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Rotterdam throughput may drop by twenty per cent in 2020

Throughput in the Port of Rotterdam in the first quarter was down by 9.3 per cent (112.4 million tonnes) compared to the same period last year. Over 2020 as a whole, this may well become minus twenty per cent due to the corona crisis, says Allard Castelein, CEO of the Port of Rotterdam Authority.

‘We are facing unprecedented disruptions and the port of Rotterdam, as a vital process, intends to continue contributing to society,’ says Castelein. ‘The impact of a decline in demand due to the corona crisis will become clear from April onwards. A 10 to 20 per cent drop in throughput volume on an annual basis would seem to be very likely. This will depend on how long the measures remain in place and on how quickly production and world trade recover.’

Despite the significant difference between the first quarter in 2020 and 2019, the Port Authority does stress that volumes in container handling, LNG and biofuels during the first quarter of 2019 were at record highs. Falling throughput was seen mainly in the coal, crude oil and oil products segments.

Positive notes

Not everything was doom and gloom in the first quarter, however. According to the Port Authority, container throughput more or less matched the level in the same period last year and biomass, iron ore, LNG and other liquid bulk throughput grew.

In the meantime, major investment projects are continuing as planned. They include the construction of the Container Exchange Route, the Theemsweg Route and port infrastructure for the production location of smoothie-maker Innocent.

Corona impact

The impact of the corona crisis was apparent to only a limited extent in late March as a fall in goods flows from China after the partial lockdown there in February. Seagoing vessels take four to five weeks to complete the journey, which means that the effect in Rotterdam is not felt until later. The volume of containers from Asia was 2.8 per cent lower than in the first quarter of 2019.

RoRo throughput was 7.3 per cent down on the first quarter of last year. As a result of the coronavirus outbreak, fewer people and goods were transported between the United Kingdom and Rotterdam in March 2020. It should also be noted that throughput in March 2019 was at a record level due to hoarding in the run-up to Brexit, which seemed imminent at the time. The throughput of other break bulk was slightly lower (-3.2%) as a result of the economic downturn.

The impact of a decline in demand due to the corona crisis is expected to become clear from April onwards. In the container segment, capacity between Asia and Europe is being cut by approximately 25 per cent in response to the reduction in demand for transport. This will also be clearly seen in the port of Rotterdam in the coming quarter.

Dry bulk

The throughput of dry bulk in the first quarter amounted to 16.7 million tonnes, down by 14 per cent compared to the same quarter in 2019. There was a substantial decrease of almost 3 million tonnes in the throughput of coal (-39.6 per cent). The main reason for this was that less power was generated from coal in Germany and the Netherlands. More electricity was generated from gas and wind because of the low gas price and large amounts of wind energy due to favourable weather conditions.

Ore throughput rose by 15.7 per cent (920K tonnes). Steel companies purchased more stocks in the past quarter than last year, while production did not increase. The flow of iron ore and coal to the German steel industry is expected to decrease in the coming months in response to falling demand from the automotive and construction industries.

Other dry bulk decreased by 21 per cent (-694K tonnes) due to postponed construction projects and the supplies of sand and building materials needed for those projects. There was also a decline in the flow of minerals in the first quarter due to declining industrial production in Germany.

Biomass throughput rose by 106 per cent. This doubling was caused by the increase in the use of biomass in the Amer 9 power station in Geertruidenberg to between 80 and 90 per cent.

Liquid bulk

The throughput of oil products fell by 32.8 per cent. Once again, there was a sharp fall in the trading of fuel oil between Russia and Singapore, for which Rotterdam has been the throughput location in recent years. Instead, much of the fuel oil went directly from Russia to the United States for refining. The throughput of diesel fuels also declined. In the area of the throughput of diesel for export, this was caused by the increase in local use for seagoing vessels in response to the new IMO rules on emissions from ship engines.

The decline in the use of oil products for transport will reduce the need for crude oil supplies in the coming months. However, volatility in the oil market can lead to higher trade flows.

Author: Mariska Buitendijk

Mariska Buitendijk is one of SWZ|Maritime's journalists as well as the magazine's copy editor.