New Transportation market report from Business Monitor International: "Kuwait Shipping Report Q3 2013"
Boston, MA -- (SBWIRE) -- 09/11/2013 -- Kuwait's ports have struggled to recover the volumes they enjoyed prior to the global economic downturn, but BMI expects this recovery to be completed for the most part in 2013, save for total tonnage volumes at Shuaiba. Downside risks from industrial actions by ports and customs workers appear to have dissipated, though we caution that they may rise up again, bringing additional risk to our outlook.
What does bode well for Kuwait's container ports is our macroeconomic outlook for the country, where high oil prices in recent years have translated into increased spending by the Kuwaiti government. This will help maintain growth at the Gulf state's ports, both through spending on infrastructure projects impacting on total tonnage throughputs, and consumer spending boosting imports of containerised goods. However, delays to infrastructure projects could hamper tonnage throughput, and a plateauing in oil production has led us to forecast GDP growth of 3.0% in 2013, meaning that a slightly slower pace of growth can be expected at Kuwaiti ports this year.
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Headline Industry Data
- 2013 Port of Shuaiba tonnage throughput growth forecast at 1.0% and to average 3.0% to 2017.
- 2013 Port of Shuwaikh container throughput forecast to grow 1.4% and to average 4.0% to 2017.
- 2013 total trade growth forecast to grow 1.0% and to average 2.4% to 2017.
Key Industry Trends
Weather Impacts Operations: In May Kuwait's three primary ports of Shuwaikh, Shuaiba and Doha were forced to close after sandstorms reduced horizontal visibility to just one nautical mile. The facilities soon reopened when visibility improved, and the small backlog of waiting vessels was quickly cleared.
United Arab Shipping To Introduce Rate Increase: Part-Kuwaiti shipping company United Arab Shipping Company announced that it would introduce a rate increase on several of its routes from June 1 2013. The rate increase for services from Asia to the Adriatic, Europe and the Mediterranean will be US $675 per twenty-foot equivalent unit (TEU). The rate increase for services between the west Mediterranean and the Middle East will be US$100/TEU and US$200 per forty-foot equivalent unit (FEU).
Risks To Outlook
Downside risks to our throughput forecasts come in the form of the exposure to oil price volatility and a slowdown in global demand. Despite the broadly healthy picture of Kuwait's public finances, its high reliance on oil - which accounts for 94% of total revenues - exposes the budget, and consequently trade, to oil price volatility.
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