Monday, February 2, 2009
Top Story
Port Metro Vancouver names new chief
Port Metro Vancouver announced today that Robin Silvester is the new president and chief executive officer of Western Canada’s top port authority, replacing Captain Gordon Houston, the Vancouver port chief for the last eight years.
Silvester is currently based in Australia as chief executive of United Group Services ANZ, an
organization that focuses on property and facilities management in Australia and New Zealand.
Silvester had spent much of his career in the ports sector, working in a number ofsenior positions internationally with P&O Ports, the port said in its announcement.
At the time of its acquisition by DP World in 2006, P&O Ports was the world’s fourth largest container terminal operator, managing stevedoring activities in more than 100 locations in 18 countries.
In his role as Chief Development Officer with P&O Ports, Silvester led the acquisition of BCR Marine; a division of BC Rail, and in 2003 became the first President of P&O Ports Canada in Vancouver.
Silvester began his career in the chemicals industry in the UK working in a range of project
management, manufacturing management and business development and marketing roles. He also worked in business management and strategy roles in the steel industry and was involved in British Steel’s acquisition program. He is a chartered engineer educated at Cambridge University. He has also completed a Corporate Finance Program at London Business School.
Ports
Guam port and MARAD to receive proposals for $195 million upgrade
Officials from the Port Authority of Guam and the U.S. Maritime Administration (MARAD) are in Washington D.C. this week to receive a round of presentations from private companies seeking contracts in the port’s $195 modernization plan, according to news reports out of the Pacific region.
Dubbed “The Port of Guam Improvement Enterprise Program,” the port upgrades are meant for the buildup of the military presence there, including military transshipment and imports.
By 2014, approximately 8,000 Marines, and 9,000 family members, from Okinawa are scheduled to relocate to Guam at a cost of about $20 billion.
MARAD was charged by the former Bush Administration to be the lead federal agency that partners with the Port Authority of Guam in overseeing the modernization project.
As part of Guam’s port upgrade project, three Hitachi container cranes were jointly purchased by the port’s primary commercial shipping customers, Matson Navigation and Horizon Lines, from the Port of Los Angeles, and transported by Crowley Maritime to the Pacific island this past week.
The port authority recently released a request for information with the following qualifications to be submitted by interested parties by March 19:
* Identify and recommend the level of funding that will be necessary for a Performance Management Contract;
* Identify and recommend an implementation plan for management of cargo terminal operations and maintenance of equipment and facilities;
* Assess & recommend operating inventory and back stock requirements;
* Assess and recommend employee certification and training programs;
* Identify and recommend a fully automated terminal operating and management information system;
* Identify and recommend quality assurance/quality control programs;
* Identify and recommend improvements to existing cargo handling productivity and performance while forging reduced, operating costs; and
* Identify and partner with a world class PMC with the capacity to invest at least $25 million in the Port's overall modernization plan.
Port of Long Beach committed to improvement projects
The Port of Long Beach is committed to port improvement projects despite the global recession, according to Richard Steinke, the port’s executive director in a “State of the Port” address on Friday.
"The world will rebound from this economic downturn, and when it does, we will be at the forefront because of the investments we are making today," said Steinke at a luncheon hosted by the Long Beach Area Chamber of Commerce's International Business Association.
The Port of Long Beach has been in the planning its modernization and environmental projects for several years, totaling approximately $2.6 billion worth of construction in the coming years, the port said in a press release.
The port pointed to its proposed Middle Harbor Redevelopment Project, a 10-year, $750-million project to remake two aging container docks into one environmentally efficient terminal. The port said the project would not only generate 1,000 construction jobs a year, but would also add 14,000 goods movement jobs to the Southern California region when it is completed. The project would enable the new terminal to move twice as much cargo with half the air pollution, the port said.
Other projects include a proposal to create a new cargo container terminal on Terminal Island at Pier S, and to replace the aged Gerald Desmond Bridge, which connects downtown Long Beach to Terminal Island.
To see the entire "State of the Port" archived Webcast:
longbeach.granicus.com
Liner
Report: Maersk gives South China ports a pass on THC rate hike
Maersk Line has reportedly exempted the South China ports engaged in the European and U.S. shipping trades from 28-33 percent increases in terminal handling charges (THC) that have been implemented by the shipping line across mainland China, according to the Hong Kong Shipping Gazette.
Beginning January 15, Maersk’s China THC was increased from approximately $54 to $69 per-TEU, and from close to $82 to just over $109 per-FEU, the Shipping Gazette reported.
The THC increase is the first instituted by Maersk in six years despite rising terminal costs at many locations, the company said in the report.
"The decision was made unilaterally by Maersk Line and was made in order for the THC level to better reflect actual charges made by terminals. Currently, Chinese state-owned shipping lines as well as foreign shipping lines charge the THC. The THC level decided on by Maersk Line is close to market averages," the company said in the Shipping Gazette.
Green
Wal-Mart to test new hybrid trucks,
alternative fuels
Wal-Mart Stores, Inc. announced today it will test two new types of heavy-duty commercial hybrid trucks and two different alternatively fueled heavy duty trucks as a part of the company's efforts to build on its progress in developing a more sustainable trucking fleet. The new trucks include:
- A full-propulsion Arvin Meritor hybrid that will initially operate in the Detroit area. The company said the dual-mode diesel-electric hybrid is believed to be the first vehicle of its type;
- Fifteen trucks operating in Buckeye, Arizona distribution center near Phoenix, will be converted by Wal-Mart’s environmental development group to run on Reclaimed Grease Fuel(TM), made with the waste brown cooking grease from Wal-Mart stores. In addition, the company said remaining trucks located in the Buckeye distribution center will operate on an 80/20 blend of biodiesel made of reclaimed yellow waste grease;
- Five Peterbilt Model 386 heavy duty hybrid trucks with diesel-electric hybrid power systems developed by Eaton Corporation and PACCAR, that will be based in Dallas, Houston, Apple Valley, Calif., Atlanta and the Washington/Baltimore regions and;
- Four Peterbilt Model 386 trucks and one yard truck, which operates only on the distribution center property, will operate on liquid natural gas. These trucks are part of a partnership with the Mojave Air Quality Management District and will operate out of the distribution center in Southern California, the company said.
"In order to meet our goal of doubling our fleet efficiency, we are taking an active role in the development of these technologies," said Chris Sultemeier, senior vice president of transportation for Wal-Mart Stores, Inc. "We look forward to determining if these technologies will help reduce our environmental footprint, are viable for our business and provide a return on investment."
Wal-Mart said it achieved more than a 25 percent increase in efficiency within its private fleet between 2005 and 2008, surpassing one of the company's stated sustainability goals. By reaching the goal, Wal-Mart said it has been able to reduce its carbon dioxide emissions and its fuel use. The goal was reached by using a combination of new, innovative technologies, better delivery routes and by loading its trailers more efficiently. Now, the company said it is working toward its goal of doubling its fleet efficiency by 2015, from its 2005 baseline. Part of the pilot program is to determine if alternatively fueled trucks can help move Wal-Mart toward that goal in addition to reducing environmental impacts, Wal-Mart said.
Wal-Mart said it has engaged several suppliers to develop and test these new technologies throughout 2009, including Arvin Meritor, Eaton, Peterbilt and International as well as smaller companies.
Trucking
Paccar Q4 earnings drop 56 percent
The number two U.S.-based manufacturer of heavy trucks, Bellevue, Wash.-based Paccar Inc., announced on Friday its earnings in the fourth quarter of 2008 dropped 56 percent due in part to lower build rates and gross margins.
The company, which manufactures trucks under the Kenworth, Peterbilt and DAF brands, reported fourth quarter profit of $113.1 million down from $261.1 million for the same period in 2007. The company said its sales declined 23 percent to $2.6 billion.
Paccar said it will continue to cut operating expenses and capital expenditures, projecting sales 130,000 to 170,000 "Class 8" heavy-duty trucks, down from 153,000 in 2008 and 176,000 in 2007 in the North American marketplace. The company said sales in Europe, where it had one of its best years at 330,000 trucks sold, should dip to between 200,000-240,000 units sold in 2009.
Old Dominion opens service centers in
Georgia, Montana
Old Dominion Freight Line Inc., the less-than-truckload carrier, announced service center openings in Columbus, Georgia and Butte, Montana.
The 21-door Columbus facility is located on a 3-acre site at 310 Columbus Manchester Expressway and will begin operations under the leadership of Service Center Manager Joey Maddox, who will direct a staff of 11.
Old Dominion also announced the relocation of a service center relocation to Butte, Montana. The 24-door facility is located on a five-acre site at 119975 Rick Jones Way, Silver Bow.
The facility will continue operations under the leadership of Service Center Manager Bruce White, who will direct a staff of 10, the company said.
Security
APL’s Agron is only shipping line exec on Homeland Security committee
The Department of Homeland Security has appointed Earl Agron, vice president of security for APL, to the National Maritime Security Advisory Committee, the shipping line announced today.
Outgoing Homeland Security Secretary Michael Chertoff chose Agron, and is the only shipping line executive on the eight-member committee. The group counsels the U.S. Coast Guard and Homeland Security on issues such as national maritime security strategy and policy and the actions required to meet security threats.
"On behalf of APL I'm honored to be chosen for the advisory committee," said Agron, a veteran of more than 25 years in the shipping business. "Security is paramount in everything we do and this appointment reflects my company's commitment to the safe transport of global trade."
Technology
TT Club advocates anti-collision systems
for cargo-handling cranes
The British shipping industry insurer TT Club said it is advocating the use of electronic sensors being installed on cargo handling cranes to help prevent maritime accidents, saving the industry millions of dollars, the company said in a statement.
TT Club said it has received over one hundred claims in the last two years resulting from the booms of cranes hitting vessels at a total cost of claims in excess of $12 million.
The company said crane boom collisions vary, including a two-million-dollar incident that caused damage to the crane boom and the vessel’s crane.
"Modern electronic sensors today can practically eliminate this type of accident. They should be retrofitted to existing cranes and specified for new cranes. For a cost in the region of US$10,600 per crane this is a very worthwhile investment. Sensors have been shown to be very effective and a great deal of damage and loss can be prevented for a relatively small investment," said TT Club Risk Assessment Director Laurence Jones.
The TT Club said there are only two electronic sensors currently available in the market that provide boom anti-collision protection: a laser-based unit by Sick Sensor Intelligence and a radar-based unit from Navtech Electronic Ltd.
Tuesday, February 3, 2009
Top Story
China is biggest pork importer in history
China became the biggest importer of pork in history in 2008, according to the U.S. Meat Export Federation’s (USMEF) calculations from Chinese trade data.
Based on import totals from China and Hong Kong, the Asian nation imported 1.925 million metric tons (4.2 billion pounds) of pork and pork products last year, including 1.161 million tons (nearly 2.6 billion pounds) of pork variety meats and 764,000 tons (1.7 billion pounds) of pork cuts, the USMEF reported.
China's imports surpassed the previous single-year record of 1.022 million tons (2.2 billion pounds) of pork imported by Japan in 2005, the USMEF said.
"The volume demonstrates the huge influence China can have on global markets when supply and demand become imbalanced,” said Joel Haggard, senior vice president of USMEF's Asia Pacific region. “The import volume, though huge, represents less than 5 percent of China’s consumption."
Final data is not in for 2008 is not in, however the USMEF estimates that total U.S. pork and pork product exports to China and Hong Kong reached 386,000 tons (851 million pounds) valued at nearly $700 million in 2008. The EU and Brazil were the other major pork suppliers to the region, the USMEF said.
Haggard said he believes it is unlikely that China's pork imports this year will match last year's record. Increased industry profitability last spring, coupled with a range of hog raising subsidies, has resulted in a substantial expansion of China's herd, and lower hog and pork prices, he said.
According to the National Bureau of Statistics, by the end of the third quarter of 2008, China's live hog inventory had increased 6.6 percent from the year-earlier figure, and the sow population increased 12.4 percent. Total marketed hogs increased 5.8 percent and meat production was up approximately 6 percent.
Although the post lunar new year early spring period usually marks the annual low point in demand, USMEF said it has heard reports of serious respiratory disease outbreaks that could be adding a bearish tone to the market. That said, the USMEF said it expects imported variety meat demand to hold through 2009, although U.S. muscle cuts face stiffer competition from domestic supplies.
The USMEF reported that as on January 12, China’s National Development and Reform Commission (NDRC), the state's leading macroeconomic planning and policy agency under the State Council, in concert with key ministries including the Ministry of Commerce, the Ministry of Agriculture, AQSIQ and the Ministry of Finance, announced a new temporary pork price stabilization program ostensibly designed to smooth out the country's volatile hog cycle. Specifically, the program establishes an early warning system for low live hog and pork prices based upon the ratio of live hog to grain prices. As the live hog to corn price index drops, the program sets triggers for different policy actions by central and local authorities, ranging from mandating government purchases of pork for reserves to restricting imports and stimulating exports if prices drop into a "red" zone range.
China's first new central policy document of the new lunar year of the ox pledged "tough" measures to support rural areas and agriculture this year. China noted that rural areas face the most difficult challenges during the global economic downturn. With 40 percent of rural income dependent on non-farm work, such as manufacturing jobs in coastal factories, the loss of overseas demand will translate directly into pain for the rural sector, the USMEF reported.
The USMEF said that results of a new Chinese survey just announced estimated that 15 percent of migrant rural workers - approximately 20 million people - have lost their jobs due to the economic crisis. A number of subsidy increases have been announced for the rural sector in addition to those for the hog-raising sector, including farm machinery and appliance purchasing subsidies, and a 16 percent rise in the minimum purchase price for grain, the USMEF said.
The U.S. Meat Export Federation (www.USMEF.org) is the trade association responsible for developing international markets for the U.S. red meat industry and is funded by USDA, exporting companies, and the beef, pork, corn and soybean checkoff programs.
Retail
Retail associations partner as consumer product safety regs approach
Two retail associations announced a partnership to help prepare retailers for the new Consumer Product Safety Improvement Act (CPSIA), which goes into effect February 10.
The Retail Industry Leaders Association (RILA), a U.S.-based group that includes major retailers like Wal-Mart, and the British Retail Consortium (BRC), said they are going to work together to establish global product safety standards.
The CPSIA will require retailers to sell only products that meet safety standards and to obtain certificates of conformity for each batch of imported products. The associations announced their BRC/RILA standard would help retailers comply with the new regulations by establishing a certifiable worldwide measure by which manufacturing operations are set.
In 1998 the BRC established a technical standard for retailers to use with food suppliers and manufacturers. Today, the BRC says the majority of UK and many European and global retailers will only consider relationships with food suppliers that have been certified under a globally certified standard such as the BRC Global Standard. The BRC has established additional industry standards for operations involving packaging, storage and distribution and consumer products.
“The retail industry is committed to ensuring the products that enter their supply chain are designed and manufactured to ensure the utmost safety,” said RILA President Sandy Kennedy. “A meaningful and attainable global standard for consumer goods will strengthen existing protocols and establish a new bar by which manufacturing operations will be measured.”
Liz Kynoch, Group Technical & Trading Law Director, Tesco plc and Chair of the BRC Global Standards Governance and Strategy Committee, said: “Over the last 10 years the BRC Global Standards have significantly aided the development of more effective product safety systems by suppliers. The standards help retailers adopt a consistent approach to the management of their supply base, form a major component of a retailers risk assessment of their suppliers and assist retailers to meet their legal obligations. The certification of over 14,000 suppliers around the world is a clear indication of their value.”
The BRC said its global standards benefit both retailers and their suppliers with certification being an effective and cost efficient way for retailers to establish confidence in products and reduces the burden of multiple audits for suppliers. Registration of their certification in the BRC database enables suppliers to promote their technical credentials to potential new customers, the BRC said.
For more information on the CPSIA: http://www.cpsc.gov/ABOUT/Cpsia/cpsia.HTML
Liz Claiborne to cut 8 percent of workforce
Apparel designer and retailer Liz Claiborne Inc., the apparel designer and retailer, announced Tuesday it would eliminate 725 jobs, or 8 percent of its U.S. workforce.
The company said the job cuts will be at all levels, and should be completed by the end of the first quarter. Liz Claiborne also said it would suspend merit pay increases for all employees and close a distribution center in Mt. Pocono, Pennsylvania.
"Personnel decisions are always the hardest, especially in times like these," said William McComb, CEO, Liz Claiborne.
Liz Claiborne has now cut approximately 2,200 staff globally since 2007 and closed six distribution centers.
Freight
UPS posts fourth quarter profit; braces for 2009
United Parcel Service Inc. (UPS) posted a fourth-quarter profit in the face of declining package and freight volumes, the company announced.
UPS reported fourth quarter net income of $254 million, compared with a net loss of $2.64 billion, from the same period a year ago. The 2008 fourth quarter results included a $575 million write-down related to the UPS Freight business. Last year’s results included a $6.1 billion pension-related charge.
The shipping company said it was freezing management salaries and suspending its 401(k) matching contributions to cut costs. The company said it has also consolidated operations, reduced its air business and cut out some package-handling operations.
"The year will undoubtedly be one of the most difficult in UPS's history. Since economists do not expect any meaningful recovery until 2010, earnings in 2009 will suffer. Lower volume levels and reductions in package weight will put further pressure on margins. We anticipate the first quarter will be weak, with slight improvements later in the year as initiatives take hold," said UPS Financial Chief Kurt Kuehn.
Green
NYK makes global corporate sustainability top 100 list for third consecutive year
Japanese shipping group, NYK, announced today it has been selected for the third year in a row as one of the “Global 100 Most Sustainable Corporations in the World.”
The Global 100 is an annual research and ratings project conducted jointly by Innovest Strategic Value Advisors in New York and Corporate Knights inToronto. The list is compiled by analyzing non-traditional drivers of riskand shareholder value, including companies’ performance on social,environmental, and strategic governance issues.
Launched in 2005, the annual Global 100 is announced each year at the World Economic Forum in Davos. The 100 companies on this year’s list are based in 15 different countries, and of the 1,800 companies analyzed, NYK said it is the only Japanese shipping company to have been selected.
Technology
Trans-Lucent launches newest AccuFreight Rate Manager for shippers
Trans-Lucent Markets Inc. announced it has launched the newest version of its AccuFreight Rate Manager (ARM) product. The company said the upgraded ARM 3 includes enhanced features and the new Load Tender function that will allow shippers to submit a pick-up request without leaving the ARM website.
"This is the next step for us in full logistics support for our customers," said Shelina Lalani, president of Trans-Lucent. "Our clients no longer have to use multiple websites, or wait on hold while they are trying to book a pick-up for their shipment. ARM 3 will do it for them."
The company describes the AccuFreight Rate Manager (ARM) as an online, freight rate management system designed for shippers to easily access and manage their current rate information, helping companies determine their most cost-effective carriers and easiest shipping method.
Trans-Lucent says ARM 3's new Load Tender function allows clients to choose their top carriers through a “Find the Best Rate” tool, and can automatically schedule a pick-up request. Using the shipment details that were entered for the freight rate look-up, ARM will generate a load tender that is emailed to the carrier with no login required by the carrier, the company said. The carrier is sent a unique URL that they can access to view the information from the tender.
If accepted by the carrier the client is notified, if not accepted, ARM 3 will then send a request to the next carrier on the list and so on until a pick up has been scheduled, the company said.
"This function will save our clients a lot of time, and ultimately money," said Lalani. "And that is the goal of our entire system."
Trans-Lucent said another new component to ARM3 is the functionality to produce carrier performance reports, where the system gathers information such as reliability of carrier, how many times they have accepted a pick-up, and number of early or late pick-ups. How each carrier has performed over time generates a report that Trans-Lucent says can help users identify the best choice for their shipment by adjusting the carrier's rating.
Thursday, February 5, 2009
Top Story
Credit Manager’s Index falls again; freight transport payments slow
The Credit Manager’s Index (CMI) fell for the sixth consecutive month in January to 39.7, where a score below 50 indicates contraction, with slow payments for freight transport factoring into the overall drop, according to statistics publishing by the National Association of Credit Management (NACM).
Some encouraging signs included month-over-month credit falls were not as steep, and a few sectors reporting stronger credit numbers such as transportation equipment and home furnishings.
All 30 components in the indexes are below the 50 level signaling economic contraction; 13 are even below 40, suggesting a powerful recession, and 13 are at record lows, the NACM reported.
Seven of 10 components fell in manufacturing sector, six of 10 in the service sector. “It was another grim report,” said Daniel North, chief economist with credit insurer Euler Hermes ACI, who evaluates the data and prepares the CMI report for the National Association of Credit Management (NACM). “Similarly, much of the recent economic data has been worse than expected, suggesting that the economy’s decline may actually be accelerating,” he continued.
“There is some positive news however,” said North. “Over the past few months the indexes have been subject to dramatic, almost sickening declines, like the 11.7 percent drop in manufacturing sales last month. This month’s report seems almost sedate by comparison, as the worst fall was only 4.4 percent. In addition, some of the respondents actually had some good news to report this month, apparently seeing a tiny glimmer of light in the darkness. There might also be the slightest hint of a bottom in the housing market, and there might also be some barely visible cracks in the frozen credit markets.”
“Combine all this with super loose monetary policy, plummeting energy prices and some new ideas from a new administration, and the optimism expressed by a few of the credit managers might be justified,” he said. “Bear in mind, though, that no matter what, it will be rough going until at least the second half of the year.”
The seasonally adjusted manufacturing index fell 0.6 percent in January to a record low of 40.4 percent. Seven components fell, all are below 50, half are below 40 and three set record lows, indicating very difficult conditions, reported North. “As always, slow payment seems to be the biggest problem,” he said, providing these comments from survey participants:
• Trade contracting: “Money is moving very slowly and I have more customers ‘hiding’ from their obligations than in the past few years.”
• Metal furnishings: “Cash flow unsteady. Mom and Pops are paying slower and give great reasons. The strong customers are paying later than the norm in the past.”
• Steel: “Downward trending on sales and a slowing of payments.”
But there was also a bit more positive commentary than usual, North reported:
• General contracting: “Problem accounts seem to have stabilized.”
• Jewelry/precious metals: “We have seen a slight increase in sales.”
• Sand and gravel: “Collections in December were exceptionally good.”
The seasonally adjusted service sector index edged down 0.1 percent in January to a record low of 39.1. Six components fell, all components are below 50, four are below 40 and five are at record lows. “The negative commentary is the same we have heard for months now,” said North:
• Freight transportation: “Customer(s) are dragging their feet in paying their monthly statements.”
• Electronic parts: “More cash flow issues cropping up.”
• Groceries: “It is going to be a tough year.”
North noted, as in manufacturing, there was some surprisingly good news too:
• Radio/TV: “No dollars in arrears...all clients are current.”
• Employment agency: “Our collections continue to be strong.”
• Home furnishings: “Sales are still up.”
• Transportation equipment: “Slight upturn in business.”
• Groceries: “Sales for last month compared to last year (were) up.”
The full report and the CMI archives may be viewed at http://web.nacm.org/cmi/cmi.asp
Trade
China manufacturing might be bottoming out
China’s national purchasing managers index (PMI) rose to 45.3 in January, up from 41.2, possibly indicating the economic decline is already bottoming out, according to the China Federation of Logistics and Purchasing.
The PMI is on a 100-point scale with numbers below 50 indicating a contraction of manufacturing, and a possible rebound in the second quarter of this year, according to the report.
"The January PMI indicates China's economy is bottoming out and the trend of a recovery is gradually taking shape," said Zhang Liqun, an economist with the Chinese government.
China is clearly not out of trouble yet with approximately 20 million migrant workers having lost their jobs in manufacturing sectors such as textiles and toys, according to government statistics.
The Chinese government is reported to announce a massive stimulus package in excess of half-a-trillion dollars in the coming days, with a large percentage of the funding to be pumped into public works.
Trade
WTO rules in favor of EU “zeroing” case against U.S.
The World Trade Organization’s Appellate Body ruled in favor of the European Union’s “zeroing” anti-dumping case against the U.S, saying it is a breach of international
trade rules.
The WTO ruling requires the U.S. to reduce or eliminate anti-dumping duties on many European Commission exports. Anti-dumping duties are based on the difference between the price in export and import markets, and when the price is higher in the U.S. than the exporting country, than the U.S. has considered this to be zero, thus raising those duties.
The latest case began in October of 2006, and dealt with U.S. anti-dumping measures against the imports of ball bearings, steel products, pasta and chemicals from EU countries.
"This is an important decision and will lend continued credibility to the WTO dispute settlement system, and to the legitimate use of Trade Defense instruments to fight unfair trade. Given the repeated WTO findings against the use of zeroing by the US, the Commission hopes that the US will abandon this practice and fall into line with other WTO Members," said EU Trade Spokesperson Peter Power.
Under WTO rules no further appeal is permissible, but the U.S will reportedly seek to have zeroing made permissible in certain cases at the next Doha talks.
Ports
Report: Port of Seattle instructs non-union employees to take unpaid leave
The Port of Seattle has instructed non-union employees to take two weeks off without pay in 2009, saving the port almost $3 million, according to a report in the Seattle Times.
Approximately half of the port’s 1,700 employees are non-union, the report said.
Port of Vancouver USA lands two wind energy agreements
The Port of Vancouver USA announced today it has reached two separate wind energy agreements to handle components transiting through the port.
In his state of the port address, Executive Director Larry Paulson announced a three-year extension to an existing contract with Vestas Wind Systems, which includes options for extending the contract. He also announced an agreement in principal on a new two-year contract with Siemens Energy.
The Siemens contract is subject to management approval, which is expected next week, Paulson said.
The two agreements are expected to provide 235 jobs and $20 million in economic value to the community, the port said.
The Port of Vancouver has been handling Vestas cargo since 2000, operating under an exclusive agreement. The ports said the agreement with Siemens also provides exclusivity in the Columbia River.
“It’s most definitely an exciting time for the port, and for Vancouver,” Paulson said.
In the summer of 2008, the port said it anticipated growth in wind energy cargo for 2009 and the port commission authorized purchase of a second mobile harbor crane. That crane, which matches the port’s first one – purchased in 2006 – is currently being shipped to the port. Its arrival is expected on March 15.
Popular former Oregon congressman and port commissioner dies
Wendell Wyatt, a popular, and influential former port commissioner and Republican congressman in Oregon, died at the age of 91 in his Portland home, according to a report in the Oregonian.
Mr. Wyatt, who was the father of current Port of Portland executive director, Bill Wyatt, was known as being an effective dealmaker, the Oregonian report said.
Wyatt’s accomplishments as a lawmaker included the establishment of the Tualatin Reclamation Project; the Columbia River 40-foot shipping channel from Astoria to Portland; Lincoln City's Cascade Head Scenic Area; and a bill authorizing the $4 million purchase of ranchlands along the Snake River for public recreation, the Oregonian reported.
After retiring from Congress, Wyatt became a partner in the law firm of Schwabe Williamson & Wyatt. He also became a commissioner for the Port of Portland and a lobbyist.
Friday, February 6, 2009
Top Story
North Carolina port lands Maersk and ICL shipping business
The Port of Wilmington, North Carolina will have two different, new shipping services calling, including a new weekly service by Maersk Line going to Central America.
The other new weekly service will be with Independent Container Line, Ltd. (ICL), calling ports in Northern Europe and the U.K.
The Maersk service is to begin March 6, and make calls between Wilmington and Puerto Cortes, Honduras and Santo Tomas, Guatemala in northern Central America, with over the road service to El Salvador and Nicaragua, the port said.
“Maersk’s new service at the Port of Wilmington supports North Carolina’s textile and apparel industries," said Carl J. Stewart, Jr., Chairman, NC State Ports Authority Board of Directors.
“The cost of savings on inland transportation to Wilmington will be realized in the delivery of raw materials to the Port for export to the north Central American zone, as well as in the return of finished goods to distribution centers in North Carolina,” said Thomas J. Eagar, chief executive of the North Carolina Ports Authority.
The ICL service will begin calling Wilmington on March 26 and each Thursday thereafter. “The Port of Wilmington’s strategic geographic location also allows them to extend their market scope to one of the fastest growing states in the country,” said Ports Authority CEO Thomas J. Eagar. “North Carolina is currently the 10th most populous state, and projected to become the 7th largest by 2030.”
The Port of Wilmington is planning container terminal expansion that includes a 42-foot navigation channel, berth reconstruction, four 100-foot gauge container cranes and a terminal operating system that allows customers to track their own containers online, the port said.
The ICL service will include serving the automotive and construction equipment industries, as well as the high-tech textiles, chemical and forest products trades, the port said.
Industrial Real Estate
ProLogis selling over 33 million square feet of U.S. industrial property
ProLogis, the Denver-based industrial real estate firm, is selling just over 33 million square feet of industrial property nationwide at a value of $1.43 billion across 14 states and the District of Columbia, according to the Denver Business Journal.
The sizable sale of the world’s largest industrial distribution property group’s holdings is indicative of the overall industrial real estate downturn, and the company’s debt load was at $11.6 billion at the end of the third quarter last year, the report said.
“You can’t sell 33 million square feet of industrial space right now,” said real estate analyst Dan Fasulo, managing director of New York-based Real Capital Analytics, in the article.
In December, ProLogis announced the deal to sell its China and Japan property holdings to the real estate investment arm of the Singapore government for $1.3 billion, taking an estimated 4-6 percent loss on the value.
The property holdings for sale include:
Tampa and Orlando, Florida - 1.54 million square feet;
South Florida - 187,581 square feet in the Copans Distribution Center and North Andrews Distribution Center in Broward County;
Texas - 3.49 million square feet in San Antonio, El Paso and Austin; 2.96 million square feet in Dallas; and 2.69 million in Houston.
Atlanta - 3.46 million square feet;
Chicago - 3.31 million square feet;
U.S. Northeast - 3 million square feet in Baltimore, Northern New Jersey and Pennsylvania;
Washington, D.C. - 695,058 square feet.
San Francisco Bay Area and Central California - 2.43 million square feet
Denver and Salt Lake City - 2.29 million square feet.
Pacific Northwest, including Seattle and Portland, Ore. - 2.16 million square feet;
Reno, Nev. - 1.88 million square feet;
Las Vegas - 1.59 million square feet;
Phoenix - 1 million square feet.
The Business Journal report pointed to ProLogis’ strong reputation for a quality product and strong clientele, but the billions of dollars worth of debt incurred with the company’s expansion that extended into the middle of 2008, worsened the company’s situation as credit markets started collapsing later in the year.
Liner
Maersk to increase Europe-Asia rates; negotiating lower Suez tolls
Danish carrier Maersk Line announced it is raising freight rates between Asia and Europe by $25-per-TEU effective between March 1 and April 1, due to what it terms “unsustainable rates and improved demand.”
In related news, Lloyds List reported Maersk Line executives met this week with officials of the Suez Canal Authority in an effort to negotiate lower transit fees for its Europe-Asia shipping business. The Danish carrier is already planning on re-directing five of its 15 shipping services using the Suez, to the Southern Africa route, the report said.
Sailing around the horn adds another week in each direction; however, bunker prices have plummeted from over $140 per barrel in July of 2008, to the more recent $40-41 per barrel.
Retail
Report: Retail container traffic to fall 11.8 percent in first half of 2009
The first half of 2009 is not projected to be a good one for retail container traffic, according to the monthly monthly Port Tracker report released today by the National Retail Federation and HIS Global Insight.
After ending 2008 down 7.9 percent, cargo volume at the nation’s major retail container ports is expected to drop 11.8 percent in the first half period, as the economic recession continues, the report said.
Final containerized data for 2008 cited in the report showed volume for the year at 15.2 million TEUs, compared with 16.5 million TEUs in 2007, a decline of 7.9 percent and the lowest total since 2004, when 14 million TEUs moved through the ports.
Volume for the first six months of 2009 is forecast at 6.6 million TEUs, down 11.8 percent from the 7.5 million TEUs for the same period in 2008. Port Tracker forecasts six months ahead, so an estimate of volume for the entire year won’t be available until this summer.
“2008 was one of the most challenging years retailers have seen, and all indications are that 2009 won’t be any better,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “Unfortunately, cargo volume at the ports reflects retailers’ anticipated sales, and NRF expects that sales will get worse before they get better. Retailers are only going to import what they can sell.”
“The combined influence of the recession and the usual winter slowdown will result in extremely weak February port traffic,” IHS Global Insight Economist Paul Bingham said. “Import container traffic is projected to be weak through June because of the underlying reduced demand during the global recession.”
All U.S. ports covered by Port Tracker – Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast – are rated “low” for congestion, the same as last month.
Logistics
URS lands U.S.M.C logistics contract
URS Corporation announced that it has been awarded what could end up being a $43 million contract to provide program management, acquisition and logistical support services to the U.S. Marine Corps Systems Command’s Program Office for Engineer Systems. The contract a one-year base period followed by two one-year options, and has a maximum value of $43 million to URS, if all options are exercised, the company reported.
URS said it would assist the Marine Corps in the acquisition, fielding and sustainability of equipment used for several Marine Corps programs and activities including, Mobility and Countermobility (MCM), Construction and Material Handling Equipment (CE/MHE), Engineer Support Equipment (ESE), and Lifecycle support.
Bulk
Baltic Dry Index up almost 10 percent
The Baltic Dry Index was up almost 10 percent to 1,642 points on Thursday, a three-month high for the economic indicator of bulk shipping commodities such as coal, grain, iron ore and fertilizer, according to a Bloomberg report.
The uptick in the BDI was largely attributed to China opening up to iron ore imports again after stock-piling in last year’s fourth quarter, the report said.
“It's not necessarily a good indicator of the health of the world economy, it's a great indicator of what demand for bulk commodities there is from importers, basically China,” said a trader quoted in the report.
China has also been purchasing grain from the United States and Australia, among other countries, dealing with an emergency due to a drought that could threaten its wheat crop.
The report also pointed to the increase this week in freight rates especially on vessels that carry grain on the trans-Pacific routes from Latin America to China and Asia.
