Davao port to be privatized in 2013
The government is set to privatize the entire operation of the Port of Davao in 2013 to keep up with its fast-growing cargo volume, Business Mirror reports.
The terms of the privatization plan are now being drafted by the Department of Transportation and Communications, said Christian Santilian, district manager for Southern Mindanao of the Philippine Ports Authority (PPA).
“We’ve been seeing volume growth in the port at a rate of 7 percent to 10 percent every year for the last eight years,” Santillan, who is also the port manager of Davao, said in an interview with reporters. “We [the Port of Davao] are the best-performing port in Mindanao even compared with Northern Mindanao.”
The PPA operates the Davao port, also known as the Sasa Wharf, with the Davao Integrated Port Stevedoring Service Corp. (Dipsscor) as the port’s cargo handler. The company is a wholly owned subsidiary of International Container Terminal Services Inc.
About 70 percent of the products handled at the port are bananas from Davao and nearby areas. According to the United Nation’s Food and Agricultural Organization, the Philippines is the world’s fourth-largest exporter of banana in 2010 after Ecuador, Costa Rica and Colombia.
Shipping lines, however, said the country’s billion-dollar banana exports industry was in peril because of the port’s inefficiencies; the facility lacks proper cargo-handling equipment to service large vessels that call.
An official of the American President Lines (APL) said the port needs a major facelift because its dilapidated state affects the efficiency of the shipping lines calling.
The official said its vessels’ average waiting time before discharging at the port is around 40 hours or almost two days. Liners spend more for the extra time their vessels sit idle. They also use more bunker fuel during the long wait.
“The process [of cargo handling] takes even longer since they [PPA] don’t have a crane and all of the vessels that we use have [cargo handling] gears,” the APL official said.
Even if the port authorities can provide new cargo-handling equipment, the Port of Davao’s old structure may not be able to withstand the weight of a crane, the shipping executive added.
An official from the shipping line Maersk-Filipinas Inc. noted that the port’s shallow draft cannot accept larger ocean-going and even domestic vessels.
APL and Maersk Lines are the port’s biggest clients.
According to data, APL’s container traffic to Davao Port reached 80,323 twenty-foot equivalent units (TEUs) from January to September; Maersk’s container traffic reached 91,879 TEUs during the same period.
PPA officials acknowledged that the port has not been constructed to handle containers since less than 10 years ago Sasa Wharf only accepted a handful of cargo.
In 2003, the port only handled 2.71 million metric tons of cargo, more than half of which are domestic goods. In 2007 the volume started to increase to 3.47 million metric tons with foreign cargoes meant for export to Asia, the Middle East and other parts of the world accounting for half of the volume.
As of October this year, the port already handled 4.46 million metric tons, of which 2.78 million metric tons are foreign cargoes.
In terms of containerized cargoes, the port handled 478,994 TEUs from January to October.
The PPA said in its earlier presentation that it needs some P3.98 billion to expand the Davao port. The project include the strengthening of Berths 1 and 2, development of Container Yard 3, demolition of the existing building, development of 300 container-yard reefer outlets as well as the supply and installation of four gantry cranes and installation of eight rubber-tired gantry cranes.
Once completed, the project is expected to increase the capacity of the port to about 1.3 million TEUs or double it current one.
The terms of the privatization plan are now being drafted by the Department of Transportation and Communications, said Christian Santilian, district manager for Southern Mindanao of the Philippine Ports Authority (PPA).
“We’ve been seeing volume growth in the port at a rate of 7 percent to 10 percent every year for the last eight years,” Santillan, who is also the port manager of Davao, said in an interview with reporters. “We [the Port of Davao] are the best-performing port in Mindanao even compared with Northern Mindanao.”
The PPA operates the Davao port, also known as the Sasa Wharf, with the Davao Integrated Port Stevedoring Service Corp. (Dipsscor) as the port’s cargo handler. The company is a wholly owned subsidiary of International Container Terminal Services Inc.
About 70 percent of the products handled at the port are bananas from Davao and nearby areas. According to the United Nation’s Food and Agricultural Organization, the Philippines is the world’s fourth-largest exporter of banana in 2010 after Ecuador, Costa Rica and Colombia.
Shipping lines, however, said the country’s billion-dollar banana exports industry was in peril because of the port’s inefficiencies; the facility lacks proper cargo-handling equipment to service large vessels that call.
An official of the American President Lines (APL) said the port needs a major facelift because its dilapidated state affects the efficiency of the shipping lines calling.
The official said its vessels’ average waiting time before discharging at the port is around 40 hours or almost two days. Liners spend more for the extra time their vessels sit idle. They also use more bunker fuel during the long wait.
“The process [of cargo handling] takes even longer since they [PPA] don’t have a crane and all of the vessels that we use have [cargo handling] gears,” the APL official said.
Even if the port authorities can provide new cargo-handling equipment, the Port of Davao’s old structure may not be able to withstand the weight of a crane, the shipping executive added.
An official from the shipping line Maersk-Filipinas Inc. noted that the port’s shallow draft cannot accept larger ocean-going and even domestic vessels.
APL and Maersk Lines are the port’s biggest clients.
According to data, APL’s container traffic to Davao Port reached 80,323 twenty-foot equivalent units (TEUs) from January to September; Maersk’s container traffic reached 91,879 TEUs during the same period.
PPA officials acknowledged that the port has not been constructed to handle containers since less than 10 years ago Sasa Wharf only accepted a handful of cargo.
In 2003, the port only handled 2.71 million metric tons of cargo, more than half of which are domestic goods. In 2007 the volume started to increase to 3.47 million metric tons with foreign cargoes meant for export to Asia, the Middle East and other parts of the world accounting for half of the volume.
As of October this year, the port already handled 4.46 million metric tons, of which 2.78 million metric tons are foreign cargoes.
In terms of containerized cargoes, the port handled 478,994 TEUs from January to October.
The PPA said in its earlier presentation that it needs some P3.98 billion to expand the Davao port. The project include the strengthening of Berths 1 and 2, development of Container Yard 3, demolition of the existing building, development of 300 container-yard reefer outlets as well as the supply and installation of four gantry cranes and installation of eight rubber-tired gantry cranes.
Once completed, the project is expected to increase the capacity of the port to about 1.3 million TEUs or double it current one.
