Excerpt from: China Supply Chain and Logistics Strategy
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| September 15, 2005 | | More Complex China Port Choices for Global Supply Chain Planners |
The Yangtze River Delta (YRD) has been experiencing the most bustling port production and fastest transportation infrastructure developments in China. From 1997 to 2004 freight volume grew 3 times and in 2004 the Yangtze River Delta made up about 33% of all of China’s container freight volume, an increase of 32% from the year before.
Naturally, port competition is heating up in the YRD, which should encourage cooperation and prevent monopolization.
Port competition in YRD over the past few years has been quiet and on the surface it appeared to be in balance. However, on 5/25/05 with the opening of the Donghai Bridge (the bridge connecting the Yangshan deep water port to Shanghai’s mainland) this balance was broken and competition began to heat up.
Competitive Response
Zhejiang’s Upcoming Integrated Ningbo Port
After the announcement of the opening of Shanghai’s Donghai Bridge, the local media published that Ningbo’s Zhoushan will integrate its two ports in 3 years. A Zhejiang province port officer even claimed that in 3 years Ningbo’s Zhongshan port will become the nation’s biggest.
In fact, in 2004 the Ningbo port handled 4 million containers and became China’s 4 biggest container port. The integrated “Ningbo Port” will consist of the Beicang port area, Zhenhaiport area , Ningbo port area, Daxie port area, Chuanshan port area, etc,. With the addition of Zhoushan port there will be rich water front resources to make up for lack at the former Ningbo port.
Jiangsu’s Newly Integrated Suzhou Port
Suzhou has combined the Zhangjiagang port, Taicang port, and Changshu port into one “Suzhou port”. Although the Suzhou port currently does not have the volume of Ningbo or Shanghai, it does have professional staff. Also, the Taicang port deep water conditions are very good and the entire water front has a large and plentiful land area and wide, well connected coast, thus making the Suzhou port ideal for export processing for direct export overseas.
General Comparison of Main
Yangtze River Delta Ports
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Pros
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Cons
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Shanghai–(Waigaoqiao)
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- 85-95% of
freight capacity comes from Yangtze River Delta region, with a big
portion being transshipped by water
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- Lacks deep
water port
- High costs
- Lacks capacity
for future growth
- Port congestion
- Can only handle medium
sized vessels
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Shanghai-Yangshan
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- Will be freest port in China
- International
transshipment hub
- Multi-modal
transportation
- Can handle
large vessels
- Consolidation/deconsolidation
center
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- Typhoons limit
use of port to 270 days/year
- Dangerous
weather conditions may limit use of bridge
- Official policies for
operating in Lingang have not been implemented yet
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Suzhou-Zhangjiagang
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- One of the top ten ports
and, so far, the largest inland port in China
- Warehousing storage costs
less than Waigaoqiao
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- Must use feeder vessels
to Shanghai
for exports
- Location not ideal for Zhejiang origin
freight
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Suzhou-Changshu
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- One of China’s
top 10 internal river ports
- Multimodal
transport hub for Jiangsu
and YRD industrial parks
- East China’s biggest
steel and paper transshipment center
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- Mainly serves nearby
development zones and Suzhou
Industrial Park
- Geographic location
limits usefulness
- Not a main export port
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Suzhou–Taicang
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- Deep water port
- Serves as mainstream harbor of Shanghai international shipping
center
- Ideal for export
processing
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- Not suitable for
consolidation/ deconsolidation with freight from other regions
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Zhejiang–Ningbo/Zhoushan
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- Good natural
deep water port
- Rich water
front resources
- Can operate 350 days/year
- China’s 4th
largest container port
- Hangzhou Bay Sea
Bridge will cut driving time
from Ningbo to Shanghai from four hours to two
- May have lower operating
costs compared to Yangshan
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- Does not receive the same
preferential treatment as Shanghai
- Not suitable for Jiangsu origin
freight
- Lack of water front
resources
- Supporting logistics
industry and infrastructure fragmented
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