New Transportation market report from Business Monitor International: "Argentina Shipping Report Q4 2012"

Boston, MA -- (SBWire) -- 08/30/2012 --BMI maintains its cautiously optimistic view on the Argentine port sector, as it continues to struggle with external headwinds as well as internal difficulties in the form of rising inflation and labour unrest. Economic growth in Argentina is set to moderate sharply in 2012 to 4.0% from an estimated 9.3% in 2011. Although Argentina's GDP growth remained strong in recent quarters we believe signs have already started to emerge that a slowdown in economic activity lies ahead.

While the authorities will continue to implement largely expansionary monetary and fiscal policies to support economic growth, we are sceptical that they will be enough to support the record-high GDP growth rates the country has recorded over the last couple of years. We are concerned about the long-term effects of the country's spiralling inflation on import demand, and about the impact of falling demand from China for Argentine raw material exports.

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Headline Industry Data

?? Total volume at the Port of Buenos Aires is set to contract by 2.2% in 2012 to reach 11.7mn tonnes. Box handling at the same port will contract by 0.8% to 1.1mn twenty-foot equivalent units (TEUs). ?? The Port of Bahia Blanca will see a 2.3% growth in volume to 14mn tonnes. Box handling at the port will also grow by 6.6% to 32,988TEUs.

Key Industry Trends

Barriers To Import Leave Cars Stranded At Port of Zarate

Barriers to import introduced by the Argentine government in an effort to stem the flow of currency out of the country left over 30,000 cars stranded in the customs area of the Argentine port of Zarate in May. The Ministry of Industry introduced new rules with aim of reducing the import of cars into Argentina by 20%.

Rosario Hit By Strikes Again

Argentina's beleaguered port of Rosario suffered further delays in June when grain trucks entering the facility slowed to a trickle due to a sales strike by farmers. Exports remained uninterrupted due to ample dockside reserves.

Key Risks to Outlook

The key risks to our outlook are on the downside. We maintain our view that Argentina faces strong economic headwinds: soaring inflation, fiscal profligacy and growing government intervention, which means the Argentine economy will struggle to sustain its current growth trajectory, as investors become increasingly cautious of the economy.

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