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Logistics industry set to grow 10.3pc to RM129.9b [17-01-2012]  
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THE Malaysian logistics industry is expected to grow 10.3 per cent to RM129.93 billion in 2012, a marked increase from an estimated RM117.8 billion a year ago.

Frost & Sullivan vice-president for transportation and logistics practice Asia Pacific and country head for Malaysia Gopal Ramasubramaniam said Malaysia's strategic advantage due to its geographical location and its focus on improving supply-chain efficiency will also drive growth in the local logistics industry.

"External trade for Malaysia is expected to increase 5.9 per cent to RM1.42 trillion in 2012, compared with RM1.24 trillion in 2011.

"Growth of the country's external trade signifies the growth of the transportation and logistics industry," he said at a briefing on the outlook of Malaysia's transportation and logistics industry here yesterday.

"The introduction of several initiatives, such as the Government Transformation Programme and the Economic Transformation Programme (ETP), provided a conducive business environment for the logistics market to grow," he said.

Gopal said logistics service providers which are able to leverage their integrated network to offer alternative solutions and help clients maintain in the distribution flow, and also tap into the growth opportunities from new clients.

"The Malaysian logistics industry is forecast to grow at a compound annual growth rate of 11.6 per cent to reach RM203.71 billion in 2016," Gopal said.

In terms of cargo volumes, Gopal said Malaysia's total cargo volumes is expected to increase 10.1 per cent to 545.13 million tonnes in 2012, compared with 495.29 million tonnes in 2011.

"Sea freight is the most favoured mode of transport for cargoes in Malaysia, handling more than 90 per cent of total freight traffic in 2011," he said, adding that total cargo volume by sea is expected to grow 10.1 per cent to 538 million tonnes in 2012.

He said Port Klang, Malaysia's busiest container port, contributed 39.2 per cent of total sea throughput in 2011, while Port of Tanjung Pelepas contributed 22.7 per cent.

"With strong growth in the nine months to September 2011, Johor Port is likely to overtake Penang Port, in terms of cargo volume handled," he said, estimating that Johor Port's market share to total sea throughput at 6.7 per cent, compared to Penang Port at 5.9 per cent.

Meanwhile, cargo volume by rail is expected to increase to 6.2 million tonnes in 2012, compared with 5.9 million in 2011.

As for the cargo volume by air, Gopal said he is predicting the cargo volume for this segment to grow 3.9 per cent to 925,000 tonnes this year.

"Steady growth in the economy and external trade will contribute to the growth of air cargo volume in 2012. Air cargo volume should aim to cross the one million mark to ensure the infrastructure facilities as well as supporting supply-chain functions are fully leveraged.

"This is very critical for the overall industry growth as well," he said.

Gopal said he believed that sustainability and healthcare will be the focus areas for the logistics industry in Malaysia in 2012.

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