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  • Yantian port volumes declined 9.6% y-o-y to 1.21m TEUs in Oct
  • Kwai Tsing port also recorded a decline of 6.7% y-o-y to 1.17m TEUs in throughput volumes in Oct
  • 10M21 volume growth tracking slightly ahead of our full year forecasts at 5.2% for Yantian and 2.0% for Kwai Tsing TEUs (m)Yantian portKwai Tsing port10M1910.811.910M2010.911.910M2111.4
    (+5.4% change from 10M19; 
    +5.2% change from 10M20)12.1
    (+2.5% change from 10M19; +2.0% change from 10M20)
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9.6% y-o-y and 15.5% m-o-m decline in Yantian volumes in October. Yantian port volumes fell to 1.21m TEUs in October as operations were affected by two typhoons – Typhoon Lionrock and Typhoon Kompasu. It should be noted that there is also high base effect from Oct 2020 (1.34m TEUs) and Sep 2021 (1.43m TEUs). The global supply chain and transportation links remain vulnerable to COVID-19 outbreaks or other disruptions. We anticipate this global port congestion to continue and yard storage income is likely to remain high. Full year throughput for Yantian should still be on track for our 4% growth forecast.
China’s Purchasing Managers’ Index (PMI): New Export Orders rose 0.4 points to 46.6 for October, ending the 6 months downward trend but still in contraction zone. Some factors that could have caused weakness in production include new COVID-19 lockdowns,high raw material prices, elevated freight costs and the power crunch. 
Maintain BUY and TP of US$0.33.   

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