Wednesday, January 20, 2010

Tanjung Manis Port to become gateway for central Sarawak

The Tanjung Manis Integrated Port is to become the primary import and export gateway for Sarawak central region when it begins full operations by next year.

The port, a subsidiary of Sarawak Timber Industry Development Corp (STIDC) and appointed by Rajang Port Authority as its port operator in Tanjung Manis new township, had shown encouraging performance since commencing operations in July last year.

As at October 2009, it had received 11 vessels and handled 2,383 TEUs (20-foot equivalent units), said STIDC general manager and Tanjung Manis Integrated Port chairman Datuk Len Talif Salleh in the latest issue of Perkasa, the bi-monthly newsletter published by the corporation.

Currently the port, which is accessible to 20,000 GRT (gross register tonnage) vessels, has the capacity to handle up to 200,000 tonnes of general cargo and 25,000 TEUs a year.

He said the existing 203m wharf would be extended by 200m to enable the port to handle an annual capacity of 200,000 TEUs and 6 million tonnes of general cargo by next year.

When fully operational, the port is expected to be equipped with state-of-the-art cargo-handling facilities such as quay cranes, mobile harbour cranes, rubber-type gantry cranes and reach stackers, said Len.

He said the port was envisaged to play a pivotal role in the shipping industry with the completion of the Sibu-Tanjung Manis road by this year and support the various industries in the hinterland, particularly the Tanjung Manis Halal Hub and other projects planned under the Sarawak Corridor of Renewable Energy (Score).

"With better facilities and a team of dedicated and experienced workforce, Tanjung Manis port promises efficient services apart from reducing vessel turnaround time due to its closeness to the sea," he said.

Len said the port's strategic location and natural deep water complemented its role as the central region's transshipment hub.

Meanwhile, the 77,000ha Tanjung Manis Halal Hub is expected to attract at least RM9 billion worth of investments for upstream and downstream halal food processing activities , which will create about 10,000 jobs, besides other economic spin-offs.

Source: Business Times

Monday, January 18, 2010

No impact yet of cabotage policy change on cargo shipment business

The Ministry of International Trade and Industry has yet to see the impact of the partial liberalisation of the Cabotage Policy on the cargo shipment business in Sabah and Sarawak.

Its Deputy Minister, Datuk Jacob Dungau Sagan, said the government needed more time to evaluate the impact as the partial liberalisation was only introduced last May.

"The ministry is monitoring interests among foreign shipping companies to go directly to the designated ports in the two states.

"The growth in volume of exports will also be monitored to assess the impact of the policy change," he told a media briefing after officiating at a seminar on "Trade Liberalisation and Government Assistance" here on Monday.

Sagan said the Cabotage Policy change was among the measures taken by the government to reduce freight costs of goods coming to and from the two states.

He said the partial liberalisation allowed foreign vessels to carry containerised transhipment cargo directly to Sabah and Sarawak without a need for a domestic shipping licence.

"It involves the cargo movements between the ports of Sepanggar in Sabah, Bintulu and Kuching (Sarawak) with the ports of Klang and Tanjung Pelepas and vice versa," he said.

Meanwhile, Sagan said he wanted more importers and exporters in the two states to join the Malaysian National Shippers Council, which had been vocal in calling for the review of the policy.

He said currently there were 25 organisations in the council with only one from Sabah and none from Sarawak.

"We want more shipping companies, or through their business associations, to join the council so that their voices can be heard to provide inputs to the government in formulating policies," he said.

Source: StarBiz

Monday, January 11, 2010

Port Klang container, cargo throughput down

Container traffic through Port Klang, the country's busiest container port, fell by 8.3 per cent last year, as the global economic downturn continues to hurt the country's exports.

The port handled 7.3 million TEUs (20-foot equivalent units), the standard measurement for shipping containers, compared with 7.9 million TEUs in 2008.

In terms of tonnage handled, traffic through the port was 133.8 million tonnes, down 8.8 per cent over the previous year.

More than half, or 61 per cent of the container volume, was from Westports, which generated 4.451 million TEUs. Northport accounted for the remaining 39 per cent or 2.858 million TEUs.

Transhipment cargo took the largest share of Port Klang's total throughput, contributing 58 per cent, with local boxes constituting the remaining 42 per cent .

However, transhipment volume also saw a 9 per cent drop to 4.3 million TEUs for the 12 months.

Port Klang Authority (PKA) general manager Kee Lian Yong said the decline in container and cargo throughput is in line with the global trend.

"(Nevertheless,) the port's container volume was better than our earlier forecast of a 10 per cent drop. Overall Port Klang also fared better than other major ports in the world, which saw a 10-15 per cent drop in traffic," he told Business Times.

Kee said Port Klang is expected to post throughput growth in 2010, returning to 2008 volume of 8 million TEUs.

"We remain cautiously optimistic as the shipping community is predicting that 2010 will still be a tough year," he added.

According to Drewry Shipping Consultants Ltd's most recent projections, the market will have to wait until 2012 before global container port volume exceeds 2008 levels again. It expects Far East and Southeast Asian container traffic to recover faster than that in other regions.

"In 2010, the market should brace for another tough year," Shipping Association of Malaysia chairman Ooi Lean Hin had said in an earlier interview .

Source: Business Times

Sunday, January 10, 2010

Port Klang: Mixed views on shorter container storage period

Industry players have mixed views on the reduction of free storage period for full-container load at Port Klang to three days from five that came into effect on Jan 1.

It now means that containers, regardless of whether they are for export or import, are only given three days without charge at Northport and Westports.

Cranes loading containers onto a ship at North Port, Port Klang.

The idea, mooted by the Transport Ministry in 2002, had seen numerous postponements and deferments.

The last deferment was made in June last year by the Port Klang Authority (PKA) due to the global economic downturn.

However, for the implementation this year, PKA had taken into consideration some of the concerns raised by the port users.

For example, it has directed the two terminals to calculate the free storage period based on hours (72) instead of days, and to waive the storage charges if delays are caused by Customs, other government agencies, or the terminals themselves.

The terminals were also told to maintain the five-day free storage period until Dec 31 for shipments from Asean ports.

MultiCargo Express Sdn Bhd chief operating officer Robin Hoh said the reduction in the free storage period was good as it would enable Port Klang to function more efficiently.

“This has been practised in most European countries for quite some time now whereas certain countries only give consignees a day to clear their cargo,” he told StarBiz. “Also, the turnover will be faster, thus profiting not only the carriers, but the ports and depots as well.”

“But, if we want this implementation to be successful, all related bodies for the clearance and delivery of cargo must be more focused and committed,” Hoh added.

On the expected challenges of the new ruling, he said that on festive holidays, all departments and authorities from the points of entry to exit must be highly efficient to run things smoothly.

“In this case, pre-submission of documents for cargo clearance should be practised,” he said.

Transways Logistics (M) Sdn Bhd president and chief executive officer Edward Chan supported the shorter free storage period but thought the timing of the implementation was wrong.

“We are still recovering from the global economic downturn. Furthermore, some types of cargo need more than three working days to be cleared.

“For example, for import cargo, before we can pay the duty, we have to calculate and confirm with our clients. And sometimes cargo needs approval from some government agencies that may take more than three days,” he said, adding that about 30% of the cargoes handled by Transways were cleared in two to three days.

Another logistics player also said the implementation at this point of time was inappropriate as it would hurt the businesses and their clients.

Meanwhile, Wilhelmsen Ships Service managing director Winston Loo said shortening the free storage time was a positive move.

“It should make the entire logistics chain more efficient. And, in doing so, would further improve Port Klang’s competitiveness in the region,” he said.

Loo also believed that sufficient time had been given to all stakeholders to re-engineer their processes to meet the new ruling.

“Thus, while we do expect some hiccups, I believe all the stakeholders will be able to overcome the shortcomings,” he said.

Source: StarBiz

Monday, January 4, 2010

Tanker, dry bulk marts may remain in rough waters

Companies in the tanker and dry bulk shipping markets are not expecting a strong recovery until 2012, as freight rates are likely to remain depressed in the next two years.

"The short-term scenarios are not strong and the (dry bulk) market is expected to worsen until at least 2011," Global Maritime Ventures Bhd chief executive officer Norulhadi Md Shariff told Business Times via e-mail.

Chemical tanker rates and earnings are expected to remain bearish in 2010, with a recovery in freight rates possible in 2011, should there be positive world gross domestic product growth.

"We don't foresee a big leap in freight rates for tankers next year due to the anticipated small growth in the world economy. If there is growth in the world economy, we foresee a lower tonne miles being moved as more refineries are being built nearer to the place of consumption," Norulhadi said.

On the dry bulk market, he said the Baltic Dry Index (BDI), which measures changes in the cost to transport raw materials, has shown a 12 per cent decline since mid-November 2009 mainly due to over stocking of iron ore and coal by China and India.

The index is, however, expected to rise after Chinese New Year, when the Chinese start restocking coal and iron ore.

"We expect the BDI will not be hovering very much off what we saw the last 15 months. Likewise for the tanker market, we don't expect any miracles," Norulhadi said.

Maritime Institute of Malaysia (Mima) research fellow Nazery Khalid, however, is more optimistic on both segments.

"Based on major economic indicators and patterns of new building orders, scrapping activities, freight rates, vessel prices, fleet deployment and port throughput, one can be bullish about the prospect of the dry bulk segment in 2010," Nazery said.

He said China almost single-handedly propelled the bulk segment's recovery from its slump of last year, and upticks in the economies of Europe and emerging economies in Asia have also contributed to the segment's rebound.

"As China accounts for a third for global demand for bulk shipping, its economic performance will be keenly watched by bulk shipping players.

"I am confident that China should be able to register a growth of around 9 per cent as forecast, provided there is no untoward events and developments that may put a spanner in the growth of its economy and the global economic recovery," Nazery said.

On the tanker segment, he said major economic indicators point to the dawn of a global economic recovery, which should support demand for oil and other tanker cargoes. This will be good news for tanker owners.

Source: Business Times

Friday, January 1, 2010

Port Klang Authority to reduce free storage period for FCL containers

Port Klang Authority (PKA) said it would implement the decision to reduce the free storage period for full container load containers from five days to three days effective today.

The decision was taken after several deferments since August 2007 following objections from industry players, PKA said in a statement.

However, Selangor Freight Forwarders and Logistics Association acting president Alvin Chua Seng Wah told a press conference in Kuala Lumpur yesterday that Port Klang would never be ready for the reduction of free storage period to three days without an effective monitoring system in place.

He said the association wondered how PKA would monitor during the three-month pilot run of the new system and determine the accountability of each party.

“The pilot run would be meaningless if it is not done in a holistic and objective manner.

“This seems like putting the cart before the horse and we are concerned that the monitoring system which PKA purportedly has may not be able to monitor effectively on the pilot run,” he said.

Chua said the freight forwarders and importers were the only parties in the entire delivery chain to deal with all the parties in the chain, from importers right up to the container hauliers.

“There must be guidelines in black and white that can access every part of the delivery process and ensure everyone is accountable to the key performance indicator (KPI),” he said.

“Any party who fails to fulfil the committed KPI and cause the cargo to be delivered beyond the 3-day free period must bear the consequential charges, not just us,” he said.

Chua added that 80% of the containers in Port Klang could be cleared within three days, but the remaining 20%, or 10,000 containers, could not be done within the short period.

It involved between RM1mil and RM2mil of extra cost every month, which would be passed down to the consumers eventually, he said.

Chua also said the players should also be given 30 days’ notice prior to the start of the pilot run, not two days before.

Bernama reported that PKA said it had taken into consideration some of the concerns raised by the port users and directed both terminals, Northport and Westports, to take several actions in order to facilitate the port users.

Among them are to calculate free storage period based on hours instead of days and to waive the storage charges if delays are caused by customs, other government agencies, or the terminal itself.

PKA has also directed terminals to maintain five-day free storage period for shipments from the ports in Asean countries.

This facility would be extended until Dec 31, 2010, by which time importers should make all necessary arrangements with their counterparts at the load ports to comply with the revised free storage period, it said.

In another development, Chua said the forwarding agents and importers would not accept demand by shipping lines or their agents for letter of indemnity (LOI).

He said the LOI initially only covered detention and demurrage charges, but had been extended to cover washing or cleaning, container repair, monitoring and electricity, loss and other related charges recently.

“It practically covers everything. Forwarding agents are not a direct contracting party with shipping lines; hence we should not be required to provide LOI.

“Also, there should be a standard format clearly spelling out the indemnity for storage, detention and demurrage charges,” he added.

Source: StarBiz