Hinds

With fewer vessels calling the Port of Kingston and cargo volumes showing a steady downward trend since June of last year, employers at the island's main port of entry are faced with tough decisions to remain viable during the current economic downturn.

According to the Port Authority of Jamaica's Statistical Report 2009, domestic cargo at the Port of Kingston has shown a significant decrease with Kingston Wharves handling 27 per cent less in January 2009 than it did in January 2008. The decline in February 2009, compared with February 2008, was of a similar percentage.

Kingston Container Terminal (KCT) whose domestic cargo accounts for 10 per cent of its business, recorded a drop of 39 per cent, January 2009, compared with January 2008, and a reduction of 35 per cent when February 2009 is compared with the same month in 2008.

Fewer calls

Cargo vessels have made significantly fewer calls in 2009, showing a 16 per cent decline for January and nine per cent decline for February compared with the same period last year. Total vessels calling the port have also seen a reduction with KCT and Kingston Wharves Limited (KWL) showing a combined 161 for January and 167 for February compared with 186 and 166 respectively for the same period last year.

This downward trend is not unique to Jamaica. Media reports from across the globe are showing similar dramatic slides in shipping activity and in other sectors allied to shipping, such as shipbuilding, vessel chartering and insurance.

Jamaica's neighbour and major competitor, Panama, has proven resilient in this period of downturn, mainly due to its current efforts to expand the Panama Canal. But even Panama is starting to show some decline. The Panama Star on March 25 quoted Panama Maritime Authority's AMP Administrator, Fernando Solorzano, as saying that in the first three months of 2009, "there has been a small decrease in the ports operations as a consequence of the crisis".

The article further states that shipping companies have been the first to experience the maritime commerce slowdown, mainly because the movement of containers has decreased. In the Panamanian maritime sector a decrease of five per cent in the port's movements is expected in comparison with 2008.

One of the main factors leading to this dramatic reduction in trade is the recession in the United States (US), the world's largest consumer market which is being battered by the global credit crunch. US imports so far in 2009 have declined by 7.9 per cent.

Decline in exports

China's exports are down by 17.5 per cent. Other major trading nations such as Taiwan and Japan have reported a decline in exports by 44 and 35 per cent, respectively.

Major shipping lines such as Maersk, CMA CGM, ZIM and Hamburg Sud have made major changes to their trade routes based on the deteriorating market conditions. These major lines have implemented measures such as staff cuts, vessel-sharing agreements and a cut back in the frequency of service along several trade lanes in order to stay afloat.

Last year, KWL reduced its workforce by 10 per cent, and, just last week, the Shipping Association of Jamaica (SAJ) announced that it would reduce its stevedoring workforce by 62.

Financial crisis

President of the SAJ, Roger Hinds, said that such a decision was not an easy one to make during the current financial crisis. However, he noted that the SAJ would seal its own fate as an employer of labour at the Port of Kingston if it failed to respond to the declining circumstances of the association's customers and its own declining revenues.

However, the SAJ president noted that several measures will come on stream that will improve efficiency at the Port of Kingston and increase our competitiveness.

"We will partner with stakeholders in the industry to make Kingston more attractive in the region and to generate new business," Hinds said. He added that the implementation of a Cargo Community System (CCS) is one of the measures that will propel Jamaica into the higher echelons of the logistics chain. A feasibility study is currently under way for the CCS.

Hinds said that other measures will include a constant and dynamic review of all operations, systems and procedures to create value for customers, employees and businesses operating at the port.

Grantley Stephenson, chairman and chief executive officer of Kingston Wharves Limited, presents a copy of History of the Shipping Association of Jamaica (SAJ), to Jean Anderson, president of the Lay Magistrates Association of Manchester after the opening of the SAJ's 70th anniversary exhibition of photographs and artefacts, held at the Manchester Parish Library last Friday.

Grantley Stephenson, chairman and chief executive officer of Kingston Wharves Limited welcomes Mayor of Mandeville Brenda Ramsay (centre) and Phyllis McFarlane of the Manchester Victims Support Unit to the opening of the Shipping Association of Jamaica's 70th Anniversary Exhibition of Photographs and Artefacts last Friday. Mr Stephenson was the guest speaker at the function.