HONG KONG: There was no let up for the port of Hong Kong in the month of September as container volumes fell for the 15th consecutive month.
Figures just released by the Hong Kong Port Development Council show a 6.7 percent decline in year-on-year throughput to 1.67 million 20-foot-equivalent units for the month of September. The Kwai Tsing terminals recorded a double-digit decline in throughput of 14.2 percent to 1.2 million TEUs, while the river trade and mid-stream operations saw throughput grow by 21.6 percent to 460,000 TEUs.
On a year-to-date basis, Hong Kong has suffered a cumulative decline of 8.1 percent in throughput to 15.48 million TEUs, with the terminals at Kwai Tsing accounting for 11.86 million of the total and the remaining 3.6 million boxes handled by the river trade and mid-stream portion. Historical data for Hong Kong’s port volumes can be found on JOC.com’s Market Data Hub.
In contrast, September data just released by Cosco Pacific show a 4.4 percent year-over-year increase in throughput at Yantian International Container Terminals in Shenzhen to 1.185 million TEUs. YICT recorded a cumulative increase of 6 percent to 9 million TEUs for the first nine months of the year.
Once the world’s busiest port, Hong Kong’s market share of direct exports has been steadily eroded by the terminals across the border. The last time a positive growth in volumes was recorded was in June of 2014.
Hong Kong is currently the world’s fourth-busiest container port but may be surpassed by Ningbo-Zhoushan this year, which expects its throughput to hit 22 million TEUs.
One of the greatest problems for the terminals at Kwai Tsing is the lack of back-up land in the container yards that was identified in a government-commissioned port masterplan 12 years ago. The government recently released a proposal to integrate 15 hectares of adjacent back-up real estate to build out new yard space and barge berthing facilities.
But with the industry looking for at least 70 hectares, there are many who fear it may be a case of too little too late. A Deutsche Bank study earlier this year said in the next 10 years, the port could expect a 30 percent fall in throughput at best, and in a worst case scenario the volumes would be slashed by 50 percent. That would drop the throughput to 11 million TEUs a year and take Hong Kong out of the top 10 rankings.
The bank said shipping lines have been adding port of calls at Shenzhen and Guangzhou ports while reducing them in Hong Kong because of shorter distance to cargo sources and lower operating costs. Hong Kong’s weekly port of calls for Northern Europe, the U.S., Middle East, and Australia services had dropped to 72 from 77 a year ago. For Asia-Northern Europe routes, Hong Kong lost five out of a total of 19 weekly calls over 2014.
And while the number of container vessels arriving in Hong Kong each year more than doubled over the 2001-2006 period, it has been trending down since 2006.
“From a cost perspective, the shift of port of calls from Hong Kong to PRD ports appears to make a lot of sense,” the bank study noted. “If carriers use Shenzhen Ports to do transshipment instead of Hong Kong, shipping lines can save up to 30 percent in THCs.”
“Note that with rising port of calls by shipping lines, the connectivity for PRD ports would improve accordingly, which in turn would attract more cargos and more port of calls. This self-fulfilling process would gradually undermine HK’s position, in our view. Clearly, the upward momentum has largely faded in recent years.”
