Short Term: Tonnes Down, But Box Growth Still In Double Digits
The Port of Gdansk, Poland's largest port, has recorded a stronger Q212 leading to a less-steep decline in the facility's total tonnage throughput and more robust growth in its container throughput. BMI is holding with its total tonnage forecast of a 10% y-o-y decline in the port's total throughput, but has slightly revised up its outlook for the facilities container throughput for the whole of 2012.
BMI 's upward revision of its container throughput for the port of Gdansk, with a growth y-o-y growth of 20% rather than 19.3% projected, comes on the back of the port's strong performance in Q212. The facility is now forecast to handle 822,722 20-feet equivalent units (TEUs) in 2012. Box volumes through the port increased by 43% y-o-y in the second quarter of the year, up from their 18% increase in Q112. For the first half of the year the port's container volumes have grown by 31%.
This increase has been achieved despite Gdansk failing to acquire the G6 Alliance as a client. The port of Gdansk was due to be added as a port of call on the G6 Alliance's Loop Three in H112 and would have been the port's second direct link to Asia (Gdansk is a port of call on Maersk Line 's AE10 service). However the 'unforeseen circumstances of securing a berthing window' led G6 Alliance members ( Hapag-Lloyd , NYK , CL , APL , HMM and MOL ) to revise their Loop Three service, which operates vessels of over 8,000TEUs. The route calls at Sweden's Port of Gothenburg, rather than Gdansk.
The Port of Gdansk's total tonnage throughput also witnessed a stronger Q212, with volumes declining by just 12% in the second quarter compared to their decline of 34% in Q112. In the first half of the year the port's total tonnage decreased by 24% to 10.5mn tonnes.
The weakening in the port's throughput decline has led BMI to hold with its full-year forecast of a 10% decline, which would see the port's throughput drop for a second consecutive year, with 22.8mn tonnes forecast to be handled at the port for the full year of 2012.
The disparity between total tonnage throughput and that of container volumes is because container traffic is more reliant on imports and total tonnage is connected to exports. We therefore believe that from a macro viewpoint, box throughput will benefit from the Polish economy's continued (although slowing) growth, with BMI forecasting real GDP to increase by 2.5% in 2012.
The Port of Gdansk's total tonnage throughput will, however, be more exposed to the country's export sector, which we believe will be buffeted by the crisis in the eurozone. Poland's top four export nations of Germany, France, Italy and the UK will all be hit by declining demand on the back of austerity packages.
Medium Term: Positive Growth Outlook To Boost Demand
Poland's macroeconomic growth outlook and the gradual recovery of the eurozone offer a climate of throughput growth at the port of Gdansk and further expansion and investment at the port offers upside risk to our projections.
After a projected slowing in real GDP in 2012 the country's economic growth is set to pick up from 2013 onwards. Over the medium term (2012-2016) we forecast that Poland's real GDP will expand by an annual average of 3.4%.
In terms of tonnage growth over this period BMI forecasts total throughput to increase by 10.7% to reach 25.2mn tonnes in 2016. This forecast growth will, however, not be enough for the port to be able to recapture its milestone throughput level of 27.2mn tonnes which it posted in 2010.
There is some hope from upside risk on this front, however, on the back of news that an agreement has been signed for the construction of a new liquid bulk terminal and storage facility at the port. The storage and handling terminal will be built in Port PÃ³łnocny, Gdansk, in the proximity of Naftoport , which has jetty capacity for discharging and loading of tankers of up to 300,000 deadweight tonnes (DWT). Port PÃ³łnocny has a draught of 18 metres (m).
Container throughput, while slowing over the medium term is forecast to remain in double digits, with a forecast average increase of 13.8% per annum over the 2012-2016 period, with the facility projected reach the 1mn TEU throughput milestone in 2014 and be handling levels of approximately 1.3mn TEU in 2016.
In order to cater for this increase in growth Gdansk is investing in its container facility. The facility is taking on more cranes and equipment in order to raise its annual capacity to 1mn TEUs. The major question is whether the port will be able to attract carriers other than just Maersk Line. As highlighted, the G6 Alliance was interested in pulling in, but withdrew due to the lack of a berthing window, an issue that must be addressed if the facility is to diversify its client base and ensure its position in the global box shipping sector.
Long Term: Long-Term Vote Of Confidence From Maersk
The development of the Port of Gdansk will be tied to Poland's demand outlook. However, the port has received the long-term backing of Maersk Line, with the company developing the port's role away from that of a feeder facility to becoming a direct call. This vote of confidence bodes well for the port in the long term, as it develops to not only cater for projected increases in domestic demand, but also as a maritime gateway for goods to Eastern Europe. The facility has already proven it is ready to handle the next generation of box ships, catering for its first 15,500TEU vessel in 2011. It is therefore well positioned to play a major role in European container shipping, as it keeps pace with the industry trend of utilising bigger vessels.