Daily Digital Magazine: Pg. 3 — January 9, 2019

Container terminals still ‘solid, profitable business’

But Drewry’s senior analyst of ports and terminals cautions growth will slow in 2019.

   The global container terminal industry is expected to “remain a very solid, profitable business” this year with a throughput of more than 800 million TEUs generating earnings before income, taxes, depreciation and amortization in excess of $25 billion, according to Drewry Shipping Consultants.
   In a brief item published Tuesday on the company’s website, Neil Davidson, Drewry’s senior analyst of ports and terminals, said he expects volumes to increase by 30 million TEUs, but added, “We will see a softening of the global container port demand growth rate, down from an estimated 4.7 percent in 2018 to just over 4 percent in 2019.”

Container terminals still ‘solid, profitable business’

But Drewry’s senior analyst of ports and terminals cautions growth will slow in 2019.

Container terminals still ‘solid, profitable business’

But Drewry’s senior analyst of ports and terminals cautions growth will slow in 2019.

 
Continued from previous page
   The global container terminal industry is expected to “remain a very solid, profitable business” this year with a throughput of more than 800 million TEUs generating earnings before income, taxes, depreciation and amortization in excess of $25 billion, according to Drewry Shipping Consultants.
   In a brief item published Tuesday on the company’s website, Neil Davidson, Drewry’s senior analyst of ports and terminals, said he expects volumes to increase by 30 million TEUs, but added, “We will see a softening of the global container port demand growth rate, down from an estimated 4.7 percent in 2018 to just over 4 percent in 2019.”
   However, Davidson said, “the projection for 2019 is highly uncertain due to the U.S.-China tariff wars, Brexit, etc. So there is a big caveat.”
   He expects continued caution by terminal operators and other investors “because returns are not what they used to be. Even Chinese players may be affected if China’s economy slows markedly.
   “Greenfield expansion projects will be the area hardest hit. Nevertheless, a global capacity addition of over 25 million TEU can be expected in 2019, representing a spend of $7.5 billion,” he said.
   Terminals have had to invest in recent years to accommodate the growing size of ships. Some terminals have extended berths, others have replaced, added or rebuilt cranes so they are higher or have longer reach. Others have added equipment or made improvements in the yards behind the quays.
   Davidson said, “The good news for the industry is that there will be no significant increase in maximum containership size (maximum TEU intake is going up but physical dimensions are not). However, cascading will still be very much at work across all trade routes, and each port will see increasing pressure on whichever berths are able to handle the biggest ships (and increased obsolescence of older berths).”
   For example, last summer four ship-to-shore cranes at SSA Marine’s terminal in the Port of Oakland were raised 27 feet so they could reach higher and work the larger ships being positioned into the transpacific trade. (This video that shows how that was done.)
   Davdson also expects new technologies such as “digitization/automation/blockchain/smart ports/IoT/hyperloop”(the list goes on) will continue to be vigorously explored by both terminal operators and port authorities” as they seek to find which ones “really work and what has the best potential.”
   He also says “terminal operators and port authorities will continue to seek to expand their activities beyond the port gate into the wider supply chain,” but notes “it’s a crowded field, with the heavyweight liner shipping companies aiming to do the same thing.”

Click here to see video.

The driver market continues to be tight, but not quite as much as the middle of 2018. The overall trend late last year was that turnover is slowing.

The Port of Toronto, which is located on Lake Ontario and primarily serves as a bulk cargo destination, moved 2.18 million metric tons of cargo in 2018, surpassing a record-breaking year in 2017.

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Container terminals still ‘solid, profitable business’

But Drewry’s senior analyst of ports and terminals cautions growth will slow in 2019.

Jan 09, 2019 on Dec 27, 2018AmericanShipper.com

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Container terminals still ‘solid, profitable business’

But Drewry’s senior analyst of ports and terminals cautions growth will slow in 2019.

Jan 09, 2019 on Dec 27, 2018AmericanShipper.com