News / HMM plans capacity boost as it focuses on port infrastructure

South Korea’s flagship carrier HMM is mirroring other lines in the market with plans to upgrade handling capacity at one of its terminals, as it looks to boost its infrastructure assets, both existing and via acquisitions.

HMM reportedly plans to invest €150m ($176m) to increase the capacity at its Algeciras terminal by 60% to 2.6m teu, from the current 1.6m teu, with more berths for 24,000 teu ships. The upgrades include installing new container cranes and storage yards as well as building new rail networks, in the Isla Verde exterior at Algeciras port.

The investment is part of HMM’s new CEO Choi Won-hyuk’s strategy to consolidate the company’s worldwide infrastructure.

In media interviews after taking office in March, Mr Choi, who formerly headed South Korean logistics group LX Pantos, has made infrastructure investments a cornerstone of his strategy.

Mr Choi had pointed out that while HMM operates eight terminals worldwide, there are opportunities to acquire assets in emerging ports, such as Santos in Brazil.

Going after terminal assets is what many of HMM’s peers is doing, as they are investing cash from the Covid-19-induced boom.

HMM acquired the Algeciras facility, operated by Total Terminal International Algeciras (TTIA), from the now-defunct Hanjin Shipping in 2017, after the latter went bankrupt.

In 2020, French line CMA CGM bought a 50% stake in TTIA, but HMM has majority control as it has one additional share.

Algeciras is Spain’s largest port and is a transshipment hub connecting Europe, Africa and the Americas.

The construction will be phased to reduce disruption to port operations, enabling the newly built site to begin operating even before its full completion.

Algeciras Bay Port Authority is keen on the upgrades to the terminal, with its chairman, Gerardo Landaluce saying: “We have met with HMM’s new management team in Seoul to discuss the pier expansion.”

HMM’s spokesperson however, told The Loadstar: “We are currently reviewing the potential investment in the Algeciras terminal, but no decision has been made at this time.”