21 December 2008

Shipping slowdown leads to more ships at Singapore port

Lying idle, more ships are being parked off our shores due to the slowdown in shipping.
Large ship off Pulau Semakau
Container traffic through our port has also slowed down.

Is this a good thing for our shores? Hmmm...

Good economy...BAD ECONOMY?
More idle ships seen on S'pore coast as trade and shipments decline
Crystal Chan, The New Paper 21 Dec 08;
THESE days, cleaner John Lee, 52, is greeted by the sight of at least 20 ships dotting the sea from his Marine Terrace flat. He told The New Paper that when he lived in the same estate from 1974 to 2000, there were fewer ships to be seen from his window. He said in Mandarin: 'When I moved back into the estate in September, I noticed more stationary ships.'

His neighbour, Mr Farkhan Said, 29, a storekeeper, said the trend became more pronounced early this month, as the recession worsened. 'It probably shows the economy is no good,' he said. 'The ships don't seem to be moving.'

Shipping companies confirmed that they have more idle vessels now because shipments have declined. Lloyd's List, a leading maritime news portal, reported in late October that at least half a dozen deep sea container ships are anchored off Singapore.

NOL Group has started removing vessels from service as it aims to save US$200 million ($287m) annually through lower fuel, crew and other costs. The homegrown shipping giant confirmed that more of its ships are lying empty in Singapore waters, but was unable to provide The New Paper with figures. With alliance partners MOL and Hyundai Merchant Marine, NOL will be taking 40 ships out of service.

NOL President and Chief Executive Officer Ron Widdows, said: 'We're trimming capacity by withdrawing a number of vessels from service, adjusting port calls and service loops.' NOL plans to lay up ships in its home port of Singapore until the recession passes. Although it has been profitable in the first three quarters of the year, a loss is expected for the fourth quarter, NOL said.

Mr Widdows said: 'Reduced demand in key trade lanes, combined with cost increases and worsening global economic conditions have adversely impacted our profit performance in the third quarter.'

Many reasons for idle ships

A spokesman for the Maritime and Port Authority (MPA) told The New Paper that there are some 1,000 ships in Singapore's ports on any given day.

She said: 'These ships may be traversing port waters, at anchorage, or loading and discharging cargo alongside terminals. The duration of ships at anchorage varies from a few hours to weeks.

'This can be for a variety of reasons, such as taking stores, lifting bunkers, awaiting cargo, undergoing afloat repairs, or waiting to enter shipyards.' Ships may also remain at anchorage while awaiting orders or charter instructions from their owners.

Mediterranean Shipping Co and Hapag-Lloyd also have vessels idling in Singapore waters, Lloyd's List reported. Most of the idle ships that can be spotted in Singapore waters are German-owned. Other ports such as Pasir Gudang and Shanghai are also seeing more unemployed vessels.

Danish shipping giant Maersk told The New Paper that it has idle vessels anchored predominantly in Asia. It also plans to lay up eight 6,500 TEU (20-foot equivalent unit) ships to save costs. Its spokesman said: 'We have reached the point where laying up the eight vessels makes better economical sense than redeploying them. Freight rates remain under severe pressure, and in several corridors the rates do not fully cover our variable costs.'

Statistics from the MPA show that 39,651,000 tonnes of cargo were shipped into Singapore last month, down from 40,886,000 tonnes in October.

In October, 10,897 vessels arrived in Singapore, an increase from 10,760 in September, but down from 11,201 in August.

While PSA Corp declined to comment, several port workers told The New Paper that they have been asked to work shorter weeks.

One worker, who gave his name only as Mr Ong, said: 'I work only three days a week now and I report for work only when I'm called. My supervisor said there are few tasks for me and my colleagues because there are fewer ships requiring servicing.

'When the port was busy, I worked overtime at least three days a week. Now, I work only eight hours a day.' He said that while he earns less, it is better than being laid off. 'I'm already in my 40s. It would be hard to get another job if I'm retrenched,' he said.

Mr Farkhan, however, likes the view. 'The lights from the ships make the skyline look so much brighter than before,' he said.

PSA throughput hit as slowdown sails into port
First time in 7 years that TEUs are lower than previous year
Vincent Wee, Business Times 16 Dec 08;
(SINGAPORE) The writing was on the wall from the figures coming out of the major container shipping lines and it was only a matter of time before the industry slowdown hit Singapore's port as well.

The latest November numbers have made this official as container throughput is lower than the year before for the first time in seven years.

November figures released by the Maritime and Port Authority showed that 2.29 million twenty-foot equivalent units (TEUs) passed through the Port of Singapore in November.

This was a 1.5 per cent decline from the 2.32 million TEUs throughput seen in November last year.

On a month-on-month basis the fall was over 9 per cent from the 2.52 million TEUs seen in October.

And this itself was a trend that started to establish itself in August when throughput slid 3.2 per cent from July. Throughput has continued to slide every month since then and November's figure is 16.2 per cent below the year's peak of 2.73 million TEUs reached in July.

Between the two port operators, dominant player PSA is still seeing growth, but the pace has slowed. Throughput at PSA Singapore terminals rose 10.9 per cent from September to October and 8.9 per cent from October to November.

For Jurong Port, the corresponding figure is a 14.7 per cent drop in October alone. Bafflingly, Singapore's niche port operator not only did not disclose the specific figure for November despite having done so throughout the year, but also made a change to reporting format based on year-to-date figures.

The unavailability of specific figures makes it hard to determine the month-on-month number but by all indications it is likely to be at least a similar, if not bigger decrease as in October.

While year-to-date figures are still registering a 9 per cent increase to 27.8 million TEUs moved in the first 11 months of 2008, it seems certain volumes will continue to slide next year as the global downturn takes its toll on container shipping. Neptune Orient Lines carried 12 per cent fewer containers in the period Oct 18 to Nov 14.

Westbound volumes on the Asia-Europe trade lane slipped 1.1 per cent in the third quarter. Even the world's second-busiest port Shanghai, which boosted its traffic 8.7 per cent to 23.5 million containers in the first 10 months is unlikely to meet its ambition of overtaking Singapore this year as Chinese export volumes plunge.

No comments:

Post a Comment

LinkWithin

Related Posts with Thumbnails