PKA says its port handled 6m TEUs containers in the 6 months to June

by ALIFAH ZAINUDDIN/ pic by ARIF KARTONO

PORT Klang, Malaysia’s largest container port, reported a 9.3% drop in cargoes handled in the first half this year yesterday after a restriction on movement caused major backlogs of cargoes and disrupted supply chains globally.

Port Klang Authority (PKA) said its port handled 5.98 million twenty-foot equivalent unit (TEUs) containers in the six months to June, down 9.3% on the same period a year ago.

Total imports fell 2.8% to 1.17 million TEUs, while exports declined 1.1% to 1.18 million over the period. Transhipment also recorded a fall of 13.5% to 3.52 million TEUs.

It said the Covid-19 pandemic created a challenging environment. However, the gradual reopening of economies globally since May have helped to restore some of the port’s operations, and saw its performance improve in June.

Forecast on the number of cargoes to be handled at the port this year has been revised downwards to 11.4 million TEUs from 14.1 million expected initially.

Transport Minister Datuk Seri Wee Ka Siong said the port could hit 12 million TEUs if operations are restored in full.

Malaysia closed its borders to travellers, restricted internal movement and kept non-essential businesses shuttered until May to contain the spread of the virus. Some businesses had earlier said they were not able to move their goods out of the port — causing a clog-up of non-essential goods.

The government later enabled the movement of non-essential cargoes — reportedly make up 80% of total cargo volume — which helped reduce the congestion at Port Klang from 78% to 60%. Additionally, PKA recently approved an incentive package worth RM17.23 million to help reduce the impact of the pandemic on logistics players in Port Klang.

The package includes exemption and discounts of up to 100% on lease rentals to PKA tenants until year-end, a 20% discount on port dues to shipping lines from July to December 2020, a 20% cut on foreshore charges to private jetty users and deferment of up to 30% on rent for the Port Klang Free Trade Zone (PKFZ) tenants which will be collected over a 12-month period in 2021.

Additionally, private jetty users, comprising importers and exporters, will get to enjoy a 20% discount on foreshore charges, worth RM180,517.

Separately, Wee said the negative forecast will not affect PKA’s ability to service the loans it took from the Finance Ministry (MoF) given its ability to generate higher revenue in recent years. However, he did not discount the possibility of making exceptions.

The PKA has committed to repaying a loan it took from MoF to build the controversial PKFZ in 2013.

The repayment scheme has been restructured twice with PKA now committing to an annual payment of RM222 million over 29 years.

PKFZ drew controversy after it was revealed that its original projected cost of RM1.96 billion spiralled to about RM3.52 billion, excluding interest costs, as at end-2008.