LONDON: Slower economic growth, deteriorating export competitiveness and weak liner profitability are narrowing the headroom within the ratings of Chinese port operators, according to Moody’s rating agency.
“Although manageable capex plans over the next three years will alleviate some of the pressure on their financial profiles, weak liner profitability will limit the port operators’ ability to raise handling chargers,” Osbert Tang, a Moody’s Vice President and Senior Analyst, said.
“In addition, export-oriented ports such as Shanghai and Shenzhen will be particularly affected by slowing container throughput amid muted export growth in China,” he added.
Port operators in China are facing major headwinds from slower economic growth and a weaker throughput outlook, which could lead to margin pressure due to the high fixed costs of port operations, Moody’s said in a report.
Overcapacity in the liner industry is exacerbating this pressure on the operators’ margins. Moody’s forecast global containership capacity will increase by 4.5%-5.5% in 2016, outpacing the expected demand growth of 1.5%-2.5%.
Consequently, shipping lines are facing significant pressure on freight rates, which in turn will make it increasingly difficult for port operators to negotiate higher container handling chargers.
Source: Dailyshippingtimes.com
We have successfully served many reputable clients for Import-Export Data Information Services. Here are some of our clients:
Copyright © 2009 - 2024 www.seair.co.in. All Rights Reserved.