge paired with a chassis shortage, for example, can be a recipe for major delays.

For a closer look at the many causes of shipping delays, from port congestion to customs snags, check out our in-depth guide.

The Impact of Port Congestions

When ports get clogged, the effects can ripple out in all directions. For individual businesses, congestion can lead to delayed inventory, missed sales, production stoppages, and dissatisfied customers. And in today’s just-in-time supply chains, even a small delay can snowball into a major disruption. 

At a macro level, port congestion acts as a bottleneck in global trade, slowing the flow of goods and materials that power the world economy. The longer ships sit idle at ports, the more pressure builds up in the system, driving up shipping rates and fueling inflation.

Want to dive deeper into the domino effect of shipping delays? Explore our analysis of how delays impact costs and performance across supply chains.

How Port Congestions Affect Shipping Rates

As if the logistical headaches weren’t enough, port congestion often comes with a financial sting in the form of congestion surcharges. These fees, levied by carriers, are designed to offset the costs of ships sitting idle for extended periods.

For shippers, congestion surcharges can add up quickly, especially on top of already-elevated shipping rates due to capacity crunches. It’s a classic supply-and-demand scenario: when space on ships is scarce because of congestion, rates rise as shippers compete for limited slots. 

Curious how congestion might affect your shipping spend? Plug your details into our freight rate calculator for an instant quote.

Strategies for Navigating Port Congestion

So, what can shippers do to minimize the impact of port congestion on their operations? While there’s no silver bullet, there are several strategies that can help keep your cargo moving:

1. Diversify your ports: If one port is chronically congested, explore alternative gateways that may have more capacity. This is where a flexible, agile shipping logistics partner can be invaluable in finding creative routings.

2. Build in buffer time: Pad your shipping timelines to account for potential delays. It’s better to have inventory arrive early than grind your operations to a halt while you wait.

3. Stay informed: Keep a close eye on port conditions and be ready to pivot if needed. Tools like real-time freight rate tracking and predictive analytics can help you stay ahead of the game.  

4. Collaborate with your logistics team: Your freight forwarder or logistics provider should be your partner in navigating disruption. Lean on their expertise and work together to craft proactive strategies.

Smooth Shipping, No Matter the Conditions

At Freightos, we know that port congestion is just one of the many challenges shippers face in today’s complex global freight environment. That’s why we’ve built a powerful platform to help you streamline, optimize, and de-risk your supply chain, even in the face of disruption.

Our cutting-edge technology gives you the tools to find the most efficient routes, book with a click, and track your cargo in real-time. With the world’s largest network of pre-vetted logistics providers at your fingertips, you’ll have the flexibility and options to adapt to any situation.  

Ready to chart a course to Smooth Shipping? Sign up for Freightos today and experience the power of frictionless freight.