Top revenues not easing JV port woes

08:00 | 25/05/2018
While recording high revenue growth in the first quarter of 2018, seaport joint ventures between Vietnam’s state-owned shipping giant Vinalines and its foreign partners are facing tremendous hitches as they try to keep their progress sustainable.
top revenues not easing jv port woes
Top revenues not easing JV port woes, photo source: thanhnien.vn

According to Vinalines, total container throughput shipped via the Cai Mep International Terminal (CMIT) reached 4.62 million tonnes during the first quarter, up more than 7.5 per cent on-year.

Located in the Cai Mep-Thi Vai port complex of the southern province of Ba Ria-Vung Tau, the seaport – a joint venture between Vinalines and Denmark’s APM Terminals – reached revenue of VND206.86 billion ($9.19 million), up 13.7 per cent on-year.

“The rise was lower than expected. We witnessed growth of 15 per cent in the first two months, but lower growth in March, thus resulting in an overall rise of 7.5 per cent in the first quarter,” Nguyen Xuan Ky, CMIT deputy director, told VIR.

“The market is performing well, thanks to the rising volume of goods shipments to the EU and the US, and the trend of preferring to call at the Cai Mep-Thi Vai port complex among mainliners, signalling an upward trend,” Ky added.

As the seaport reaches its designed capacity of 1.2 million twenty-foot equivalent units (TEUs), CMIT aims to achieve the same throughput as it did, last year when it handled 1.33 million TEUs.

Big improvements were also witnessed at the Cai Lan International Container Terminal (CICT) located in the northern province of Quang Ninh. This joint venture has US-based Carrix – the parent company of SSA Marine – as Vinalines’ partner.

Unlike in previous years, when CICT had to handle goods in bulk to survive, the port reported a throughput of over 1.55 million tonnes in this year’s first three months, an on-year rise of 29.4 per cent.

What is more, CICT’s revenue ascended by 15.9 per cent on-year to reach VND69.61 billion ($3.09 million), equivalent to 25.45 per cent of 2017’s full-year figure and 39.5 per cent of 2016’s.

SP-PSA and SSIT, the other two seaports located in the Cai Mep-Thi Vai port complex, also showed a good track record between January and March.

SP-PSA, a joint venture between Vinalines and Singapore-based PSA, reported an on-year increase of 18 per cent in the handled volume of goods to over 560,175 tonnes in the first quarter, while the figure was 1.54 million tonnes for the whole of 2016.

The seaport fetched revenue of VND27.12 billion ($1.2 million), up 16.3 per cent on-year, while the all-year total was $3.07 million in 2016, when revenues were already rising at 33.47 per cent on-year.

Always ranking lower than other jointly-invested seaports, SSIT – a joint venture between Vinalines and SSA Marine – witnessed strong growth in revenue in the first quarter.

SSIT reached revenue of VND38.85 billion ($1.73 million), jumping 40 per cent on-year, while total goods volume was 972,000 tonnes, up 5 per cent on-year.

In spite of the improved performance, the seaports in the Cai Mep-Thi Vai port complex are struggling with delays in channel dredging since mid-2017, as they still await approval from the Ministry of Natural Resources and Environment for procedures related to mud fills.

The channel is filling up with sand rapidly, reaching up to -13.3 metres and, in some shallow places, even -12.6 metres, thus preventing mainliners from the EU from entering the area.

Several local seaports, namely CMIT, TCIT, SSIT, Baria Serece, SITV, and TCTT, as well as shipping lines like MOL and Maersk Lines, have lamented the delays in dredging as a major obstacle for their activities many times.

“Many mainliners had to cut back their shipments of cargo as the channel at the seaports is not deep enough. If the situation remains unchanged, shipping lines may leave Cai Mep and move to other seaports in the region. Goods will then be transhipped to Singapore, Malaysia, and other countries instead,” they said in a statement.

By Bich Thuy

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