January to April period Containerized export volumes drop by 40%

CEBU, Philippines – Cargo handling company Oriental Port and Allied Services Corp. (OPASCOR) noted a 40 percent decline in export cargo volume, specifically on outbound containerized cargo shipments from January to April this year compared to the same period last year.

In an interview with OPASCOR president and general manager Atty. Tomas A. Riveral, he said that the bulk of their containerized export volume are composed of cargoes loaded using container vans such as furniture, crafts, and housewares for export.

Riveral said that exported cargoes started to decline since September of last year during the start of the global economic meltdown.

He said that their clientele are composed of exporters and importers and usually, their export volume are sent to countries like the United States, Europe and inter-Asia but the bulk with 70 percent of the bulk bound for the US.

Riveral also added that despite the significant decrease of their export volume, they still note some export companies who continued increasing their volume despite the crisis due to peculiar needs of US residents which were not hindered by the slow demand.

OPASCOR also noted that exporters are now exploring new markets in Europe like Russia; however these cargoes are trans-shipped to other ports and do not go direct to these destinations so data is difficult to obtain.

He added that during the lean months of the export volume, there has been a significant increase of the bulk of cargo going to other Asian destinations by 20 percent for the first four months of the year going to countries like Hong Kong, Malaysia, and Singapore.

"The inter-Asian trading has increased the foreign cargo and has been the saving grace of the foreign cargo shipments because it kept the shipping operations alive during the period of slowdown," he said.

Although OPASCOR's import volume for the first four months of this year did not decline, Riveral shared that the significant decline of their export volume affected their revenues as they incurred a decline of about seven to 11 percent in their gross revenue for the period of January to April this year.

However he stressed that even if the global crisis has been the worst crisis they have experienced so far, they did not resort to laying off their people but instead they cut cost on some of their operating expenses like electricity and they also followed a shorten work day.

 Riveral stressed that due to the global economic crisis, there has been a global slowdown of cargo shipping and in fact the Philippines specially ports in Subic and Davao has become a preferred lay-up area for foreign vessels which were tied down because business activities are down these days.

"Cebu fare relatively better than other places within the Asian region in terms of cargo shipments because our economy is not just propelled by manufacturing outputs but also by other derivatives like tourism so the demand for imported products is still big," said Riveral.

He said that for the second quarter of the year, they expect that the reduction in export volume will bottom out and become a plateau after the significant decline and so that gradual increase in cargo volume could be expected in the third quarter of the year as the world economy starts to recover. — Rhia de Pablo