Qingdao Confident of Double-Digit Growth

Qingdao port, the world’s seventh-busiest by cargo volume in 2011, expects to see its cargo volume increase in double digits this year, reported China Daily.

Despite the effects of the sluggish world economic recovery and China’s economic slowdown on the global shipping industry, the port handled 372 million metric tonnes of cargo in 2011. Its goal for this year is more than 400 million tonnes of cargo and 14.5 million TEUs.

The company attributed the port’s performance to its “high efficiency” in handling cargoes, which saved the shipping companies’ time and made it a stronger competitor against other ports.

By September 24, total throughput at the port had exceeded 300 million tonnes, reaching that number 26 days earlier than in the previous year.

“We are very confident about achieving this year’s goal,” Chang Dechuan, chairman of Qingdao Port (Group) Co, said.

The world shipping industry has been struggling with difficult market conditions since the latter half of 2011, due to the ongoing eurozone debt troubles and cooling economic expansion in China, which has put downward pressure on global demand for Chinese exports, as well as China’s appetite for bulk commodities such as coal and crude oil.

Trade experts and industry analysts said that the declining market is likely to persist for the next few years and no substantial recovery in either external or domestic demand is expected within the next two or three years.

“Chinese ports are generally suffering from overcapacity,” Chang said.

“The current economic slowdown will intensify competition between ports and may also lead to industry consolidation.”

Given the current declining shipping market, Chang said Qingdao port would lower its charges to help shipping liners weather this difficult period.

“Ports and shipping companies should brace themselves and help each other in the face of uncertainties in the global and domestic economies,” he added.

But Qingdao, unlike other ports, faces the problem of having relatively little capacity. With 1.3 percent of China’s port shoreline, it handled 6.9 percent of the country’s total cargo transported by sea in 2010.

To expand its capacity, Qingdao port plans to invest US$4.76 billion by 2015 in the 400,000-tonne Dongjiakou ore terminal, which is expected to become operational later this year. In addition, the port also intends to build a 300,000-tonne oil terminal and a coal terminal whose capacity “is still under discussion”, Chang said.

Chinese ports, the world’s busiest, handled a total cargo volume of 792 million tonnes in August, up two percent year-on-year – the smallest increase since the beginning of this year, according to the Ministry of Transport.

In the meantime, Chinese ports’ container throughput reached 15.11 million TEUs in August, up 3.9 percent year-on-year, according to official data.

Source: Cargo News Asia