Boston, MA -- (ReleaseWire) -- 04/30/2014 -- This year is expected to represent something of a recovery for Japan's freight industry, albeit unremarkably. 2013 saw negligible tonnage growth across the modes and despite the sizeable and prolonged depreciation of the yen, exports actually fell, according to Izumi Devalier, an economist at HSBC, speaking to Bloomberg.
Japan's trade figures for January missed expectations by a wide margin, with imports surging and exports stagnating. We expect to see the country record a current account deficit in 2014 as the weaker yen is insufficient to counteract the structural forces at play. Beyond 2014, the deficit is likely to widen as policies aimed at creating inflation will seriously undermine the domestic savings rate.
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In terms of the freight industry's forecasts by mode for 2014, rail freight is set to enjoy the highest rate of annual growth with BMI's forecast coming in at just under 3%, while air and road will perform less impressively at 1.6% and 1.4% respectively. Growth is not set to be anything other than steady over the medium term across the freight modes.
Headline Industry Data
- Air freight tonnage forecast to grow by 1.6% year-on-year (y-o-y) in 2014 to 3.039mn tonnes, marking an improvement on 2013 growth of 1.0%.
- Road freight tonnes hauled in 2014 forecast to grow 1.4% to 4.495bn tonnes.
- Rail freight tonnage will increase by 2.9% in 2014 to 44.831mn tonnes.
- Port of Tokyo 2014 tonnage throughput forecast to grow 2.05% to 87.156mn tonnes.
- Port of Nagoya 2014 tonnage throughput forecast to grow 3.24% to 212.254mn tonnes.
- The real value of Japanese trade will grow by 4.65% in 2014. Exports will grow by 2.8%, behind imports, which will gain 6.5%.
Key Trends And Developments
NYK, Tokyo LNG Tanker Sign 20-Year Charter Contract: Japanese shipping group Nippon Yusen Kaisha (NYK) and Tokyo LNG Tanker Company signed a long-term charter contract at the end of February 2014, with the 20-year contract designed for the charter and joint ownership of a new liquefied natural gas (LNG) carrier. NYK has also entered into a contract with Japan Marine United Corporation. This contract is aimed at constructing the LNG carrier with a cargo tank capacity of 165,000 cubic metres. Construction work on the ship is due to be completed in 2017.
Mixed Bag For Japanese Freighters: There were mixed fortunes for two of Japan's largest freight forwarders as the Q3 2013 financial results were announced in February 2014. Nippon Express announced that its profits had grown by almost 14% (13.8%) to JPY18.305bn. Meanwhile, Yusen Logistics saw its profit drop during the same period, despite operating revenues jumping. Group net profit slumped by 38.9% in Q3 2013, compared with the corresponding period 12 months previous, however, operating revenues growing 22.1% year-on-year.
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