Bahrain port plans to revise tariffs upwards

Bahrain's Khalifa bin Salman Port (KBSP), a transshipment hub that was inaugurated last month, is considering revising up its port tariffs that is likely to come into effect in a few months, according to an official of APM Terminals Bahrain that manages and operates the port.

"We are in the process of restructuring our tariffs and at the moment are in co-ordination and consultation with the General Organisation of Sea Ports Bahrain, our regulatory body. But the tariff has not been finalised yet, and will probably come into effect during the end of the first quarter or beginning of the second quarter of this year. It's more likely that the revised charges would be increased from the present," Iain Rawlinson, Chief Commercial Officer, APM Terminals Bahrain, told Emirates Business.

The intention behind that is predominantly restructuring and streamlining tariffs and to make sure that tariff is commercially viable across the board, rather than increasing it for the sake of it. Overall, in Bahrain the handling charges are competitive within the region, he said.

The new state-of-the-art KBSP occupies a land area of 110 hectares of reclaimed land in Bahrain, and it began operations on April 1 last year. The port has a total quayside of 1,800 metres and is designed to accommodate a container capacity of more than 1.1 million TEUs annually, as well as passengers, general breakbulk and roll-on/roll-off cargo.

The port's capacity is four times larger than the capacity of Mina Salman Port, which has been Bahrain's main port over the past 50 years. Unlike Mina Salman Port, KBSP will ultimately have the capability to handle ships with draughts up to 15 metres, the size of which are becoming commonplace in the GCC as foreign trade increases.

Asked whether container lines are asking APM terminals to reduce port charges in Bahrain, he said: "Most shipping lines are very keen on reducing costs, as it is a very tough time to be in shipping business. We have had conversations with a number of shipping lines about how can we work towards reducing costs. Our tariff is a fixed one, and therefore, we do not give special dispensation to one carrier over another. However, we have been working with carriers to improve efficiency that would minimise costs at the port as well as for ships calling at the port."

Rawlinson expects volumes at the port to remain more or less the same for 2009, as in 2008, and there will be no noticeable downfall in volumes on the container terminal side. "Earlier, we had seen growth between seven and 10 per cent year-on-year for Bahrain's ports, and now not seeing growth in a market such as Bahrain is quite unusual. But having said that, to post flat volumes amid today's economic environment is actually very good news," he said.

"On the general cargo side, however, we have actually seen a fall in certain commodities. For instance, car imports are down by about 50 per cent year-on-year. Same is the case with steel and timber. This is partly because in the last quarter of 2008, there was substantial volume of general cargo that came through, but we suspect there may have been speculative buying of steel and other commodities, and therefore their import dropped substantially for the first nine months of last year that impacted the cargo throughput," he said.

He said: "However, we have diversified our general cargo shipments at KBSP since April that has helped us in keeping overall general cargo volumes steady last year. For instance, we are receiving bulk commodities such as cement, clinker, limestone shipments, etc, which we were not handled at Mina Salman previously."

Asked what his projections are for this year, he said: "The feeling in the market is that this year could see a more substantial drop in volumes than 2009, but that remains to be seen. But we are quite confident that we will see a firming up in 2010. We don't expect massive growth but it will be at least back on track with small growth in throughput in Bahrain," he said.

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