Singapore shipping looks abroad for opportunities as good times ebb
SINGAPORE's container shipping industry has not been spared the downturn in the global industry, with CEO Martyn Wade of Singapore-based Grindrod Shipping describing this year as the worst in the company's history, according to Channel News Asia.
"It's been tough. This would rank as the worst year ever," Mr Wade told the Singapore television channel. "After 2015 ?it was the third worst year, after 2012, the fourth worst year, so it has been really, really tough.
"I think the market bottomed in the first quarter; I think that was rock bottom, and since then we've seen improvement in commodity demand."
Said Container Transport International Consultancy partner Andy Lane: "Growth is going to be very modest. We see certain trends already occurring in trms of manufacturing centres: China becoming less of an export factory and more of an internal market. And we still have to see how the implications of Brexit and the Donald Trump presidency will also pan out.
"It's difficult to tell, but I will not expect anything more than three per cent annual growth moving forward in terms of container shipping volumes," he said.
"It's going to be a tough year ?2017, 2018. So, if anybody owns a ship and your only strategy is treading water, my recommendation is that you need to be more proactive. Otherwise it will be a very tough period."
Some experts are optimistic China's One Belt One Road initiative will offer the industry a life line to ride out the downturn in world trade.
Said Mr Wade: "It's going to be very positive. The steel, cement ?they need. This is why we believe that China imports are still going up, like iron ore, producing steel, and they're exporting this. They've built the world's infrastructure."
Meanwhile, industry players in Singapore have started looking overseas for opportunities to tap. PSA International earlier announced plans to invest in China's rail container network through the acquisition of Hong Kong-based Luck Glory International Ltd, which owns a 15.33 per cent stake in China United International Rail Containers Co.
In Egypt, Pacific International Lines (PIL) has invested US$30 million in its first logistics facility in Cairo. The company is also looking to Africa for further expansion.