DP World container volumes rise almost 3% in second quarter

Ports operator records strong growth across its terminals in Asia Pacific, the Americas and Australia

Jebel Ali is the only port outside the Far East to make it into the latest Top 10 list of the world’s largest ports. Courtesy DP World
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DP World, one of the world's largest port operators, registered a nearly 3 per cent annual rise in gross container shipping volumes in the second quarter of the year, as trade picked up globally.

The company handled 20.2 million twenty-foot equivalent units (TEU) during the April-June period, with volume growth driven by its terminals in Asia Pacific, the Americas and Australia, Dubai-based DP World said on Wednesday.

The results are "another solid set of throughput figures", which are "once again ahead of industry growth", said Sultan bin Sulayem, group chairman and chief executive of DP World.

"This robust performance illustrates the resilience of the global container industry, and DP World’s continued ability to outperform the market," Mr Bin Sulayem said.

Shipping costs have risen after the Covid-19 pandemic, which has disrupted supply chains, with the continuing Russia-Ukraine conflict further straining operators.

In particular, the conflict is stifling trade and logistics in the Black Sea region, increasing global vessel demand and the cost of shipping around the world, the UN Conference on Trade and Development said last month.

Shipping distances have also increased, along with transit times and costs, as Ukraine's trading partners now have to source commodities from farther away.

The global shipping container market is projected to grow to more than $10 billion in 2022 from $9.37bn in 2021, and is seen to hit around $13.5bn by 2026 at a compound annual growth rate of 7.5 per cent, according to Research and Markets.

For the first six months of the year, DP World transported 39.5 million TEU across its global portfolio of container terminals, up more than 2 per cent annually.

The Americas and Australia recorded the strongest growth in the first half, with volumes increasing 4.5 per cent to more than 5.7 million TEU.

The Asia Pacific and Indian subcontinent regions handled more than 17.6 million TEU, an increase of 3 per cent annually, while volumes in Europe, the Middle East and Africa (Emea) grew about 1 per cent to more than 16.1 million TEU.

DP World's flagship Jebel Ali port in Dubai handled almost 7 million TEU in the first half and more than 3.5 million TEU in the second quarter, an increase of 1.2 per cent and 3.5 on a yearly basis, respectively.

Mr Bin Sulayem said the near-term outlook is uncertain given the geopolitical environment, inflationary pressures and continued impact of the Covid-19 pandemic.

DP World, however, remains "positive on the medium to long term outlook for global trade".

Quote
This robust performance illustrates the resilience of the global container industry, and DP World’s continued ability to outperform the market
Sultan bin Sulayem, group chairman and chief executive of DP World

"Overall, given the solid start to the year, we expect to deliver an improved full performance," he added.

DP World, which operates through a global network of 295 business units in 78 countries, has been aggressively expanding its portfolio.

Its South African unit, Imperial Logistics has this month increased its stake in Botswana firm PST Sales & Distribution; received approval to buy a 100 per cent stake in Mozambique-based logistics company J&J Group; and acquired a controlling stake in Nigeria's Africa FMCG Distribution.

In June, DP World and the Saudi Ports Authority signed an agreement to build a "port-centric" logistics park at the Jeddah Islamic Port with a total investment of more than 500 million Saudi riyals ($133.33m).

Also last month, DP World and Dubai’s Ports, Customs and Free Zone Corporation signed an agreement with Romania to develop infrastructure in the port city of Constanta and help it become one of the Black Sea’s “most important” cargo and vehicle ports.

Canadian fund Caisse de Depot et Placement du Quebec, also announced in June that it will invest $5bn in three of DP World's UAE assets — Jebel Ali Port, Jebel Ali Free Zone and National Industries Park.

Updated: July 27, 2022, 5:01 PM
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