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Estonia Shipping Report Q1 2013

  • Publication Date:January 2013
  • Publisher:Business Monitor
  • Product Type: Report
  • Pages:119
  • ISBN:165445

Estonia Shipping Report Q1 2013

Includes 3 FREE quarterly updates

BMI View: Port Of Tallinn Back On Moderate Growth Path
We have trimmed back our GDP growth projections for Estonia in 2012 and 2013, to reflect the ongoing
troubles of the eurozone. BMI now expects the economy to grow by 2.4% in 2012 and 3.0% in 2013 -
both these numbers are a few decimals of a percentage point lower than our earlier projections.

However, we are confident that the medium-term outlook is good, based on the resilience of consumer
demand, the country's low debt ratios, and its trade links to northern Europe and the Scandinavian
economies. We expect total foreign trade (imports + exports) to grow by a healthy 6.1% in 2013.
Within the ports and shipping sector, competition from the new Russian Baltic port of Ust-Luga has taken
significant bulk cargo business away from Estonia's Port of Tallinn. We estimate that throughput will
have fallen by 16% in 2012, and are projecting a small increase in 2013. On the other hand, container
activity levels have been lifted by the growth of transit trade in other commodities and manufactured
products, and by the resilience of imports.

Headline Industry Data
- Port of Tallinn gross tonnage set to grow by 1.3% to 31.039mn tonnes in 2013, following a
16.0% fall in 2012.
- Box traffic at Tallinn to grow by 7.7% to 257,646 twenty-foot equivalent units (TEUs) in 2013,
down from 21.0% growth in 2012.
- Estonian foreign trade to gain 6.1% in real terms in 2013, after 7.6% growth in 2012.
- Import growth will lead with 6.4% expansion, ahead of exports, which will be up by 5.8%.

Key Industry Trends

Industry Seriously Worried Over Waterway Tolls
Local shipping and port operators were expressing growing concerns over government plans to
consolidate and increase waterway toll charges from 2013 onwards. Proposed legislation would raise
charges to cover a range of investment costs, including safety and environmental provisions. The
Association of Estonian Ports warned that total fees for marine shipping could rise by between 14% and
60%, while others suggested charges may more than double. 'This affects cruise ships, cargo and fuel,
because cargo is often cost sensitive. There is the choice of whether to ship through Estonia or through
Latvia,' said Viktor Palmet, president of the Association.

Competition From Russia's Ust-Luga Continues To Bite
Bulk cargo volume at the various facilities controlled by Port of Tallinn fell by 19% year-on-year (y-o-y)
to reach 20.2mn tonnes in the first eight months of 2012, the authorities said. Chief commercial officer
Erik Ringmaa said the fall was due to growing competition from Russia's new port of Ust-Luga, which is
being used as an outlet for oil and petroleum products previously shipped through Estonia. In fact, liquid
cargo shipped through the Port of Tallinn fell by 27% y-o-y to 13.3mn tonnes over the first eight months.
Ringmaa noted that investments currently being made in the port's Muuga Terminal would contribute to
longer-term diversification of cargo types. Containers handled by the port meanwhile rose by 22% over
the first eight months of the year to reach 155,595 TEUs.

APM Gains Indirect Stake In Estonia's Vopak Terminal
Danish shipping and port operator AP Moller-Maersk said in September 2012 that it had agreed to buy a
37.5% stake in Russian container terminal operator Global Ports Investments for around US$860mn.
Moller-Maersk's port-operating arm, APM Terminals, will acquire the stake from Transportation
Investments Holdings, or N-Trans, one of Russia's largest privately owned transportation groups. NTrans
currently holds 75% of Global Ports' equity. Global Ports operates three sea container terminals in
Russia, two sea container terminals in Finland and one inland terminal in the St Petersburg region, and
together with Dutch company Royal Vopak, runs the Vopak E.O.S. oil products terminal in Estonia.

Key Risks To Outlook
While Estonia has to date come through the eurozone turbulence and enjoys a strong fiscal position, any
intensification of the crisis could hit the country's foreign trade and domestic growth rates, leading to a
downturn in freight demand. There is also a local political risk factor: complicated bilateral relations with
Russia, which could have an adverse impact on the significant transit trade flows between the two
countries. Bilateral relations hit an all-time low in 2007 and have improved significantly since. However,
there are still a number of flashpoints, and there is a risk that they could impact on the still-important
transit trade between the two countries.
BMI Industry View ..... 5
SWOT Analysis .. 7
Estonia Shipping SWOT ..... 7
Estonia Political SWOT ..... 7
Estonia Economic SWOT ... 8
Estonia Business Environment SWOT ...... 8
Global Overview - Container Shipping . 9
2013 Offers Promise, But Will Be Tough . 9
Transpacific Demand To Tick Up ... 13
Supply Issues To Become More Acute .... 22
Another Year Of Strict Capacity And Rate Management ..... 25
Global Overview - Dry Bulk Shipping . 32
2013: Stimulus Offers Short Term Blip, Demand To Slip ..... 32
2013: Supply Problems Remain And It Is Too Tough For Some .. 36
Global Overview - Liquid Bulk Shipping ... 43
2013 To Offer Little Respite For Tanker Operators ...... 43
Cross-Basin Trade To Aid Supertanker Operators ....... 47
Chinese Pool To Drive Down Rates 49
Sanctions Hit Crude Shipping Sector ..... 51
Industry Trends And Developments ... 54
Estonia Container Shipping Market Overview .. 57
Industry Forecast .... 64
Port of Tallinn 64
Table: Major Port Data, 2010-2017 ...... 66
Table: Trade Overview, 2010-2017 66
Table: Key Trade Indicators, 2010-2017 ....... 67
Table : Main Import Partners (US$mn), 2002-2009 ..... 68
Table: Main Export Partners (US$mn), 2002-2009 ...... 68
Company Profiles .... 69
Maersk Line ...... 69
Mediterranean Shipping Company (MSC) ..... 77
CMA CGM 81
Evergreen Line . 86
COSCO Container Lines Company Limited (COSCON) ...... 90
Hapag 94
APL .... 98
Hanjin Shipping (Container Operations) ......103
China Shipping Container Line (CSCL) .......107
Mitsui OSK Lines (MOL) (Container) ...111
Estonia Demographic Outlook ... 115
Table: Estonia's Population By Age Group, 1990-2020 ('000) ...116
Table: Estonia's Population By Age Group, 1990-2020 (% of total) .117
Table: Estonia's Key Population Ratios, 1990-2020 ....118
Table: Estonia's Rural And Urban Population, 1990-2020 118
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