Red Sea crisis mars Salalah Port’s Q1 performance
Port of Salalah, the leading transshipment hub of the Sultanate of Oman, reported a significant 17% decline in container throughput handled during the first quarter of this year – a slump it attributed to, among other factors, ongoing disruptions in maritime shipping through the Red Sea.
Volumes handled at the port’s Container Terminal plummeted to around 878K TEUS during Q1 2024, down from 1.056 million TEUS achieved during the corresponding quarter in 2023.
Although revenue was marginally up 1.2% to RO 18.446 million (from RO 18.222 million in Q1 2023), net profit after tax tumbled 28% to RO 846K at the end of Q1 this year, down from RO 1.170 million a year earlier.
“The container terminal throughput decrease Q1 – 2024 vs Q1 – 2023 is due to the impact of the Red Sea issue and capacity constraint related to the ongoing upgrade,” said Bart Van De Graaf, Chief Financial Officer – Salalah Port Services Co SAOG. The comments came in the company’s initial unaudited and unapproved financial results for Q1 2024, disclosed to the Financial Services Authority (FSA) on Monday.
The Red Sea crisis, currently in its fifth month, was sparked by Yemen’s Ansar Allah movement, which began mounting attacks on merchant ships owned or operated by Israeli companies or transporting cargo to and from Israeli ports. The Ansar Allah has been campaigning to pressure Israel and its Western allies to end Tel Aviv’s ongoing genocidal assault on Palestinians in occupied Gaza.
Since the start of the Ansar Allah action last November, scores of containerships and other cargo vessels have been bypassing the Suez Canal and Red Sea for the relative safety of, albeit significantly longer, maritime routes around the Cape of Good Hope.
In the process, Salalah Port – incidentally the first major port of call as vessels exit the Red Sea and Gulf of Aden – has often been overlooked.
Compounding matters for Salalah Port is the ongoing upgrade of its Container Terminal – part of an initiative to enable the handling of the world’s largest containerships at the port.
As part of the upgrade, as many as 10 new container gantry cranes – ranked among the largest of their kind in the world – are being installed at the port.
Upon completion in Q1 2025, the upgrade will not only enhance Salalah Port’s container capacity to 6 million TEUS but also bolster its capability to meet the evolving demands of the maritime industry.
On the general cargo front, however, throughput was up 14% to reach 5.763 million tonnes in Q1 2024, up from 5.039 million tonnes a year earlier.
The growth was fuelled by an uptick in the handling of dry bulk cargoes, the Chief Financial Officer added.