APM Terminals Pipavav’s outreach pays off with volume growth

APM Terminals Pipavav’s outreach pays off with volume growth

APM Terminals Pipavav.

APM Terminals Pipavav (above), about 150 nautical miles from Jawaharlal Nehru Port Trust, hosts 10 weekly mainline services, in addition to a fortnightly coastal loop, and other ad-hoc calls. Photo credit: APM Terminals Pipavav.

A whirlwind trade outreach program —  involving a series of roadshow presentations at hinterland locations in the past couple of months — is working for APM Terminals Pipavav, as its container volume increased substantially in July, following a somewhat dismal performance in the first fiscal quarter.

The latest data collected by JOC.com from industry sources show APM Terminals Pipavav — a minor, alternative cargo gateway on India’s west coast — handled 85,571 TEU in July, compared with an average volume of 65,000 TEU per month during April-June — good for an impressive 30 percent increase.

Further, the July total appears to be a new monthly high for the private operator, which ended the first fiscal quarter with 195,000 TEU, down 5 percent from the fourth quarter of 2017. The company, in an earnings statement, attributed that decline to “lower transshipment volumes” during the quarter.

Efforts to reach APM Terminals Pipavav officials to comment on the July rebound were unsuccessful.   

APM Terminals Pipavav, about 150 nautical miles from Jawaharlal Nehru Port Trust (JNPT), reportedly hosts 10 weekly mainline services, in addition to a fortnightly coastal loop, and other ad-hoc calls.

Futher, as its volume struggles continued, group liner unit Maersk Line stepped in to support the sister company with new calls from its two weekly loops serving India’s west coast trade — such as the intra-Asia Far East-Indian Subcontinent Service (FI3), and the Europe-Middle East (ME1) Service.

Ease-of-doing business measures

In addition, a slew of ease-of-doing-business measures — such as gate automation and speedier customs examinations — along with rail upgrades appear to have played a role in the aforementioned uptrend. One example: the company offers seven weekly block-train runs, compared with three previously.

The first-quarter analysis also stated that APM Terminals Pipavav more than doubled its dry bulk cargo handling, but suffered steep declines in liquid and roll-on, roll, off shipments. That amounts to a mixed performance, as the company has been vigorously targeting other, general cargoes to offset prolonged, weak container growth.

Further, in India’s hyper-competitive shipping market, it’s extremely difficult to predict if the July container boost represents a long-term freight shift toward Pipavav from hinterland shippers controlled by rivals.

Two facts that serve as notes of caution regarding APM Terminals Pipavav’s strong July: closest private rival Adani Group-owned Mundra Port is close to doubling capacity to 6.6 million TEU annually, and JNPT has substantially increased capacity with the opening of PSA International’s Bharat Mumbai Container Terminals, which is designed to handle 2.4 million TEU in the first phase. 

APM Terminals Pipavav — India’s first public-private-partnership port venture — is a multi-purpose harbor, capable of handling 1.35 million TEU, as well as 5 million metric tons of dry bulk, 2 million metric tons of liquid bulk cargoes, and about 250,000 finished cars, annually. 

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