Alphaliner Says Vietnam Port Faces Overcapacity

International port companies face rising losses at Vietnam’s showpiece Cai Mep container port as terminals are operating at less than half of their capacity, according to industry analyst Alphaliner.

Further new entrants are due to launch operations in Cai Mep in the next two years, resulting in more cutthroat competition at Vietnam’s only deepwater port, Alphaliner warned.

Nine global terminal operators in 2006 secured stakes in terminals in the port when the government invited foreign, amid optimism that rising cargo volumes would overcome poor infrastructure and potential overcapacity.

Five of the nine planned terminals are currently in operation at Cai Mep, some 35 miles south of the Vietnamese capital Ho Chi Minh City, and are working well below capacity, according to Alphaliner.
Singapore-based PSA’s SP-PSA terminal has lost most of its line-haul vessels to the recently commissioned CMIT terminal operated by APM Terminals, the port operating unit of Denmark’s A.P. Moller-Maersk. It will only handle a weekly call in September.

Hong Kong’s Hutchison Port Holdings’ SITV terminal also lost its sole line-haul call this month to TCIT, a joint venture of Saigon New Port and three Asian ocean carriers Hanjin Shipping, MOL and Wan Hai.

Meanwhile, Dubai’s DP World is facing problems filling its SPCT terminal in Hiep Phuoc in Ho Chi Minh City. Average capacity utilization at the Cai Mep and Hiep Phuoc terminals is below 50 percent and there is little hope this will improve in the near term, Alphaliner said.

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