Shanghai city has taken a big step towards its ambition of becoming Northeast Asia's shipping hub with the opening of the first phase of Yangshan Deep-water Port on Saturday.

The port is located on Xiaoyangshan Island at the mouth of Hangzhou Bay in Zhejiang Province. It is linked to Luchao Port in Shanghai's Nanhui District by a 32.5 kilometre cross-sea bridge.

The Yangshan project, which was first thought of 10 years ago, is the largest port project ever built in China.

The port, which includes four stages of construction, is expected to be fully completed by 2012, eight years ahead of the original plan.

The new port will eventually have a container handling capacity of 15 million TEUs (20-foot equivalent units), with more than 30 berths. That is approaching the current handling capacity at Shanghai Port.

Due to its average depth of 16 metres, it can accommodate ships loaded with 8,500 containers and handle about 3 million TEUs annually.

The Shanghai International Port Group, the port's operator, has already said all ships destined for Europe will leave from Yangshan rather than Shanghai Port.

On its day of inauguration, Yangshan had four ships in dock, three of which were loaded with 8,000 containers.

Wang Xuan, vice-general manager of the port, said: "Shanghai started looking for a deep-water port location in the middle of the 1980s after recognizing the city's difficulty in handling increasingly large-scale container ships."

Shanghai Port is only about 7 metres deep. This prevents very large ships from docking there.

Although Shanghai Port has handled more and more cargo in recent years, its handling capacity is approaching its maximal level, analysts say.

Shanghai handled 379 million tons of cargo in 2004, making it the second largest in the world. It could soon overtake Singapore, the world's number one port.

"Shanghai will compete better against Taiwan's Kaohsiung, South Korea's Busan and Yokohama in Japan," Wang said.

During a press conference after the inauguration ceremony, Yang Xiong, vice-mayor of Shanghai municipal government and director of the management committee of the port, said Shanghai wants to become an even bigger distribution centre.

Yangshan will open up new opportunities for the logistics business in Shanghai and the Yangtze River Delta, industry insiders said.

The first phase port project also included building a logistics zone at Luchao Port.

Yangshan port area covers an area of 8 square kilometres.

"The integration of the sea port and the logistics zone will facilitate bonded logistics for the first time in Shanghai," director of Yangshan logistics zone office, Wang Shengyuan, said.

The second stage of Yangshan project has already started and will be finished at the end of 2007. It includes another four berths. Enditem

(China Daily December 12, 2005)