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New Market Study Published: Indonesia Freight Transport Report Q4 2012

New Transportation market report from Business Monitor International: "Indonesia Freight Transport Report Q4 2012"


Boston, MA -- (SBWIRE) -- 11/09/2012 -- BMI View: Freight Benefits From Slightly Stronger 2012 Outlook We have been fine-tuning our growth forecasts for Indonesia in 2012 and 2013, but only marginally so. Since our last quarterly report we reduced the forecast a little (mainly on fears of inflation forcing a monetary tightening), but then in August pushed it up again as data for Q212 showed that the domestic economy is growing rather faster than expected. We still believe that the slowdown in the global economy is the main negative and will hold Indonesian growth below its 2011 level. On the other hand, everything shows that the country's domestic economy remains healthy, with consumer spending looking solid and investment also performing well as the government and the private sector begin to tackle the often postponed need to expand and update infrastructure. The net result is that BMI now expects the Indonesian economy to grow by 6.0% in 2012 (up from 5.8% in our last quarterly report); our outlook is for GDP growth of 6.3% in 2013 (no change). In the five years to 2016 we expect growth to average 6.3% per annum, confirming the country as a regional outperformer.

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The growth outlook for Indonesia's freight sector, constrained by short-term capacity limits, has not changed significantly. We continue to think that the key to sustainable growth is investment in port infrastructure, including road and rail links in the hinterland areas. We are encouraged that after many delays, Indonesia Port Corporation II (IPC) announced earlier this year that it will invest US$2.47bn to develop an extension Tanjung Priok port in North Jakarta, the country's largest port. Also a positive this quarter was the company's announcement that it will build a big iron ore and container transhipment facility on the island of Batam (see below).

Headline Industry Data

- Air freight volumes are forecast to grow by 5.6% in 2012, with average annual growth of 6.1% during our forecast period to 2016.

- Rail freight volumes are estimated to rise by 5.0% in 2012, with average growth of 6.5% during our forecast period.

- Tanjung Priok total tonnage growth forecast for 2012 is 5.9% to 49.879mn tonnes, with average growth of 5.7% expected over our forecast period to 2016.

- Tonnage at the Port of Palembang is set to grow by 3.6% in 2012 to reach 10.595mn tonnes; average growth to 2016 will come in at 4.1% per annum.

- We expect the total value of Indonesian trade to grow by 7.6% in real terms in 2012, down from an estimated 13.8% in 2011.

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