UAE operators pouring in capacity
If all the terminal space to be developed in the Gulf is indeed required, world trade will not be in such bad shape.
The goal of a container crane operator is to lift a 40-foot box off a ship and place it on a truck at least every two minutes. At least that is the target set by the training center at Jebel Ali port in the United Arab Emirates.
Trainees use a simulator in the center to master their trade, and it comes complete with buffeting winds, rain and poor visibility. It is a tricky business and requires a steady hand and the ability to judge depth perception, even with various digital distance meters in the crane cabin.
The instructor offered me a go on the simulator and five minutes later I had managed to get the container rocking like a child on a swing. It looked serious on the computer animation, but in reality a wildly swinging container must be a frightening sight. And when trying to get the box on to the back of a truck it kept landing skew or thumping into the cab. They offered to send the bill for damages to my employers and I agreed to pick up the tab for the truck driver's funeral.
As much fun as it was to play computer games with containers, the real business at hand was a tour of the port, which is impressive.
Jebel Ali has been on an aggressive growth path since 2001 and is the biggest man-made port in the world. Just last week DP World announced an US$850 million expansion project that will add an additional four million containers to the port’s capacity by 2014 when it will be able to handle 19 million boxes.
That is a lot of capacity, especially when viewed against the space being added by Abu Dhabi Terminals’ Khalifa Port just down the road. Khalifa’s industrial zone will be two-thirds the size of Singapore by 2030 when it will have 15 million TEU capacity online.
Great stuff, but it raises a question that is beginning to be asked more often in the Gulf: Is all that capacity really needed in the UAE?
The head of DP World, Mohammad Sharaf, is in no doubt. Jebel Ali’s forecasts have always been conservative, he said, and even by that cautious measure all the capacity will be required by 2014.
He is probably right. The global scale of DP World and the network of shipping lines will ensure that traffic remains high at the port. Sea-air connections are a large part of its service offering and will increase with the growth of the Dubai World Central airport nearby and the bonded logistics zone at Jebel Ali.
Of course, it all depends on trade improving over the next few years, and on that score Sharaf is equally positive. He said even if the US economy grew by one percent that would be enough to keep demand steady.
The DP World boss also reckons Jebel Ali is 10 years ahead of any competitor in the Gulf. If that is the case, any overcapacity in the UAE will probably see the port operator’s rivals suffering from poor utilization rates.
Especially if they make the mistake of allowing me to handle one of the cranes.