DP World's first-quarter gross shipping container volumes rise on Asia growth

Dubai-based ports operator handled 19.5 million twenty-foot equivalent units across its global portfolio in three-month period

DP World operations in a harbour in Antwerp, Belgium. The port operator outperformed the industry's quarterly forecast for container volumes in the first three months of 2023. AFP

Global ports operator DP World reported an increase in gross container volumes for the first quarter of 2023 of 1.4 per cent annually and 3.7 per cent on a like-for-like basis, outperforming the shipping industry's performance of a 6.3 per cent drop.

The Dubai-based company handled 19.5 million twenty-foot equivalent units, or TEUs, across its global portfolio of container terminals in the three-month period to the end of March, it said on Thursday.

Asia Pacific and India drove DP World's first-quarter gross volume growth, which was partially offset by weaker performance in Europe and the Americas “due to uncertain economic conditions”, it said.

Volumes at the company's flagship Jebel Ali port grew by 2.3 per cent.

“Our portfolio has had an encouraging start to the year,” Sultan Bin Sulayem, group chairman and chief executive of DP World, said.

The company's outperformance of the industry “continues to demonstrate that we are in the right locations, and our strategy to offer integrated supply chain solutions to beneficial cargo owners is driving value for our stakeholders”, he added.

Global container port throughput ended 2022 with a growth of 0.5 per cent and is expected to remain at a similarly low level of 1 per cent during 2023, according to forecasts by maritime research and consulting services firm Drewry.

The London consultancy also forecasts a 59.8 per cent reduction in global freight rates in 2023, followed by a drop of 13.7 per cent in 2024.

The Covid-19 pandemic-induced disruptions to shipping and the resulting global supply chain crisis created a challenging operating environment for companies. This has underscored the crucial importance of logistics systems, with supply chain resilience and its related national security implications emerging as top concerns for governments.

DP World's terminals handled 11.4 million TEUs at a consolidated level during the first quarter of 2023, up 0.7 per cent year-on-year on a reported basis but down 1.3 per cent on a like-for-like basis, it said.

Looking ahead, the company warned of macroeconomic and geopolitical difficulties but forecast a “stable” outlook for its portfolio during the year.

“The near-term outlook remains somewhat uncertain, given the geopolitical backdrop, high inflation and currency fluctuations,” Mr bin Sulayem said.

“However, we expect our portfolio to deliver a stable performance in 2023 as we remain focused on driving revenue synergies from our recent acquisitions while managing costs and growth capex.”

The UAE is among the top 12 countries in the World Bank's Logistics Performance Index released earlier this week.

It shows that adopting digital technologies in supply chains, especially in emerging economies, can help countries reduce delays at ports by up to 70 per cent compared to those in developed nations.

Opting for environmentally-sustainable logistics options can also lessen the carbon footprint of supply chains and keep trade flowing by shifting to less carbon-intensive freight and more energy-efficient warehousing, the Washington-based lender said.