6.2.

Port performance and capacity management

Port operations are improved through optimizing port capacity and overall performance.
A port’s performance indicators are both financial and operational and are based on data collected from
each terminal or berth. The principal productivity indicators pertain to its:

i. Utilization
ii. Productivity, and
iii. Service time.

a) Utilization is measured in terms of berth occupancy, ashore equipment occupancy, and the
occupancy of warehousing and storage areas.

b) Productivity is measured by means of an estimation of traffic per year, or handling costs based on
time efficiency, the factors of production, versus output and profitability. Namely, a ship productivity
is estimated in terms of cargo handled per hour; a berth’s productivity is measured in terms of cargo
handled per month or year; and the productivity of cargo handling equipment is measured in terms
of movements per hour.

c) Since service indicators are associated with berthing, they are measured in terms of:
i. Berth and shore facilities availability/time %,
ii. Ship’s dwell time prior to berthing,
iii. Ship’s turn-around time, that is, until departure. Modern ports are integrated with the entire
local logistics system; hence, their service indicators may involve cargo handling at port, as
well as logistics turn-around time.

Port planning aims to properly schedule ships to berths in a manner that balances between congestion
and under-utilization, considering time allowance and the ship’s principal characteristics, that is, ship’s
type, principal dimensions such as draft, LOA, DWT, and quantity of cargo to be loaded and discharged.

Dwell time reflects the time cargo remains idle in a terminal’s in-transit storage space or warehouse,
in the process of distribution and further carriage. Long cargo dwell times while at port is a vital concern
of modern ports, as bottlenecks creates slow process time, and may encourage the creation of new,
competing trade routes.

In order to estimate in approximation the capacity of a berth, the following econometric formula is
used:

BC = (O x E x H x EM)

Or

BC = (O x E x H x TEU)

Where : BC : berth capacity (tons) or TEU’s

O : berth occupancy (%)
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 E : the number of cargo handling equipment (e.g., two cranes)
EM : cargo handling equipment productivity per hour (tons)
H : port’s working hours per day, shifts per day, working days a week,
and so on
TEU : number of TEUs per crane move need to be assessed

6.3 Operational performance indicators

These indicators are general operational figures of a port/terminal which can be calculated on
the basis of actual performance of operation and which can be used for planning of additional port
facilities and equipment.

The most important performance indicators are as follows:

6.3.1 Berth Occupancy

Berth occupancy describes the time during which a vessel occupies a berth in a port, i.e., the period
between arrivals of a ship at the berth until actual departures

This indicator is of high ranking importance for a port management as the investment in new berths
can be considered as the highest financial burden for a port in general. The berth occupancy rate,
however, cannot be defined for a port as a whole. Special berths and related handling facilities,
different kinds of commodities (bulk, general cargo, containers, etc.) and different productivities
require a separation into different groups of berths.

Taking the example of a container terminal or container handling facility, the available berths (for
the average size of vessel calling at the terminal) for container ships can be taken as one group.
Then the berth occupancy rate is defined as the total number of hours, these berths are occupied
by container ships, divided by the total number of hours per day and the number of berths available
in the terminal.

100 hours of occupation

Berth occupancy rate = = 69.44%
24 hours x 6 berths

From the experience of many ports worldwide and according to international standards, the
economical berth occupancy rate is calculated with 60% in order minimize waiting times for
arriving vessels and to allow proper cargo handling without crowded traffic, still guaranteeing a spare
capacity for traffic peaks. The more a berth facility is used, the more ships must wait for space and
the more cargo is handled in the port area.

This 60% rate as economical utilization applies to a situation when several berths are available in a
group. If for example only one berth is at the port’s disposal for a category of ships. The 60% berth
occupancy is by far too high as there is no flexibility at all.

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From critical figure will be reached at approximately 85% of berth occupancy. Having reached this
point on a nearly regular basis, means a clear indication that new berth facilities have to be made
available for this kind of traffic.

The above described berth occupancy rate has to be considered as a gross rate as it includes many
factors which are beyond of control concerning the cargo operation itself. A break-down of
occupancy rate into the different components leads to the net berth occupancy rate, i.e., the real
time of operation of a ship at berth. This indicator is very important for management too, as it
monitors the actual operational performance by separation of side-effects.

6.3.2 Berth Throughput

This indicator describes the actual tonnage loaded and/or discharged at one berth or at a group of
berths. This figure is expressed in tons per current meter of quay and time (year, month, day)

Amount of cargo = 100,000 tons per year

Number of berths = 2 berths
Length of berths = 250 meter each

100,000 t
Berth throughput = = 200 t per meter/per year
2 berths x 250 m

= 0.55 tons per meter/day

It also applies to the berth throughput that different commodities and the related berths have to be
group together in order to receive comparable and adequate performance indicators.
As far as container traffic is concerned there are three modes of calculating the berth throughput:

 Ton per meter of quay

 Container moves per meter per quay
 TEU per meter per quay

The decision of choice depends on the percentage of 20’/40’ containers, full/empty containers etc.
As the handling of empty containers normally plays an important role in the operation of a container
terminal, it is recommended to calculate the berth throughput in terms of containers (moves or TEU).

6.3.3 Ship’s Turnaround Time

Ship turnaround time is the indicator which carefully looked at by the shipping lines and their agent
in order to calculate the port’s efficiency and the sailing schedule for the vessels.

The ship’s turn-around-time is directly related to berth occupancy and berth throughput and includes
the following components:

- Nett working time of ship, i.e., actual time of operation

- Waiting time of a ship in port, i.e., periods for non-operation due to equipment breakdown, non-
availability of cargo and/or labor, shift-breaks, opening/closing of hatches, storms, rains, etc.
- Manoeuvring time and clearance time prior to and after operation, such as towage, mooring,
customs clearance, immigration etc.
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 A clear separation and calculation of these different components before arriving at the overall ship’s
turn-around time is advisable as it supports negotiations between the port operators and port users
when talking about good or bad performances.

Example of ship’ turn around time are given in chapter 7.1

6.3.4 Productivity

The productivity, the most important figure of a port, describes the number of tons/units handled per
hour for a ship. Productivity can be calculated as a gross figure (including all waiting times) or as a
net figure (excluding waiting times).

Needless to say that on overall productivity indicator for a whole port cannot be given. The
productivity depends on the different commodities and can therefore only be given for different
groups of cargo (e.g. containers, pelletized cargo, bagged cargo, bulk, general cargo etc.) or even
commodities (tobacco, wool, grain, etc.)

Productivity should be defined as tonnage handled per man-hour; other definition (such as tonnage
per gang/hour) is misleading because of different compositions of gangs concerning labor and
equipment.

The productivity data enable the management to:

- Compare different operational units concerning their efficiency;

- Compare companies between each other;
- Evaluate effects of rationalization/rearrangement;
- Measure effects of personnel training.

6.3.5 Dwell-Time

The dwell-time of cargo in the port must be considered as an important indicator although large
difficulties arise for its calculation.

The dwell-time is necessary for the planning of additional storage areas in the port and also an
important figure for negotiations with the shipping lines and the shippers/consignees.

Dwell-time is the measure of the time elapsed from the time the cargo arrives in the port to the time
the goods leave the port premises after all permits and clearances have been obtained.

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Data of dwell time at select Ports for the month of September, 2016

Customs station Time taken Time taken by Time taken Time taken Time taken Total Percentage
from arrival of Customs for by importer from payment from time of time taken
cargo to filing assessment for payment of duty to registration of by customs
of declaration after filing of of customs registration of documents to
by importer declaration duty documents "out of customs
charge"

JNCH(Mumbai) 4 days 20 hours 20 hours 49 21 hours 50 2 days 3 hours 6 hours 23 9 days 1 12.5%
23 minutes minutes minutes 56 minutes minutes hour 21
minutes

Chennai 4 days 23 hours 18 hours 52 15 hours 14 2 days 2 hours 5 hours 56 8 days 17 11.8%
Customs House 33 minutes minutes minutes 11 minutes minutes hours 45
minutes

The port operating company is facing the following essential difficulties for the calculation of dwell-
time:

- The unitization for cargo (pallets etc.) and the kind of commodity influences the possibility of
stacking cargo two or three high
- The measurements of cargo have influence on the calculation of tons per sqm.
- The sequence of vessels of a shipping line sometimes defines the dwell-time of export cargo in
the port prior to ship’s operation.

These difficulties can only be solved individually especially as far as general cargo is concerned.
For containers, however, things are much easier as the unitization and the possibilities of stacking
are very clear. The only need is, by experience, to divide the dwell-time of containers into exporters,
importers and empty containers as they normally have different stay times.

Generally speaking, a port operating company should avoid a utilization-rate of storage area
exceeding 80-85%. This applies to sheds, open-storage areas and container yards. A higher
utilization automatically result in re-stowage of cargo, search of cargo, damages etc., which
negatively affects the operational performance in terms of decreasing productivities. Having these
indicators available, the management of a company is in a position to decide whether the storage
capacities shall be extended by building new areas or by diminishing the dwell-time for the cargo.

6.3.6 Utilization of Equipment

The utilization-rate for the different types of equipment also represents an important figure for the
company’s management.

It shows the use of equipment as a percentage of the maximum time as well as the operational
down-times due to maintenance and repair.

For the calculation of this indicator the various kinds of equipment have to be combined in groups,
e.g. normal forklifts, heavy forklifts, quay cranes, straddle carriers etc.

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Example:

A group of 30 forklifts indicates 120,000 actual working hours. The maximum working hours per
year for individual forklift is 20 hours x 300 days = 6.000 hours.

120,000 hours
The Utilization rate = = 66.7%
6000 hours x 30 forklifts

If the rate of utilization is permanently exceeded, the operational costs for this equipment will
normally increase progressively and supersede the annual depreciation-costs for new equipment
investments.

6.4 Monitoring of performance indicators

All above mentioned performance indicators and productivity data have to be derived from the
operational records as this is the only actual source of the various operational activities of a port

In order to guarantee a sound basis for proper operational records, two pre-requisites must be
fulfilled:

- Each gang for shipside operation and landside operation must include a checker who is fully
responsible for an accurate documentation of operation;
- The worksheets to be filled in must have a standardized format, allowing simple and
accurate recording.

The checker should note the composition of gangs, the tonnage, type of goods, types of equipment,
and last but not least the time needed, broken down into certain period, indicating operation, waiting
time and reasons therefore.

6.4.1 Analysis of data

All worksheets, containing the operational data, have to be collected and centrally evaluated in a
central section: the cost-accounting department

There, different reports, ship’s calculations, and analysis can be prepared, showing the performance
indicators and their companies with previous figures. Analysis of deviations should always be made
in cooperation with the operations department as operational special conditions may have been the
reason for each deviation.

6.4.2 Timing

As port normally comprises a large variety of commodities and customers, it becomes necessary
for the management to be permanently informed about the operational performance in all respects.
Therefore, all reports and analysis have to be established on a regular basis (e.g., monthly),
comparing the figures with those of the same month in the previous year. Accumulated figures for
half year’s periods and years have to be made available to the management.

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 CHAPTER 7

Measuring port performance and productivity

Port performance cannot be assessed on the basis of a single value measure. A meaningful evaluation
of a port’s performance will require sets of measures relating to :

1. The duration of a ship’s stay in port

2. The performance of cargo handling operation
3. The quality of service to inland transport vehicles during their passage through the port.

The complicating factor is the strong interrelationship that exists between the three sets and between
the various performance measures in each. Thus it is virtually impossible and certainly inappropriate to
study each of these in isolation. However because of the particular importance of the first two sets, and
their dominant position with respect to the main port users (namely the ship operators), we will mainly
concentrate on a more detailed discussion of these two.

7.1. The duration of a ship’s stay in port

The first and the foremost measure of “ship productivity” through a port will concern the “total turn-
round time in port” (Figure 17) of a given vessel on a given call (generally express in hour).

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The second measure presents total turn-around time in port as a function of tonnage to be handled
during that call.

The third measure must show the total turn-around time in port in the light of cargo composition
(traditionally presented by main classes, e.g. bulk liquids, bulk solids, conventional general cargo,
containerized cargo).

Up to this point the “total turn-around time” in port has been examined without any breakdown of the
“ship’s time” period as shown in figure 17. Although a reduction of any of these may improve the overall
“productivity of the ship in port”, at least two of these periods require special emphasis, namely the
“ship’s waiting time for a berth” and “the ship time at berth”. These two measures are particularly
crucial in port facing latent or acute port congestion, i.e. where ships have regularly to wait before
berthing because all adequate service points are already occupied.

7.2. The performance of cargo handling operation

The essential period “time at berth” is basically constituted by alternative working and non-working
periods during which cargo handling takes place. As a result, the performance of the cargo handling
operation will to a large extent determine the quality of service to the ship and consequently deserves
special analysis. To effectively measure the cargo-handling performance, two groups of indicators are
required, namely:

(1) Indicators of output;

(2) Indicators of productivity.

The indicators of output provide information on the total quantity of work done in a particular period
or on the tonnage handled in a stated time.

In ports the most commonly used indicators of output are:

(1) Berth throughput

(2) Ship output
(3) Gang output.

The latter two values are obviously also measures of productivity and efficiency, with the last one
constituting the most frequently used indicator of productivity.

Berth throughput measures the total tonnage of cargo handled at berth in a stated period.

Berth throughput is usually expressed on a weekly, monthly or annual basis. It does not, however,
provide an indication of how efficiently the facilities have been managed. Moreover, this measure only
has significance if it is further differentiated by stipulating the type of cargo handled, the handling
technique used (e.g. grabs, conveyor belts, conventional gear, container handling equipment). It is
basically a measure of “activity” on a facility.

This indicator describes the actual tonnage loaded and/or discharged at one berth or at a group of
berths. This figure is expressed in tons per current meter of quay and time (year, month, day).

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Example:

Amount of cargo = 100,000 tons per year

Number of berths = 2 berths
Length of berths = 250 meter each

100,000 t
Berth throughput = = 200 t per meter/per year
2 berths x 250 m

= 0.55 tons per meter/day

It also applies to the berth throughput that different commodities and the related berths have to be
group together in order to receive comparable and adequate performance indicators.

Ship output measures give a clear indication of how good cargo-handling operations are.

Nevertheless, these figures still require the same differentiation as mentioned for berth throughput. The
more frequently used measures include:

(1) Tons per ship working hour

(2) Tons per ship hour at berth
(3) Tons per ship hour in port

Large differences between these values will indicate considerable time losses for the ship at the berth
or in the port.

A simplified below example may well illustrate the importance of comparing theses three measures.

A ship arrived in port at : 04.00,

Berthed at : 05.00,
Started working at : 08.00,
Finished operations at : 18.00,
Left berth at : 23.00, and left port at midnight
During her stay she handled a total of 1.000 tons of cargo.

The respective output measures would then be:

- Tons per ship working hour: 1000 tons/10hrs = 100 tons/hr

- Tons per ship hour at berth: 1000 tons/18hrs = 55 tons/hr
- Tons per ship hour in port : 1000 tons/20hrs = 50 tons/hr

Many ship operators will also calculate the following:

1000 tons x 24 hours

Ship output per 24 hours in port = = 1200 TONS / 24 hours
20 hours

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In this very simple example it is obvious that the gap between 55 tons per hour at berth and 100 tons
per ship working hour points to waste of time at the berth, when the ship is not being operated. Although
this example does not permit the pinpointing of the exact reasons why the ship registered a
considerable amount of non-operational time, the port traffic manager certainly should be motivated to
investigate the underlying causes and take necessary action.

Gang output, measures the average quantity (tons) of cargo handled by a gang in a certain time
interval, normally an hour.

This is the most significant value regarding the performance of labor, although the bare tons per gang-
hour measures need to be completed by explanatory data on such factors as the gang composition,
the cargoes worked, the ship’s configuration and many others before any valid conclusions can be
arrived at. One more refinement certain analysts aim to express output in man/hours rather than gang/
hours, thus eliminating the distorting factor “gang composition”. It may also be worthwhile emphasizing
that in container terminals, output is now measured in “containers per gross or net crane hour”, as
the notion of a gang in such operations is no longer a realistic one.

7.3. Utilization of Cargo Handling Equipment

The utilization-rate for the different types of equipment also represents an important figure for the
company’s management.

It shows the use of equipment as a percentage of the maximum time as well as the operational down-
times due to maintenance and repair.

For the calculation of this indicator the various kinds of equipment have to be combined in groups,
e.g. normal forklifts, heavy forklifts, quay cranes, straddle carriers etc.

Example:

A group of 30 forklifts indicates 120,000 actual working hours, and 24,000 hours actual downtime.
The maximum working hours per year for individual forklift is 20 hours x 300 days = 6.000 hours.

120,000 hours
The Utilization rate = = 66.7%
6000 hours x 30 forklifts

24,000 hours
The Downtime rate = = 13.3%
6000 hours x 30 forklifts

If both percentages are added, one arrives at 80% which represents the usual maximum capacity
(on average) for one piece of equipment.

If the rate of utilization is permanently exceeded, the operational costs for this equipment will normally
increase progressively and supersede the annual depreciation-costs for new equipment investments.
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7.5. Case study

7.5.1. Calculation of Berth Occupancy (1)

Baltic Container Terminal has the record of annual container throughput as follows:

Year Number of vessels Throughput(TEU)

2012 100 30.000

2013 110 50.000
2014 120 70.000
2015 140 80.000
2016 150 100.000

Productivity: 25 TEU/hour, and working hours is 20 hrs/day

Operational delays due to equipment breakdown is 20% of effective operational days, and
Maintenance and Repair of Cranes is 10% of effective operational days.
If dead time due to mooring is 2 hrs per ship, per day, you are asked to calculate:

1. Berth day Requirement

2. Required berth at 60%
3. Gross berth occupancy
4. Net Berth occupancy
5. Based on the calculation what is the conclusion?

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7.5.2. Calculation of Berth Occupancy (2)

The berth occupancy record of Zone A in a hypothetical port, Al Morjan Port (berth 7, 8, 9) for the first
week of November 2016 provides the attached day-by-day information.

Available working shifts : Day:

1st 06.00 – 14.00
2nd 14.00 – 22.00
Night 22.00 – 06.00
No work on Sunday

Berth Lengths are as follows:

No.7: 165 meters

No.8: 165 meters
No. 9: 170 meters
Total Zone A: 500 meters

You are requested to calculate the berth occupancy for zone A for the week 6 - 12 November and to
present the result graphically, making a distinction between:

 Berth not occupied;

 Berth occupied – by non – operational vessels (or not workable);
 Berth occupied – by operational vessels not working;
 Berth occupied – by operational vessels working.

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