The Container Depot Alliance of the Philippines (CDAP) has put on hold a plan to close newly opened empty container depots (ECDs) outside Metro Manila and declare a holiday at all member container yards (CYs).
CDAP president Roger Torres, in text messages to PortCalls, said the group is exhausting all avenues first to resolve the problem of low utilization stemming from the direct return of empty containers to port terminals, adding that conducting a container yard holiday would be a last resort.
“We will implement it (closure and holiday) only if we think we will not be successful in our talks with stakeholders” and the government, Torres said.
In letters to the Department of Transportation, Bureau of Customs (BOC), Philippine Ports Authority, and Association of International Shipping Lines (AISL) on May 9, Torres said CDAP was considering closing recently opened depots outside Metro Manila and declaring a holiday at all member depots if yard utilization did not improve from an average of 50% to at least 70% in two weeks’ time.
Torres also appealed to “consignees/shippers/shipping lines and port terminal operators to observe and implement best global practice of returning empty containers to designated empty container depots and return to the historic system of no or limited return of empty containers from consignees.”
Torres said member depots had been experiencing low utilization for the past weeks “due to direct returns of empty containers from the consignees/shippers/shipping lines to the port container terminals.
“Almost all returns of empty containers are now to the container port terminals and only withdrawals are being done in our CYs. These direct returns of empties to the container terminals have greatly affected the financial viability and the very existence of CDAP off-dock depots,” Torres explained.
He noted that during the height of the port congestion from October 2018 to March 2019, various government agencies and private entities “urged and cajoled CDAP to open new off-dock yards to help solve and ease the congestion at the container ports.” CDAP accepted the challenge and opened new off-dock yards outside Metro Manila with a capacity of 204,000 square meters (sqm), he added.
But after port operations normalized, he claimed terminals resorted “again to the very same method of building empty pool inside the ports to the detriment of off-dock depots,” a charge denied by port operators International Container Terminal Services, Inc. (ICTSI) and Asian Terminals Inc. (ATI). Both terminal operators insisted there are no empty pools inside their ports, and they are only accepting empties scheduled for load out by vessels docking at the terminals.
Torres said that after sending the letters, CDAP had discussions with AISL and some government officials. Following the talk with shipping lines, average yard utilization of CDAP member depots within Metro Manila improved to 60% as of June 3, he said. For Bulacan and Cavite depots, average yard utilization is 14% and 45%, respectively.
The group also submitted a position paper to BOC requesting a policy regulating the direct return of empty containers to port terminals.
CDAP is composed of 13 container yard operators managing a total of 305,000 sqm with a total capacity of 33,800 twenty-foot equivalent units.
AISL general manager Atty. Maximino Cruz earlier said “the establishment of more off-dock ECDs (empty container depots) should not only be encouraged but their role as a key player in port and shipping operations should be strengthened.”
He added, “With the surging import volume and the widening trade imbalance between imports and exports, the planned closure of newly opened depots and the cessation of operations of existing ones will be disastrous to the economy as this will bring about congestion in the terminals, slow down movement of trade and will have dire consequences to Philippine exports.” – Roumina Pablo