Our triple M approach Mobilisations across 8000 nm, Modifications of span of 12 m, Modernisations of drive & PLC, and 8 months later, 2 QCs stand fully operational at our Béjaïa Mediterranean Terminal, Algeria Since 1988, our engineering team has been working with the World’s Port of Call to match their everyday needs with our customised solutions. Our full spectrum of <strong>port</strong> equipment competencies include the Mobilisation, Modification and Modernisation of cranes - also known as our triple M approach. Come speak to us about how we can work with you in maximising throughput and accelerating growth! www.<strong>port</strong>ek.com A Mitsui & Co., Ltd. Subsidiary
PORT DEVELOPMENT Global operators on a roll The past four years have seen huge variations in annual container throughputs, with 2009 seeing the first decline (-10%) in the industry’s history, 2010 a strong return to growth (12%) and 2011 and 2012 more modest increases in the 4-6% range. This year most analysts are expecting growth in the 5-6% range. Although global terminal operators (GTOs) scaled back on their capital expansion programmes slightly in the fiscally constrained 2008-10 period, they still invested and secured new operating concessions. For the past 20 years or so, the sector has seen a constant increase in its share of the global container market. This is a situation that is expected to continue, despite some renewed interest in <strong>port</strong>s and terminals from equity groups, financial intermediaries and pension funds. But the GTOs will be operating in a slower trading environment with annualised growth rates of only 5-6% a year expected over the next decade. This compares with average volume rises of 10-12% a year throughout the 1990s and 2000s, a period that was characterised by robust traffic rises and hundreds of new deals being concluded by the main international terminal operators/ stevedores as they gained ground in the industry. Maturing sector While the slower rates of growth in container handling activity partly relate to poorer global economic growth prospects, especially in the OECD countries, they also reflect the maturing nature of the container shipping industry. In many regions of the developed world well over 80% of general and neo-bulk cargoes – such as steel, lumber and forest products – have already been unitised. Having said this, there remains a significant volume of refrigerated cargo that is moved in specialised ships, while a range of agricultural commodities, such as soya beans, lentils, some grain and ores, are moved conventionally and could be containerised if the right infrastructure were in place. Geographically, it is the emerging markets that offer the GTO industry the best prospects, principally because: • Annualised rates of growth over the next 10 years in regions such as Africa, Latin America and Concessions catapult capacity All the main global terminal operating companies have sizeable operating and investment concessions in place which are due to deliver a significant amount of additional container handling capacity over the next two to three years. A conservative estimate suggests that by the end of 2015, six leading GTOs – HPH, PSA International, DP World, APM Terminals, China Merchants Holdings International and Cosco Pacific – collectively will have added 30M-35M TEU of annualised handling capacity to the global total. Of these, DP World and APMT come out as being highly ambitious. DP World’s main projects are set to add about 12M TEU of new capacity over the next two-three years. Around 40% of this new capacity will come on stream at its home <strong>port</strong> of Jebel Ali in Dubai, with 1M TEU added through its Jebel Ali Container Terminal 2 extension project by the end of 2013 and up to 4M TEU coming into operation at the new Terminal 3 complex in 2014. Elsewhere, its Embramar project in Santos, where it works with Odebrecht, will add 1M TEU later this year. At London Gateway at least 1.6M TEU will come on stream this year, with the possibility of a further 2M TEU within the next two years. While there is some uncertainty about the scheduling of its Rotterdam World Gateway complex, it is expected to open in late 2014 with a design capacity of 2.4M TEU and eventually will be able to handle 4M TEU a year. By 2020 DP World hopes to have doubled its 2011 handling capacity and have facilities capable of handling close to 100M TEU in place. APMT has an ambitious expansion programme in place too, with a goal of becoming the world’s leading container <strong>port</strong> and inland services operator by 2016. On the basis of new developments, the operator will phase in to service an estimated 12M TEU of new capacity over the next three years. Due to open in late 2014, APMT’s Maasvlakte II terminal is among its biggest projects, with stage one delivering about 2.7M TEU of extra handling capacity to the Benelux market, eventually increasing to 4.5M TEU, to be phased in according to market demand. Developments in the emerging markets will be responsible for most of the group’s remaining capacity increases as terminals in Santos, Callao, Lazaro Cardenas, Izmir, Port Moin and Ningbo are completed. Hong Kong’s HPH and Singapore’s PSA International have fewer concessions and expansion programmes in place, although the Singapore Government is preparing to build an entirely new box <strong>port</strong> at Tuas in the west of the island. While no time frame is known for the development, PSA’s leases with the government for its terminals at Keppel, Pulau Brani and Tanjong Pagar will expire in 2017. In the meantime, PSA is focused on expanding its Pasir Panjang terminal. An estimated S$3.5B will be spent on phases three and four with at least 8M TEU of additional handling capacity expected to be in place at the complex over the next decade. The next two years will also see it complete a 1.8M TEU capacity terminal at Dammam in Saudi Arabia and add some capacity at Port Mariel, Cuba. Outside of the leading pack, Manila-based ICTSI has secured a number of high profile concessions in the last few years and was recently shortlisted in the bidding process to build a third terminal in the <strong>port</strong> of Melbourne, Australia. The next two-three years will see the group introduce new handling capacity throughout its network, including at its flagship facility in Manila, at Manzanillo in Mexico, Lekki in Nigeria, Gdynia in Poland and Rijeka in Croatia. Overall, a projected 4M-5M TEU of new handling capacity will be added to ICT- SI’s global <strong>port</strong>folio of facilities over this period. Despite high levels of volatility and uncertainty over container growth prospects, global terminal operators continue to invest heavily parts of Asia are projected to be three-four times higher than those in Europe, North America, Japan and maturing nations in Asia, such as South Korea, Taiwan and Singapore. • There is a rising demand for the development of modern cargo/ container handling facilities and associated infrastructure. Local <strong>port</strong> authorities are often short of cash or unable to raise the finance for such projects. • Rising levels of foreign direct investment by a mix of companies, quite often including manufacturers/producers, dictate that efficient supply chains are in place. Fundamentally, this means efficient <strong>port</strong>s and container terminals to handle the im<strong>port</strong>/ex<strong>port</strong> flows that normally follow on from the investment. APM Terminals (APMT), China Merchants Holdings (International) (CMHI), DP World and PSA International (PSA) are among the leading GTOs already well-established in managing terminals in the developing world. Each is actively chasing new op<strong>port</strong>unities. Russian roulette Last year saw APMT make a key move into the Russian market, a region singled out by group CEO Kim Fejfer as displaying the fastest growth rates of any BRIC nation last year and offering sound prospects. The Netherlandsheadquartered terminal operator bought a 37.5% stake in Global We’re there, wherever you need us From Singapore to Uzbekistan, if you’re involved in an incident, we’ll get someone on site and quickly. With 20 claims offices in key locations, and a further network of local partners, we always have professionals on hand with knowledge of the key issues and the legal frameworks needed to manage a claim effectively. Because we don’t do anything else, we lead the way in trans<strong>port</strong> and logistics insurance. PSA will spend S$3.5B to build an additional 8M TEU of capacity at Pasir Panjang terminal over the next decade, while the Singapore government is planning a new box <strong>port</strong> at Tuas in the west of the island Ports Investments (GPI), Russia’s leading operator of container terminals, which also has a presence in Finland and Latvia. GPI handled about 1.4M TEU in 2012, up 8% on 2011, and with about a 30% share of Russia’s total container market. “Russia will need world-class <strong>port</strong> infrastructure and operational excellence to serve global shipping lines and meet its own ambitions of economic development and GPI has a ‘good eye’ to grow the business. This deal is a great op<strong>port</strong>unity for APMT,” said Fejfer. He added: “The nation’s rapidly developing middle class, Russia’s integration with the global economy as evidenced by its membership of the WTO plus the country’s wealth of natural resources will continue to fuel the growth in ex<strong>port</strong>s and im<strong>port</strong>s in the long run.” GPI controls the Petroles<strong>port</strong> and Moby Dik terminals in St Petersburg – a total operating capacity of 1.8M TEU – as well as the city’s Yanino Logistics Park. May 2013 59
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