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Over building China container ports risks over-capacity
POSTED: 8:36 a.m. EDT, June 8,2007
Concerns were raised at the recent 2007 China International Ports Summit in Shanghai that the splurge of building up the country's container ports risks over-capacity, Xinhua reports.
But the Ministry of Communications maintains that supply and demand for the services provided by the country's coastal ports will balance out by the end of the decade.
Industry experts warned that ports face a situation of over-capacity ahead of "expectations" especially in Guangdong province and the Bohai Rim. An expert from Fujian's Luoyuanwan port even said that over-capacity was just around the corner.
Separately, major terminal operator Cosco Pacific has announced that it was pulling away from containers, fearing the market had become vulnerable to a downturn, and was instead, investing more in diversified port facilities, including bulk and ro/ro.
Qian Yongchang, the president of China Communications and Transportation Association, was more positive, pointing out that China lacked large specialised terminals and deep-water channels, whereby port capacity could not meet the actual demand for sea freight given the rapid pace of economic development.
To address concerns about the imbalance of supply and demand, the CEO of shippingchina.com, Kang Shuchun, called on small regional ports not to blindly follow in the footsteps of the thriving international hub ports. He said that ports such as Shanghai and Tianjin have had to invest great sums in infrastructure development projects to raise capacity to meet growing demand.
Li Gang, vice president of Shanghai Shipping Exchange, said the larger ports should join to develop facilities while smaller ports should refrain from assuming that by expanding their capacity they will attract greater volumes of cargo. Mr Li said that there will be a limit as to how much small ports can raise their throughput volumes based largely on their geographic location. |
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