BMI View: T he outlook for Oman's shipping sector remains mixed , reflecting the country's main ports' specialisation. The port of Salalah is expected to post another strong annual increase and achieve historic highs in total tonnage helped by higher demand for limestone and gypsum it handles while box volumes at the country's top container facility will endure another year of decline in 2015, affected by decreasing transhipment.
The port of Sohar will enjoy strong growth in 2015 - both in terms of total and container throughput. This is largely due to the transfer of operations from Sultan Qaboos, although continued investment into new dry bulk industries will also prompt growth. Over the medium term, we project further growth at the port of Sohar and total throughput growth at the port of Salalah while container volumes at Salalah will continue declining. However, despite the at-times challenging outlook, Oman continues to invest in its maritime facilities.
Headline Industry Data
2015 port of Sohar tonnage throughput forecast to grow 21.8% to 54.85mn tonnes.
2015 port of Salalah container throughput forecast to contract by 20% to 2.43mn TEUs.
2015 total trade growth forecast at 3.9%.
Key Industry Trends
Sohar Container Capacity T o Reach 6mn TEUs: The USD303mn expansion of Oman International Container Terminal (OICT) at the port of Sohar will quadruple its capacity to 6mn TEUs by 2019. OICT is a joint venture between Hutchison Port Holdings, the Government of the Sultanate of Oman, Steinweg of Netherlands and a number of other Omani investors.
Oman T o Get First Sugar Refinery: An engineering, procurement and construction contract between Oman Sugar Refinery Company and China's Sinolight Corporation to develop a sugar refinery at the port of Sohar was signed on June 7 2015. Completion of the country's first such facility is expected by the end of 2017.
Risks to Outlook
There are considerable risks to our outlook for Omani maritime ports. The continued development of their dry bulk capabilities leaves it hard to project by just how much total tonnage throughput will expand at the facilities of Sohar and Salalah in the coming years. Throughput growth of 139.4% at Sohar in 2011 is indicative of this. Equally, recent contractions in box volumes at Salalah in 2013 and 2014 demonstrate how the port's transhipment business is subject to the vagaries of the global macroeconomic climate and increasing regional competition. Nevertheless, container volumes at the country's ports will continue to be supported by private consumption, which will keep increasing in real terms in 2015, as the improvements in household incomes achieved over the past few years should provide a continued boost to consumer purchases, including imported products.