Signs of sharp declines in Asian exports and shipping

Sales orders for Thai exports have plunged 30 per cent recently according The Federation of Thai Industries (FTI).

Export industries affected the most include clothing, furniture, ceramics and electrical appliance industries.

Employment is also likely to take a hit:

The industrial sector may cut from 10 to 15 per cent of its employees, or approximately 900,000 to one million people out of about six million in total. Around 700,000 new graduates would also have more difficulties in finding jobs.

Recent developments in the Asian shipping industry do not bode well for Asian export trade:

The ports and shipping lanes of Asia, the arteries of world trade through which goods and commodities surged in the boom times, are starting to seize up as the financial crisis strangles demand.

The Baltic Dry Index, a signpost of economic trends which tracks the cost of moving goods across the oceans, has set off alarm bells by plummeting 85% from its peak in May to a six-year low.

Share prices of some major shipping companies, which haul bulk freight such as iron ore, coal and grains destined to be turned into manufactured goods, have fallen 50-70% in the past few months...

Standard & Poor's also said this week that the Asian shipping market has suffered double-digit declines on the US-Asia route in June and July, as well as being hit with higher operating costs.

The industry had been expecting an upturn after the Beijing Olympic Games ended and factories chugged back to life, after an enforced holiday to help improve air quality.

But instead disaster struck on global markets.

Production grinding to a halt

There are reports of idle vessels being put to anchor, and question marks over the many orders for new ships that were placed in brighter times, years ahead of expected completion dates.

"Pain levels could be high for companies that agreed to pay 2007 top-dollar prices for dry bulk ships, or who agreed to pay high long-term charters," said an article in the Far Eastern Economic Review this month.

Container shipping was hit first earlier this year as demand for Asian-made goods in the US and Europe dropped off, a casualty of the sub-prime mortgage crisis and poor consumer confidence.

In a chain reaction, the countless Asian factories churning out electronics and consumer items for the US and European markets began lowering output, and the need for raw materials declined.

Declines across the board

Container shippers, bulk operators and port authorities across the region are reporting slowdowns.

Malaysia's Port Klang said it had been hit by a decline in cargo handling since the start of October, blaming a retail downturn and lower vehicle sales in the United States and Europe...

Hong Kong, which is sensitive to any drop in demand for toys, gadgets and clothes made in the factory-belt of China's southern Guangdong province, said that after an increase of 6.7% in container traffic in August, growth dropped suddenly in September to just 1.2%...

The Baltic Dry Index which hit 11,793 in May is now under around 1,300, approaching rates not seen since the Asian financial crisis in 1997-1998, and tipped to slip below 1,000 as commodity prices fall...

Container shipping lines have said they expect cargo demand on the US-Asia route to fall by as much as 8% in 2008...

However, the group said vessels are still running at 90% capacity as firms cut costs by consolidating routes and returning chartered vessels, and take advantage of the downturn to lay up ships for repairs...AFP

(Source #1: Bangkok Post, breaking news, 28-10-08, link)

(Source #2: Bangkok Post, business, 23-10-08, Reuters, SARAH STEWART)

Vocabulary:

take a hit - be hurt or damaged ได้รับผลกระทบ

X is a sign that Y - X indicates that Y is true or will be true  เป็นสัญญาณบอกเหตุที่จะเกิดขึ้น

bode well for - is a sign of a good future สัญญาณที่ดี

arteries of world trade - the routes and sea lanes used to transport goods between countries  เส้นทางการขนส่งสินค้าทางทะเล

seize up - stop moving completely หยุดลงโดยสิ้นเชิง

Baltic Dry Index - an index that measures dry bulk shipping rates and managed by the Baltic Exchange in London (See Wikipedia) 

dry bulk shipping - carrying large amounts of dry goods or material  การขนส่งสินค้าแห้ง

a signpost - a sign ป้าย

set off alarm bells - this was a signal of danger  เป็นสัญญาณเตือนภัย

plummeting - falling quickly by a large amount ดิ่งลงอย่างรวดเร็ว

haul bulk freight - transport large amounts of goods from one place to another การขนส่งสินค้าจำนวนมาก

suffered double-digit declines - decreased by 10% or more เผชิญกับการลดลงของการส่งสินค้ามากกว่าร้อยละสิบ

factories chugged back to life - factories started to produce goods again  โรงงานเริ่มผลิตสินค้าอีกครั้ง

grinding to a halt - stopping quickly จบ หรือยุติลงอย่างรวดเร็ว

a vessel - a ship เรือขนาดใหญ่ใช้บรรทุกสินค้า 

idle vessels - ships not going anywhere, not working เรือที่จอดอยู่นิ่ง

put to anchor - park the ship, let the anchor down to prevent the ship from moving  ทอดสมอลง

pay 2007 top-dollar - pay the highest price in 2007 ในปี 2007 สินค้าได้ราคาสูงที่สุด

charters - planes or boats hired for temporary use, not bought เช่าเหมาลำ

a casualty of Y - was damaged or ceased to exist because of Y ได้รับความเสียหายจาก

a chain reaction - a series of events, each event causing the next event ปฏิกิริยาลูกโซ่ คือได้รับผลกระทบต่อๆ กันมา

churning out - producing in large quantities ผลิตขึ้นเป็นจำนวนมาก

across the board - everyone and everything affected  ทั่วหน้า

container shippers - a ship that carries stacked containers that can be transported on the back of a truck (See Wikipedia and photo above) เรือบรรทุกสินค้า

a bulk operator, a bulk shipping operator - a company that ships large amounts of dry goods บริษัทขนส่งสินค้า

port authorities - the organizations that runs ports เจ้าหน้าที่การท่า

cargo handling - moving the cargo from the ship in port to the destination การขนส่งสินค้า

factory-belt - a area in a country where a lot of factories are located ในเขตนิคมอุตสาหกรรม

running at 90% capacity - only producing 90% of the total that it could produce มีความสามารถในการผลิตทั้งหมดคิดเป็นร้อยละเก้าสิบของสินค้าที่มีการผลิตทั้งหมด

consolidating routes - combining the goods carried by two ships (to save money)  ขนส่งสินค้าร่วมไปกันสินค้าอื่นๆ เพื่อประหยัดต้นทุน

chartered vessels - ships that are hired for temporary use (not bought) เรือสินค้าเช่าเหมาลำ

lay up ships for repairs - stop using the ship so it can be repaired  จอดเรือทิ้งไ้ว้รอการซ่อมแซม

Posted by Jon Fernquest at 07:28 PM | Permalink | Comments (0)