That’s the upside view for 2017 from some global transportation analysts and insiders. But while others see the year ahead being only marginally better than the year gone by, investors – if not analysts – are betting on continued growth in transpacific container cargo handling through B.C. and Pacific Northwest ports.
However, that growth will depend on much going right in the world economy and in trade between Asia and North America.
According to HSBC Bank Canada’s annual Global Trade Forecast, the value of global goods exports is expected to expand 3% in 2017 and then 6% annually to 2030.
But that’s contingent upon governments refraining from “introducing new impediments to trade.” And that, in the new Donald Trump trade era, is a long shot at best.
In its Container Traffic Forecast Study 2016 released last August, Ocean Shipping Consultants (OSC) projected annual container cargo growth of 4.8% for North America’s Pacific Gateway region to 2025.
The Port of Vancouver (PoV), according to the report, took a 37.8% share of the Pacific Northwest’s 8.07 million TEU (20-foot container) total in 2015. That share is up from 31.5% in 2011. The OSC report noted that PoV and the Port of Prince Rupert enjoy numerous marketplace advantages, including good terminal productivity and relatively low intermodal and rail costs.
But, it added, “there is already a pressing need for container terminal investment if further potential demand is not to be missed.”
The OSC study also conceded that the “Chinese economy is considerably more uncertain than was noted in earlier forecasts.”
The Port of Vancouver, it said, remains a highly competitive option for import and export container cargo and projected that its terminals would be handling more than 4.8 million TEUs annually by 2025 compared with the three million handled in 2015.
Meanwhile, Prince Rupert, one of North America’s fastest-growing container ports, has increased its share of Pacific Northwest cargo to around 10% since it started handling containers in 2007.
The B.C. container ports’ strength was underscored in late 2016 when Maersk Line, the world’s largest container shipping carrier, added new transpacific services to Prince Rupert and Vancouver to meet growing customer demand and what Maersk Canada president Jack Mahoney told Business in Vancouver are their cost-competitive options for reaching Canadian and American markets. Much of that competitive edge, he said, is driven by efficient port operations and Canadian rail service.
While Mahoney said Maersk’s expectations are for year-on-year growth in its container business, it will be “moderate” growth. “We don’t have the expectation that it will be something dramatic.”
In its 2016 third-quarter financial filing, Maersk Group (CO:MAERSK-B) cited “challenging market conditions” among reasons for Maersk Line’s third-quarter loss of US$116 million compared with a profit of US$264 million in 2015’s third quarter.
But Mahoney pointed to 2016’s relatively strong finish as reason for 2017 optimism.
Rest at https://www.biv.com/article/2017/1/outlook-2017-dark-days-could-be-done-ocean-carrier/
