A growing number of mid-market logistics firms are diverting container traffic away from major gateway ports such as Los Angeles, Rotterdam and Shanghai toward secondary hubs including Savannah, Le Havre and Ningbo. The shift is driven by persistent congestion at primary ports and the desire to reduce exposure to tariff-related disruptions.
This realignment is not a temporary workaround. It reflects a structural change in how mid-sized logistics operators manage risk, capacity and cost. For investors, port authorities and businesses that depend on predictable freight movement, the implications are significant.
What Changed
Congestion at the world's largest container ports has become a recurring operational problem. At the Port of Los Angeles, average vessel wait times exceeded eight days during peak periods in 2023 and 2024, according to data from the Pacific Maritime Association. Similar bottlenecks have been reported at Rotterdam and Shanghai, where berth availability remains tight.
Mid-market logistics firms — those handling between 10,000 and 100,000 TEUs annually — have been disproportionately affected. Unlike large carriers with dedicated terminal agreements, these firms often rely on common-user berths and face higher variability in turnaround times.
In response, a measurable shift has occurred. Freight forwarders and mid-sized 3PLs are increasingly routing containers through secondary ports. Savannah, Georgia, has seen container volumes rise by 12 per cent year-on-year in the first half of 2024, according to the Georgia Ports Authority. Le Havre in France reported a 9 per cent increase in transshipment volumes over the same period. Ningbo, already a major port, has gained additional traffic from smaller carriers seeking alternatives to Shanghai.
Tariff risk is the second driver. The US-China trade war and the threat of new tariffs on European and Asian goods have made primary ports politically exposed. Secondary ports, often located in different customs zones or with more flexible trade agreements, offer a way to reduce the likelihood of cargo being held or taxed unexpectedly.
Why It Matters
For mid-market logistics firms, the ability to reroute through secondary hubs directly affects operating margins. A delay of one week at a primary port can increase warehousing and demurrage costs by 15 to 20 per cent for a typical mid-sized shipment. By shifting to less congested ports, firms can reduce these costs and improve delivery reliability.
For port authorities and investors, the trend signals a redistribution of infrastructure demand. Secondary ports are seeing increased pressure to expand container handling capacity, invest in rail and road connections, and improve customs processing. Ports that respond effectively may capture a permanent share of traffic that previously flowed through primary hubs.
For importers and exporters, the shift introduces new complexity. Routing through secondary ports often requires adjustments to inland logistics, longer trucking distances and different customs procedures. Companies that fail to adapt may face higher total landed costs.
Commercial Impact
The commercial impact is most visible in three areas:
Port infrastructure investment. Secondary ports are accelerating capital expenditure. Savannah has committed $2.5 billion to deepen its harbour and expand terminal capacity. Le Havre is investing in automated cranes and rail links. These projects are partly funded by increased terminal fees, which will be passed on to logistics firms.
Freight rate differentials. Spot rates for containers routed through secondary ports are typically 5 to 10 per cent lower than those for primary ports, according to freight rate indices from Xeneta and Drewry. However, inland transport costs can offset these savings. Mid-market firms are rebalancing their total cost calculations.
Insurance and risk premiums. Insurers are beginning to adjust premiums based on port congestion and tariff exposure. Firms that can demonstrate diversified routing strategies may secure lower rates. This is an emerging but commercially relevant development.
Risks / Unknowns
Several uncertainties remain. Secondary ports may themselves become congested as volumes increase. Savannah's rapid growth has already led to occasional rail bottlenecks. Le Havre's labour relations have been historically strained, and strikes could disrupt operations.
Tariff policy is unpredictable. A broad trade agreement between the US and China, or between the EU and China, could reduce the incentive to avoid primary ports. Conversely, new tariffs could accelerate the shift.
Data on mid-market routing decisions is limited. Most public port statistics aggregate all traffic, making it difficult to isolate the behaviour of mid-sized firms. The trend is inferred from freight forwarder surveys and anecdotal reports rather than comprehensive industry data.
FY Outlook
Over the next 12 to 18 months, the realignment is expected to continue. Primary ports will remain congested as global trade volumes grow and infrastructure upgrades lag. Secondary ports will capture a larger share of mid-market traffic, particularly for non-perishable goods and commodities where transit time is less critical.
Mid-market logistics firms should evaluate their port diversification strategies now. Those that lock in terminal service agreements at secondary hubs may gain a competitive advantage. Port authorities should prioritise investment in hinterland connectivity and customs digitisation to attract and retain diverted traffic.
Investors should watch for secondary port operators that demonstrate consistent volume growth and operational efficiency. The shift is not a cyclical blip but a structural adjustment to a more fragmented and risk-aware global logistics landscape.
Conclusion
The port city realignment is a rational response to congestion and tariff risk. Mid-market logistics firms are leading the shift, and their decisions are reshaping port hierarchies, investment flows and supply chain strategies. The trend carries risks, but for firms that adapt, the commercial opportunity is real.
