Trouble brewing

Shipping lines appear to have the upper hand in Thailand these days due to the huge volume of new berths operated by different companies coming onstream, leading to a potentially dangerous price war.

Speaking on the second day of the TOC Asia 2007 conference in Hong Kong, Laem Chabang Container Terminal 1 managing director Anil Singh warned that there might not be enough boxes to go round in five years time at the nation’s leading terminal. At Laem Chabang, Mr Singh said phase one, which includes his facility, is likely to hit full capacity by end 2007.

Phase two, part of which is already under way, is due to have a capacity of 13.3m teu when completed in 2010, although total demand is only likely to be 8.3m teu. Phase three, which is due to start around 2011, will boost capacity by a further 12m teu, although demand is only likely to be about 7.5m teu.

Laem Chabang handled 4.2m teu last year of which 765,000 teu were handled at the single berth Laem Chabang Container Terminal 1,a joint venture between APM Terminals and PSA International. In Laem Chabang, Mr Singh said, container growth generally followed export growth from Thailand’s manufacturing industry as transhipment was “negligible”. With this “strong correlation” Mr Singh made clear his concerns about overcapacity.

Acknowledging this potential schism between supply and demand the government is trying to put the kybosh on expansion plans at Bangkok Port. Transport Minister Theera Haocharoen has asked the Port Authority of Thailand to review expansion plans for the port.

A previous authority expansion proposal would have increased handling at Bangkok Port by 500,000 teu, taking capacity to 1.5m teu a year. “If we let Bangkok Port expand, not only will Laem Chabang miss its target of becoming a marinetransport hub, it will increase congestion and traffic jams,”Mr Theera warned.