SUBANG JAYA: Until a few months ago, Port Klang was a hive of activities, with containers usually stacked six stories high.
These days, it’s a lot quieter. Major shipping firms have moved their hubs to Singapore, according to recent reports.
“A few years ago, we could still compete with Singapore,” said an industry player who owns a logistics company. “We managed to draw big carriers to Port Klang. I don’t think we can catch up with Singapore now.”
So what’s taking business away to Singapore?
The city state has better technology, infrastructure and services in its port industry, making it more efficient in support services such as customs clearance.
Early this year, the Port Klang Authority said the port registered a growth of 10.8% in 2016, with 13.17 million twenty-foot equivalent units (TEU) in container handling, compared to the previous year. TEU measures a ship’s cargo carrying capacity. One TEU is equal to the carrying capacity of a standard 20-foot container.
A Singapore Straits Times report, quoting data from port operators Northport and Westport, said cargo throughput at Port Klang fell 8.4% in the second quarter of this year to three million TEU after a flat first quarter growth of 0.9%.
Major firms have moved to Singapore, and these include the Ocean Alliance, a grouping of four shipping giants, namely China’s Cosco, France’s CMA CGM, Taiwan’s Evergreen and Hong Kong’s OOCL.
The Ocean Alliance oversees more than 323 ships covering 40 destinations worldwide, and the shift made by some shipping companies to Singapore could result in Port Klang losing up to two million TEU annually.
Port economics aside, an industry source told FMT that Malaysia’s work culture had also contributed to Port Klang’s decline.
“The problems we have at the port and in the shipping industry are like what you see elsewhere on a daily basis,” he said. “When you go shopping, don’t you see shop assistants on their phones instead of attending to customers?”
Aside from a general lack of efficiency, there are the countless public holidays that employers keep complaining about.
“Shipping is a 24-hour game,” said one business owner. “Too many holidays are bad for business.”
If the current trend continues, the ultimate losers will be consumers. With more ships going to Singapore, shipping costs will increase.
“Take for example a trading company sending its products to Port Klang as a transhipment hub,” said the source. “If the ships go to Singapore, there will be extra cost in transshipment.”