Short Term: Regaining The Title
BMI forecasts that 2013 will be a strong year for the Port of Singapore, with the facility set to regain its title as the world's largest port in terms of container handling. Singapore had been the largest container port in the world for many years before ceding its crown to the Chinese Port of Shanghai in 2010. The Chinese port remained number one in 2011, and we estimate that these positions were maintained in 2012. In 2013, however, on the back of the projected slowdown in Chinese growth we project that Singapore will overtake Shanghai once again.
In 2012 we estimate that the Port of Singapore handled 31.76mn twenty-foot equivalent units (TEUs). This is based on January to September throughput of 23.76mn TEUs, and if realised would represent growth of 6.1% on the 29.94mn TEUs handled in 2011. In terms of total tonnage throughput we estimate that 2012 saw a slower rate of growth, of 0.8% from 530.49mn tonnes in 2011 to 534.73mn tonnes. Again, this is based on three-quarter throughput data, with Singapore handling a total of 403.82mn tonnes over the nine month period.
We do not believe that this growth in box throughput will have been enough to take Shanghai in 2012, where we estimate that 32.09mn tonnes were handled. However, in 2013 we forecast Singapore's throughput of 33.89mn TEUs to exceed Shanghai's 32.88mn TEUs. If realised this would represent growth of 6.7% by the Port of Singapore. In terms of total tonnage we forecast a stronger rate of growth in 2013 compared to its sluggish outlook for 2012; throughput is set to expand by 3.2% to hit 551.97mn tonnes.
Medium Term: Maintaining The Lead
Over the medium term (2013-2017) we forecast growth in box throughput at the Port of Singapore to average 5.4% per annum, which would see 41.27mn TEUs handled at the facility in 2017. In terms of total tonnage throughput we project a slightly more sedate average growth rate of 3.2% over the same period, rising to 626.72mn tonnes.
This growth in box handling would see the Port of Singapore maintain its regained lead over the Port of Shanhai. Indeed, with our forecast slowdown in economic growth in China, we believe that the gap between the two facilities will widen over the medium term, rising from 1.01mn TEUs in 2013 to 4.02mn TEUs in 2017.
Long Term: Working To Secure Strong Future
Over the long term we believe that the Port of Singapore will continue to face serious challenges for its top spot from the Port of Shanghai and other Chinese mainland facilities. However, we note that the facility is investing heavily in order to ensure that it remains relevant for many years to come. All of Singapore's container shipping terminals will be consolidated at Tuas in the long term, with the aim of opening the first berths there in around 10 years. Tuas was chosen because of its sheltered deep waters and proximity to major industrial areas and international shipping routes.
The port's city terminals at Tanjong Pagar, Keppel and Brani will be moved and merged at Tuas, with the leases for the current sites due to end in 2027. The terminal of Pasir Panjang will also be merged at Tuas; BMI notes that PSA International, the Singapore ports operator, continues to invest in this facility. It was at the launch for phases three and four of the terminal that the move to Tuas was announced. The expansion will comprise 15 new berths, an automated container yard and unmanned, rail-mounted gantry cranes. These cranes, along with those deployed at the berths, will operate on electricity.
BMI notes that the move to Tuas is a brave one, but underlines the commitment Singapore has to its shipping sector. It is a major source of economic wealth for the small state, which has throughout its history been a major trading post. Through coming up with a long-term strategy Singapore will hope to continue to compete. The new port complex will be like a blank slate for the country, leaving it free to put in state-of-the art infrastructure. By consolidating all terminals in one complex it will take away the current need that exists for road haulage to take transhipment volumes from one terminal to another, making it more efficient. The deep waters at the site, meanwhile, will mean that it can accommodate the largest container ships afloat. Further, the new port will nearly double the port's capacity from the current 35mn twenty-foot equivalent units (TEUs) per annum to 65mn TEUs. Last year the Port of Singapore handled 29.94mn TEUs.