Shipping Ban Ease Offer Receives Cold Shoulder from Traders

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  • The market receives UAE’s gesture of easing ban on shipping of goods between the country and Qatar with lukewarm response.
  • Due to business through Port of Salalah in Oman and direct shipments from countries worldwide, interest in Jebel Airport has mellowed.
  • DP World reported a fall of 4.6 percent in fourth-quarter (Q4, 2018) shipping container volumes in Dubai.
  • Dubai’s Jebel Ali and Mina Rashid port account for about 20 percent of DP World’s global volumes.
  • Dubai shipping container volumes fell 2.7 percent to 15 million TEUs in 2018.

It sounded like good news for an ordinary consumer. Recent media reports of the UAE easing its ban on the shipping of goods between that country and Qatar, barring Qatari-flagged vessels owned by Qatari shipping firms or Qataris should have been a welcome thing; after the unjust blockade imposed on Qatar by the Arab quartet, including the UAE, says the Peninsula.

Unexpected Outcome

But the fact is that the market has received this gesture with lukewarm response. A section of Doha traders who spoke to The Peninsula, said they don’t attribute much to the announcement. “Ban or no ban, business is just usual here”, said a market leader.

Alfred Sequeira, managing director of Gulf International Enterprises, which supplies food and beverage products to Al Meera and Carrefour supermarkets, a number of grocery stores, hotels and restaurants here said that the easing of the shipping ban won’t have much significant effect in the already well-adjusted Qatari market.

What is different?

He said, “People are shipping now through Port of Salalah in Oman and having direct shipments from various countries across the world. They will not ship all of a sudden through Jebel Ali port in Dubai again. And we are not that much interested with Jebel Ali now because we are getting the same rate from other shipments. It doesn’t matter anymore”.

Sequiera, whose containers have all been previously shipped through Jebel Ali port, said that the market scene in Doha has already normalized now; far from the first few months of quandary caused by the blockade on Qatar.

Stockholm Syndrome

“They already blocked us and put us into trouble in the beginning. We lost some business then. At that time, my 10 containers were stuck in the holding in Singapore port for at least two months.”  According to Sequiera, the things had begun stabilising after three to four months. Right now noone is much interested with Jebel Ali port. They are getting good rates now with the current shipments. And their operations are all working normally.

In the opinion of a procurement manager of ‘Qatar’s oldest supermarket chain’ which operates four branches across the country, the shipping ban not only led traders in Doha to devise new shipping routes and suppliers, it has also encouraged local producers and suppliers to step up and be more visible in grocery aisles.

Blockade Increased Local Produce

He said that, most of the products are available. There’s no scarcity of the products and some of them are locally manufactured. Before the shipping ban, there was not much local produce. Approximately around twenty percent of our goods mainly vegetable, flour, bread, and milk were coming locally. But since the blockade, the local goods have risen up to over fifty percent.

Blockade Enabled Independence

“With the shipping ban easing, more goods may come. But who will pay for oversupply? If I have stock, I will not buy. As far as I’m concerned as a procurement officer it will be business as usual. We are bringing all assorted goods for the showroom directly from our partners or local agents now and we don’t have issues. Any items to procure we get it through shipment and air freight and all are coming properly just like before,” he added.

Impact on Stocks

Meanwhile, international media reported DP World reported a fall of 4.6 percent in fourth-quarter (Q4, 2018) shipping container volumes in Dubai. Dubai’s Jebel Ali, the largest transshipment port in the United Arab Emirates, and Mina Rashid port account for about 20 percent of DP World’s global volumes. The two ports handled 3.6 million 20-foot equivalent units in the three months to December 31, 2018, compared to 3.8 million in the same 2017 period. Dubai container volumes also fell in the third quarter.

Dubai shipping container volumes fell 2.7 percent to 15 million TEUs in 2018, international media quoted DP World as saying. Individual container volumes for Jebel Ali Port or Rashid port were not disclosed. Globally, container volumes grew by 1.9 percent in 2018.

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Source: The Peninsula

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