World Economy

Dubai Shipping Volumes Waning

Dubai Shipping Volumes WaningDubai Shipping Volumes Waning

The amount of shipping cargo handled at Dubai’s ports, which includes flagship terminal Jebel Ali, has declined for the third consecutive quarter, according to the latest DP World figures.

The Dubai-owned terminal operator said on Tuesday its ports in the United Arab Emirates, all located in Dubai, handled 3.75 million twenty-foot equivalent units (TEUs) in the three months to June 30.

That is 6.2% lower than the four million TEUs it reported for the second quarter of 2015 and follows a 5.9% decline in the first quarter of 2016. Cargo volumes at its Dubai ports fell by 2.89% in the fourth quarter of 2015, Arabian Business reported.

DP World operates Dubai’s Jebel Ali, Mina Al Hamriya and Mina Rashid in the UAE, according to its website.

The company said it had faced “challenging market conditions in the first half of the year” and that a “reduction in lower-margin cargo” contributed to a 6% first-half decline in cargo volumes in Dubai.

It was generally a better story across its portfolio that includes ports from Europe to South America. Overall, gross container volumes were up 2.5% in the first half to 31.4 million TEUs but flat in the second quarter with 1.47% growth.

DP World group chairman and chief executive Sultan Ahmad bin Sulayem said the company remains confident in meeting its full-year target with larger contributions in the second half expected from terminals in India, Netherlands, Turkey and the United Kingdom.

“We continue to focus on driving profitability by targeting higher margin cargo, improving efficiencies and managing costs. We are encouraged by the progress we have made in the first half of 2016.

“We expect the second half of 2016 to show an improved performance.”

In the first half, DP World’s strongest percentage growth was in the Americas and Australia, up 8.3%, though that region makes up nearly 12% of total company volumes.

Europe, Middle East and Africa, which account for 42% of container volumes, grew by 0.6% in the first half compared to 7.1% a year earlier. Asia Pacific and the Indian Subcontinent, which account for 46% of container volumes, recorded a flat year-on-year first half growth rate of 2.9%.

DP World shares were trading down 0.82% to $16.95 at midday trade on the Nadaq Dubai on Tuesday.