A report by transport research and analysis company Transport Intelligence (Ti) has claimed that the Middle East Persian Gulf region could suffer from substantial overcapacity of container terminal infrastructure if all planned projects go ahead.
According to the Middle East Logistics Investment Opportunities 2018 document, nearly all major ports have substantial upgrades in the pipeline.
The study said that if certain major airport and port development projects occurred, particular facilities risked being significantly underutilised.
According to the report, significant underutilization of facilities is already occurring in a number of terminals.
In 2016, Bahrain’s throughput was about 300,000 teu, while its Khalifa Bin Salman Port had a capacity of 1m teu a year.
Qatar handled just under 500,000 teu but has the capacity to take four times that, while the Omani container ports of Duqm, Sohar, and Salalah have total throughput of 4m teu but capacity is 10.5m teu.
The report also found that the UAE is still the dominant place for container traffic in the region.
Recent figures from the Alphaliner database showed that the Saudi Arabian ports of Dammam and Jeddah and the UAE’s Khorfakkann Port were last year among the ten biggest losers of container volumes.
Yet, the decline does not seem to have deterred executives from further port building: in Dubai, the Port of Jebel Ali is set to see work commence late this year to bring the facility’s capacity to 22.1m teu, while Qatar’s capacity is set to increase to 6m teu by 2020.
Meanwhile, Saudi Arabia’s King Abdullah Port will, in 2020, see the current 4m teu capacity boosted to 20m teu.
“Overall, it is abundantly clear that if these planned investments go ahead, there will be vast under-utilization of terminal capacity across the region, as there simply will not be the demand for the available capacity,” Ti said.
Source: Port Strategy