Estimating the economic losses of port disruption due to extreme wind events

The operation of a seaport is highly dependent on the ocean climate, where a necessary consideration of the later is essential to govern the normal running of the seaborne transportation. To estimate the port risks associated with the climate factors is a challenging task. Not only because of the complexity in the weather, but also the variations in the daily trade volume. This paper develops an approach of estimating the economic losses of port disruptions induced by extreme wind events, and conducts a study for two selected ports, Ningbo and Shanghai. The loss considers both the variation in the daily cargo throughput and the climate. The throughput is analyzed in a regression analysis which accounts for both the long term trend and yearly cyclic components. The likelihood of port disruptions is estimated from a climate analysis based on the historic record at both ports. The calculation of the total economic loss is split into four parts, namely, reputational loss, loss to the shippers, loss to the carriers and loss to the ports. The results are illustrated in a comparison between Shanghai and Ningbo to provide the information of associated risks within different months. The study is also extended to investigate the influence of extreme wind events on the port of Shenzhen which is located in a different geographical region for comparison. The impact of the extreme wind events on the ports and the economy is then discussed.