Ports of Auckland warns of slower growth

As the slowdown begins to take a toll, fewer containers will be coming into the country. Picture / Herald on Sunday

Ports of Auckland has warned the economic slowdown will crimp growth in container volumes in the coming year.

Disclosing a rise in December half-year underlying earnings from $35.8 million to $37.6 million, the port company, which was last year taken over by the investment vehicle of the Auckland Regional Council, said the slowing was evident in the weakening imports of vehicles.

In the half year, container volumes rose 8 per cent to 352,788. Non-container cargo volumes were unchanged at 2.4 million tonnes.

Car imports are averaging around 13,600 a month, down from the average of 15,200 a month last year.

"It is clear the economy is slowing and that is likely to impact on volume growth in the second half of the year," said Ports of Auckland chairman Neville Darrow.

Half-year net profit rose from $21.5 million to $21.7 million, reflecting higher interest charges after the port paid a $120 million special dividend to Auckland Regional Holdings.

The port said it was watching Christchurch City Council's planned takeover of Lyttelton Port and then sale of a near half share to Hong Kong's Hutchison Whampoa.

But it was still difficult to say what it meant for the port.

"There is considerable restructuring being carried out in the logistics and port industries. Mergers of international shipping lines and port operators continue to be negotiated and new alliances formed," Darrow said.

Growth in volumes reflects the arrival of three new shipping services to the port: the Maersk Oceania service; Mediterranean Shipping's weekly service and CP Ships' trans-tasman roll-on, roll-off Auckland hub service.

The port said the review of shipping services after the merger of P&O Nedlloyd and Maersk Sealand would not have a dramatic effect on shipping volumes.

"Ports of Auckland will win some new shipping services and lose some others. There will be movement in container volumes between Ports of Auckland and Port of Tauranga, but overall volume split between the ports will remain around the same," said chief executive Geoff Vazey.

He said the port was working well with the Auckland City Council on plans to redevelop the Wynyard Wharf and the Tank Farm.

Work continues on the 9.4ha Axis Fergusson container terminal reclamation, the deepening of the commercial shipping lane and the development of the inland port at Wiri.