ASB and ExportNZ Stories: Empty Depots Struggle to Manage COVID Container Supply Issues

Empty depots are the unseen but crucial home for shipping containers, ensuring importers can clear containers, and exporters have the container they need when they need it.

With serious congestion being reported at these facilities we spoke with ContainerCo – one of New Zealand’s major empty container service companies to learn more.

ContainerCo’s Margaret Harris told us their company processes the equivalent of 600 thousand shipping containers a year through their seven main facilities. Three quarters of these containers need testing, repairs and upgrades, and a speedy turnaround is a high priority.

How has ContainerCo fared over summer?

COVID combined with long standing supply issues to create new challenges. Importers and exporters are seeing freight rates rapidly increase and worldwide port disruptions are seeing schedules disrupted, port time slots missed by ships and the time available for container exchanges put under great pressure.

The flow on effects are empty containers not being relocated, choking depots with unneeded containers and at the same time putting containers needed for exporters in short supply.

Harris told us ContainerCo has responded to these challenges, operating well over capacity, at a large cost penalty. It has opened extended hours, re-allocated land from other businesses for depot use, opened a new yard in Hamilton, rushed to complete a new facility in Napier and worked closely with shipping companies, Government and exporters to stretch container supplies.

Harris explained that in recent years empty container terminals have found themselves full during the peak summer season and these container yards operate best at around 80% capacity. At 80% with normal shipping patterns, they will have the right container and will have the room to process it as it is needed. This year’s peak has seen the container yards at 140%-240%.

Why so full? A couple of reasons. The first is that thousands of low-grade containers (“evacuation” containers) – not suitable for New Zealand exporters, and normally relocated back to China by the shipping companies – are being left in place. Shippers are finding themselves pressed hard all over the world for space on ships and booking slots at ports are tight. They therefore prioritise full cargoes over evac boxes, leaving these in storage in New Zealand. Ports are also working at full capacity, meaning any delay anywhere in the world ripples through the system. The second is that strong import volumes during a traditionally “off-peak” season has overlapped with the peak export season, causing large unexpected demand.

ContainerCo’s COVID-19 Lockdown Experience

ContainerCo was (and is) an essential business. During the lockdown staff continued to work to ensure exporters got their boxes, and importers of critical goods (such as the vaccine) could clear away their containers by handing them off to us at our yards.

Harris went on to say a crucial challenge has been keeping the staff safe in a setting where facilities are overstretched and COVID is a risk.

ContainerCo reacted early. Extra cleaning, deep sanitising of the machines, isolated split shifts, controllers working from home (including the crash deployment of nearly twenty laptops), and plastic guards were deployed two weeks before lockdown. A practice “lockdown” day ironed out the bumps – when the full lockdown was introduced, ContainerCo was ready.

The company’s IT systems proved more than ready for remote working and mobile teams organised to relieve fatigue and boost container turn times. ContainerCo staff came to appreciate that they are essential to New Zealand’s supply chain, and responded brilliantly to the challenges, deciding there would be no container outage and working literally night and day to achieve this.

Harris reports that staff have been turning many containers around inside a day, and other containers in ‘C-Grade’ condition were being returned to service in ‘like new’ conditions, ready to serve exporters.

The early action also paid dividends. ContainerCo had vulnerable staff working from home by mid-February and stayed in constant communication with staff to make sure they understood what to do next. The IT system was flexible enough to work from home, and we had enough PPE on hand – and more on order – to keep those in the parks safe and working.

What Kinds of Projects does ContainerCo have underway?

Container terminals are pragmatic affairs. It is about the quality of work and quantity of space we can provide to shippers and exporters – that is what brings shipping companies back. ContainerCo is focused on bringing online new, purpose-built terminals in Auckland and the provinces to ensure supply of containers to all the important exporters. We are also looking outside the square, with smaller boutique yards that service the local area, and allow the general public to purchase a shipping container of their own as well.

ContainerCo is a family-owned company, with roots back to 1947, and plans to exist for the next seventy years as well. That means committing to the environment. The new park in Napier has been built in partnership with iwi and has noise-baffling landscaping, an in-built wetland to clean water and provide a home for ducks and is designed to accommodate innovative container handling systems.

ContainerCo’s EV container Delivery Unit

In mid-2020 with the support of ECCA ContainerCo put in the road NZ’s first EV container delivery vehicle. This truck has a range of around 200km and carries three standard twenty-foot containers on urban shuttle runs to and from ContainerCo’s yards.

Harris says the trial has been a huge success and the company is looking to purchase more units including some with extended range.

Harris went on to say that the company is committed to decarbonisation and has a plan that will replace most of our diesel forklifts with electric cranes and hybrid hoists.

All these things are exciting and will be rolled more widely across the country during off-peak seasons.




5 May, 2021

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