We remain bullish on the prospects for ports and shipping in Estonia. As far as macroeconomic prospects are concerned, Estonia is doing a good job of bucking the eurozone trend. While Europe's debt and currency worries clearly will have an impact, for the moment Estonia is enjoying an export-driven industrial boom, resilient consumption and strong investment. BMI has now raised its 2011 GDP growth forecast to 5.0% (up from 4.1% in our last quarterly report). Our outlook for 2012 GDP has also been raised, to growth of 4.0%, up from 3.9% previously. In the five years to 2015, we expect growth to average 3.9% per annum, indicating that Estonia will outperform most of its Baltic peers.
Industry-specific factors are also favourable. With Russian oil exports through the Port of Tallinn expected to fall, we are now expecting a shift away from bulk cargoes in favour of container traffic as the port develops its maritime gateway role. However, and despite the development of rival Russian ports (such as Ust-Luga), the data still show substantial transit business taking place. Tallinn remains one of the key facilities in the Baltic, and a combination of ongoing GDP recovery together with dynamic trade with Estonia's Scandinavian and Baltic neighbours should maintain freight transport demand on a reasonable growth curve.
Headline Industry Data
?? Port of Tallinn gross tonnage set to rise by a strong 8% to 39.585mn tonnes in 2011, following a 16% increase in 2010.
?? Box traffic at Tallinn to grow at a faster pace, +19% to 180,827 TEUs in 2011, up from 16% the year before.
?? Estonian foreign trade to gain 15% in real terms this year, after 21.4% growth in 2010. Export growth will lead with 16% expansion, ahead of imports, which will be up by 14%.
Key Industry Trends
Double-Digit Percentage Growth In Port Tonnage - Cargo volumes rose by 14% to 25.1mn tonnes in the first half, according to Statistics Estonia. Loaded cargo totalled 18.7mn tonnes, up by 8.1%, while unloaded cargo was 6.39mn tonnes, up by 36.2%.
Tallinn Port Sees Bulk-To-Boxes Shift - BMI believes container business is growing at the Port of Tallinn, with a corresponding shift away from bulk cargo. We think the change is being driven by two the port into a maritime gateway, via a series of partnerships such as with Rail Garant of Russia and Sinotrans, Xiamen Logistics, and Fujian Logistics of China.
Tallink Grupp Reports Nine-Month Loss - The shipping company said it had a net loss of EUR15.6mn (US$22.5mn) in the first nine months of its 2010/11 financial year, a narrowing of the loss it suffered in the comparable year-earlier period. In the third quarter of the 2010/11 financial year Tallink carried 76,366TEUs (up by 11% y-o-y) and 2.098mn passengers (down 2.7% y-o-y).
Key Risks to Outlook
BMI believes the risks to our Estonia ports and shipping forecast are evenly balanced. We see three main risk factors. First there is an upside risk from the general economy. While we see the strength of the recovery cooling over 2011 and 2012, it is still possible that both those years will be a little above our projections. New data releases have already caused us to upgrade this year's GDP forecast to 5.0%, from 4.1% in our last quarterly report. Second there is a continuing downside risk of Russian transit oil shipments being diverted away from Tallink towards the new Russian port of Ust-Luga. What is unclear is how fast that process will take. And third, there is a further downside risk from the current eurozone crisis of confidence, caused by high sovereign debt levels in Greece, Portugal. Italy, and Spain among others. The fear is that, as Germany and France are increasingly called on to bail the weaker economies out, the general rate of economic growth will slow.
[Studien Infos ausblenden]
