According to the Global Port Development Report (3Q12) (hereinafter referred to as the Report) issued lately by SISI, the stagnant economy and trade around the globe have left global ports in a predicament, epitomized by the sluggish growth in throughput and the lackluster performance during the traditional peak season.

Since the financial crisis in 2009, the port industry has offered better performance than other sectors. The world’s total container throughput recorded a promising increase of 15% in 2010 and 7.2% in 2011, both higher than the average GDP growth. However, given the performance of major ports and port operators around the globe in the first three quarters, the year 2012 means a tough run for the industry. It is predicted that this year the world’s total container throughput will amount to 615 million TEU or so, up about 4% YoY. Generally speaking, ports in the US and Australia will witness a growth in cargo and container throughput against the trend.

1. Helpless Asian Ports in Cargo Throughput Downturn
The Report points out that against the backdrop of the shrinking manufacturing industry and the insufficient need of international trade, IMF has frequently lowered the global economic outlook, and the QE3 and other quantitative easing monetary policies prolifically promulgated by Europe and the US have failed to boost market confidence. During the first three quarters, cargo throughput of major ports around the globe dropped from 9% in 2011 to 6% or so, and Q3 recorded a particularly sluggish port throughput, up only 5% YoY. The stagnant economy and trade of emerging economies in the Far East has hindered the development of their port industry which fails to make greater contribution to global ports.

Major ports in Asia have suffered shrinking growth for the first time
Despite being major contributors to global port throughput, Asian ports failed to maintain the stable growth in Q3. The port throughput of Shanghai, Singapore and Guangzhou dropped 0.3%, 0.9% and 2.77% respectively, and major ports in Asia witnessed a significant drop in aggregate growth from 7% in H1 to 4.8%. Affected by the sharp decline in imports and exports and supported by the increasing throughput of cargo for domestic trade in second-tiered ports, Chinese ports above designated size have recorded an aggregate cargo throughput of 7.136 billion tons in the first three quarters, with the growth rate dipping to 6.6%. Due to the decline in transshipment and exports, Korean ports registered a cargo throughput of 320 million tons, with the growth rate lower than 1%.

European ports sank deeper in negative growth
The fiscal and monetary policies successively issued by European countries failed to extricate port industry from the economic crisis in the first three quarters. The recession of European ports is unavoidable with shrinking consumption and demand for crude oil and coal. In Q3, Rotterdam Port recorded a cargo throughput of 110 million tons, down 1% YoY, and Antwerp Port of 45.082 million tons, down 2.4% YoY. The -2% growth in throughput from Q1 to Q3 is likely to continue till year-end.

African ports have reversed the downturn
The large potential of emerging African markets has drawn the attention of global terminal operators. African ports managed to reverse the downturn in H1 with a 4.5% growth in throughput during the first three quarters, and the Port of Richards Bay and the Port of Cape Town, in particular, were burgeoning with a growth of over 10%.

2. Growth in Container Throughput Staying Low with Lackluster Performance in Peak Season
According to the Report, in the first three quarters, the growth in container throughput of various ports stayed at a low level. Major ports but those in Australia saw an aggregate container throughput growth of below 6%, coupled with lackluster performance - a slight growth of 3.3%, which poses a sharp contrast with the 5.8% growth in Q1 - during the peak season in September and October. As the engine of economic growth, major ports in Asia recorded a 5.6% growth in aggregate container throughput. A potential pick-up in Q4 driven by holiday consumption at year-end had a fat chance to offset the sluggish performance in 2012.

Asian ports lack momentum
Asian ports failed to show a steady uptrend as previously expected in the wake of the slow growth in H1. In 3Q 2012, the container throughput of Asian ports suffered another decline, up 3.6% YoY. The container throughput of Chinese ports above designated size amounted to 46.10 million TEU, up 6.7% YoY, which growth rate was 6% lower on a year-on-year basis. Container throughput was unlikely to see a sharp increase under the dual pressures of domestic economic slowdown and shrinking demand for foreign trade. Shanghai Port, Hong Kong Port and Guangzhou Port registered a container throughput of 8.36 million TEU, 5.96 million TEU and 3.65 million TEU, down 0.71%, 4.58% and 4.77% respectively, and Singapore Port and Busan Port of 8.12 million TEU and 4.22 million TEU, up 5.84% YoY and 2.04% YoY respectively, as compared with the 7.31% and 8.36% growth in H1.

American ports saw slight pickup, while Australian ports met limited growth
In 2012, the US has showed a better economic performance than other countries, even better than the euphoric expectations. So is with the container throughput of major ports in the US, which saw an aggregate growth of 2% or so, up 1% from 2011. Driven by the Christmas consumption, American ports as a whole witnessed a smooth growth of 3.12% in Q3, led by the double-digit growth of Vancouver Port, Virginia Port and Tocoma Port. Los Angeles Port, Santos Port, Vancouver Port and Virginia Port recorded a stable growth of 5.15%, 7.67%, 6.65% and 8.42% respectively, compared with the disappointing 1.5% growth of Australian Ports from Q1 to Q3. Sydney Port and Brisbane Port saw a container throughput of 1.5065 million TEU and 746,900 TEU respectively.

African ports have registered a decline and European ports sank deeper in recession
African ports which depend largely on exports have failed to maintain the sound performance in H1. Durban Port, the largest port in South Africa, recorded a container throughput of 662,100 TEU in Q3, down 8.9% YoY, causing a aggregate decline of 2.09% in the first three quarters. European ports are still suffering from negative growth. Among the major ports, Rotterdam Port saw a container throughput of 3.0755 million TEU in Q3, down 0.1% YoY, and Antwerp Port of 2.1546 million TEU, down 0.4% YoY.

3. Slow but Steady Growth in Dry Bulk Throughput
Given the shrinking demand in China and other emerging markets, global ports have seen a slow but steady growth in dry bulk throughput at large. Chinese ports imported 185 million tons of iron ores, up 6.38% YoY, a growth rate which was a little lower than before. European ports remained sluggish, with Rotterdam Port registering an iron ore throughput of 8.402 million tons, plunging 16.7% YoY. As a major iron ore supplier, Port Hedland exported 62.1848 million tons of iron ores, down 10% QoQ. Primary coal supplier - Port of Richards Bay - exported 17.4016 million tons of coal, growing steadily by 6.7% YoY.

4. Differentiated Performance of Liquid Bulk Throughput
Since the beginning of the year, liquid bulk throughput of global ports has stayed at a low level, with a negative growth reported by most ports. In Q3, ports in China and Singapore maintained the recession in H1. China imported 60.31 million tons of crude oil, down 1% YoY, and Singapore Port recorded a liquid bulk throughput of 40.4501 million tons, plummeting 12.1% YoY. On the contrary, the throughput of European ports went up against the trend. Rotterdam Port and Antwerp Port registered a liquid bulk throughput of 53.99 million tons and 11.72 million tons, up 4.7% YoY and 2.7% YoY respectively.
Generally speaking, in view of the growing risk of global economic downturn and the short-term increase in holiday trade volume, the growth of global ports will continue to slow down in the wake of a fleeting rebound at year-end.

The English version of Global Port Development Report (Q3) will be released soon on our website.