2013-03-02 15:43:38 - Recently published research from Business Monitor International, "Vietnam Shipping Report Q2 2013", is now available at Fast Market Research

BMI Industry View

Net exports remain the biggest downside risk to our outlook for the Vietnamese economy given that we expect external demand to remain sluggish as we head into H113; this will undoubtedly have a detrimental impact on the country's shipping sector. Despite recording an average monthly trade surplus of US$172mn since June 2012 (resulting in a year-to-date surplus of US$77mn), we do not see the case for a substantial pickup in external demand in the near term. Accordingly, we expect exports to expand at a moderate pace of 6.5% in 2013. We expect private consumption to grow at a relatively subdued pace of 4.9% in 2012 before accelerating towards 5.6% in 2013. However, we note that the risk of

a sustained collapse in exports and further bankruptcies among SMEs, could potentially lead to widespread job losses in export-driven sectors.


Full Report Details at
- www.fastmr.com/prod/541300_vietnam_shipping_report_q2_2013.aspx


Indeed, the problems currently experienced at Vinalines are indicative of a deeper malaise in the Vietnamese shipping sector. State-owned shipbuilder Vinashin was bailed out in 2010 when its US$4.5bn debt threatened to bring down the entire Vietnamese economy.That said, we are sticking to our forecasts from last quarter for the Vietnamese shipping industry for 2013. Therefore, the Port of Ho Chi Minh City remains by far the country's largest port and will also be Vietnam's outperformer in terms of tonnage handled this year - forecast to increase 7.56% year-on-year (y-o-y) in 2013 to reach 38.75mn tonnes, compared with the Port of Da Nang's predicted annual growth of 4.33% (4.16mn tonnes). On the other hand, it will be the Port of Da Nang that will enjoy the higher levels of annual growth in terms of containers handled, with y-o-y growth set to come in at double figures in 2013, as opposed to the Port of Ho Chi Minh City's protracted growth of 8.03%.

Headline Industry Data

* 2013 tonnage throughput at the Port of Ho Chi Minh City is forecast to grow 7.56% to 38.75mn tonnes.
* 2013 tonnage throughput at the Port of Da Nang is forecast to increase 4.33% to 4.16mn tonnes.
* 2013 container throughput at the Port of Ho Chi Minh City is forecast to rise 8.03% to 3.48mn twentyfoot equivalent units (TEUs).
* 2013 container throughput at the Port of Da Nang is forecast to increase 10.54% to 133,366TEUs.
* 2013 total trade real growth is forecast to increase 5.70%.

Key Industry Trends

Government Must Delay Launch Of Cai Mep-Thi Vai Port Complex The government has announced that it is to delay the launch of the Cai Mep-Thi Vai port complex in the southern region, a scenario that was proposed by Vietnam Business Forum 2012's Infrastructure Working Group and representatives from some foreign-invested businesses providing port services, it was reported in December 2012. The launch of the port in June 2013 would result in worsening the surplus situation in southern deep-water container ports according to the group.CSCL Launches New Container Service

Chinese shipping company China Shipping Container Line has established a new service between Haikou and Ho Chi Minh in Vietnam, reported Transport Weekly in November 2012. Haikou is located on the island of Hainan. The direct container service will operate on a weekly basis. It is intended to facilitate the transportation of products, including coconuts, fruit, rice and rubber, between Hainan and Vietnam.Saigon Port Relocation Project Update

Progress has been slow at the Saigon Port relocation project in Vietnam, owing predominantly to capital shortages, the Saigon Times Daily reported in December 2012, citing Saigon Port Company Deputy Director Huynh Van Cuong. The relocation work is moving at a slow pace despite financial assistance from the Vietnamese government. The Hiep Phuoc Port construction project is required to be finished first in order to relocate the Saigon Port from Ho Chi Minh City; however, construction work is only 38% completed.

Key Risks To Outlook

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