Penang Port seeks tariff review

Penang Port Sdn Bhd (PPSB) will submit a proposal to review its tariffs to the Transport Ministry next month.
Chief operating officer Obaid Mansor told StarBiz that the review of container charges was done every three to four years.
“This review will also be timely due to higher oil prices and other operating costs which are eroding our margins,” Obaid said.
The last review was done in 2007, which saw a 30% hike in handling charges for container cargo to RM182 for a twenty-footer container and RM273 for a forty-footer container.
Revenue from the container-handling operation contributes 60% of PPSB’s revenue, which stood at about RM300mil in 2010.
Revenue from non-container cargo-handling operation and other tariffs contribute the remaining 40%.
Obaid said there was currently a shortage of empty containers for export and this had affected the volume of cargo at North Butterworth Container Terminal (NBCT) last month.
“Most of the empty containers from the Middle East and India are sent to China by shipping companies, where there is a high volume of export activities. Also, during the recession three years ago, many shipping companies stopped ordering new containers.
“Now that demand has exceeded supply, there is a shortage. For this reason, the volume of container cargo handled at NBCT from January to May hit 470,572 twenty-foot equivalent units (TEUs), about 3.5% less than our target of 488,000 TEUs,” he said.
The 470,572 TEUs were about 4% more than 452,575 TEUs achieved in the same period a year ago.
Obaid said now that PPSB had started servicing bank loans for the port’s expansion exercise, it was vital for it to start the dredging works to deepen its sea channel.
“The dredging works, to deepen the sea to 14.5m from 11.5m presently, should be completed in 12 to 18 months. It will allow larger vessels to arrive and increase the port’s revenue.
“We hope the Government will release the RM350mil allocation for us to do the dredging works as soon as possible,” he said.

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