Damco Connect Bangkok with Cambodia and Vietnam

Damco, the logistics division of Denmark-based shipping group AP Moller Maersk, has expanded its operations in Thailand by starting operations at a new export freight hub in Bangkok and by launching a cross-border trucking service linking Thailand, Cambodia and Vietnam. The freight hub is connected to the main Thai Port of Laem Chabang through a daily container barge service and offers a variety of services including barging, warehousing, import and export handling, customs clearance, and other valueadded services. The barge service will enable shippers to bypass Lad Kra Bang Terminal’s Inland Container Depot in Bangkok.

The cross-border trucking service, as Damco believes, will allow it to capture a share of growing trilateral trade volumes between the three countries by providing a faster and more cost-efficient alternative to existing sea and air freight. The move supports BMI’s view that the increased trade integration in South East Asia will create opportunities for freight transport operators in the region.

Damco is attracted to the growing market which is recovering after 2009 downturn. Affected by the global recession, Thailand’s total trade plummeted by an estimated 16.07% in real terms in 2009, and we see a good 10.5% rebound in 2010, followed by 7.5% growth in 2011. In 2010 imports will grow more strongly than exports in real terms (13.0% vs. 8.5%). Improvements in total trade will have a knock on effect on Thai freight volumes.

BMI Freight Transport desk’s forecast for Thailand’s air freight goes in line with the Internationl Air Transport Association (IATA)’s forecasted year-on-year (y-o-y) growth of 16.2% of Asia Pacific region’s combined airline passenger and cargo traffic in 2010. We see Thailand’s air freight volume recovering by 7.15% y-o-y in 2010 to 1.25mn tonnes, after an estimated contraction of 10.75% in 2009.

We expect cargo handled at two of Thailand’s key ports, the Port of Laem Chabang (PLC) and Port of Bangkok (POB), to grow at a moderate to good rate in 2010. In general tonnage terms, PLC will be out in front, with 11.5% growth to 51.47mn tonnes, following a good 2009 performance when the port was largely able to sidestep the effects of the international recession (volumes grew an estimated 4.1% to 46.15mn tonnes in 2009). 2010 total volume at Port of Bangkok will gain a more subdued 6.6% to 16.6mn tonnes; 2009 volumes there dropped by 12.4% to 15.57mn tonnes.

For the rail freight sector we expect the volumes to recover 11.03% to 15.79mn tonnes in 2010, after falling an estimated 15.67% in 2009. The pace should slow down in 2011 with a growth of 7.68%.


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