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Summary for January 5 - January 9, 2009:
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Monday, January 5, 2009

Top Story

Obama has spot to fill for Commerce post

President-elect Obama’s cabinet-to-be suddenly became one name short when New Mexico Governor Bill Richardson announced on Sunday that he is withdrawing his name from the nomination process for Secretary of Commerce.

Governor Richardson’s decision comes on the heels of news reports that a federal grand jury in Albuquerque, New Mex. is investigating an alleged “pay-to-play” situation between Richardson and a Beverly Hills, Calif.-based financial firm. The grand jury is investigating whether or not the firm CDR Financial Products was able, through two $100,000 donations to Richardson in 2004, to secure over $1.4 million worth of municipal bond deals in New Mexico.

"Given the gravity of the economic situation the nation is facing, I could not in good conscience ask the president-elect and his administration to delay for one day the important work that needs to be done," Richardson said in a statement.

President-elect Obama said in a statement he accepted Gov. Richardson’s withdrawal with “deep regret,” given Richardson’s extensive public service experience as one of the highest-profile Hispanic politicians in the U.S.

Other potential candidates to replace Richardson being bandied about in various media reports include: Michigan Governor Jennifer Granholm, Kansas Gov. Kathleen Sibelius; Scott Harris, managing partner of a Washington DC law firm that specializes in trade issues; Leo Hindery, former CEO of the Yes Network, the largest regional sports network in the U.S., and a senior economic policy advisor to former Democratic presidential candidate John Edwards; and Charles Philips, president of Oracle.

The commerce secretary is seen as the voice of U.S. business in the White House and in promoting U.S. business interests overseas.
Some of the key areas the next commerce secretary will be involved with include the 2010 national census and free trade agreements.



Apparel importers urge Obama to eliminate import duties

The Obama administration should eliminate “high tariffs” on textile and apparel imports, said Laura E. Jones, the executive director of the U.S. Association of Importers of Textiles and Apparel (USA-ITA) in a press release today.

Jones referred to the expiration of a half-century of quotas on imports of textile and apparel products as a “transformative moment in U.S. trade policy” and has delivered a set of recommendations that includes dropping import duties on clothing and reforming origin rules and special exceptions.

“Now that the quotas are extinct, it’s time to eliminate the high tariffs on clothing that hit hardest on America’s poorest families,” she said.

The USA-ITA referenced the expiration of 22 quotas that had limited imports of Chinese-made textile and apparel products since 1980, with hundreds more quotas on other textile and apparel imports into the U.S. having ended four years ago.

“While there were quotas, one administration after another acquiesced to demands for separate and different – discriminatory – treatment for imports of textile and apparel products, in trade agreements and in unilateral preference programs,” Jones explained. “It’s time to move on. All the exceptions should be discontinued in favor of simple, user-friendly and uniform rules premised on real business practices.”

Jones said one important step would be to completely integrate trade policy for apparel
manufacturing into a single U.S. manufacturing policy.

There are fewer than 200,000 workers in the U.S. apparel industry today, said Jones, and she said her association believes “that most of them work on products for government procurement projects, or produce specialized niche products.”

The USA-ITA also recommended that the Obama administration “refocus its attention to a U.S. industry that is facing tremendous difficulties, the U.S. retail industry, which lost 250,000 jobs in 2008 alone, and clearly faces a tough 2009.” According to Jones, there were approximately 3.2 million workers employed by department stores and clothing and accessories stores in 2007, based on data from the U.S. Department of Labor’s Bureau of Labor Statistics.



Rail shippers appeal to Congress

Rail shippers are asking Congress to step in with tougher regulation for what they view as escalating, unfair rail freight prices, according to a Wall Street Journal report.

Rick Patterson, an analyst for UBS, said in the article that U.S. railroads gained pricing power in 2004 when cargo exceeded capacity, and profits have been strong. However, with rail freight declines in the past year, some prominent rail customers are complaining of price gouging.

Rail rates for the largest U.S. rail carriers increased 6 percent on average over the first three quarters of 2008, not counting fuel surcharges, Patterson said, while other transportation modes such as ocean and trucking didn’t do so well.

One rail shipper, Seminole Electric Cooperative of Tampa, Fla., has filed a complaint with federal regulators accusing CSX Corp., one of the four major Class One railroads, of doubling its rate for shipping coal, the article said. Seminole said the increased rates would mean it would need to raise electric bills by $100 million for its 1.7 million Florida customers.

The president of the Association of American Railroads trade group, Ed Hamberger, said in the article that profits are key to the railroads’ ability to invest $148 billion to accommodate an expected boom in rail volumes in the decades ahead. He also referred to a recent Federal Surface Transportation Board study that rising rail rates in recent years largely have been "the result of declining productivity growth and increased costs rather than the increased exercise of market power."

The article pointed out that the incoming majority of Democrats might make for a more sympathetic Congress to rail pricing regulation.

Class-action suit filed against Horizon Lines

Horizon Lines Inc. has been named as a defendant in a securities class-action lawsuit filed in U.S. District Court in Delaware by stockholders following allegations that the Charlotte-based shipping line fixed prices in its Puerto Rico trade.

Horizon, the largest domestic ocean carrier in the U.S., was raided by federal agents last April as part of an investigation into its Puerto Rico pricing practices. An antitrust lawsuit had been filed in district court in Puerto Rico prior to the raid. The lawsuit alleged Horizon and three other carriers servicing Puerto Rico conspired in raising freight rates and levying illegal surcharges.

In a statement on Janurary 2, Horizon said it “believes that it has appropriate disclosure practices and intends to vigorously defend against the lawsuit.”



China port traffic declined in November

Cargo traffic at China’s ports declined for the first time in at least seven years in November, according to the Ministry of Communications.
Cargo volume fell 1 percent from a year earlier to 460 million tons in November, the Ministry said. Container traffic rose 4.1 percent to 10.4 million TEUs.
The impacts of the global recession on China's three biggest economies – the U.S., Europe and Japan – have had on impact on China, and the Ministry of Commerce there said its export trades might face a tougher 2009.

Prologis leases space in Ontario

Prologis, a global industrial real estate company, announced it has leased approximately 282,000 square feet in Ontario, Calif., to Safelite AutoGlass, a provider of vehicle glass repair and replacement services.

Safelite will occupy space at Prologis Park Ontario Airport, in a newly constructed, 681,000-square-foot facility. This is the fifth distribution facility deal between the two companies.

"The Inland Empire West submarket provides excellent regional access to Los Angeles, Orange County and San Diego, as well as Arizona and Nevada," said Mike Del Santo, first vice president and market officer for Prologis.

Prologis claims it is the largest owner of industrial distribution space in Southern California, with approximately 45 million square feet in 198 distribution centers owned, managed or under development.


New U.S. inbound cargo requirements start Jan. 26

Beginning January 26 of this year, the U.S. Department of Homeland Security (DHS) will require what it terms Importer Security Filing and the Additional Carrier Requirements interim final rule, (ISF & ACR).

Ocean carriers and importers will need to submit additional data to U.S. Customs and Border Protection (CBP) before cargo vessels will be allowed into U.S. ports.

Carriers will need to submit vessel stow plans and container status messages for inbound containers. Importers will need to submit the ISF no later than 24 hours before cargo is loaded aboard a U.S.-bound vessel. The ISF data must include: seller, buyer, importer of record number/foreign trade zone applicant identification number, consignee number, manufacturer/supplier, ship to party, country of origin and commodity HTSUS number.

The ISF must be updated no later than 24 hours prior to a cargo vessel’s arrival at a U.S. port, and at that point, must also include the container stuffing location and consolidator.

DC law firm buys more time against new vessel discharge regs

A team of environmental and maritime lawyers representing a coalition of shipping industry interests, said in a statement today that it has obtained a court order to allow the maritime industry more time to comply with new vessel discharge regulations.

The court order, obtained in U.S. District Court in San Francisco by the Washington DC-based law firm of K & L Gates, has extended the deadline for complying with new Environmental Protection Agency (EPA) requirements governing the discharge of pollutants from vessels.

The 80-page Vessel General Permit was enacted by the EPA under the Clean Water Act on December 18, 2008, and was scheduled to have taken effect on the next day. The regulation is applicable to most commercial vessels over 79 feet long, and requires the development of best management practices for 26 different discharge streams, including deck run-off.

The new court order extends the deadline for complying with the EPA’s best practices requirement to February 6, 2009, and according to K & L Gates, will allow the shipping industry more time to get up to speed with additional requirements that are to be imposed by some states as per the permit.



ATA publishes cargo security guidebook

The American Trucking Associations (ATA) has published its ATA Certified Cargo Security Professional Resource Guidebook, which the group said offers an in-depth resource for motor carrier security.

The 186-page guidebook was by the ATA’s security council and covers such areas as managing security risk, federal regulations, logistics/intermodal issues, emergency disaster management, hazmat transport, cross-border security, and food security.


Tuesday, January 6, 2009

Top Story

Report: Industrial to recover faster than
office space

A major real estate services and investment firm says the industrial real estate sector will recover faster than its office space counterpart in what is projected to be a generally tough year for the commercial real estate market.

Grubb & Ellis Company, a real estate services and investment firm, released its 2009 Global Real Estate Forecast, which states the year has started with an economy that is already 13 months into what could become the longest recession since the 1930s.

“The economy will struggle in 2009, which will dampen demand for all product types, resulting in negative absorption and increased vacancy,” said Robert Bach, senior vice president, chief economist of Grubb & Ellis.

However, due the logistics sector’s continued push for greater productivity and cost efficiencies, demand for industrial space should be sustained, according to the report.

In Grubb & Ellis’ Investment Opportunity Monitor’s 2009 rankings, logistics infrastructure was a clear indicator in terms of the locations. Los Angeles stayed on top of the list due to the two largest ports in the Americas situated there, and tighter available, and developable, space. Other port cities on the list are Houston (2), Oakland and Seattle (tied at 4), Miami (8), Portland, Ore. (9) and New Jersey (10). Inland distributions hubs on the list are Atlanta (3), Dallas (6) and Chicago (7).

The complete Grubb & Ellis Global Forecast is available at:



China’s manufacturing declines

China’s manufacturing declined for a third month due to falling exports in the world’s fourth largest economy, according to a Bloomberg report.

The Purchase Managers’ Index (PMI) was 41.2 in December, up from 38.8 in November. An index level below 50 is equated with a slowdown.

The China Federation of Logistics and Purchasing, and the National Bureau of Statistics jointly produce the PMI. The index is based upon a survey of more than 700 companies in 20 industries, and tracks changes that include manufacturing output, new orders, export orders, employment, inventory levels, costs and prices.
The report, citing Shanghai-based Industrial Bank Co., said China’s growth might have declined 5.5 percent last quarter, making it the weakest in at least 15 years, due in large part to a cut back in exports to the world’s big three economies: the U.S., Europe and Japan.

The Chinese government announced a $585 billion economic stimulus package in November. Further government assistance policy reviews were announced on Jan. 2 for the steel and automobile industries, with reports that economic growth might be revived in the second quarter of 2009.

China’s economy rose 9 percent from a year earlier in the third quarter of 2008, which was the lowest growth since 2003. The World Bank has forecasted a 7.5 percent increase in 2009, the lowest in almost 20 years.



B.C. waterfront trying to avoid strike

The B.C. Marine Employers Association (BCMEA) and the International Longshore Workers Union Local 514 (ILWU) will meet on Friday to try and avoid a strike that could halt cargo business at British Columbia’s ports.

According to a BCMEA statement, the two sides met on Saturday morning and engaged in talks until 2 A.M. Sunday.

Local 514 represents 450 ship and dock foremen. The two sides have been at odds for several months and the situation grew tenser on Friday. The primary areas of contention include pension payments and working conditions. According to a news report in the Prince George Citizen, another 5,000 additional port workers are expected to strike with the Local 514 members.

If there is a strike, grain shipments will be allowed due to federal protection. If a strike occurs, Canada’s Parliament can order the strikers back to work, however, that body is not back in session until January 27.



Allen Group relocates headquarters to Dallas

The Allen Group, an industrial real estate company, announced it has moved its corporate headquarters from San Diego, Calif., to Dallas, Texas. The Allen Group developed the 6,000-acre, multi-modal Dallas Logistics Hub in South Dallas County.

“The Dallas Logistics Hub has gained significant national and international recognition as the most sophisticated Inland Port logistics park in North America, and we are very excited to call Dallas our new home,” said Richard S. Allen, Chief Executive Officer of The Allen Group. “We have refocused our company’s investments to the DFW region because of the significant opportunities that exist here. Being a nexus of the global supply chain infrastructure and having the business-friendly environment of the State, the local community and the political support for the DLH, the move to Dallas only makes sense.”

Top Allen Group executives relocating to Dallas will include: Richard S. Allen, Chief Executive Officer; Ken Howell, Chief Financial Officer; Jon Cross, Director of Leasing and Marketing and David Hernandez, Director of Construction Services.

The Allen Group states its major focus has been in the development of logistics parks and inland ports that are located adjacent to rail, intermodal and highway infrastructures.



UPS, Merck in distribution deal

United Parcel Service Inc. (UPS) announced today it has an agreement manage most of Merck & Co.'s U.S. distribution and transportation services for its pharmaceuticals and vaccines.

UPS Supply Chain Solutions has taken over two Merck distribution centers in Atlanta and Reno, where most of Merck’s U.S. pharmaceuticals and vaccines are distributed.



Ryder appoints former APL Logistics exec
to Asia Pacific post

Ryder System, Inc. announced the appointment of Paul Tay as vice president and managing director of Asia Pacific. In his new role, Ryder says Tay will be responsible for “the continuing development and operation of Ryder's supply chain solutions offering throughout the Asia-Pacific region.” He will report directly to Ryder's president of supply chain solutions, John Williford.

Tay has more than 15 years of experience in both the contract and international supply chain management industry. He was most recently vice president of consolidation for APL Logistics, where he was responsible for managing APL Logistics' international logistics portfolio. Prior to that role, Tay served as vice [resident of Greater China for APL Logistics.

Tay was born and raised in Singapore and is fluent in English and Mandarin. Before entering the shipping and logistics industries, he served for three years in the Singapore Police Force.



Fedex, UPS rates go up          

U.S. postal rates are going up January 18, and both Fedex and UPS have already increased their rates for shipping packages by an average of between six and seven percent.

Both companies say their respective increases are due to the impacts from fuel surcharges.



U.S. signs cargo screening agreement with Lebanon

The U.S. and Lebanon have signed an agreement to deploy U.S. radiation detection equipment at the Lebanese ports of Beirut and Tripoli, the U.S. National Nuclear Security Administration (NNSA) recently announced.

The agreement will allow NNSA personnel to work with the Lebanese Customs Administration maintain the equipment for a limited time period and train Lebanese personnel to scan cargo for potential radiological and nuclear-weapon materials.

The U.S. is also hoping to deploy radiation scanners at border crossings in Lebanon in cooperation with the European Commission and the International Atomic Energy Agency.

“This agreement represents a major step forward in our efforts to prevent global smuggling of radiological and nuclear materials because of Lebanon’s geostrategic position as an east-west transit point for goods and people,” NNSA Deputy Administrator William Tobey said in a statement.

The U.S. is pursuing nuclear security efforts throughout the Middle East via its Second Line of Defense program, which places radiation detection technology at the international point of entry.



“Smart container” introduced to Europe-Asia shipping market

A “smart container” has been introduced to the global shipping market as part of the European-Asian security initiative, according to Belmont, N.C-based technology firm, Powers International, LLC.

Powers International announced it has entered a joint venture with European Datacomm (EDC) and Beijing-based Trade-Route, to install a container tracing and tracking device called the EDC-76 on cargo containers deployed in Europe-China shipping trades.

Currently patented in 33 countries, Powers International said the “smart container” technology will provide: location and status information from origin to destination; identify authorized personnel packing, securing and unsealing containers; detect any breaches to the container; changes of environment within the container; diversions of trade routes; and have the ability to be integrated with other software systems.


Wednesday, January 7, 2009

Top Story

Schwarzenegger urges Obama on major infrastructure investment in California

In a letter to President-elect Obama dated January 5, California Governor Arnold Schwarzenegger urged the president-elect to consider “a broad national economic recovery package” that includes assisting California with $44 billion in infrastructure projects.

The governor said his state would be ready to break ground within 120 days of the new Obama administration, and $11 billion of the total package would include investment in road, transit and rail construction.

In total, Governor Schwarzenegger said “California would be able to generate nearly 800,000 jobs over the life of these projects.”

The governor’s letter also addressed what his office sees, as needed regulatory and related changes to achieve these projects including:

  • “Waive or greatly streamline National Environmental Protection Act (NEPA) requirements consistent with our statutory proposals to modify the California Environment Quality Act (CEQA) for transportation projects.

  • Shorten federal permitting turnaround times and allow negotiations with permitting agencies over mitigation to occur during construction.

  • Structure funding for infrastructure projects in a way that encourages design-build approaches.

  • Encourage more public-private partnerships to attract more capital to these projects, improve efficiencies and lower costs.

  • Using the Diesel Emission Reduction Act to assist with the $1.6 billion cost of retrofitting an estimated 160,000 trucks that haul goods through California and will have to be upgraded

  • Providing tax credits for companies that produce these filters, thereby aiding American companies that manufacture diesel engines and those that make technologies to reduce truck emissions.”



Global box ship fleet hits 13 million TEUs and growing

The world's containership fleet hit 13 million TEUs and is projected to hit 14 million TEUs by August of 2009, according to Paris-based consultancy AXS Alphaliner.

Alphaliner’s statistics cover approximately 6,078 ships, including those that are laid up.

Of the total number vessels accounted for in the report, 94.4 percent are cellular containerships, with the remaining number being non-celled containerships, multi-purpose vessels and Ro-Ro ships.



Evergreen to build 100 box ships; sees global recovery
in 2012

Evergreen Marine, the Taiwanese global shipping line, has announced plans to order 100 containerships at a cost of $5.5 billion as part of a vessel replacement program, according to a story in the Economic Daily News out of Taipei. 

The owner of Evergreen, Chang Jung-fa, said in the article that he expects the global downturn to start picking up in 2012, with steel prices falling in the second half of 2011.

Evergreen would begin ship orders in 2012 with Japanese and South Korean shipyards.
The new vessel fleet will include 40 percent of the ships at 5,550-TEU capacity, 30 percent in the 8,000-TEU range, and the remainder between 2,800-and-3,900 TEUs.

Evergreen’s fleet is currently numbers at 178 containerships, of which 100 are owned by the company with the rest on charter.



Northern NJ warehouses beating national odds

Cargo shift from west to east is having impact

The national vacancy rate for industrial property has been estimated at 11 percent, and much higher in some parts of the country, but not in Northern Jersey, according to a New York Times report.

New Jersey’s vacancy rate is between 7 to 9 percent, but is tighter in the northern part of the state.

Jay Cornforth, manager of the AMB Property Corp.’s eastern division, told the Times that shipping lines are shifting more cargo from the West Coast to the East “because distributors are looking ahead a few years to when there will an all-water route to the East Coast from Asia, after a wider, deeper Panama Canal is completed.”

The article cited the Portfields Initiative between the Port Authority of New York and New Jersey and state economic officials, which was launched in 2004.

The initiative helped subsidize restoration of polluted “brownfields” and related land within the port authority’s jurisdiction and out of it major logistics and distribution centers have sprung up in the Northern Jersey port region, albeit in a suddenly tougher economy.

Despite the market downturn, industrial real estate analysts interviewed in the article referenced vacancy rates in the 5.9 percent to 9.4 percent range, including several Class A distribution centers.

An analyst from CB Richard Ellis said more shippers are moving distribution centers closer to urban areas and population centers to reduce shipping costs and lower environmental impacts.

Approximately 85 percent of the cargo moving in and out of the New Jersey ports is via truck, the article said.



New U.S. Ops director for UPS

United Parcel Service (UPS) announced Tuesday Myron Gray will head up U.S. operations as of February, replacing Jim Winestock, a 40-year veteran of UPS. For the past four years, Winestock has overseen all package operations in the U.S. and is retiring. Gray is currently the head of the UPS regional operations in Canada and all of Latin America.



South Korea pursues “Green New Deal”

The government of South Korea has announced plans to create almost one million new jobs through an investment of $38 billion in a variety of green projects.

The 36 projects are to include restoring the country’s four major rivers, establishing a green transportation network, and distributing green cars and clean energy over the next four years.

Approximately $13.7 billion is to go into the river restoration project, which the government said would create 280,000 jobs.

Another $8.4 billion and 160,000 new jobs would be invested in the “green transportation project,” which would include completion of high-speed railways that link Seoul with its port cities in the south – Busan and Mokpo. A rapid transit bus system is to be included as part of this project.

Other “Green New Deal” projects are to include securing alternative water resources, building environment-friendly, smaller dams; broader distribution of green cars; great availability of green energy; recycling more resources; utilizing forest biomass; building more energy-efficient homes and offices; and creating green living spaces.

Of the total projected investment, $28.7 will come from the South Korean government, $4.3 billion dollars from provincial governments, and $5.4 billion from the private sector.



Northrop Grumman gets big AIS contract
from USCG          

Northrop Grumman Corporation has been awarded a contract worth an estimated $68 million to design, integrate, install and test the U.S. Coast Guard's Nationwide Automatic Identification System (Nationwide AIS).


Nationwide AIS is to be a two-way maritime digital communication system, which will continually transmit and receive voiceless vessel data, including vessel identity, position, speed, course, destination and other data of critical interest for navigation safety, marine mobility and maritime security.

In addition, data collected by Nationwide AIS will be combined with other government intelligence and surveillance data and shared with authorized government operators, contributing to maritime situational awareness, in part by identifying and locating vessels offshore.

Nationwide AIS coverage is to be for all ships approaching the U.S. coastline and ports, including U.S. territories.



Kalmar delivers 4,500th straddle carrier

Cargotec’s Kalmar business unit announced it has delivered its 4,500th straddle carrier to EUROGATE at Bremerhaven, Germany in December 2008.

The machine is Kalmar’s seventh generation ESC440W straddle carrier equipped with a low noise insulation package, a soft landing system and automatic container picking system that minimises noise generated in container handling. The machine features an electrically controlled engine, which lowers exhaust emissions and reduces fuel consumption.

Bremerhaven has witnessed a significant increase of 50 percent in container throughput during the last three years and currently handles 5.6 million TEUs annually.



French ship, crew released, while China
patrols Gulf of Aden

Pirates released a French merchant ship and its nine crew members that had been seized off the coast of Nigeria this past weekend, according to the ship's owners on Wednesday. The crew is reported to be in okay after the supply vessel Bourbon Leda was captured by pirates operating out of Cameroon on the Nigerian coast.

In the wake of the latest, major piracy indicent, China has deployed two destroyers  to patrol the Gulf of Aden off of Somalia, joining a growing international coalition of anti-piracy patrols that includes the U.S., Russia and India.

The warships will join a multinational naval force patrolling the area, including vessels from the United States, NATO member states, Russia and India.


Thursday, January 8, 2009

Top Story

NYK strategic restructure: 
focus on overland, airfreight, logistics

The president of Nippon Yusen Kabushiki Kaisha (NYK), the major Japanese transportation group, announced NYK would launch a heavier focus on non-marine modes of transport in the next three to four years.

NYK’s Emergency Structural Reform Project is strategically aimed at coping with global economic conditions, said Koji Miyahara, president of NYK, in his New Year’s address.

"We intend to maintain stable management by fostering overland transport, air transport and logistics, which promise to become major spheres rather than relying on marine transport," he said.

The project’s subtitle is:  "To overcome the harsh winter and successfully reach the Sea of Yosoro (Sea of Steady-Going)."

NYK’s Structural Reform Project is planned for two years and will be under the leadership of NYK’s president-elect, Yasumi Kudo, who succeeds Mr. Miuahara on April 1 of this year.

The reform project is in line with NYK’s New Horizon 2010 plan that focuses on growth, stability and the environment, Mr. Miyahara said.
"Our NYK Group has all along pursued a policy of attaching prime importance to medium- and long-term profits grounded in mutual trust with important customers, accruing those profits primarily from long-term contracts rather than from short-term profits from fleet operation in the spot market," he said.

As for NYK’s environmental initiatives, the NYK president said: “The post-Kyoto Protocol framework is expected to impose certain restrictions on greenhouse gas (GHG) emissions from ships, raising the possibility that the NYK Group management will also be impacted to no small extent, depending on the new framework. Accordingly, we regard environment as one of the most challenging areas for our management."



Maersk restructure to cut head office staff 12 percent

The AP Moller-Maersk headquarters in Copenhagen will cut staff 12 percent from 830 to 730 in a reorganization of top management, the company announced on Wednesday.

The reorganization move will divide operations into distinct corporate and service units.

The corporate center will focus on accounting, finance, IT, corporate relations and human resources. The service functions will support the corporate center and all business units in areas like Information Technology, procurement, oil trading, technical operations and recruitment.

"Having to reduce the number of employees is regrettable," said group CEO Nils Andersen. "But as the pressure on our business increases, group functions have to be more effective to strengthen competitiveness."

Anderson said the corporate split will “reduce complexity and save costs” by decentralizing business units, placing “more operational responsibility where it should be.” The corporate restructure includes the reduction, by 100, of the corporate headquarters staff, leaving 250 staffing the corporate center and 480 for service functions, he said.

The new corporate arrangement is expected to be finalized within the month, the company said.


APL is Phoenix-bound

American President Lines (APL) announced Wednesday that it is moving its national headquarters from Oakland to Phoenix in the second half of 2009.

The shipping and logistics unit of Singapore-based Neptune Orient Lines (NOL) said it is negotiating with landlords in the Phoenix area will announce the location of its new office space later this month.

Currently, APL employs between 300 and 400 staff in its Oakland office building, where it has been since a move from San Francisco in 1990. In recent years, the company has been downsizing its office space.

NOL announced last November plans to lay off 1,000 employees and make the move out of Oakland as part of a company-wide effort to cut costs due to the mounting global economic downturn.

The APL terminal at the Port of Oakland will remain, where it currently employs 50 to 60 workers. The Port of Oakland invested $68 million in the APL terminal last year.


Höegh adds Savannah for Middle East service

Höegh Autoliners, Inc. announced the addition of the Port of Savannah to its U.S. Middle East Service.  The service will call on the Port of Savannah’s Ocean Terminal twice a month moving various new equipment, light vehicles and used high and heavy cargo.

The U.S. port rotation varies among Baltimore, Bridgeport, CT, Jacksonville, Savannah, and Wilmington, DE. In the Middle East direct port calls are Abu Dhabi, Aqaba, Bahrain, Beirut, Dammam, Doha, Jebel Ali, Jeddah, Kuwait, Muscat, Iraq and Tripoli, depending on cargo requirements, the company said.

The current economic conditions, as well as additional tonnage through its continued new building program, presented Höegh Autoliners with an opportunity to look at new ports of call, both in the United States and overseas.  Just last month Höegh Autoliners’ announced that the same Middle East service would begin calling Bridgeport, CT to load for Lebanon and Libya once every three weeks, beginning in mid-January 2009.

Höegh Autoliners operates approximately 70 pure car and truck carriers (PCTCs). The company said it carried approximately 2 million car equivalent units (CEU), making more than 3,000 port calls worldwide.



Sinotrans moves to number two in China logistics

The merger between Sinotrans and the China Changjiang National Shipping (CSC) Group has been approved by the China State Council, according to a report in Xinhua.

The merger between the two state-owned enterprises (SOE) will create the second largest logistics company in China after COSCO Group.
Sinotrans will change its name to Sinotrans CSC Group and will be the parent company after the merger.

The China State Council said it plans, through continued mergers to reduce the number of state-owned companies to between 80 and 100 by 2010.


Port of Seattle announces meetings for
truckers on air emissions

The Port of Seattle today announced a series of three meetings slated for the second half of January for independent truckers serving the port’s cargo terminals.

The port’s meeting announcement stated the meetings would give the independent trucking community “important information about efforts to reduce air emissions and provide an opportunity to ask questions and offer comments to port staff.”

The port said topics will include: outlook on Seattle's cargo industry and update on operations; the Northwest Ports Clean Air Strategy; and the port's Small Business Initiative and its potential opportunities to help independent owner/operators with resources and information.

The meeting dates are: January 14, 22 and 26, from 5:30-7:00PM at South Seattle Community College’s Georgetown campus.

For more information:


Alaska Air influences USPS direct village
hub change         

The United States Postal Service (USPS) is expected to make an alteration to its 2009 Bypass Mail Program, which transports mail by air directly to rural customers, according to a report in the Alaska Journal of Commerce.

The change is a direct influence of the Alaska Air Boeing 737-400 combi aircraft that can be loaded with bypass mail that is destined for unpaved airports in rural Alaska.

The U.S. Postal System (USPS) revealed plans in 2008 to create intra-Alaska hubs across the state, with four initial hubs in the plan: the villages of Hooper Bay, Shishmaref, Savoonga and Kiana.
Ten additional sites are being considered with the plan in Anaktuvuk Pass, Holy Cross, Point Hope, Sandpoint, Togiak, Eagle, Pilot Point, Red Devil, Tanana and Wainwright.

USPS estimates it will shave approximately $7.8 million off of its $150 million annual transportation costs if mail is flown direct to the first four villages alone, the report said.

The Alaska mail route change is not popular with some in the air industry. "The mail flown to the new intra-Alaska hubs would reduce mail volumes flown into Bethel, Nome and Kotzebue because it would be flown direct to the villages, causing unforeseen economic and labor hardships on existing passenger and freight carriers," said Wilfred Ryan, president of the Alaska Air Carriers Association in the article.
The air transport industry in Alaska operates with marginal profits and changes to the bypass mail system would impact the financial operations of many companies there, he said.

"For instance, changes in mail transportation qualification requirements, contained in the Rural Services Improvement Act of 2002, caused a substantial number of mail-only carriers to go out of business," he said.



Transite Technology releases ship-base software

Transite Technology, a provider of logistics and shipping cost-management software services, announced the release of the latest version of what it terms its Continental rate base.

“Continental is the only neutral rate base that is a true shipper rate base for pricing and bidding freight,” said Geoff Comrie, CEO of Transite. “Its rates have never been influenced by carriers. No other company can bring this level of neutrality to the bidding and pricing of freight,” he said.

The company said its Continental solution “is strategically positioned to compete against two products widely used today -- CzarLite, and MARS 500.

"Another major difference is what you get for the money," said Comrie. "Continental has obvious big advantages in rates and technology; it’s less expensive and has friendlier licensing terms. For example, at a single standard price that’s lower than our competitors, Continental delivers five and six digit zip code and postal code accuracy with no extra cost for rates for Canada. Plus, the rating program is more advanced with capabilities used by shippers and carriers such as batch rating and analysis," he said

The company said in its efforts to attract shippers, brokers, and logistics companies, Transite is offering a “two for one” promotion: Until April 1, 2009 all customers who purchase Continental 2009 can get the Continental 2010 version at no charge.


Friday, January 9, 2009

Top Story

State of Florida to review $1billion
Port of Miami Tunnel project

A major $1 billion tunnel project that would run the Port of Miami’s cargo and cruise traffic under Biscayne Bay direct to interstates, might be showing signs of life again with Florida’s Department of Transportation, according to a report in the Miami Herald.

The project was dead in mid-December when State Transportation Secretary Stephanie Kopelousos announced as much when the private French-Australian group that would have been responsible for designing, building and operating the tunnel over 35 years was hit hard by the global financial crisis, the report said.

Miami-Dade lawmakers subsequently applied a full-court press with the DOT and the result was Secretary Kopelousos, along with Governor Charlie Crist, announced they would take another look at the project.
The tunnel team has asked the state to replace the original consortium of Babcock & Brown with the private equity fund, Meridiam, which is headed by the second-largest bank in France and a global engineering fund.

The tunnel project’s inception was in the early 1980s when a task force first included it as one possible solution to separating port traffic from non-port traffic on the Miami waterfront, according to the Port of Miami.

A traffic and demand study in 2003 reported that approximately 24,000 vehicles per day visited the port, with 29 percent being trucks and buses. By 2033, the report projected 70,000 vehicles per day at the port. Currently, the port says roughly 4,000 18-wheelers transit in and out of the port causing congestion in Miami’s central business district.
The proposed twin tubes of the tunnel would go under the bay and link the port’s Watson and Dodge islands.

The state’s share of the tunnel funds is reported to be $452 million for construction and $850 million for long-term operations and maintenance, and Secretary Kopelousos told Miami-Dade lawmakers those funds will not be diverted to other projects, according to the Herald report.

Recent studies were cited showing the Port of Miami is responsible for $17 billion in business, making it the second biggest economic generator, with Miami International Airport taking the top spot.
While the project might be somewhat revived, Secretary Kopelousos was not overly optimistic in the Herald report.

''There's a lot of passion for this project. We understand that,'' Kopelousos said. "The reality of it is: In the current financial market, we don't believe we're going to be able to bring this thing to fruition.''



2008 retail container traffic lowest in four years

Retail cargo volume at the major U.S. ports fell for the 17th straight month, and lowest level in four years, according to the monthly Port Tracker report released yesterday by National Retail Federation and IHS Global Insight.

Volume for the year was estimated at 15.3 million TEUs, compared with 16.5 million TEUs in 2007, the report said, showing a decline of 7.1 percent and the lowest total since 2004, when 14 million TEUs moved through the ports.

“2008 was a slow year for the ports for the simple reason that it was a slow year for retail sales,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “We don’t expect a significant increase in traffic at the ports until retail sales return to normal levels, and even then retailers will be careful not to over-stock.”

U.S. ports surveyed by Port Tracker handled 1.23 million TEUs in November, which was down 10.3 percent from the 2008 peak of 1.37 million TEUs set in October and down 11.8 percent from November 2007. December was estimated at 1.2 million TEUs, down 6.4 percent from December 2007. The last month to see a year-over-year increase was July 2007, when the 1.44 million TEUs moved through the ports was up 3.4 percent from July 2006, according to the report.

Port Tracker forecasts January at 1.16 million TEUs, down 6.3 percent from January 2008, with February forecast at 1.1 million TEUs, down 11.1 percent from 2008. March is expected to be up 1.1 percent from a year earlier at 1.17 million TEUs, but April is expected to decline 2.6 percent from 2008 at 1.23 million TEUs. May is forecast at 1.25 million TEUs, down 4 percent from last year.

“Between the economy and the customary winter impact of the slow season, port traffic is very weak,” IHS Global Insight Economist Paul Bingham said. “Port traffic is projected to continue to be very slow due to the underlying weakness in demand.”



UPS adds 16 countries to express service

UPS began offering domestic express pickup and delivery services inside 16 additional countries this week across Europe, Africa, the Middle East and Latin America.

The nations involved in the expansion are Algeria, Argentina, Chile, Cyprus, Czech Republic, Hungary, Kazakhstan, Kenya, Malta, Pakistan, Romania, Saudi Arabia, Serbia, South Africa, Ukraine and UAE.

Shippers in these countries now will be able to consolidate all of their package delivery services with one carrier, effectively eliminating multiple shipping processes while potentially saving money, UPS said in a statement. 

"This expansion represents an investment for the future through markets where we're seeing growing demand," said Dan Brutto, president of UPS International. "While we've provided international service to these countries for years, we see an opportunity now to expand our customer base and grow our business. We're excited that we can extend our network to meet the growing needs of these customers."

"Today's economy is affecting nearly every company on the planet, large and small," added Brutto. "In these uncertain times, it's critical to have an experienced partner like UPS that can help provide efficiency, reliability and ultimately, opportunities for new growth in the future."



Teamsters ratify job plan with YRC Worldwide

Teamsters working for Yellow, Roadway, Holland and New Penn (YRCW), have approved a job protection and retirement security plan for what is reported to be tens of thousands of its members.

The plan calls for a reduction in gross wages, mileage rates of 10 percent and suspension of cost-of-living adjustment and is good through March 31, 2013. There was no change to health, welfare or pension contributions.

"While we never want to see wage reductions, this vote shows that our members understand that we are facing the worst economy since the 1930s and that the company needs some help to get through this difficult period," said Tyson Johnson, Director of the Teamsters National Freight Division. "We are hopeful that this agreement will protect the livelihoods of our members and their families by protecting the jobs and health, welfare and pension benefits of our freight members."

The new plan does include a provision that will allow Teamster members to recover lost wages if YRCW's stock price goes up in the future.



NCBFAA files comments with FMC
on TSA amendment request

The National Customs Brokers & Forwarders Association of America, Inc., (NCBFAA) yesterday submitted comments to the Federal Maritime Commission (FMC) opposing requested anti-trust immunity by the Transpacific Stabilization Agreement (TSA).

Prepared and filed by NCBFAA General Counsel Edward Greenberg, the NCBFAA comments were in response to the TSA’s request to amend its agreement with the FMC to grant it immunity from antitrust laws when it collectively discusses capacity rationalization issues.

In its comments, the NCBFAA posits that approval of the TSA request would lead to less service and higher rates.

“The NCBFAA believes that the proposal on its face raises concern that it could result in an unreasonable reduction in transportation service or an unreasonable increase in transportation costs,” according to the NCBFAA, “and that no approval should be considered by the [FMC] unless or until the carriers are able to demonstrate that neither of these fears are justified.”

  “The NCBFAA has long opposed the continuation of anti-trust immunity for steamship lines as inappropriate and unnecessary,” the Counsel Greenberg wrote. “And, the NCBFAA is particularly concerned that the expanded immunity now sought by TSA could substantially and adversely affect the ocean shipping marketplace.”



Floods impact rail connections
in Western Washington

Floods throughout the Western Washington region cut off many rail connections yesterday, with greater impact at the Port of Tacoma than the Port of Seattle, according to a report in the Puget Sound Business Journal.

The one open intermodal rail connection reported yesterday was Stevens Pass, operated by the BNSF, and crosses east over the
Cascade Mountains.

The Port of Tacoma relies more on southerly rail routes and tracks owned by the BNSF were flooded and closed on Thursday, railway company spokesman Gus Melonas, told the PSBJ.

Port of Tacoma spokeswoman Tara Mattina said five inbound and five outbound trains from the port had been halted by the flooding, and that the port was working with the BNSF to move some of its cargo through the Stevens Pass tunnel.

The Union Pacific utilizes BNSF tracks to the south and was also shut down, a UP spokeswoman told the Journal.

For more updated information on the Port of Tacoma’s rail status:



Cushman & Wakefield partners with EPA on green real estate inititative          

Cushman & Wakefield, the largest privately-held commercial real estate company in the world, has signed a memorandum of understanding with the U.S. Environmental Protection Agency to reduce environmental impact on over 3.200 commercial properties it manages throughout the U.S. The MOU includes goals of reducing energy consumption at Cushman & Wakefield propeties by 30 percent by 2012, tracking water usage and promoting conservation, joining the EPA's WasteWise reduction program called WasteWise, and joining the agency's GreenScapes program, which emphasizes reuse of industrial materials and sustainable landscaping practices.

The company also pledged to work with its clients to achieve these goals to make energy efficiency a top priority in operating its corporate sites, such as seeking green building when feasible.

Cushman & Wakefield said it will deliver progress reports to the EPA every six months.



Cal Maritime announces
2009 continuing ed courses

The California Maritime Academy has announced the 2009 lineup of continuing education via its Extended Learning Department. Courses aimed at professionals involved in the maritime industry include:

  • Company, Facility and Vessel Security Officer Training.
  • STCW – Basic Safety Training including firefighting, first aid/CPR and water survival training.
  • First Responder – For public safety and other personnel who may respond to emergencies or significant events at maritime facilities within their jurisdiction such as vessels, ports and terminals.
  • Radar Renewal and Exam – for personnel needing refresher certification.
  • Bridge Resource Management
  • Dangerous Liquids Management for Tanker Personnel.

Many of the courses are offered on the school’s Vallejo campus. Others may be provided off-site or via the Internet, enabling participants to take part at times and locations convenient to their own schedules, the school reported.

For more information go to:



ShipServ reports record year

ShipServ, a maritime e-marketplace solution, announced today that 2008 was its most active year ever with record numbers of buyers and sellers of ship supplies.

The number of transactions on its trading platform, ShipServ TradeNet, grew by 69 percent with a gross merchandise value of $1 billion, the company said.

The number of ships signed up on the network increased by 50 percent and the number of suppliers also increased by 50 percent, ShipServ said.

In 2008, the company reported 31 new ship owners, managers and yards joined TradeNet, including A.P. Moller-Maersk, Bibby Ship Management, Companhia de Navegacao Norsul, Crowley, Far East Ship Management, Malaysia International Shipping Corporation Berhad and MSC Ship Services.

The company said many product and equipment sellers to the shipping and maritime industries have integrated their systems with the ShipServ trading platform, connecting to what the company reports to be over 130 buying organizations, 4,500 vessels and 23,000 suppliers.


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