RM500m upgrading for Malaysia's Northport
Malaysia's Northport is in the midst of a RM500 million (S$220 million) upgrading project and aims to focus on niche port businesses to keep up with competition from regional ports.
The main port for Malaysia's local cargo, it is aiming to handle three million TEUs (standard container boxes) this year, 13 per cent more than last year's 2.7 million TEUs.
With the upgrading will come an additional container berth, which will help raise its box-handling capacity to five million TEUs within the next two years.
But while largely a container-handling port, Northport's growth strategy involves increasing its conventional cargo-handling capacity as well, so that it can handle a broader product base as a multi-purpose port.
This also means it need not get into the cut-throat competition for transhipment cargo which neighbouring ports, including Malaysia's own Westport and the Port of Tanjung Pelepas further down south, are entrenched in.
Northport, one of two privatised ports in the Port Klang cluster, will instead handle more conventional cargoes like cars and provide value-added distribution services, said chief executive officer Basheer Hassan Abdul Kader.
The port company will promote the development of 'freight corridors' in the country to foster cargo generation and will work with the Malaysian Railway to widen connectivity to the port and its distriparks and develop rail-linked terminals, Mr Basheer told BT in Kuala Lumpur, following celebrations to mark its 21st anniversary.
The highly profitable port company - majority-owned by NCB Holdings Berhad (NCB), a transport conglomerate listed on the local bourse - was described by Malaysian Deputy Prime Minister Najib Abdul Razak as one of Malaysia's first privatisation success stories.
The challenge of a highly competitive market environment has forced Northport - which recorded 4-5 per cent annual growth in recent years - to focus on rate of returns and profit margins rather than market shares and throughput figures for the top box terminal charts.
'It is no longer just the state of the infrastructure that matters but increasingly shipping lines and shippers are focusing on the quality of services available at the port,' Mr Basheer said.
'This is especially with regard to transhipment traffic where the competition has become keener, eroding margins somewhat severely as lines seek to reduce costs, including problems brought about by repositioning of containers.'
Elaborating on Northport's development plans, Mr Basheer said the building of a new berth and dredging of the access channel will also help Northport handle the 'mega ships' of above 8,500-TEU capacity that are being deployed by the world's major container shipping lines.
'We are confident that the deepening of the approach channel and our development plans will strengthen Northport's competitive position to effectively respond to the increasing size and capacity of ships calling at selected ports worldwide,' he added.
The port company also owns Malaysia's largest haulage, Kontena Nasional, and logistics subsidiary, Northport Logistics.
The main port for Malaysia's local cargo, it is aiming to handle three million TEUs (standard container boxes) this year, 13 per cent more than last year's 2.7 million TEUs.
With the upgrading will come an additional container berth, which will help raise its box-handling capacity to five million TEUs within the next two years.
But while largely a container-handling port, Northport's growth strategy involves increasing its conventional cargo-handling capacity as well, so that it can handle a broader product base as a multi-purpose port.
This also means it need not get into the cut-throat competition for transhipment cargo which neighbouring ports, including Malaysia's own Westport and the Port of Tanjung Pelepas further down south, are entrenched in.
Northport, one of two privatised ports in the Port Klang cluster, will instead handle more conventional cargoes like cars and provide value-added distribution services, said chief executive officer Basheer Hassan Abdul Kader.
The port company will promote the development of 'freight corridors' in the country to foster cargo generation and will work with the Malaysian Railway to widen connectivity to the port and its distriparks and develop rail-linked terminals, Mr Basheer told BT in Kuala Lumpur, following celebrations to mark its 21st anniversary.
The highly profitable port company - majority-owned by NCB Holdings Berhad (NCB), a transport conglomerate listed on the local bourse - was described by Malaysian Deputy Prime Minister Najib Abdul Razak as one of Malaysia's first privatisation success stories.
The challenge of a highly competitive market environment has forced Northport - which recorded 4-5 per cent annual growth in recent years - to focus on rate of returns and profit margins rather than market shares and throughput figures for the top box terminal charts.
'It is no longer just the state of the infrastructure that matters but increasingly shipping lines and shippers are focusing on the quality of services available at the port,' Mr Basheer said.
'This is especially with regard to transhipment traffic where the competition has become keener, eroding margins somewhat severely as lines seek to reduce costs, including problems brought about by repositioning of containers.'
Elaborating on Northport's development plans, Mr Basheer said the building of a new berth and dredging of the access channel will also help Northport handle the 'mega ships' of above 8,500-TEU capacity that are being deployed by the world's major container shipping lines.
'We are confident that the deepening of the approach channel and our development plans will strengthen Northport's competitive position to effectively respond to the increasing size and capacity of ships calling at selected ports worldwide,' he added.
The port company also owns Malaysia's largest haulage, Kontena Nasional, and logistics subsidiary, Northport Logistics.