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New U.S. container security law likely to benefit Rotterdam port

Hugely costly upgrades for older facilities


Tags: Excerpts from the Windmill

ROTTERDAM - The new American law that makes it mandatory for ports to scan every container shipped to the United States, creates major problems for European ports which are lacking behind in upgrading their systems. Rotterdamís facilities are continually the subject of upgrades.

Rotterdam and most Asian ports are the ones likely to meet the new U.S. standards. The law, aimed at making it more difficult for terrorist groups to import arms into the United States, was passed in August and will take effect in 2012.

The huge machines required to scan containers are priced about $5 million each. The European Commission estimates that it will cost the average port about $100 million to install and maintain the scanners, far too costly for a large number of smaller ports.

Older ports situated inland on rivers, are considered to be at a disadvantage. Among the ports put in such a quandary is Rotterdamís nearest main competitor Antwerp. To accommodate the upgrade, the city has to build new access roads and bridges to its outlying freight handling quays, and could possibly fail to meet the deadline. According to the Belgian Customs Service, compliance involves billions of euros of extra investment.

Opportunity

Although national governments will probably shoulder a significant share of such extra costs, the additional construction projects that will be required may take years because of EUís cumbersome and stringent environmental laws.

Some analysts see Antwerp working closer together with nearby Rotterdam, which is expected to be able to install the equipment more quickly and at relatively lower cost. Port of Rotterdam Authority officials regard the impending changes as a new opportunity.

The new U.S. standards are seen as a windfall for the manufacturers of the scanners. The main challenge will be to speed up the actual scanner process per container which now still takes several minutes but must be reduced to about 20 seconds. Every year, about 12 million containers enter the United States, a number that is only bound to rise over time.