Shipping, trade and ports market analysis - Port development … · 2018-03-21 · 130104_Conference_Manila v6.pptx 1 Manila, January 30, 2013 Presentation Port development outlook

1130104_Conference_Manila v6.pptx

Manila, January 30, 2013

Presentation

Port development outlook in the Singapore basin

The 7th PHILIPPINE Ports and Shipping Conference 2013

2130104_Conference_Manila v6.pptx© Roland Berger Strategy Consultants

Contents Page

A. Current situation 3

B. Planned developments 8

C. Traffic outlook 15

D. Singapore basin by 2025 23


A. Current situation


Asia already contributes the most to the global maritime trade, recording steady growth in its market share

9%

Africa

Oceania

19%Europe

11%

America

21%

Asia40%

5%

Africa

1%

Oceania

23%Europe

16%

America

55% Asia

EXPORTS

Share of world maritime trade [%]

+18%

7,034

2010

3,191

3,844

5,980

2006

3,073

2,907

Total maritime trade by region [USD Bn]

ASIA

825686

+14%

2010

1,955

1,130

2006

1,716

1,031

AMERICA

1,607

2010

1,105

-1%

3,123

1,516

2006

3,168

2,063

EUROPE

IMPORTS

Exports Imports

Sources: Review of Maritime Transport 2011, UNCTAD, Roland Berger

CURRENT SITUATIONA


The Singapore basin is an important hub for cargo flows given its strategic location and the strong growth in South East Asia

A CURRENT SITUATION

Singapore

Hormuz

Melaka

Sunda

Lombok Torres

Korea

Tsugaru

South China Sea

PTP

Port Klang

Laem Chabang

Tg Priok

Bintulu

Kota Kinabalu

Colombo

Major ports

Main shipping lanes

Mumbai

Kaohsiung

Ho Chi M inh City

Shenzhen

Shanghai

Hong Kong

Ningbo

Tianjin

Surabaya

Busan

Palembang

Belawan

Yokohama

Tokyo

Ujung Pandang

Cargo flow – East Asia> Situated along main East-

West trade route

> Natural mid-point between 2 key growth markets – India & China

> Strong inter and intra-regional trade flows in ASEAN

> Crossroads for Middle East – America west coast

Sources: UNCTAD, Roland Berger

30% of world trade travels through the Straits of Malacca

India and China experienced 25% annual import growth over the last 5 years

10.2% average annual intra-ASEAN growth


Singapore leads in trade volume, followed by Malaysia and Indonesia

Total merchandise trade

20111) [USD bn]Trade dependency index

20112) [%]GDP 2011

[USD per person]

152

219

434

479

516

Philippines

Vietnam

Indonesia

Malaysia

Thailand

Singapore 1,017

India 1,060

China 3,971

Japan 0.29

India 0.45

Indonesia 0.45

China 0.50

Philippines 0.53

Germany 0.76

Cambodia 1.26

Thailand 1.32

Malaysia 1.49

Vietnam 1.66

Singapore 2.98

Vietnam 1,382

India 1,457

Philippines 2,370

Indonesia 3,492

China 5,046

Thailand 5,343

Malaysia 9,659

Singapore 48,588

Comparison of trade indicators for selected countries

1) Total export and import volumes, but not inclusive of export/import of services2) Calculated as Total merchandise trade/GDP in current prices

A

Total merchandise trade

20111) [USD per person]

854

Thailand 7,427

Malaysia 16,599

Singapore 196,171

Vietnam

India

Philippines 1,598

Indonesia 1,790

China

2,491

2,955

Sources: WTO, IMF, World Bank

CURRENT SITUATION


Major ports in the Singapore basin - summary

Source: Port authoriiy and operator websites, Ministry of Transport, UNCTAD, Portsworld

Within the basin, Malaysia and Singapore have a developed port sector; Indonesia still lags behind

A

Note: Tanjung Bin, Pengerang and Tanjung Agas ports are still under development; figures, if any, are forecasts

Pengerang (RAPID, Vopak/Dialog Terminal))

Tanjung Langsat Port

Johor Port

Port Telaga PunggurPort of Batam/Waterfront City

Tanjung Bin

Pulau Sebarok

Kg. Teluk Ramunia

Keppel Terminal

Tanjong Pagar Terminal

Brani Terminal

Port of TanjungPelepas

Jurong PortPasir Panjang

Asia Petroleum Hub (APH)

Pulau BusingPulau Bukom

Kabbil Port

Tanjung Uban

CURRENT SITUATION

Tanjung Piai(Maritime Industrial

Park)

Tuas container port

Planned

Existing


B. Planned developments


Singapore aims to consolidate all of its container shipping terminals in Tuas in the long term, almost doubling port capacity per annum

NEW CONSOLIDATED CONTAINER PORT IN TUAS, SINGAPORE

Current status:> In operation: terminals at Tanjong Pagar, Keppel, Brani; leases expiring in 2027> Pasir Panjang is also a terminal in operation, currently undergoing expansion> Current combined capacity is 35 mn TEUs

Future development

> Known expansion plans in Tuas will comprise 15 new berths, with nearly 6000 meters of quay length and a draft of 18 meters

> Expansion plans also include an automated container yard and unmanned, rail-mounted gantry cranes

> In the long term, capacity will nearly double to 65 mn TEUs to meet future growth of global trade and long term needs of customers

> Efficiency improvement by minimizing current need for road haulage between terminals for transhipment volumes

> Target completion date is 2020

Source: Business Monitor International, Roland Berger analysis

B PLANNED DEVELOPMENTS

Tuas container terminal


Malaysia's new development, Pengerang is being planned to be one of the largest oil and gas hubs in the region and the world

PENGERANG PETROCHEMICAL COMPLEX

Current status

> Malaysia's Economic Transformation Programme (ETP) – EPP 4: Building a regional oil storage and trading hub

> Water depth of up to 26m> JV between Johor State Government, Dialog Group & Vopak Asia to develop an

independent deepwater petroleum terminal and storage hub - Construction began in late 2011

> 20-year project with initial storage capacity of 1.3 million m3 by 2014> Construction on-going

Future development

> Planned construction of USD $20 billion integrated petroleum hub by Petronas -Refinery And Petrochemical Integrated Development (RAPID)

> RAPID will feature a crude oil refinery with refining capabilities of 30,000 barrels per day, a naphtha cracker and around 45 petrochemical plants

> Further plans: LNG terminal, 3 other refineries and petrochemicals complexes, downstream industries and new townships in infrastructure

Sources: ETP, Factiva, press releases, Roland Berger

PLANNED DEVELOPMENTSB


Tanjung Bin is a new liquid bulk port under development; Total capacity can grow to 10-15 million tons of oil products

PORT OF TANJUNG BIN

Current status

> Seaport Worldwide Sdn Bhd is the master developer of the Tanjung Bin Petrochemical & Maritime Hub

> Spans about 2,255 acres of land and 4.5 km of shoreline/ waterfront land> Designated for oil & petrochemical players to set up operation base for activities inc.

processing & blending, tankage & terminaling, trading and logistics of liquid bulk products

> Newly-built ATT Tanjung Bin (ATB) oil terminal has started operations in April 2012> ATB is owned and operated by VTTI, a 50:50 joint venture between Vitol and MISC

Bhd

Future development

> Currently, it is in the 2nd phase of its development master-plan, developing 20 hectares of land to create an additional 820,000 cubic meters of storage

Sources: SWW website, Factiva, press releases, Roland Berger


Tanjung Bin


Aggressive expansion plans for fast-growing container port PTP –aims to capture higher transshipment share from Singapore

Current status:

> In operations since: 1999; owned and operated by MMC> Pure container port across from Singapore> Fast-growing port that handles mostly transhipment > Throughput around 8.5 mn TEUs in 2012> With Johor Port - achieved a 44% market share in Malaysia's container business

(2011 data)

Future development

> Undergoing expansion to increase current capacity from 8.5 mn to 10 mn TEUs in 2012 or 2013 to enhance its yard management and upgrade the capacity of its first generation quay cranes

> Next phase of development consists of 8 more berths, raising its capacity to over 18 mn TEUs and would require dredging and land reclamation

> Long term masterplan envisages a capacity of 150 million TEUs

Sources: PTP website, MMC Annual Report, Factiva, press releases, Roland Berger

PORT OF TANJUNG PELEPAS (PTP)



Though "mature", Johor Port continues to improve and expand its capacity – in all cargo types, except containers

JOHOR PORT

Current status

> Operating since: 1977; Owned/operated by MMC > Part of logistic triangle to serve Iskandar Malaysia (with PTP and Senai Airport)> In 8,000 acre Pasir Gudang Industrial Estate (petrochemicals, engineering, furniture,

electronics and telecommunications)> One of the largest Palm Oil Hub in the world> No. 6 out of 35 in the World for LME Cargoes> Considered a "matured" port and already operating at full capacity> With PTP holds a 44% market share in Malaysia's container business (2011 data)

Future development

> Ongoing five-year business and port expansion plan, which will involve redevelopment and restructuring of port infrastructure such as building four new additional berths dedicated for the handling of liquid cargo and major upgrades to the port’s equipment and facilities

> Under the five-year modernization plan will be carried out in phases

Sources: Johor Port website, MMC Annual Report, Factiva, press releases, Roland Berger



Construction of a deepwater port near Batam, Indonesia-fuelling throughput growth opportunities

DEEPWATER CONTAINER PORT OF TANJUNG SAUH

Current status:> Currently under construction and to be completed in 2015> Initial investment of USD 792 m> Major transhipment port on an island between Batam and Bintan, Tanjung Sauh> Part of Indonesia's overhaul of its transport infrastructure to cope with growing

domestic demand> Initial 2 km of wharves to reach expected capacity of 4 mn TEUs in 2015> Almost no dredging or reclamation required

Future development

> Room for further expansion as it is across the island from the existing port at BatuAmpar

> Port targets East Asian traffic and growing domestic demand from Batam as it has been declared a special economic zone

Sources: Indonesia Port Corporation, press releases, Roland Berger



C. Traffic outlook


Liquid bulk is the largest cargo type in global maritime trade and will experience continued growth due to demand from Asia

B TRAFFIC OUTLOOK

World maritime trade by cargo type [m MT]

Source: UNCTAD

> Liquid Bulk

– Strong growth due to demand for LNG from Asia (67% of imports in 2011)

– Projected growth due to demand from Indonesia and Malaysia

> Dry Bulk

– Steady share

– Growth in major bulks linked to growing infrastructure development needs for emerging developing countries

> Container

– Growth in demand for not only raw materials and commodities in China but also high value goods

– Growth in demand for containerization of unconventional commodities

> Other cargo

– Slowed growth due to weakening world economy

– Slowdown in steel production activity, an important source of demand for other cargo types

OUTLOOK

8.0%

1.2%

5.8%

2.9%36% 34% 33% 32% 33%

32% 26% 24% 24% 24%

10% 14% 15% 16% 16%

2012201120102000 2009

27%28%22% 27% 28%

Liquid bulkDry bulkOther cargoContainer

CAGR09-12 [%]

5,984 7,858 8,409 8,748 9,297


By 2025, maritime activity in the Singapore basin will be 2-3 times the size of today

B

> Most populous region

> Largest economic zone

> Biggest consumption zone

> Majority of world's middle class

Global trade shifts to the East…

…creating a multi-polar global economy

ASEAN – SOUTH ASIA MARITIME TRADE

Strong trade growth - ASEAN will seek to minimize China's geo-political influence

ASEAN – CHINA MARITIME TRADE

> Strong China EXIM growth in general – transhipment in Singapore basin

> Growth in trade between ASEAN and China

Source: European Commission's "The World in 2025", ADB, Australian Government, press releases, Roland Berger

INTRA -ASEAN MARITIME TRADE

> AFTA, ASEAN Economic Community

> Rapid economic growth of Indonesia and Indochina

> Decreasing tariff rates between member nations

TRAFFIC OUTLOOK


On balance, we see 4 main drivers that will shape maritime trade in the Singapore basin in the coming decade

1

2

3

4

Growth in intra-ASEAN trade

Overall trade growth in ASEAN

38% growth in 2010

USD 100 billion by 2015

Increasing trade between India and China

Cargo demand to shift to liquids due to consumption demand from China

USD 5 trillion by 2025

China – 38% of growth in

global demand

In 2010 alone, intra-ASEAN trade grew by 38% (USD 376 Bn to 520 Bn); full tariff reduction in 2015 (AFTA) to 0.05% from 3.64% in 2000 will further spur intra-ASEAN trade

Bilateral trade between India and China is expected to hit the USD 100 billion mark by 2015, most of which will pass through the Straits of Malacca and the Singapore basin

Trade in ASEAN has rebounded from the global economic recession with an annual growth rate of 25% between 2009 and 2011. The robust projected 5-6% GDP growth of the region for the next 5 years and the implementation of the ASEAN Economic Community in 2015 will undoubtedly further support growth in ASEAN's trade

Liquid demand growth is predicted to shift from OECD countries to Asia until 2030. China alone will contribute to 38% of the growth in global oil demand → it is expected to consume 17.5 Mb / day by 2030, overtaking the US to become the world's largest oil consumer

Sources: BP Energy Outlook 2030, OECD, ADB other publicly available sources, Roland Berger analysis

B

Main (selected) drivers

TRAFFIC OUTLOOK


Growth in intra-ASEAN trade will benefit the Singapore basin

GROWTH IN INTRA-ASEAN TRADE1

Intra-ASEAN

Rest of the world

10.2%

8.4%

Trade annual growth rates 1995-2011

1995 2011

Intra-ASEAN

Rest of the world

20

80

25

75

2025e

30

70

ASEAN share of trade (%)

Sources: WTO Statistics Database, publicly available sources, Roland Berger analysis

616 2,394 5,067Total trade value [USD Bn]

> Modest growth projections predict that the share of intra-ASEAN trade will easily touch 30% by 2025

5,067


We expect the increase in India-China bilateral trade to spur seaborne trade of at least 70 Bn USD by 2015 via the Singapore basin

INCREASING TRADE BETWEEN INDIA AND CHINA

"The economic cooperation between India and China in the lastdecade has been a remarkable story"

Indian Ambassador to China

24.9

100.0

2006 2011 2015e

India-China trade [USD Bn] Comments

> Trade between India and China has been growing at an unprecedented rate of 24% annually between 2006 and 2011 and is expected to grow at 8% annually to surpass the USD 100 billion mark by 2015

> To further support this, India and China have signed 11 pacts designed to boosts bilateral between the two Asian economic giants

> As ~90% of trade is typically seaborne, ports in Singapore basin will benefit greatly from the increase in India-China bilateral trade

73.9

Sources: Ministry of Commerce China, Publicly available sources, Roland Berger analysis

2


Overall import / export in ASEAN will rapidly grow following a strong post-recession rebound led by fuels and mining products

OVERALL TRADE GROWTH IN ASEAN

2010

2,005

48%

52%

2009

1,541

47%

53%

2008

1,929

49%

51%

2007

1,641

47%

53%Exports

2025e

5,067

48%

52%

2011

2,394

48%

52%

+6%

+18% -20%+25%

Imports

> After experiencing a contraction of 20% due to the global recession, ASEAN trade has rebounded strongly at 25% CAGR between 2009 and 2011

> Assuming a modest GDP growth of 5.5% for the region until 2025, total merchandise trade could easily achieve a value of USD 5 trillion

ASEAN merchandise trade [USD Bn] ASEAN merchandise trade product mix

20% 23% 20% 21% 24%

9% 10% 10% 11% 12%

2009

Manufactured goods

Fuels and mining products

Agriculturalproducts

2011

64%

2010

100%

68%69%

2008

67%

2007

72%

> The trend of fuel and mining products' increasing share will continue to drive the growth ASEAN trade

> This is due in part to the demand from China and emerging ASEAN economies which has led to:– Planned capacity increases in Johor for liquid bulk – Coal production boom in Indonesia

Sources: WTO Statistics Database, publicly available sources, Roland Berger analysis

3


By 2030, Asia will require an additional ~13 Million barrels per day or ~75% share of the growth in world liquid demand

CARGO DEMAND TO SHIFT TO LIQUIDS

Sources: BP Energy Outlook 2030, International Energy Agency, Roland Berger analysis

12%

20%

68%

Rest of the worldRest of AsiaChina

24%

17%

59%

Global liquid consumption [%, 2011] Global liquid consumption [%, 2030]

Rest of the worldRest of AsiaChina

CHINA'S NEED FOR ENERGY IS PROJECTED TO INCREASE BY 150% BY

2020

BY 2030, CHINA WILL OVERTAKE THE US IN OIL IMPORTS

4

Total = ~88 Million barrels / day Total = ~102 Million barrels / day

ADVANCED ASIA TO CONTRIBUTE TO SHORT TERM GROWTH (JAPAN AND SOUTH KOREA) WHICH HAS

RECENTLY DRASTICALLY INCREASED LNG IMPORTS

EMERGING ASIA TO DRIVE LONG TERM


D. Our vision of the Singapore basin 2025


By 2025, the world's largest trade corridor will have moved eastwards, extending from advanced Asia to emerging Asia

D OUR VISION OF THE SINGAPORE BASIN 2025

Sources: Report on China Port Development 2010-2011, UNCTAD, Roland Berger Analysis

Economic and maritime industry outlook by 2025

Brazil, China, India, Indonesia, theRepublic of Korea and the Russian Federation expected to account for more than 50% of global growth

The share of emerging developing economies in global real GDP is forecasted to expand from 36% in 2010 to 45% in 2025

Coal trade continue to grow – import,

export, transshipment

Asia will drive demand for LNG as a relatively green

alternative for power generation especially in East Asia and Southeast Asia

Single market in ASEAN (ASEAN Economic Community) in full swing – intra and extra regional trade to flourish

For the basin, the cargo composition will have moved to a more "natural" and balanced mix – lower share of containers


Within the basin, we believe that Johor will eventually overtake Singapore (in terms of tonnage throughput)

Sources: Business Monitor International, Roland Berger analysis

D

1) Throughput from 2012 is calculated based on best available data, figures if any are estimates

Throughput evolution by cargo type

OUR VISION OF THE SINGAPORE BASIN 2025

CAGR: +4%

2025

881

513

305

43 20

2011

12531

309

26184

General ContainerLiquid bulkDry bulk

309

184

12

CAGR: +2%

2025

657

408

21126 12

2011

531

26

122152

CAGR: +8%

2025

435

299

106254

2011

152

13

12215

2

CAGR: +11%

2025

678

408

230

30 10

2011

152

13

Base case [mn tons] Roland Berger view [mn tons]

SINGAPORE

JOHOR

InclWestport


Rapid growth of PTP, ~9%

Key competitors: WestPort (MY), Pengerang Port (MY)

Rapid growth of Pengerang Port, Tg. Langsat, Johor Port and Tg. Bin, ~22%

Cargo demand to shift to liquids

Strong and steady growth of Johor Port, ~6%

Rapid growth of ~12% due to:• Pengerang dev't (construction material)

• O&G-related (material)

• Cars

• LME, steel products etc.

The ports in Johor will emerge as leaders with liquid bulk being the mainstay in their cargo mix

Cargo typeSingapore Johor

Batam and Bintan, Indonesia

Containers

Liquid bulk

Dry bulk

General cargo

Slow growth. 2%Tg. Sauh development, 4 m TEU

capacity in 2015

Minor developments

Slow to no growth, ~1%

No growth

No growth

Area

Source: Roland Berger Analysis

D OUR VISION OF THE SINGAPORE BASIN 2025


By 2025, the maritime landscape of the Singapore basin will have totally transformed compared to present day

1

2

3

D

ASEAN share in global maritime trade will have increased

The regional share in ASEAN's maritime trade will have strongly increased

Predictions for the Singapore basin 2025

The combined ports in Johor will have overtaken Singapore's ports in terms of total throughput

Grown and growing share of liquids in the cargo mix of the Singapore basin ports

OUR VISION OF THE SINGAPORE BASIN 2025

Source: Roland Berger Analysis


Creativestrategies that work!

Anthonie Versluis, Managing Partner Malaysia

Roland Berger Strategy Consultants Sdn Bhd (Co. no: 949134-W)Level 39, Menara Standard Chartered, 30 Jalan Sultan Ismail50250 Kuala Lumpur, MalaysiaTel: +603-2203-8600 [email protected]

Documents

Shipping, trade and ports market analysis - Port development … · 2018-03-21 · 130104_Conference_Manila v6.pptx 1 Manila, January 30, 2013 Presentation Port development outlook