Page 77: of Maritime Reporter Magazine (October 1997)

MARKET REPORT Short Sea Container Survey: No Pain, No Gain

Intense Competition Expected To Mark The Burgeoning Market

Collectively, the world's short sea container markets represent one of the largest and most dynamic ele- ments of the global container ship- ping industry. They currently sup- port deepsea trades by providing the opportunity to feeder over 15 million teu to and from hub ports, as well as independently moving substantial volumes of intra- regional trade. According to

Drewry Shipping Consultants' new survey short sea container ship- ping is set for a period of sustained growth, but competition will remain fierce and sometimes destructive.

Dynamic Market Growth

Intra-regional links are becom- ing ever stronger, particularly due to the development of economic groupings such as ASEAN, EU,

Nafta and Mercosur. Current intra-regional trades are estimat- ed to total 16.5 million teu per annum, now representing more than one third of the world con- tainer trade.

In Asia in particular, the hierar- chy of economies is giving rise to massive intra-regional trade as manufacturing activity seeks out low wage cost countries, under- pinned by the rapid growth in Far

East economies and the awaken- ing of China.

At the same time, deepsea trades are set to expand further and this, combined with the ever increasing propensity for transshipment, will have a multiplying effect in terms of generating feeder traffic.

Following more than 15 years of double-digit average growth (see

Table), current global transship- ment activity is forecast to more than double by 2005, reaching a figure in excess of 70 million teu of port handling moves.

This development of global trans- shipment has implications for ports and shipping lines, as hubs become bigger and busier in an atmosphere of unprecedented development surrounding contain- er port facilities worldwide. For example, the development of new hub ports such as Aden and

Salalah in the Middle East will threaten the traditional hubs of the Arabian Gulf, while major com- panies such as P&O Ports and

Hutchison Whampoa are investing in such diverse places as India,

Thailand and the Caribbean.

The east coast of South America is another area where transship- ment and feeder activity is set to mushroom, once the costs of cargo handling in Brazilian ports decline to international levels.

Taking the port analysis further, the survey also provides an insid-

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G'timid Wyne

Yard Superintendent

October, 1997 87