Port development outlook in the Singapore basin

Transcription

1 Port development outlook in the Singapore basin Presentation The 7 th PHILIPPINE Ports and Shipping Conference 2013 Manila, January 30,

2 Contents Page A. Current situation 3 B. Planned developments 8 C. Traffic outlook 15 D. Singapore basin by Roland Berger Strategy Consultants 2

3 A. Current situation 3

4 A CURRENT SITUATION Asia already contributes the most to the global maritime trade, recording steady growth in its market share Total maritime trade by region [USD Bn] Share of world maritime trade [%] +18% 7,034 5,980 3,191 EXPORTS Africa Oceania 9% 11% 19% Europe 40% Asia 3,073 2,907 3, % 1,716 1,955 1,031 1, ,168 1,105 2,063-1% 3,123 1,516 1,607 IMPORTS Europe 21% America Oceania Africa 1% 5% 23% ASIA Exports Imports AMERICA EUROPE America 16% 55% Asia Sources: Review of Maritime Transport 2011, UNCTAD, Roland Berger 4

5 A CURRENT SITUATION The Singapore basin is an important hub for cargo flows given its strategic location and the strong growth in South East Asia Cargo flow East Asia Hormuz Shenzhen Ningbo Tianjin Korea Shanghai Kaohsiung Busan Tokyo Tsugaru Yokohama > Situated along main East- West trade route > Natural mid-point between 2 key growth markets India & China > Strong inter and intraregional trade flows in ASEAN > Crossroads for Middle East America west coast 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 Mumbai Laem Chabang Hong Kong South China Sea Ho Chi Minh City Melaka Kota Kinabalu Colombo Belawan Port Klang Bintulu PTP Palembang Singapore Sunda Tg Priok Surabaya Lombok Ujung Pandang Torres Major ports Main shipping lanes Sources: UNCTAD, Roland Berger 5

6 A CURRENT SITUATION Singapore leads in trade volume, followed by Malaysia and Indonesia Comparison of trade indicators for selected countries Total merchandise trade ) [USD bn] Total merchandise trade ) [USD per person] Trade dependency index ) [%] GDP 2011 [USD per person] China 3,971 Singapore 196,171 Singapore 2.98 Singapore 48,588 India 1,060 Malaysia 16,599 Vietnam 1.66 Malaysia 1.49 Malaysia 9,659 Singapore 1,017 Thailand 7,427 Thailand 1.32 Thailand 5,343 Thailand Malaysia China Vietnam 2,955 2,491 Cambodia 1.26 Germany 0.76 Philippines 0.53 China 5,046 Indonesia 3,492 Indonesia 434 Indonesia 1,790 China 0.50 Philippines 2,370 Vietnam 219 Philippines 1,598 Indonesia 0.45 India 0.45 India 1,457 Philippines 152 India 854 Japan 0.29 Vietnam 1,382 1) Total export and import volumes, but not inclusive of export/import of services 2) Calculated as Total merchandise trade/gdp in current prices Sources: WTO, IMF, World Bank 6

7 A CURRENT SITUATION Within the basin, Malaysia and Singapore have a developed port sector; Indonesia still lags behind Major ports in the Singapore basin - summary Pasir Panjang Jurong Port Port of Tanjung Pelepas Existing Planned Johor Port Tanjung Langsat Port Pengerang (RAPID, Vopak/Dialog Terminal)) Tanjung Bin Tanjung Piai (Maritime Industrial Park) Asia Petroleum Hub (APH) Tuas container port Pulau Busing Pulau Bukom Note: Tanjung Bin, Pengerang and Tanjung Agas ports are still under development; figures, if any, are forecasts Kg. Teluk Ramunia Keppel Terminal Tanjong Pagar Terminal Brani Terminal Tanjung Uban Kabbil Port Port Telaga Punggur Port of Batam/Waterfront City Pulau Sebarok Source: Port authoriiy and operator websites, Ministry of Transport, UNCTAD, Portsworld 7

8 B. Planned developments 8

9 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 Tuas container terminal 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, railmounted 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 9

10 B PLANNED DEVELOPMENTS 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 10

11 B PLANNED DEVELOPMENTS Tanjung Bin is a new liquid bulk port under development; Total capacity can grow to million tons of oil products PORT OF TANJUNG BIN 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 2 nd 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 11

12 B PLANNED DEVELOPMENTS Aggressive expansion plans for fast-growing container port PTP aims to capture higher transshipment share from Singapore PORT OF TANJUNG PELEPAS (PTP) 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 12

13 B PLANNED DEVELOPMENTS 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 13

14 B PLANNED DEVELOPMENTS 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 Batu Ampar > 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 14

15 C. Traffic outlook 15

16 B TRAFFIC OUTLOOK Liquid bulk is the largest cargo type in global maritime trade and will experience continued growth due to demand from Asia World maritime trade by cargo type [m MT] 5,984 7,858 8,409 8,748 9,297 10% 14% 15% 16% 16% 32% 26% 24% 24% 24% 22% 27% 28% 28% 27% 36% 34% 33% 32% 33% CAGR [%] 8.0% 1.2% 5.8% 2.9% OUTLOOK > 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 Container Other cargo Dry bulk Liquid bulk Source: UNCTAD 16

17 B TRAFFIC OUTLOOK By 2025, maritime activity in the Singapore basin will be 2-3 times the size of today Global trade shifts to the East > Most populous region > Largest economic zone > Biggest consumption zone > Majority of world's middle class creating a multi-polar global economy ASEAN CHINA MARITIME TRADE > Strong China EXIM growth in general transhipment in Singapore basin > Growth in trade between ASEAN and China ASEAN SOUTH ASIA MARITIME TRADE Strong trade growth - ASEAN will seek to minimize China's geo-political influence INTRA -ASEAN MARITIME TRADE > AFTA, ASEAN Economic Community > Rapid economic growth of Indonesia and Indochina > Decreasing tariff rates between member nations Source: European Commission's "The World in 2025", ADB, Australian Government, press releases, Roland Berger 17

18 B TRAFFIC OUTLOOK On balance, we see 4 main drivers that will shape maritime trade in the Singapore basin in the coming decade Main (selected) drivers 1 Growth in intra-asean trade 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 38% growth in Increasing trade between India and China 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 Overall trade growth in ASEAN Trade in ASEAN has rebounded from the global economic recession with an annual growth rate of 25% between 2009 and 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 Cargo demand to shift to liquids due to consumption demand from China Liquid demand growth is predicted to shift from OECD countries to Asia until 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 USD 100 billion by 2015 USD 5 trillion by 2025 China 38% of growth in global demand Sources: BP Energy Outlook 2030, OECD, ADB other publicly available sources, Roland Berger analysis 18

19 1 GROWTH IN INTRA-ASEAN TRADE Growth in intra-asean trade will benefit the Singapore basin Trade annual growth rates ASEAN share of trade (%) Total trade value [USD Bn] 616 2,394 5,067 Rest of the world 8.4% Intra-ASEAN Intra-ASEAN 10.2% Rest of the world e > Modest growth projections predict that the share of intra-asean trade will easily touch 30% by 2025 Sources: WTO Statistics Database, publicly available sources, Roland Berger analysis 19

20 2 INCREASING TRADE BETWEEN INDIA AND CHINA 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 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 e "The economic cooperation between India and China in the last decade has been a remarkable story" > As ~90% of trade is typically seaborne, ports in Singapore basin will benefit greatly from the increase in India-China bilateral trade Indian Ambassador to China Sources: Ministry of Commerce China, Publicly available sources, Roland Berger analysis 20

21 3 OVERALL TRADE GROWTH IN ASEAN Overall import / export in ASEAN will rapidly grow following a strong post-recession rebound led by fuels and mining products ASEAN merchandise trade [USD Bn] ASEAN merchandise trade product mix +6% 5,067 Agricultural products 9% 10% 10% 11% 12% 100% Exports Imports +18% -20% 1,929 1,641 1,541 53% 51% 53% 47% 49% 47% +25% 2,005 52% 48% 2,394 52% 48% 52% 48% Fuels and mining products Manufactured goods 20% 23% 20% 21% 24% 72% 67% 69% 68% 64% e > 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 > 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 21

22 4 CARGO DEMAND TO SHIFT TO LIQUIDS By 2030, Asia will require an additional ~13 Million barrels per day or ~75% share of the growth in world liquid demand Global liquid consumption [%, 2011] Global liquid consumption [%, 2030] Total = ~88 Million barrels / day CHINA'S NEED FOR ENERGY IS PROJECTED TO INCREASE BY 150% BY 2020 Total = ~102 Million barrels / day 12% BY 2030, CHINA WILL OVERTAKE THE US IN OIL IMPORTS 17% 20% 68% ADVANCED ASIA TO CONTRIBUTE TO SHORT TERM GROWTH (JAPAN AND SOUTH KOREA) WHICH HAS RECENTLY DRASTICALLY INCREASED LNG IMPORTS 59% 24% EMERGING ASIA TO DRIVE LONG TERM China Rest of Asia Rest of the world China Rest of Asia Rest of the world Sources: BP Energy Outlook 2030, International Energy Agency, Roland Berger analysis 22

23 D. Our vision of the Singapore basin

24 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 Economic and maritime industry outlook by 2025 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 Brazil, China, India, Indonesia, the Republic of Korea and the Russian Federation expected to account for more than 50% of global growth Single market in ASEAN (ASEAN Economic Community) in full swing intra and extra regional trade to flourish Asia will drive demand for LNG as a relatively green alternative for power generation especially in East Asia and Southeast Asia For the basin, the cargo composition will have moved to a more "natural" and balanced mix lower share of containers Sources: Report on China Port Development , UNCTAD, Roland Berger Analysis 24

25 D OUR VISION OF THE SINGAPORE BASIN 2025 Within the basin, we believe that Johor will eventually overtake Singapore (in terms of tonnage throughput) Throughput evolution by cargo type Base case [mn tons] Dry bulk General Roland Berger view [mn tons] Liquid bulk Container SINGAPORE CAGR: +4% CAGR: +2% JOHOR CAGR: +8% CAGR: +11% Incl Westport ) Throughput from 2012 is calculated based on best available data, figures if any are estimates Sources: Business Monitor International, Roland Berger analysis 25

26 D OUR VISION OF THE SINGAPORE BASIN 2025 The ports in Johor will emerge as leaders with liquid bulk being the mainstay in their cargo mix Cargo type Area Singapore Johor Batam and Bintan, Indonesia Containers Slow growth. 2% Rapid growth of PTP, ~9% Key competitors: WestPort (MY), Pengerang Port (MY) Tg. Sauh development, 4 m TEU capacity in 2015 Liquid bulk Slow to no growth, ~1% Rapid growth of Pengerang Port, Tg. Langsat, Johor Port and Tg. Bin, ~22% Cargo demand to shift to liquids Dry bulk No growth Strong and steady growth of Johor Port, ~6% Minor developments General cargo No growth Rapid growth of ~12% due to: Pengerang dev't (construction material) O&G-related (material) Cars LME, steel products etc. Source: Roland Berger Analysis 26

27 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 Predictions for the Singapore basin ASEAN share in global maritime trade will have increased The regional share in ASEAN's maritime trade will have strongly increased The combined ports in Johor will have overtaken Singapore's ports in terms of total throughput 3 Grown and growing share of liquids in the cargo mix of the Singapore basin ports Source: Roland Berger Analysis 27

28 Anthonie Versluis, Managing Partner Malaysia Roland Berger Strategy Consultants Sdn Bhd (Co. no: W) Level 39, Menara Standard Chartered, 30 Jalan Sultan Ismail Kuala Lumpur, Malaysia Tel: Creative strategies that work! 28