Ports worldwide are experiencing unprecedented challenges. While intermodal freight operations are booming, port congestion, container and chassis shortages, and labour shortages are all wreaking havoc on intermodal yard operations.
Adding to their challenges are record volumes. For example, the Los Angeles/Long Beach port complex recorded 10.13 million TEUs in the first and second quarters of 2021. That volume earned it a ninth-place ranking in the global ports listing, just ahead of Hong Kong.
Vancouver is experiencing increased import volumes and high yard utilization at all of its terminals. Inland rail intermodal ports also saw their volumes increase 7.7 percent from June 2020 to February 2021 compared to the same period last year, based on data from the Intermodal Association of North America (IANA).
State of the industry
There is no doubt that ports need major infrastructure improvements. According to the American Association of Port Authorities (AAPA), its members cited US$20 billion in multimodal port and rail access needs through 2028. Rail access in particular, which factors largely into faster vessel processing and movement of goods, needs updates at many ports to increase throughput capacity. In fact, 42.86 percent of AAPA members said improved rail access could increase their capacity by over 25 percent.
Escalating port congestion is among the greatest challenges many of the top North American ports have been facing, which is right during peak shipping season from August through November. For example, on September 22, the independent information provider S&P Global Platt reported that Los Angeles/Long Beach had 63 container ships waiting to berth – 41 of which were at anchor near the coast, and 22 in the drifting zone.
Overall, S&P Global Platt reported the top 20 ports experiencing a 13 percent volume increase and increase in freight rates by 346 percent in the first half of 2021 over the same period in 2020. Along with the increased demand and reduced capacity problems, the pandemic further heightened the already-present labour shortages with workers taking time off because they contracted Covid-19 or were exposed and in quarantine.
Needless to say, these challenges have only led to declining performance metrics. From increased turn times (i.e., intermodal transfers, turnaround time for truckers) to decreased lifts per man-hour and gate transactions, and increased vessel delays. Inefficiencies like these can not all be blamed on the pandemic. Many were present before, but to a much lesser degree.
Before the pandemic, most intermodal terminals were seeking ways to improve their planning processes, gate processing times, and truck loading/unloading and pick-up processes, as well as maximizing their yard space utilization. These objectives demand real-time data for real-time decision-making, which today’s terminal operations systems with optimization software can deliver.
Advanced terminal operating systems
Leading-edge intermodal terminal operating systems use advanced technologies such as Artificial Intelligence (AI), Machine Learning (ML), and operations research-based algorithms to optimize terminal processes. With their module design and scalability, they can be tailored to meet a port’s current and future needs.
Among the processes these systems optimize are:
- bookings, made easy with interfaces to support third-party booking systems and the capability to highlight and intercept any booking conflicts;
- gate processes, including sequencing of incoming trucks and load units for optimum handovers, checking of load units, issuing transport orders to truckers, time slot management and truck schedules, etc.;
- yard utilization/management via complete yard visibility depicting all terminal processes, load unit positions, and locations of internal/external resources within the terminal.
These systems can also manage:
- load unit configurations based on preferred load unit types and forbidden (hazardous content) load units;
- vehicles and cranes by knowing current status/position and work orders (actual and planned);
- incoming and outgoing ship voyages, including ship schedule administration, quay management, and pre-stowage functionality;
- all rail data to facilitate train planning; and maintenance and repair management.
Optimizers
To further support processes, especially in the largest intermodal terminals experiencing high container volume demand, optimizers are another way to improve decision-making and operational processes. Vehicle optimizers improve the utilization of all types of manual, semi- and fully-automated vehicles, including carriers, terminal trucks, stackers, automatic guided vehicles, and tractors.
Through their real-time matching capabilities, vehicle optimizers match the right vehicle to each transport order to maximize the use of these resources, completing jobs within their allotted schedule, and reducing vehicle idle and travel time. Crane optimizers powered by AI increase productivity, improve crane routing, reduce idle and travel times, and facilitate double-cycling uses, when appropriate.
Rail schedulers, another type of optimizer, improve train loading and unloading processes. They differ from a crane optimizer. They are actively forecasting, up to eight hours in advance, the containers that should be brought to the intermodal yard for loading, and scheduling the best order for those containers to arrive.
In addition, they make real-time adjustments to crane schedules and indicate a job’s progress and a crane’s position, which serves to reduce travel distances and improve container handling. When applicable, this optimizer also recommends double-cycling to drive smooth handovers and equipment transfers. They can separate cranes and assign resources so that bottlenecks can be avoided: an important function for terminals operating multiple cranes. Rail schedulers also help intermodal terminals better plan activities such as staff breaks, maintenance and repairs.
Train load optimizers are another example of optimization software for intermodal terminal operations. They create optimized train loads, making real-time adjustments to indicate when new containers become available, and reflecting when certain containers are no longer suitable for loading. They facilitate optimized outgoing train container allocations and update this information as needed.
To lessen yard work, they select rail containers for train stowage, and promote double-stacking without compromising regulatory compliance. Train load optimizers also accommodate other important criteria including loading restrictions (i.e., weight, hazardous goods, and stacking restrictions), as well as terminals’ individual key performance indicators (KPIs).
Success through automation
By applying these advanced technologies, intermodal terminals are able to optimize their resources and processes to achieve key and visible benefits. They realize vastly improved decision making for even the most complex and time-critical decisions. There’s better planning, full transparency of terminal operations, and streamlining of processes from gate to yard operations. They also see increased productivity, less waiting times in truck and rail operations, and improved turnaround times.
In a report, The Future of Automated Ports, McKinsey & Co. noted that successful automated ports can overcome operational challenges, reduce operating expenses by 25 to 55 percent, and increase productivity by 10 to 35 percent.
Deloitte, in its Global Port Advisory of April 2020, Global Port Trends 2030 – The Future Port Landscape, cited technology as a competitive advantage, noting “smart ports” are leveraging data to streamline and optimize existing infrastructure and eliminate unnecessary and empty transport.
Optimization software, powered by AI and other advanced technologies, is a path toward realizing smart ports and greater resiliency that is required in the future.
Eva Savelsberg is senior vice-president, logistics division, Inform GmbH. Matthew Wittenmeier is senior manager, logistics division, Inform GmbH.
