Maersk Prepares Expansion of Its Terminal Capacity in Lagos, Nigeria

Danish shipping and ports group AP Møller-Maersk is preparing to expand its terminal capacity in Lagos to meet rapidly growing Nigerian import volumes.

APM Terminals​ (APMT) is considering a US$120 million proposal to develop land at its Apapa facility that could eventually be able to handle more than 1m teu a year. A final decision from corporate HQ in Copenhagen is expected by the end of the year, but local APMT executives in Nigeria are confident that the plan to enlarge the container stacking yard, invest in new equipment and improve the customs area will get the go-ahead.

The investment would be part of a much larger commitment by AP Møller-Maersk to the West Africa trades, with the group already spending $2.5 billion on 22 ships purpose-built for this market, plus container equipment.

“We are not here to make a fast profit, we are here for the long-run,” said Maersk Nigeria MD David Skov during a media visit to Lagos.

With half a dozen of the world’s 10 fastest-growing economies in sub-Sahara Africa, Maersk has targeted the region as one of its key markets of the future. So far, six of the first 11 “wafmax” ships have been delivered, with the second series of 11 due in 2013. Two of the vessels will carry the name of sister company Safmarine, which also has a 30% allocation on all the new ships. These are both the first containerships designed specifically for West African ports, where the water depths are relatively shallow, and also the largest in the trade.

They are replacing ships of around 2,500teu previously on Maersk Line​’s FEWA2 loop between Asia and West Africa. Until now, the largest containerships Nigerian ports could handle were around 3,500teu, but the wafmax vessels, with a shallow draught but wide beam that allows for 17 rows of containers across their decks, are able to come into Apapa almost fully laden.

At the moment, some cargo has to be taken off in Walvis Bay, but very soon the wafmax ships should be able make their first call in Lagos once further dredging to a depth of 13.5 metres has been completed. IFW’s sister publication, Lloyd’s List, reports that plans to raise capacity at the Apapa facility,acquired by APMT in 2006, are being driven by a sharp rise in containerised cargo over the past year as demand recovers from the slump in 2009 when global box liftings shrank.

The new ships, with their larger capacity and lower slot costs, have also enabled Maersk to grow its share of the Nigeria trades, with the total container market said to be up by 23% so far this year.

But there are also many impediments to trade, with roads in a dreadful state, no rail freight services and layers of bureaucracy all adding to distribution bottlenecks. However, the Nigerian government has responded to complaints by announcing a few days ago that the number of agencies allowed to inspect cargo in the ports will be cut from 14 to six within a couple of weeks. APMT Apapa, which expects to handle around 650,000teu this year, is effectively full, and the plan is to develop the final 20ha of the 55ha site which is used by lines such as Hapag-Lloyd and MOL, as well as Maersk and Safmarine.

(FreshPlaza)