Jon Monroe Consulting
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Yangtze River Infrastructure Development www.yangtzeriverports.com Jon Monroe Consulting 1 Jon Monroe Consulting 2 Yangtze River Overview An Emerging Economic Corridor Jon Monroe Consulting 3 We believe a river system is more than the sum of it’s ports. Jon Monroe Consulting 4 YR as Regional Sections YR Sections Upper Reaches Gateway to Western China Middle Reaches Distribution to all China 14.7% of river Lower Reaches Shuttle to Yangshan 78.0% of river Delta and Coastal Gateway to Int’l Markets 32.0% of China Jon Monroe Consulting 7.3% of river 5 Yangtze River Lower Reaches Nanjing to Shanghai: 402 km Middle Reaches Upper Reaches Yichang to Nanjing: 1550 Kilometers Yibin to Yichang 850 Kilometers Jon Monroe Consulting 6 YR as a Single Entity Five Year Planning Mechanisms Port Infrastructure Road/Rail/Bridge Infrastructure Hinterland Development Provincial and City Plans Urbanization Planning Jon Monroe Consulting 7 Yangtze River Basin • Seven Provinces: 424.6 mil • Two Municipalities: 48.0 mil Sichuan Pop: 84.3 Mil GDP:1.05 trillion RMB City: Chengdu Port: Luzhou, Yibin Chongqing Pop: 30.9 mil GDP: 411 billion RMB City: Municipality Port: Chongqing Anhui Pop: 60.7 mil GDP: 735 billion RMB City: Hefei Port: Tongling, Ma’anshan Hubei Pop: 58.25 mil GDP: 915 billion RMB City: Wuhan Port: Wuhan, Yichang Jiangsu Pop: 71.1 mil GDP: 2.56 trillion RMB City: Nanjing Port: Nanjing, Lianyungang Shanghai Pop: 17 mil GDP: 1.2 trillion RMB City: Municipality Port: Shanghai Hunan Pop: 63.42 mil GDP: 914.5 billion RMB City: Changsha Port:Yueyang Jiangxi Pop: 43.4 mil GDP:547 billion RMB City: Nanchang Port:Jiujiang Zhejiang Pop: 43.43 mil GDP:1.86 trillion RMB City: Hangzhou Port: Ningbo Strategic Yangtze River Cities Region Primary Secondary Upper Chongqing, Chengdu Luzhou, Yibin Middle Wuhan Yichang, Jiujiang, Wuhu Lower Suzhou, Nanjing Nantong Yangtze River Delta Shanghai, Ningbo Lianyungang, Suzhou, Hangzhou, Nanjing Note: Though the lower reaches runs through the Yangtze River Delta, each is covered separately. The dynamic of the coastal ports is distinct from the activity of the river ports in the lower reaches Jon Monroe Consulting 9 Key YR Economic Regions Economic Region Location Coverage Shanghai Metro Circle Yangtze River Delta Shanghai, Covers all YRD Jiangsu, Zhejiang SuXiChang Metro Circle Lower Reaches Jiangsu Suzhou-Wuxi Nanjing Metro Circle Lower Reaches Jiangsu, Anhui Extends YRD to Anhui Wuhan Metro Circle Middle Reaches Hubei and beyond Primary Economic Corridor MR Chengdu – Chongqing Upper Reaches ChongqingSichuan Primary Economic Corridor UR Xuzhou Metro Circle N. Jiangsu Jiangsu, Anhui, Developing Henan, Shandong Economic Corridor Hangzhou Metro Circle Zhejiang Zhejiang Jon Monroe Consulting Comments 10 Yangtze River Lower Reaches Nanjing to Shanghai: 402 km Middle Reaches Upper Reaches Yichang to Nanjing: 1550 Kilometers Yibin to Yichang 850 Kilometers Jon Monroe Consulting 11 Top 10 Yangtze River Ports Rk Port 2008 2009 % 1 2010 Suzhou Ports 2,448,809 2,723,913 11.2 3,644,000 33.8% Taicang 1,450,495 1,513,161 4.3 2,211,500 46.1% Zhangjiagang 814,220 870,312 6.9 1,088,810 25.1% Changshu 305,300 340,440 11.5 343,690 1.5% 1,280,265 1,200,326 -6.2 1,415,610 17.9% 2 Nanjing 3 Jiangyin 502,200 699,733 39.3 1,001,000 43.0% 4 Wuhan 473,797 563,700 19.0 648,800 15.1% 5 Chongqing 482,893 465,400 -3.6 500,070 7.4% 6 Nantong 443,300 350,600 -20.9 462,000 31.8% 7 Zhenjiang 292,400 280,700 -4.0 257,740 -11.9% 8 Yangzhou 267,968 220,943 -17.6 287,350 30.0% 9 Wuhu 164,106 99,525 -39.4 142,630 43.3% 10 Jiujiang 80,927 100,666 24.4 120,570 19.8% Others 423,899 493,553 16.4 697,332 41.3% 6,981,610 7,199,059 3.1 9,177,102 27.4% Total Jon Monroe Consulting 12 Yangtze River 12th 5 Year Plan Summary Gov’t will spend rmb 36bil/US$ 5.6bil on Yangtze River under 12th 5 Year Plan (vs rmb 13.2 bill in 11th plan) Devlopment of YR Port Clusters Shift to Regional Cooperation More investment in Hydroelectric power on river Continue Dredging and standardization of container vessels Expand Hinterlands, especially rail Jon Monroe Consulting 13 YR Container Port Projections 2008 TEU 2009 TEU % 2020 TEU CAGR Upper Reaches 549,130 526,081 -4.2% 5,430,000 23.64% Middle Reaches 973,924 1,059,988 8.84% 9,300,000 21.83% Lower Reaches 5,458,556 5,612,920 2.83% 40,360,000 19.64% 6,981,610 7,198,989 3.10% 55,090,000 20.48% Coastal Ports 42,470,000 39,240,000 -7.6% 88,900,000 Total 49,451,610 46,438,989 -6.1% YR Sub Total 7.72% 143,990,000 10.84% By 2020, YR & Delta design capacity will be greater than all of China throughput in 2009 2020 projections based upon current port plans for new construction & expansion Jon Monroe Consulting 14 Upper Reaches “Go West” Jon Monroe Consulting 15 Upper Reaches Fact Sheet Includes the area from Yibin to Yichang Chongqing can be reached by vessels of 1500 DWT Expect the draft to increase to allow 2500 DWT vessels to reach Chongqing Most cities on a hill due to rising waters of River Major market in the Chongqing-Chengdu corridor reaching more than 100 million people Transit to Shanghai by barge is 7-9 days Increased investment in 12th 5 Year Plan Jon Monroe Consulting Yangtze River: Upper Reaches Luzhou to Yichang Jon Monroe Consulting 17 Upper Reaches Cities Chengdu 260km 299km 263km Yibin Chongqing 650km 3 Gorges Dam 177km 123km Yichang Luzhou Jon Monroe Consulting 18 Upper Reaches: Key River Ports Port 2008 Ton 2009 Ton 7.72 mil 8.52 mil 10.4% Luzhou 11.21 mil 11.64 mil Chongqing 14.71 mil Yibin % 2008 TEU 2009 TEU % N/A N/A N/A 3.8% 66,237 60,681 -8.4% 13.0 mil -11.6% 434,797 416,400 -4.2% Fuling 2.41 mil 5.5 mil 128% 30,086 28,000 Wanzhou 8.22 mil 8.78 mil 6.9% 18,010 21,000 16.6% 44.27 mil 44.33 mil 7.2% 549,130 526,081 -4.2% Total -7% Source: Respective Port Authorities Jon Monroe Consulting 19 Upper Reaches: Infrastructure Challenges Source: Jon Monroe Consulting Jon Monroe Consulting 20 Source: Jon Monroe Consulting 6 to 8 moves per hour vs 32+ Jon Monroe Consulting 21 Source: Jon Monroe Consulting Jon Monroe Consulting 22 SIPG Chongqing Chayuan Terminal Source: Jon Monroe Consulting Jon Monroe Consulting Upper Reaches Projections Companies are relocating westward to the upper reaches of the Yangtze River; Examples: Foxconn, Hewlett Packard, Apple Computer, Amazon, APL and Maersk Upper reaches container traffic is expected to grow ten times 2009 throughput by 2020 Three port groups driving this growth; Sichuan Port Group, Chongqing Port Group and Shanghai International Port Group Financial crisis will expedite this movement as companies focus on cost Most upper reaches container movement is direct to Shanghai via either Waogaoqiao or Yangshan Ports Upper reaches infrastructure is being rapidly constructed to support port; rail intermodal movement might not be for some time Chongqing Government will subsidize logistics companies who move into one of the development zones Jon Monroe Consulting 24 Middle Reaches “Booming Central China” Jon Monroe Consulting 25 Middle Reaches Fact Sheet Middle Reaches cover 1,550 km from Yichang to Nanjing Key cities include Wuhan,Yichang, Jiujiang and Wuhu Wuhan and Jiujiang have access to the Beijing-Guangzhou Railway Access to Yangtze River and Railway makes these cities ideal for domestic distribution in China Yichang will become hub and gateway to/from Sichuan as well as center of power industry Transit to Shanghai by barge is 3 to 5 days Middle Reaches Ports grew faster than Upper or Lower Reaches in 2009 Eleven River Ports are located in Middle Reaches By 2015, the Middle Reaches capacity are expected to grow five time Jon Monroe Consulting 26 Middle Reaches Yichang to Nanjing: 1,550 km Jon Monroe Consulting 27 Middle Reaches Key Cities Hefei Wuhu 3 Gorges Dam Wuhan Jiujiang 44km Yichang 133km Yangtze River Nanchang Jon Monroe Consulting 28 Middle Reaches: Key River Ports Port 2008 Ton 2009 Ton % 2008 TEU 2009 TEU % Yichang 33.32 mil 35.38 mil 6.2% 42,496 44,455 4.6% Wuhan 55.92 mil 54.09 mil -3.3% 473,637 563,700 19% Jujiang 61.82 mil 82.84 mil 34% 80,927 100,666 24.3% Wuhu 55.14 mil 57.09 mil 3.6% 164,106 99,525 -39.4% Sub Total 206.19 mil 229.39 mil 11.2% 761,166 808,346 6.2% Others 211.12 mil 218.57 mil 3.5% 212,000 251,642 18.6% Total 417.32 mil 447.96 mil 7.3% 973,924 1,059,988 8.8% Source: Respective Port Authorities Jon Monroe Consulting 29 Wuhan Port Yangsi Terminal Yangluo Terminal Source: Jon Monroe Consulting Jon Monroe Consulting 30 Jon Monroe Consulting 31 Middle Reaches Projections Middle Reaches represents the longest stretch of the river, winding through four provinces; Hubei, Hunan, Jiangxi & Anhui This includes eleven port cities; Hubei (4), Hunan (1), Jiangxi (1) and Anhui (5) Middle Reaches is expected to grow five times 2009 by 2015, a CAGR of 32.75% Four port cities are instrumental to Middle Reaches growth; Yichang, Wuhan, Jiujiang and Wuhu Two cities are the best positioned strategically to develop the Middle Reaches and Central China; Yichang and Wuhan Wuhan will dominate Middle Reaches and the rapidly developing supporting rail and road infrastructure will support make Wuhan a major distribution hub for Central China Expect growth in the middle reaches during the 12th Five Year Plan (2011 – 2015) Jon Monroe Consulting 32 Lower Reaches “Shuttle for Eastern Manufacturing” Jon Monroe Consulting Lower Reaches Fact Sheet Lower reaches cover 402 km from Nanjing to Shanghai The lower reaches has the highest density of river ports with ten ports located on the YR The lower reaches ports represents 78% of the container throughput of the Yangtze River In 2008, Taicang Terminal passed Nanjing to become the largest container port on the Yangtze River and lower reaches The majority of container throughput in most lower reaches ports moves direct to Shanghai terminals supporting Shanghai as a shipping center Nanjing, Nantong and Taicang have international direct calls to Hong Kong, Taiwan, Japan, Korea and SE Asia Lower reaches container capacity is expected to triple 2009 throughput by 2015 Jon Monroe Consulting 34 Lower Reaches Nanjing to Shanghai: 402 km Jon Monroe Consulting 35 Lower Reaches Key Cities Nantong Nanjing 192km Zhangjiagang 90km To Shanghai Taicang Yangtze River Suzhou Jon Monroe Consulting 36 Lower Reaches: Key River Ports Port 2008 Ton 2009 Ton % 2009 TEU % 203.48 246.24 mil 21.0 2,570,015 2,723,913 6.0 40.2 mil 51.64 mil 29.0 1,450,495 1,513,161 4.3 123.24 mil 150 mil 21.7 814,220 870,312 6.9 40.04 mil 44.6 mil 11.0 305,300 340,440 11.5 Nanjing 111.25 mil 121.46 mil 9.2 1,280,265 1,200,326 -6.4 Nantong 132.14 mil 135.41 mil 3.2 443,300 350,600 -20.9 Sub Total 446.49 mil 503.16 mil 12.6 4,293,580 4,274,839 -0.5 Other 285.6 mil 334.36 mil 17.0 1,164,976 1,338,081 14.8 Total 732.09 mil 837.53 mil 14.4 5,458,556 5,612,920 2.8 Suzhou Ports Taicang Zhangjiagang Changshu 2008 TEU Source: Respective Port Authorities Jon Monroe Consulting 37 Taicang Terminal Jon Monroe Consulting 38 Lower Reaches Projections - 1 The lower reaches of the Yangtze River runs through a single province, Jiangsu, encompassing ten river ports The top four ports along the Yangtze River, by TEU throughput, are Taicang, Nanjing, Zhangjiagang and Jiangyin, all located in the lower reaches The lower reaches container activity accounted for 78% of total Yangtze River container activity Suzhou Port as a combined port group, is the largest container and general cargo port along the Yangtze River In 2008, Taicang surpassed Nanjing to become the largest container port along the Yangtze River Jon Monroe Consulting 39 Lower Reaches Projections - 2 In 2009, Zhangjiagang surpassed Nantong to become the largest general cargo port along the Yangtze River Most of the manufacturing activity in the lower reaches has been contained in South Jiangsu As manufacturing activity moves north in Jiangsu Province, Nantong becomes a more viable port, putting it in a more strategic position relative to the other Yangtze River ports The close proximity of the ten lower reaches ports will create a competitive environment due to the overlapping hinterlands Logistics facilities are moving from Shanghai to lower reaches cities like Nanjing, Suzhou and Kunshan Jon Monroe Consulting 40 Yangtze River Delta “An economic engine….. & Gateway to the World” Jon Monroe Consulting Yangtze River Delta Fact Sheet The YRD accounts for 21.4% of China’s GDP with only 11.1% of the population and 2.2% of land area The YRD embraces Shanghai Municipality and 15 cities of Zhejiang and Jiangsu Provinces YRD cities are promoting regional integration for growth and economic activity Most of the manufacturing sector along the Yangtze River has settled in this area Five Metro Circles have been developed to drive YRD cities integration: Shanghai, SuXiChang, Nanjing, Xuzhou and Hangzhou Rail, road and bridge infrastructure has been completed to support this integration including four major bridges; Donghai, SuTong, Hangzhou Bay and Zhoushan Cross Sea Bridge Two largest Yangtze River ports, Taicang and Zhangjiagang; and two largest coastal ports in China, Shanghai and Ningbo are all located in YRD Jon Monroe Consulting 42 Yangtze River Delta Economic Indicators Indicator 2008 YRD GDP (billion RMB) 2009 2010 6,520.91 7,179.39 8,460.00 30,067.00 33,535.30 39,500.00 21.7% 21.4% 21.4% YRD FDI (billion USD) 45.27 45.76 50.62 China FDI (billion USD) 92.40 90.03 105.70 48.9% 50.8% 47.9% China GDP (billion RMB) YRD % YRD % Note: GDP stated in RMB and FDI stated in USD Source: China National Statistics Bureau Jon Monroe Consulting 43 Jon Monroe Consulting Jon Monroe Consulting 44 Yangtze River Delta: Key Coastal Ports Port 2008 Ton 2009 Ton % Shanghai 582.0 mil 592.0 mil 1.7% 28.01 mil 25.0 mil -10.7% Ningbo 520.47 mil 577.57 mil 11.0% 10.93 mil 10.5 mil - 3.9% 1,102.47 mil 1,169.57 mil 6.0% 38.94 mil 35.5 mil -11.2% 261.08 mil 15.2% 3.53 mil 4.4 mil 25.7% 1329.02 mil 1,430.65 mil 7.6% 42.47 mil 39.2 mil -7.6% Sub Total Others Total 226.55 mil Jon Monroe Consulting 2008 TEU 2009 TEU % 45 To Shandong Province Lianyungang Xuzhou Yancheng Huai’an Suqian Yellow Sea Yangzhou Taizhou Nanjing Nantong Changzhou Zhenjiang Wuxi To Anhui Province Suzhou Shanghai Taihu Lake Huzhou Jiaxing East China Sea Hangzhou Bay Bridge Hangzhou To Jiangxi Province Quzhou Jinhua Zhoushan Shaoxing Ningbo Taizhou Lishui Wenzhou Yangtze River 16 YRD Cities + + + JingHang Canal 25 YRD Cities YRD Coastal Jon Monroe Consulting 46 Yangtze River Corridor Emerging City Cluster Chongqing-Sichuan 115 million people GDP 1.2 Tril yuan Emerging City Cluster Middle Reaches Yangtze River 58 million people GDP 1 Tril yuan Jon Monroe Consulting Major City Cluster Yangtze River Delta 130+ million people GDP 3.9 Tril yuan 47 Where Are We? Mfg costs going up in YRD Focusing on cooperative development among YRD Cities Approximately 70% of the traffic along Yangtze River moves within YRD Expect more cooperation between YRD cities and cities in the upper and middle reaches of Yangtze River More companies will locate in YRD as a base to access central and Western China Expect larger vessels to call Nanjing and move direct to foreign ports Jon Monroe Consulting 48 Summary Jon Monroe Consulting 49 Yangtze River Summary Yangtze River may well become the world’s largest economic corridor by 2020 China’s central planning will encourage western movement and cooperation as well as competition among city’s and ports The river can be regionalized into four sections: upper, middle, lower and delta & coastal Rapid urbanization and an improved infrastructure will drive this process Port development capacity may well exceed demand By 2020, China will have the most sophisticated manufacturing and transportation infrastructure in the world connecting ports and cities via rapid rail, road and air networks. This will be supported by a shift from dependence on exports to a more balanced trade flow and a strong domestic economy Jon Monroe Consulting 50 Thank You www.yangtzeriverports.com 51
