MASCAT: Oman Ports’ transshipment still faces challenges as Salalah Port revenues dropped 9 percent to RO53.5mn last year due to lower container volume while net profit decreased more than 7 percent to RO5.26mn.
The port’s general cargo terminal (GCT) posted record volumes, which, to some extent offset a decline in container terminal transshipment volumes, Salalah Port Services said in a report posted on the MSM website.
The container terminal handled 3mn twenty-foot equivalent units (TEUs), which was nine per cent below from 3.3mn TEUs in 2013. The company said the decline in transshipment volumes is largely the result of new terminal developments within the region, combined with the slow development of global transshipment trade. “The container shipping market continues to pass through a period of margin pressure and there are no indications of growth in container industry market.”
Salalah Port Services, which operates the port, said that the market scenario following the global economic downturn has significantly changed. “A large amount of government-driven (rather than market-driven) port development in the region and the corresponding increase in port capacity are cause for concern. At the same time shipping lines are working to form alliances to reduce operating costs and this reduces transshipments. However, we believe our strategic location and our service levels will remain an important factor in customer choice.”
The GCT handled a record throughput of 10.3mn tonnes during 2014, a growth of 30 per cent over 7.9mn tonnes in 2013.
“The company expects to see continued growth in GCT, fuelled by increasing demand for limestone and gypsum. We forecast that our throughput of these products will exceed, on average, 1mn tonnes per month in 2015. We are planning a significant investment in automated equipment for handling aggregates which expect to receive and commission in 2016. We also expect to see steady improvement in our importation of grain and other general cargo,” SPS said.
The company added that the port will continue to extend and explore joint opportunities with the Salalah Free Zone and play a significant role in the development of Dhofar region.
The future of the container terminal, however, is less optimistic as the company expects the reduction in throughput that has been experienced in recent years to accelerate. “Shipping lines always want to avoid incurring the extra costs of transshipment and with increasing vessel tonnage available they can now do more direct calls. This is a growing trend and will mean that our transshipment business will continue to erode for the foreseeable future,” it added.
