Thailand Shipping Report Q4 2012
Business Monitor International, October 2012, Pages: 152
The Thailand Shipping Report provides industry professionals and strategists, corporate analysts, shipping associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Thailand's shipping industry.
BMI View:
Floods and World Economy Weigh on Forecasts
We continue to predict 4.0% GDP growth this year in Thailand, as the recovery from last year's floods is held back by a sluggish world economy and worries about political risk at home. In 2013 we believe growth will gather pace moderately to reach 4.4%. While remaining depressed relative to last year, we are a bit more optimistic about foreign trade – we now expect the real value of foreign trade to grow by 10.7% in 2012 down from 11.6% in 2011. So despite the difficulties, the wider economy will provide a reasonable level of support for the ports and shipping sector.
As for industry-specific factors, the worst fears about the impact of last year's floods now seem to be receding. While there is a new awareness of flood risk, there is little sign that multinational companies active in the Thai manufacturing sector have decided to relocate their activities to other countries less exposed to flooding or other natural hazards. Automobile exports from Thailand have recovered at a healthy pace.
Headline Industry Data:
- Gross tonnage at Laem Chabang, the country's largest port, set to rise by 6.8% to 57.23mn tonnes in 2012 (faster than the forecast 4.2% GDP growth for this year).
- Box handling at the same port to rise 8.7% to 6.231mn twenty-foot equivalent units (TEUs).
- At the Port of Bangkok BMI projects that tonnage growth will reach 8.0% in 2012 (up from 2.4% in 2011) to 18.191mn tonnes, with container handling set to grow 7.9% to 1.408mn TEUs.
- We expect the real value of foreign trade to grow 10.7% in 2012, with imports up by 12.4% and exports a little slower at at 9.0%.
Key Industry Trends:
Thoresen Thai Still Buying Boats Thoresen Thai Shipping is still buying new ships, despite continuing overcapacity in the dry bulk sector.
While BMI believes that fuel-efficient fleets will give an advantage to shipping companies when the dry bulk sector turns around, we reiterate our stance that a full recovery is not in immediate sight, and therefore question whether the strategy will work as planned. In the first quarter of 2012 the company made a net loss of THB560mn (US$17.7mn), in comparison to a net profit of THB329mn in Q111. The firm's income fell year-on-year (y-o-y) in Q212, recording a net loss of THB205mn from a loss of THB119mn over the same period in 2011. Thoresen's revenues have also declined considerably, falling 42% from THB9.27bn in 2010 to THB5.43bn in 2011.
Daiwei Mega-Project Moving Ahead Slowly After twice-delayed summit talks, both the governments of Thailand and Myanmar have reiterated their commitment to the Dawei deep-sea port project. The multi-billion dollar port project (current estimates put the total development cost at around US$8.6bn) is to be built on Myanmar's southern Andaman coast;
Thailand has a strong interest in the project that will give it an outlet to the Indian Ocean. Separately, it has been reported that India has granted a US$500mn loan to Myanmar, part of which would be used to fund the construction of a 3,200km trilateral highway linking India, Myanmar, and Thailand. The route,
which is expected to be completed in 2016, would run from India's north-eastern states into Myanmar,
where over 1,600km of roads would be built or improved.
Russia Sniffing Out Gas Opportunities Gazprom, Russia's state-owned gas company, hopes to target Thailand and other fast-growing energy markets in Asia with its liquefied natural gas (LNG) exports. Gazprom chief executive Alexei Miller was quoted saying that 'in the near future Gazprom will become a major player on the LNG market', adding that demand was growing in a number of key markets. Miller said his company would be building a new LNG plant in the Russian Pacific Port of Vladivostok by 2017, designed to serve Asian markets.
Key Risks to Outlook:
We believe domestic political risk to our shipping forecast is rising. While the government has called a two-month pause on its controversial plans for constitutional reform, they continue to weigh down on the business environment. The fear is that moves to allow a political comeback by the Prime Minister's brother, Thaksin Shinawatra, will re-ignite conflict between the 'red Shirts' (supporters of the ruling Puea Thai Party, PTP) and the 'yellow Shirts' (the largely urban opposition).
The second downside risk to our Thailand ports and shipping forecast continues to come from the uncertain global economy. Thailand remains exposed to the possibility of a sharper-than-expected slowdown in China, an increasingly important trade partner. We believe that an external blow to Thailand's economy could still tip the country into a recession.
BMI Industry View 5
SWOT Analysis 7
Thailand Shipping SWOT 7
Thailand Political SWOT 8
Thailand Economic SWOT 9
Thailand Business Environment SWOT 10
Global Overview – Container Shipping 11
More Positive Box Outlook In H212 11
Box Supply Demand Imbalance Worsens 12
Concerted Rate Push Must Continue 21
Bunker Price Still A Worry 24
2013: A Year Of Mega Realisation 25
Containerisation Revolution Hits Dry Bulk 32
Global Overview – Dry Bulk Shipping 35
Stockpiling: A Threat To Dry Bulk Shipping 35
Overcapacity A Long Term Problem 38
Bankruptcies To Continue 41
Vale's Forced Diversification Hedges Against China Slowdown 45
Protectionism Trend Takes Off 50
Global Overview – Liquid Bulk Shipping 55
Executive Summary: Unconventional Sectors To Outshine Traditional Crude 55
Dirty Tanker Index To Remain Depressed 56
Bunker Prices Down, But So Are Rates 61
Table: BMI's Bunker Fuel Forecasts, 2010-2016 ($/Bbl) 61
Iran Sanctions Continue To Affect Crude Shipping 64
Saudi Arabian Merger Bad News For Other Operators 66
Table: Biggest Operators Of VLCCs & ULCCs 67
Bullish On Golar LNG Prospects 68
Tight Market Creates Boom Times For Rig Sector 72
Industry Trends And Developments 76
Thailand Container Shipping Market Overview 79
Industry Forecast 84
The Port Of Laem Chabang 84
The Port Of Bangkok 87
Table: Major Port Data, 2009-2017 89
Table: Trade Overview, 2009-2017 90
Table: Key Trade Indicators, 2009-2017 90
Table: Main Import Partners, 2002-2009 91
Table: Main Export Partner, 2002-2009 92
Company Profiles 93
Thailand Shipping Report Q4 2012
© Business Monitor International Ltd
Page 4
Precious Shipping PCL (PSL) 93
Regional Container Lines (RCL) 95
Maersk Line 98
Mediterranean Shipping Company (MSC) 04
CMA CGM 08
COSCO Container Lines Company Limited (COSCON) 15
Hapag-Lloyd 19
Evergreen Line 24
APL 28
China Shipping Container Line (CSCL) 33
Hanjin Shipping (Container Operations) 39
Mitsui OSK Lines (MOL) (Container) 43
Country Snapshot 148
Table: Thailand's Population By Age Group, 1990-2020 ('000) 49
Table: Thailand's Population By Age Group, 1990-2020 (% of total) 50
Table: Thailand's Key Population Ratios, 1990-2020 51
Table: Thailand's Rural And Urban Population, 1990-2020 51
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