Kwai Tsing terminals posted a two-year low.
Hutchison Port Holdings Trust (HPHT)'s disappointing figures last month are evidence of a crumbling environment, according to a report by OCBC.
In February, Kwai Tsing terminals clocked an 18% YoY fall to 973,000 twenty foot equivalent unit (TEU)—the first time in two years the terminals dropped below 1.6m TEU. Shenzhen throughput volumes also tumbled 13% YoY in February to 1.6m TEU.
Other figures for China also paint a gloomy picture, as February exports and imports dropped 25% and 14% YoY respectively, while both the official and Caixin manufacturing PMI stand below 50.
Moreover, mega-vessel deployment places HPHT in good stead, though risks prevail. In 2016, 53 mega ships are anticipated to enter service, according to Drewry Shipping. While HPHT’s assets look well-positioned to outshine the industry on back of its suitability for mega-vesel deployment, OCBC remains concerned with the ongoing rationalisation of port usage.
Furthermore, Shanghai’s proposal for the liberalisation of cabotage in China could pose a serious threat to Hong Kong’s position as a transshipment hub. The proposal is understood to currently be under review by mainland authorities.
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