Sunday, May 17, 2009

Westports sees first volume drop

WESTPORTS Malaysia Sdn Bhd, one of the fastest growing ports in Malaysia located in Port Klang, expects its volume to contract for the first time this year since it started its container business in 1996 due to the global economic meltdown.

The port, which was established in 1994, expects to record about four million 20ft equivalent units (TEUs) this year, which would mean a 19.5% fall from 4.97 million TEUs achieved last year.

According to executive director Ruben Emir Gnanalingam, container volume for the first-quarter this year saw a decline of 15% to 16% year-on-year.

Ruben Emir Gnanalingam says the decline affected all types of cargo

“And the downtrend continued in April as well.

“March had the highest volume so far this year with 355,431 TEUs.

“The decline affected all types of cargo – import, export and transhipment,” he told StarBiz.

He said the drop in volume was in line with the decline observed in other major ports in the region.

But, he added that the average daily volume at Westports had showed signs of stabilising in recent months compared with the sharp decline recorded earlier.

“Thus, we are also expecting lower turnover this year in tandem with the decrease in volume,” he said.

Westports posted a revenue of RM984mil last year, up 19% from 2007.

Due to the slowdown, Ruben said Westports would not embark on any infrastructure expansion this year.

“We spent about RM600mil last year on expansion that has elevated our capacity to 7.2 million TEUs without any congestion possibility. The current capacity is more than enough to operate our business for now.

“Thus, we do not have any capex plans this year and we will re-look at expansion plans at the end of next year.

“This is because we do a long-term expansion plan. We completed container terminal (CT) 5 last year and, according to our plan, we can go up to CT9 or even to CT11 if the environmental condition permits,” he said, adding that Westports’ expansion was mainly supply driven.

Also, according to Ruben, Westports would use the less busy business environment to upgrade its efficiency.

“We are now operating at 100% berth on arrival compared with our busier times’ berth on arrival of 75% to 80%. This is the best time to upgrade our system as we are not that busy.

“Other than that, we are also retraining our staff so that they are ready to give their best on the next upcycle of the industry.

“We want to upgrade our efficiency of moving containers from the current average of 36 moves per hour to over 40 moves,” he said, adding that Westports had a policy of not retrenching its staff due to the economic slowdown this year.

Currently, the port has about 3,400 employees.

On the reduction in the free storage period to three days from five at Port Klang, tentatively effective from July 1, Ruben said the five days – by industry standard – were considered more than ample time given to exporters and importers to clear their goods at the port.

“The port is not a storage facility regardless of the economic situation and whether it is congested or not.

“Other ports in the region have shorter free storage period as well,” he said.

Source: StarBiz

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