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Containerised throughput at the port of Singapore fell dramatically last year, driven down by the loss of its biggest customer, Danish shipping giant Maersk Sealand.

The Port of Singapore Authority (PSA) moved 15.52 million boxes across its docks last year, a drop of 8.9 per cent year on year.

Analysts pointed to Maersk's defection across the Malacca Strait to Malaysia's port of Tanjung Pelepas (TPT) as the main reason for the fall.

Maersk contributed about two million teu (20ft equivalent units) a year to Singapore's throughput.

A statement form PSA did not mention Maersk's leaving.

It attributed the fall to the collapse of the technology sector, the aftermath of the September 11 attacks and the worldwide depletion of inventories brought on by reduced consumption in leading markets.

Analysts said the recession and the terrorist attacks only compounded what was already destined to be a bad year for Singapore.

Hong Kong, exposed to the same events, saw throughput decline 2 per cent year on year.

The difference in throughput at the world's two busiest container ports is now bigger than at any time in the past decade.

However, analysts said the results could have been worse for Singapore if not for a late-season flourish.

'We have been holding to a projection of a 10 per cent year-on-year decline for Singapore for some months now, so 8.9 per cent is a slight recovery from the worst expectations,' a Hong Kong-based analyst said.

'There are also some signs of stabilisation given that when you compare November to December, there was 2 per cent month-on-month growth, the first the PSA has seen in a year.'

December 2000 was the first month to show signs of what was to come for the PSA.

Throughput for the month fell 8.3 per cent as the Maersk fallout hit home.

While stability may have temporarily returned to the port, PSA executives are bracing for another tough year.

Its biggest customer last year, Taiwan's Evergreen Marine, plans to follow Maersk to Malaysia in August when its contract with the PSA expires.

Evergreen chairman Chang Yung-fa confirmed the move last week and said relocating its Southeast Asia transshipment hub to TPT would save the carrier NT$200 million (about HK$44.5 million) a year. Evergreen moved about 1.2 million teu through Singapore last year.

The PSA has refused to lower its terminal rates for carriers, preferring to add value through the operational efficiencies it offers. But in the present economic climate, that may no longer be enough.

Peter Williamson, investment analyst for ING Barings, said: 'This year's throughput result was not a surprise and next year will also be tough for the PSA.

'They will need to be flexible enough to keep their remaining customers. For the container shipping industry, cutting cost has become the name of the game. The PSA must be very careful that other lines don't follow Maersk and Evergreen to TPT.'

A silver lining to the increasingly ominous cloud over the Lion City came from the results of the authority's international facilities.

The PSA participates in 13 port projects in eight countries, which together saw throughput grow 32.8 per cent year on year to 3.6 million teu.

However, as those facilities represent less than a quarter of the PSA's total throughput, these are not likely to compensate for the year-on-year profit lost last year.



Maersk move to Tanjung weighs on result