Tan Cang - Cai Mep International Terminal (TCIT) gate

Strongly increasing container throughput volume in Vietnam

According to the Vietnam Maritime Administration, in the first nine months of 2018, the cargo throughput volume reached nearly 386 million tons. In particular, container cargo volume reached more than 13.3 million TEUs, gained 18% and 27% respectively in comparison with the same period of 2017. In particularity of September 2018, the cargo throughput volume reached about 42.9 million, the cargo container volume was over 1.4 million TEUs, gained 18% and 30% respectively in comparison with the same period of 2017.

Mr. Bui Thien Thu, Deputy Director General of Vietnam Maritime Administration, said that ports in Ho Chi Minh, Vung Tau, Quang Ninh, Hai Phong have the largest volume with the total of 51.98 to 73.53 million tons. Some other seaports are also in the top with the highest volume of cargoes throughput such as: Ha Tinh - increased 97% (from 8.86 million tons to nearly 17.5 million tons); Quang Nam increased by 83.5% (from approximately 938 thousand tons to over 1.7 million tons); Nghe An increased 81% (from over 3.5 million tons to nearly 6.5 million tons). In addition, some ports in the region such as Binh Thuan and My Tho also had cargoes throughput volume increased by 40- 46%.

“According to the statistics of the first eight months, the cargo container throughput volume in some ports increased sharply, especially Quang Ninh increased 161% (from nearly 42.7 thousand TEUs to over 111 thousand TEUs) due to CICT port in Cai Lan port opened trial in 6/2017 with the international container line and increasingly effective; Nghe An increased 85.4% (from 32.8 thousand tons to 60.8 thousand tons", Mr. Thu said.

However, according to Mr. Thu, in addition to the group of ports with high growth rate as the above, there are still some ports in Kien Giang, Quang Tri had the throughput volume reduction of 32-67% over the same period 2017. "The reason is that by 2018, Kien Giang area does not have the volume of sand dredged in the port as 2017", Mr. Thu said.

NYK Behind LNG Carrier Order at Samsung

Japanese shipping company NYK is the Asian owner that ordered an LNG carrier from the South Korean shipbuilder Samsung Heavy Industries (SHI) last week.

The newbuilding has been chartered out to Total Gas & Power Chartering Limited (TGPCL), a subsidiary of French oil and energy firm Total, for a period of seven years.

The company has an option to extend the charter for one additional year.

NYK said that the LNG carrier would be equipped with a WinGD-made dual-fuel slow-speed diesel engine that can operate on marine gas oil or boil off gas stored in the cargo tank.

“The cargo tank will be a 174,000 cubic meter capacity membrane-type tank that will make use of advanced insulating materials to suppress the boil-off rate in the cargo tank. In addition, the new carrier will realize superior efficiency and economical LNG transportation through use of a re-liquefaction system that can use surplus boil-off gas effectively,” the company added.

Samsung revealed that the deal is worth around KRW 200.1 billion (USD 180 million).

The new vessel is due to be delivered by the end of March, 2021.

UNCTAD: 7 Key Trends Impacting the Shipping Industry’s Future

Seaborne trade expanded by a healthy 4% in 2017, the fastest growth in five years, with a similar growth forecast this year, according to UNCTAD’s Review of Maritime Transport 2018.

Volumes across all segments are set to grow in 2018, with containerized and dry bulk commodities expected to record the fastest growth at the expense of tanker volumes.

Healthy trade growth aside, the 2018 edition of the report also looked at the key opportunities and challenges faced by the shipping industry, and here are the 7 trends to be weary of:

Growing protectionism 

First, on the demand side, the uncertainty arising from wide-ranging geopolitical, economic, and trade policy risks, as well as some structural shifts, have a negative impact on maritime trade. Of immediate concern are inward-looking policies and rising protectionist sentiment that could undermine global economic growth, restrict trade growth and shift trading patterns.

“While the prospects for seaborne trade are positive, these are threatened by the outbreak of trade wars and increased inward-looking policies,” UNCTAD Secretary-General Mukhisa Kituyi said. “Escalating protectionism and tit-for-tat tariff battles will potentially disrupt the global trading system which underpins demand for maritime transport.”

The warning comes against a background of an improved balance between demand and supply that has lifted shipping rates to boost earnings and profits.

Supply-demand improvements, namely in the container and dry bulk shipping segments, are expected to continue in 2018. Freight rates may benefit accordingly, although supply-side capacity management and deployment remain key. UNCTAD projects an average annual growth rate in total volumes of 3.8% up to 2023.

On the supply side, after five years of decelerating growth, 2017 saw a small pick-up in world fleet expansion. During the year, a total of 42 million gross tons were added to global tonnage, equivalent to a modest 3.3% growth rate.

Technological advances 

Second on the list are the continued unfolding of digitalization and e-commerce and the implementation of the Belt and Road Initiative. These bear major implications for shipping and maritime trade. Technological advances such as block chain applications, cargo and vessel tracking, autonomous ships, and the Internet of Things, hold opportunities for the global shipping industry.

However, there is still uncertainty within the maritime transport industry regarding possible safety, security and cybersecurity incidents, as well as concern about negative effects on the jobs of seafarers, most of whom come from developing countries.

Excessive capacity 

Third, from the supply-side perspective, overly optimistic carriers competing for market share may order excessive new capacity, thereby leading to worsened shipping market conditions. This, in turn, will upset the supply and demand balance and have repercussions on freight-rate levels and volatility, transport costs and earnings.

Consolidation 

The fourth trend to be aware of is the liner shipping consolidation through mergers and alliances has been on the rise in recent years in response to lower demand levels and oversupplied shipping capacity dominated by mega container ships. The implication for competition levels, the potential for market power abuse by large shipping lines and the related impact on smaller players remain a concern. Competition authorities and regulators, as well as other relevant entities such as UNCTAD, need to remain vigilant.

As of January 2018, the Top 15 shipping lines accounted for 70.3% of all capacity. Their share has increased further with the completion of the operational integration of the new mergers in 2018, with the Top 10 shipping lines controlling almost 70% of fleet capacity as of June 2018.

Three global liner shipping alliances dominate capacity deployed on the three major East-West container routes, collectively accounting for 93% of deployed capacity. Alliance members continue to compete on price while operational efficiency and capacity utilization gains are helping to maintain low freight-rate levels. By joining forces and forming alliances, carriers have strengthened their bargaining power vis-à-vis the seaports when negotiating port calls and terminal operations.

Growing consolidation can reinforce market power, potentially leading to decreased supply and service quality, and higher prices. Some of these negative outcomes may already be in effect. For example, in 2017–2018, the number of operators decreased in several small island developing States and structurally weak developing countries.

 Vessel sizes and alliances 

The fifth trend is alliance restructuring and larger vessel deployment, which are also redefining the relationship between ports and container shipping lines. Competition authorities and maritime transport regulators should also analyze the impact of market concentration and alliance deployment on the relationship between ports and carriers, UNCTAD said.

Increases in the size of vessels and the rise of mega-alliances have heightened the requirements for ports to adapt. While liner shipping networks seem to have benefited from efficiency gains arising from consolidation and alliance restructuring, for ports, the benefits did not evolve at the same pace. This dynamic is further complicated by the shipping lines often being involved in port operations which in turn could redefine approaches to terminal concessions.

The report says that global ports and terminals need to track and measure performance as port performance metrics enable sound strategic port planning, investment and decision-making.

Determining the value of shipping 

Sixth, the value of shipping can no longer be determined by scale alone. The ability of the sector to leverage relevant technological advances is becoming increasingly important.

Environmental agenda

Finally, efforts to curb the carbon footprint and improve the environmental performance of international shipping remain high on the international agenda. When incomes to the implementation, owners will need to consider carefully what compliance strategy to choose.

 

Source: World Maritime; Bao Moi (Vietnam)