New Transportation market report from Business Monitor International: "Taiwan Shipping Report Q2 2013"

Boston, MA -- (SBWire) -- 05/15/2013 --BMI View: While we see an export-led recovery making itself felt in 2013, with Taiwan benefiting from renewed external demand for semi-conductors, plastics, metals and machinery, we have reservations about the strength and sustainability of the upturn. This has led us to hold to out below-consensus GDP growth forecast of 3.0% for the year, bearing in mind concerns over the strength of the mainland China recovery, and over domestic issues such as inefficiencies in the banking and financial sector, and rigidities in the labour market. This year's growth will follow on from a difficult 2012 when we estimate GDP grew by only 0.9%. Prompted by our reassessment of Taiwan's investment and export prospects, we have lowered our average annual growth forecasts for the period running from 2014 to 2022, from 4.7% down to 3.9%.

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Consistent with the macro-economic recovery we continue to expect a modest upturn in 2013 port activity levels, but this will be in the low single percentage digits. Broadly speaking Kaohsiung, Taiwan's largest port remains the most resilient, not least because it is attracting new investment. Keelung, the country's second largest port, will recover weakly from a difficult 2012, when we estimate it experienced percentage falls of around 8% in both bulk tonnage and box traffic. On the plus side, the policy of cross-straits integration is expected to continue as Taiwan's ports and shipping lines position themselves to work through a series of alliances and partnerships with mainland companies over the next few years.

Headline Industry Data

- 2013 Port of Kaohsiung tonnage throughput forecast to grow by 1.5% to 123.311mn tonnes, over the mid-term to 2017 we project an annual average increase of 1.6%.
- Port of Kaohsiung container throughput forecast to grow 2.7% to 10.045mn TEUS in 2013, over the midterm we project an annual average 3.5% increase.
- Port of Keelung will see tonnage recovering by 1.3% in 2013 to 70.319mn tonnes, with container traffic up by 1.3% to 1.627mn twenty-foot equivalent units (TEUs).
- 2013 total trade growth forecast to recover by a 3.4% in real terms, compared to an estimated drop of 2.0% in 2012.

Key Industry Trends

Yang Ming Charters Big Box Ships: The trend towards mega-container ships continues. Taiwan's Yang Ming Marine Transport says it is chartering up to 10 new mega ships from Seaspan Corporation. Yang Ming will lease five of the vessels, each with a carrying capacity of 14,000 twenty-foot equivalent units (TEUs) for a span of 10 years, and the company has an option on an additional five vessels. The ships are expected to be built by a South Korean shipbuilder.

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