Japan, South Korea market share hurt by SE Asia container growth

Panelists at the TPM Asia conference noted Southeast Asia’s rising prominence in container markets, but said growth has been mitigated by the fact that most cargo stays in the less lucrative intra-Asia trade.    Japan and South Korea have surrendered container market share to Southeast Asia nations, according to speakers at the TPM Asia conference in Shenzhen.
   Michel Looten, director of maritime for the consultancy Seabury, said Southeast Asia’s share of exports to China have grown at the expense of exports from Japan and South Korea. Meanwhile, Mario Moreno, senior economist for IHS Maritime and Trade, noted that Southeast Asian countries has wrested market share from South Korea and Japan on the Asia-U.S. container lane.
   Looten said Chinese imports from Southeast Asia have grown 12 percent annually between 2010 and 2014, while imports from Northeast Asia declined 5 percent in the same period.
   Moreno noted that Southeast Asia’s market share of Asia-U.S. imports have grown from 13 percent in 2010 to 15 percent in 2015, while Northeast Asia’s share has fallen from 18 percent to 15 percent in the same period.
   In a keynote address, Rafi Danieli, chief executive officer of the Israeli container line ZIM, said that Southeast Asia’s growth in container trade can be attributed to rising production costs in China driving manufacturing to the region.
   But Looten emphasized that Southeast Asia’s growth cannot be seen as a replacement for growth in China, which will remain the driving force behind global container trade. He also said that much of Southeast Asia container trade is tied to intra-Asia trade, which is not necessarily the most lucrative of trades from a carrier point of view.
   “If you’re a shipping line focusing on long-haul trade, Southeast Asia isn’t going to help you all that much,” said Looten. “It’s unlikely that Southeast Asia will replace China as a source of long-term container growth. China, for good or bad, will remain the driving force of container shipping industry for years to come.”