Looming problems at Port of Colombo for NVOCC Lines

The crisis faced by NVOCC Lines operating to and from the Port of Colombo, was featured in the Daily FT 11 February 2022, under the heading “Fresh Shipping Setback for imports, exports from feeder operators”, due to the International Feeder Shipping Line Operators imposing new conditions for the carriage of NVOCC Line containers to and from the Port of Colombo.

NVOCC Lines, are regional container/box Operators providing an important service in the ocean freight service category, offering a similar containerised service as main shipping lines to both importers and exporters to and from the Port of Colombo to many Indian Sub-Continent, Middle East-Gulf and Far East destinations.

As per 2021 statistics, approximately 23% of Sri Lanka’s containerised import and export cargo volumes are handled through NVOCC container Lines. It is estimated that over 50% of import cargo from Indian Ports to Colombo are carried on NVOCC containers. A majority of Sri Lanka’s tea exports to the Middle East countries move in NVOCC Lines.

The initial deadline given by the Feeder Operators, has now been extended till 1 August 2022

The new conditions initially imposed by the Feeder Operators include NVOCC Lines/Agents obtaining Direct Billing Facilities with the three terminals of the Port of Colombo. The initial deadline given by the Feeder Operators, has now been extended till 1 August 2022, due to the intervention of the Ministry of Ports and Shipping and SLPA Chairman to form a “Joint Committee,” comprising of all stakeholders to find a workable solution to offer NVOCC Lines/Agents the required Direct Billing Facilities at the Colombo Port Terminals.

If the Shipping Authorities and Port Terminals do not treat this as a high priority matter and arrive at a viable solution prior to the deadline given by the Feeder Operators, there will be a considerable shortage of NVOCC Line Containers coming into Sri Lanka, which will adversely affect the import and export trade.