Rotterdam Port Growth Continues

Maritime Activity Reports, Inc.

December 30, 2005

In 2005, 369 million tonnes of cargo passed through the port of Rotterdam, almost 5% more than in 2004 and a new record. The volume of cargo leaving the port grew faster than that of cargo coming in, with 9% and 3% respectively, with general cargo enjoying 7% growth – almost twice the growth of bulk cargo. Ores and scrap metals (-5%), crude oil (-1%) roll on /roll off (-9%) and other general cargo (-3%) arrived and left in smaller volumes. However, handling of agri-bulk (+1%), coal (+7%), other dry bulk (+4%), other wet bulk (+4%), mineral oil products (+27%) and containers (+10%) showed very positive figures. In numbers, container movements increased by more than 12% to 9.3 million TEU (container units of 20 feet). In containers, coal, mineral oil products and in other wet bulk, records were realised.

Port of Rotterdam Authority CEO Hans Smits: "The port is doing extremely well. We are achieving or even exceeding the highest prognoses for volumes arriving in and leaving the port of Rotterdam. Capital expenditure is reaching almost 'Asian levels’. Added value is rising strongly and the same goes for the role played by the port in the Dutch and European economy. The flourishing transhipment volumes are driven by the containers, with another million units being added, and a 27% increase in mineral oil products. In this particular area, Rotterdam is already the world hub, with Russia and the Middle East as the ‘wings’. These regions still offer great perspectives and therefore play a major role in our commercial strategy and those of the companies operating in the port. My prognosis for the coming year is “realistic/optimistic”.We have quite a job on our hands to hang on to present levels, especially in the area of oil products. On the other hand, macro-economic growth expectations are becoming increasingly favourable. We will be happy if throughput in general in the port keep growing at roughly the same pace, say 3 to 4 %”

Dry bulk

The total volume of dry bulk cargoes remained stable at nearly 90 million tonnes. Transhipments of agri-bulk (grains, seeds, livestock feed raw materials) amount to around 10.7 million tonnes for the third successive year. Imports declined slightly in the past year because of disruptions in Gulf of Mexico ports caused by hurricanes. Quantitatively more important is a drop in tapioca imports because Thailand is exporting more of it to China. Exports of European (intervention) grains via Rotterdam, arriving by train, grew strongly.

The total volume of coal being handled in Rotterdam grew by 1.7 million tonnes. The demand from the main buyers, Dutch and German power generation plants, dropped. This was offset by the fact that the EECV terminal transhipped more coking coal, for steel production. Part of the coking coal came from ports surrounding us.

Handling of ores and scrap metals declined by 5 % to 40 million tonnes. In the course of the year, European steel factories reduced production for a while because of rising stocks and to support steel prices. Apart from lower ore imports, scrap metal exports also declined as a result of the increased demand from European electro-steel factories.

Other dry bulk goods continued to maintain a rising line with a 4% increase this year to 12 million tonnes. In spite of the pressure on the manufacturing industry, major demand for ores, minerals and concentrates continues for the production of steel, metals, paper and chemical products. Especially ship-to-ship transhipments on the buoys were on the rise because of higher frequencies of "parcel services" from China and South Africa.

Wet bulk

The total volume of wet bulk handling rose by 6% to 170 million tonnes. The volume of crude oil arriving in Rotterdam dropped a little, by 1% to 100 million tonnes compared to the extremely good preceding year. The demand for refined products is high and refining margins are good. These fundamental factors ensure that crude oil supplies continue at a high level of 100 million tonnes or more.

Fluctuations arise especially as a result of maintenance stops. This was also the reason why Total Antwerpen and Nerefco Rotterdam came to a standstill for some time this year. Shell Pernis suffered a shutdown that was unplanned.

Imports of oil products grew by 24% to 28 million tonnes, while the volume of oil products leaving Rotterdam grew by 36% to more than 15 million tonnes. A total of 42 million tonnes (+27%) were bought/sold. Supplies of (fuel/heating) oil from Russia, where Rotterdam has a market share of about 80%, grew once again.Of this, a larger proportion than usual was shipped to Asia, for which no fewer than 13 VLCCs were engaged. Imports of lighter products such as kerosene from, for in stance, are also on the rise for the time being. A structural shortage already exists in Western Europe and more and more refining capacity is concentrated in the Middle East.

Throughput of other wet bulk cargoes, mostly base chemicals, grew by 4% to 27 million tonnes (exports down 4%, imports up 9%). The somewhat lower export volume (prices rose) of chemical products was more than made up for by the growth in imports of "new"and usually "green"products. These are oilseed (for bio-diesel), ethanol (from Brazil, to Sweden and England), ETBE and palm oil. The palm oil comes especially from Malaysia and Indonesia and since autumn this year is also being refined in Rotterdam (Loders Croklaan, Maasvlakte). Palmoil is used in foodstuffs, in the chemical industry as, for instance, a hardener, and as a green fuel for power generation plants.

General cargo

The general cargo sector had a good year with a 7% increase of more than seven million tonnes to 110 million tonnes. This was due to the much larger volume of containers arriving (+11%) and leaving (+10%) the Port of Rotterdam. In weight, container handling grew by nine million tonnes to total 91 million tonnes. In numbers, the increase was 12% to total 9.3 million TEU (+1 million). The forces driving this growth remain the Far East, South America and the Baltic region, more especially Russia. In the beginning of the year, growth was still very high, among other things as a result of the influx of textiles, but then gradually slowed. It appears that this (expected) development is caused especially by macro-economic conditions. The increased availability of transhipment capacity elsewhere in north-western Europe has, to date, had only a limited effect on Rotterdam.

“Roll-on/roll-off declined by 9 % to total 10 million tonnes. This drop is caused mostly by the fact that a Seawheel ro-ro service was turned into a container service. The growing popularity of shipping containers on ro-ro vessels is a trend. Other ferry companies were operating at levels that were slightly positive. Clearly positive is the development of automobile transhipments at Rotterdam Car terminal and those of paper (on cassettes).

Other general cargo lost a little of gains made the year before: dropping 3% to 8.6 million tonnes. This decline is found mostly in export cargoes and in LASH transports. On top of that, some ships with fruit discharged their cargoes in Vlissingen, under a collaborative agreement between Seabex and Kloosterboer. Handling of steel and forest products enjoyed positive development.

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