The Thai unit of Denmark’s Maersk Line, the world’s largest container shipper, has downgraded its business performance outlook this year, citing impacts from the Japanese disaster and lingering economic uncertainties in the US and Europe.
Bangkok’s Klong Toey port has been busy lately, mainly because of congestion caused by the months-long shutdown of two wharves for maintenance. Maersk Line (Thailand) had a good first quarter but sees activity slowing over the rest of the year.
The updated outlook for 2011 is based on the performance seen in the first four months after the company reported a big turnaround last year, said Thomas Lindy Sorensen, the managing director of Maersk Line (Thailand).
“The performance was very good in the first quarter, but now the supply and demand [for containers] are not in the same situation because of what’s happening in North America and Europe,” he said.
While the market outlook does not seem healthy, new ships continue to arrive in the market each year, he said.
Japan’s devastating March 11 earthquake and tsunami and subsequent nuclear crisis affected imports of components into Thailand for final assembly and re-export. Automobile manufacturers in Thailand sharply cut back their production in April and May due to parts shortages.
Automotive products are among four key sectors handled by Maersk in Thailand along with electronics, commodities and petrochemicals, he said.
While Maersk (Thailand) posted 10% growth in shipment volume in line with the overall industry, the company now projects a 7% rise in exports and 10% increase in imports this year, said Mr Sorensen.
In 2010, the shipping line handled 270,000 20-foot equivalent units (TEUs) of outbound shipments and 100,000 TEUs of inbound shipments.
“In terms of volume it will certainly grow, but revenue may be the same as last year,” said Mr Sorensen.
Globally, Maersk Line expects its financial results will be lower than last year’s. The Danish group forecasts global demand for seaborne containers to grow by 6-8% this year, as freight rates remain under pressure in the short term but with a stronger market in the second half.
Early this year, the company signed a contract with South Korea’s Daewoo Shipbuilding unit to build 10 of the world’s largest new ships with an option for another 20 for delivery from 2013-15.
Mr Sorensen also called on the new government to expand the rail and road networks approaching Laem Chabang deep-sea port and add locomotives to improve the efficiency of the Lat Krabang inland container depot.