UAE ranks among top 15 in global liner fleet size

The UAE ranks among the top 15 countries in the world by the size of a country's current liner fleet (and the only from the Middle East), said a report by IHS Global Insight, a global research, analysis and consulting firm.

The report said Dubai ranked the sixth global port from the top in terms of throughput with the total capacity last year being 11,827,299 TEUs, and it is the only port from the Middle East to rank among the top 20 global ports.

In terms of investments made by terminal operators, DP World ranks third in the world (after APM Terminals and PSA) spending $1.4 billion (Dh5.1bn) last year.

China is currently the leading operator of liner vessels globally, operating 804 vessels, with 11 per cent of the global liner fleet, and 15 per cent of its capacity. It is followed closely by Japan, with 788 liner vessels. Denmark, which ranks fifth by the fleet count, operates the second largest fleet by capacity.

The UAE ranks 15th in the world with the total number of the liner fleet at 106 vessels. Germany is the largest European Union operator of liner vessels and the country with the most vessels on-order worldwide.

By the current order book, Germany will operate only two fewer vessels than China by the time the orders are completed, it said. The report 'Valuation of the Liner Shipping Industry: Economic Contribution and Liner Industry Operations' commissioned by the World Shipping Council, said over the past five years, the container shipping has been one of the fastest growing segments of seaborne shipping.

The global container shipping fleet has grown by an annual average of 13 per cent over the last five years, driven primarily by vessels with a capacity of over 5,000 TEUs, which added 3.1 million TEUs of capacity between 2004 and 2008, it said.

In the next five years, the container fleet is expected to expand with an average of 9.3 per cent per year, with growth in vessels of more than 8,000 TEUs topping 25 per cent through 2013, according to the report.

The growth in the vehicle carrier fleet has also been significant, averaging 9.3 per cent per year between 2004 and 2008. However, this growth will slow down to about five per cent per year over the next five years, the report said.

The liner industry (consisting of container, vehicle, and roll-on/roll-off or Ro/Ro vessels) accounts for more than four million direct jobs worldwide and investment in fixed assets of $29bn. This estimate of the value of the industry does not include related activities such as cargo handling and storage activities at ports, nor does it include the inland transportation of liner cargoes, unless moved inland by water.

As of July, about $236 billion has been spent cumulatively on purchasing new liner vessels since the inception of the liner trade.

This amount does not include the additional and potentially substantial amounts spent subsequently in the second-hand market, or for upgrades and maintenance, the report adds.

Cumulatively, European operators have spent the most on liner vessels, more than $105bn or 45 per cent of total purchases of liner vessels. This reflects the historical dominance and a continued strong presence of Europe in liner shipping, the report said.

Greater China (Greater China is a regional definition used in this report to represent all of China, including Taiwan, China and Hong Kong SAR), however, is the second-largest cumulative spender on liner vessels, with 15 per cent of total spending, although most of its purchases have been more recent than Europe's.

Cumulative spending on liner vessels by operators in the Middle East stood at $10.1bn. In terms of the cumulative recipients of spending on liner vessels as of July, South Korea, the leading shipbuilding country, has received more than $76bn or 32 per cent of the total, the report said.

Europe is ranked next at 27 per cent, although many of its yards have been losing competitiveness and market share. Japan does not lag far behind Europe, with a cumulative market share of 25 per cent. The United States no longer has a major international commercial liner vessel building industry.

Middle East received $278 million or 32 per cent of the total spending (in RoRo segment), it said.

Fleet size and capacity

As of July this year, the global liner fleet consisted of 7,210 vessels with almost 185 million dead-weight tonnes of capacity. The container fleet of 4,684 vessels has capacity of just over 12.5 million TEUs, and the vehicle fleet of 773 vessels has the capacity of about 3.2 million car equivalent units (CEU).

The Ro-Ro fleet provides an additional 1.2 million CEU of capacity, it said. The total order book for liner vessels in July contained another 1,381 vessel to be added to the fleet.

These vessels will account for another 68.1 million dwt in liner tonnage. Container ships on-order will add 5.5 million TEUs of capacity or roughly 40 per cent additional capacity. The order book thus reflects the growing size of container vessels.

The average container ship in the current fleet has the capacity of about 2,670 TEU where as the average container ship on-order will have the capacity of more than 5,000 TEU.

A similar trend can be observed in vehicle vessels. The vehicle carrier vessels on-order will provide another 1.14 million CEU of capacity, or an average capacity of 5,300 CEU per vessel compared to an average capacity of 4,100 CEU per vessel in the current fleet.

The regional breakdown of the liner fleet demonstrates that with a total fleet of 2,112 vessels, or 29 per cent of the global fleet (as of July), and an additional 654 vessels on order, the European Union is the largest regional participant in the liner industry.

With almost 600 liner vessels each, Denmark and Germany are the leading participants in the European Union liner industry and account for 55 per cent of the Union's liner fleet. France operates more than 300 liner vessels; where as all other member states operate less than 100 vessels. Sweden is the major operator of vehicle vessels, accounting for more than 55 per cent of the total European Union vehicle fleet.

However, the European Union operates much fewer vehicle vessels than Japan does alone.

Ro-Ro operations are spread fairly evenly through out the European Union.

Asia, particularly Greater China and Japan, also has a significant and expanding presence in container shipping. Japan, however, is the leading country in seaborne vehicle shipping, with almost 48 per cent of the total global vehicle carrier fleet.

Out of the global liner fleet of 7,210 vessels, Middle East and Africa has a total liner fleet of 410 vessels, comprising 229 vessels in the container shipping; 12 vessels in the vehicle carrier segment; 169 vessels in the RoRo segment.

Shipbuilding

Many maritime nations participate in liner vessel operations, with larger nations tending to operate larger fleets, the report said.

Shipbuilding, however, is more concentrated among a few countries – particularly South Korea and Japan – with highly developed shipyards. Shipbuilding is an important component of the liner industry, and it generates many skilled jobs and revenues.

South Korea's dominance in shipbuilding has slowly eroded over the last three years, as its market share declined from 54 per cent to 43 per cent between 2006 and 2008, it said.

The main beneficiary has been China, whose market share increased from less than 10 to more than 20 per cent in the same time period.

Indonesia and Malaysia deliver dozens of smaller vessels, with less than one thousand gross-tonnes of capacity. The report said in the first 35 weeks of this year, container ships on average made more than 9,100 port calls and vehicle vessels just over 1,000 port calls per week. Operators from the European Union made more than a third of these port calls and operators from Greater China and Other Asia made about 17 per cent each.

Throughput at liner ports

Throughput at liner ports is another important indicator of liner industry activity, the report said. and the throughput at the top 20 global ports reached almost 250 million TEUs last year, it said. Asian ports dominate container trade. In particular, the throughput at the ports of Ningbo and Guangzhou in China has been growing rapidly. These ports now rank seventh and eighth and have overtaken Rotterdam.

Kaohsiung and the ports of Los Angeles and Long Beach in the United States were particularly affected by the downturn that started last year.

Container fleet

Last year, the global container fleet consisted of 17.8 million containers, providing 27.3 million TEU of capacity, and which cost the industry almost $81bn, the report said. This was an increase from about 24.8 million TEU of capacity the previous year.

Europe accounts for the largest container fleet at 6.9 million units or nearly 39 per cent of the total fleet.

North East Asian and North American owners account for nearly the rest of the global fleet, reflecting the location of company headquarters that own the containers, not the deployment of the containers, which move throughout the world.

Aside from containers, the industry relies on numerous types of on-board and port terminal equipment to handle liner cargo


China fast emerging as shipbuilding hub

Shipbuilding is an important component of the liner industry, and it generates many skilled jobs and revenues. China's market share in shipbuilding has increased from less than 10 per cent in 2006 to 20 per cent last year. While it delivered a total of 95 container and Ro-Ro vessels in 2006, last year the figure rose to 164.

Many maritime nations participate in liner vessel operations, with larger nations tending to operate larger fleets.

Shipbuilding, however, is more concentrated among a few countries – particularly South Korea and Japan – with highly developed shipyards.

A total of 532 container and Ro-Ro vessels were delivered in 2007.

South Korea delivered about 48 per cent of new liner capacity in 2007 and Japan delivered another 18 per cent.

However, South Korea's dominance in shipbuilding has slowly eroded over the last three years, as its market share declined from 54 per cent to 43 per cent between 2006 and 2008.

Indonesia and Malaysia deliver dozens of smaller vessels, with less than one thousand gross-tonnes of capacity.

As regards vessel purchase prices, while it is not possible to determine the current book value of the liner fleet from available sources, one can measure the amount of capital originally invested in liner vessels.

Cumulatively, $236 billion (Dh866.1bn) has been spent on the purchase of new liner vessels though July this year.

 

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