Monday, March 18, 2013
Maersk gets stock boost on higher freight rates from China
A.P. Moller Maersk stock rose in Copenhagen on increased freights rates for Chinese exports, with the company's B shares rising 1.7 percent since March 5.
Maersk Line and other container carriers had announced a rate increase effective Friday to fight freight declines due to vessel overcapacity. The Shanghai Containerized Freight Index rose 13 percent Friday, the biggest increase in a year.
"It seems that container lines have enjoyed initial success in their efforts to boost rates, but it was also needed," Jacob Pedersen, an analyst at Sydbank A/S, said to Bloomberg. "It will be interesting to see if rates go up again next week as some of the announced increases may not have filtered through yet in today's SCFI."
Maersk cut 21 percent of capacity on its Asia/Europe trade route last year on sluggish demand. It announced Feb. 22 that its 2013 profits will be more than the $461 million made in 2012 due to cost cutting measures and an anticipated boost in global demand.
For more of the Bloomberg story: bloomberg.com
Port of Long Beach February container volume surges 36.6 percent
Container volume at the Port of Long Beach surged 36.6 percent year over year in February, according to a port statement. This includes a 46 percent rise in imports and a 17.2 percent rise in exports.
Container handling in February at Long Beach totaled 530,967 TEUs. This included 279,144 TEUs of imports, the highest volume of import containers for a February since 2007. Exports increased to 140,626 TEUs.
Empty containers were up 44.2 percent to 111,197 TEUs compared to February 2012.
For more of the Press-Telegram story: presstelegram.com
Oregon delays decision about coal terminal on Columbia River
Oregon wants more data before approving a decision to build special dock at the Port of Morrow for coal shipments to Asia.
Department of State Lands Assistant Director Bill Ryan said Thursday the department has pushed the decision to Sept. 1 to allow Australian company Ambre Energy to provide more information about the proposed coal terminal on the Columbia River.
Issues that concern the state include impacts on Columbia River fisheries, water quality, and the overall need for the shipments.
Gov. Kitzhaber has expressed doubts due to the potential environmental impact on the region and the global impact of burning more coal.
For more of the Businessweek story: businessweek.com
South Carolina Ports Authority to invoke eminent domain to vacate 20-year tenant
The South Carolina Ports Authority will use eminent domain to dispense with the remaining years on a lease with Nordic Cold Storage, located on the proposed South Carolina inland port site in Greer, S.C.
The authority passed the resolution March 12 via a teleconference meeting, according to spokesperson Allison Skipper.
Negotiations had reached an impasse with the tenant, the ports authority said in a statement.
Don Schoenl, Nordic Logistics and Warehousing president, said he was "a little bit surprised right now." He said Nordic met with the ports authority in November 2012 to discuss plans.
"It didn't have room for us to grow the building but they showed us plans that allowed us to stay there and assured us that they were going to make the accommodations necessary for us to continue our quiet enjoyment of the premises," Schoenl said.
"We've been there for 20 years, servicing our customer base," he said. "We like the customers there. We like the location. We like South Carolina."
The ports authority issued a statement saying, "The Ports Authority is committed to completing the inland port project as expeditiously as possible and plans to be operational by Sept. 1."
For more of the Greater Greer News story: greenvilleonline.com
Two die, one critically injured in platform collapse at Port Everglades
Two workers died and one was critically injured when a platform scaffold collapsed at Port Everglade on Friday, and they fell several stories to the sidewalk.
The three Broward County Public Works employees were performing routine maintenance on a passenger bridge while standing on the platform, also called a scissor lift. The bridge, which was located at Terminal 1 at the time of the accident, is used for cruise passengers to disembark.
When Broward Fire-Rescue arrived at the scene, two workers were declared dead and one was rushed to Broward Health Medical Center in critical condition.
For more of The Miami Herald story: miamiherald.com
Tuesday, March 19, 2013
Report: U.S. ports and inland waterways need substantial infrastructure improvements
Today the American Society of Civil Engineers released its 2013 Report Card for America's Infrastructure, a comprehensive assessment of the nation's infrastructure including U.S. ports and inland waterway systems, which barely passed muster.
"AAPA is pleased that ASCE included seaports for the first time in its critical infrastructure Report Card," said Kurt Nagle, president and CEO of the American Association of Port Authorities. "The inclusion of seaports in this infrastructure analysis is recognition of the importance of ports, and the connections to them, and to our nation's freight transportation system."
In the ASCE's inaugural assessment, it was found that port authorities have planned over $46 billion in capital improvements from now through 2016. While ports have made investments to improve terminal infrastructure, their connections to roads, rail, and water channels have suffered from inadequate federal funding. The report also found that more dredging will be necessary to take advantage of higher trade capacity once the expanded Panama Canal opens in 2015.
"AAPA played an active role in providing information and insight about seaports to ASCE," Nagle said. "The 'C' grade given seaport-related infrastructure in its study reinforces our viewpoint that the federal government is not investing nearly enough in the landside and waterside connections to ports."
Inland waterways received a D- grade because conditions are poor and investment remains sluggish. In fact, many sections of the inland waterways systems an locks have not been upgraded since the 1950s, leading to an average of 52 service interruptions a day throughout the inland waterway system, and a backlog of projects with estimated completion dates stretching to the year 2090, according to the report.
"The report card reiterates what other national and international studies have concluded about the neglected state of our nation's port related transportation infrastructure," added Nagle, "including recent reports from the World Economic Forum, Building America's Future and the U.S. Army Corps of Engineers, to name a few."
According to the U.S. Army Corps of Engineers, maintaining existing levels of delay will cost more than $13 billion by 2020, while current funding levels are expected to be $7 billion during this period. The need for capital investments and improvements is strong enough that many barge operators support increasing their fuel tax to pay for them. The periods of time it takes for approval processes also contributes to increased costs.
The U.S. Army Corps of Engineers estimates that over 95 percent of overseas trade produced or consumed by the U.S. moves through our ports and the nation's inland waterways and rivers carry the equivalent of approximately 51 million truck trips each year.
Shipping magnate Fredriksen nearly doubles ship orders amid overcapacity
Frontline 2012, the shipping company owned by billionaire John Fredriksen, almost doubled the number of ships it's building amid industry-wide vessel overcapacity and low shipping rates.
The company increased new ship orders from 28 to 53 at the end of 2012, Fredriksen said in a statement Tuesday. While the market is "massively oversupplied" in some cases, Frontline 2012 placed orders for fuel-efficient carriers after construction prices slumped, the statement said.
Vessel earning rates will start to recover in three years, according to ship broker Clarkson Plc, and Frontline 2012 is ordering vessels to carry crude, refined products, liquefied petroleum gas, coal and iron ore.
"It is the shipping company you want to own as we move through the trough of the shipping cycle," Erik Nikolai Stavseth, an analyst at Arctic Securities ASA, said in an e- mailed note to Bloomberg today.
"The company is currently in the process of concluding one of the most aggressive newbuilding programs ever executed," Frontline 2012 said. Most of the new carriers will be profitable at rates where "existing tonnage barely covers operating costs," the statement said.
For more of the Bloomberg story: bloomberg.com
Study: South American countries must improve infrastructure to facilitate post-Panamax ships
In order to accommodate super-sized vessels after the Panama Canal expansion is complete in 2015, South American countries must "dramatically" improve intermodal infrastructures, trucking services and institutional coordination, according to two studies released Monday by the Inter-American Development Bank at the bank's annual meeting in Panama.
"The region needs to change course in the way it handles freight logistics to enhance its integration with the world and continue to grow," said Alexandre Meira da Rosa, manager of the IDB's infrastructure and environment sector. "Companies may be extremely efficient producing goods at low prices, but if there are inefficiencies in shipping and transporting these goods within the country, by the time they ship abroad they lose their competitive advantage."
The IDB's first study, "Assessment of port performance and port connectivity study in Belize, Central America and the Dominican Republic," evaluates the performance of 18 ports in Belize, Central America and the Dominican Republic. The second report, "Trucking services in Belize, Central America and the Dominican Republic: performance analysis and policy recommendations," assesses the trucking industry and makes recommendations going forward.
The IDB called for countries to establish national logistics agendas to improve policy coordination and tackle bottlenecks that impede the region's ability to compete in the global marketplace.
The port study assessed the capabilities of 18 ports in 7 countries in Central America plus the Dominican Republic, in areas that range from transport and trade regulations to geography. For example, only one port, Caucedo, received a "very good" rating in land connectivity, which factors in road congestion, security and the number of lanes at port gates, among other issues. Six ports received "good" ratings, four were "adequate" and seven were "poor."
The need for greater coordination at South American ports is especially crucial, said the IDB, as the expansion of the Panama Canal will accommodate post-Panamax vessels that carry 12,600 TEUs, compared to current vessels that carry 4,500 TEUs.
The trucking study found that rates are expensive and security costs are high, plus the lack of low-sulfur diesel fuel inhibits fleet renewal investments in new technology. Road improvement is greatly needed as only 15 to 22 percent of roads are paved in Honduras, Belize and Nicaragua.
Port of Long Beach commissioners to expand grant guidelines
The Long Beach Board of Commissioners met yesterday to reexamine the guidelines of its Mitigation Grant Programs that relate to healthcare, seniors and schools.
Grant revisions under consideration include expanding eligibility to sound walls and noise dampening projects, relocation projects (such as moving a playground away from truck traffic), adding pregnant women as a target population for the grants and getting rid of the three-year time limit for healthcare related programs.
Since 2011, the port has awarded $5.4 million in greenhouse gas mitigation grants, $5 million in health and senior-related projects and $4.7 million for schools. More than 280,000 people have benefitted from the grant program, according to port officials.
For more of the Press Telegram story: presstelegram.com
11 dead, 2 missing after container ship sinks off China
A container ship sank off the east coast of China, killing at least 11 crewmembers.
One sailor was rescued by helicopter, and two are still missing.
The Guangyangxingang capsized Monday night in strong winds, northeast of Longkou in Shandong, according to rescue officials.
Two rescue vessels and a helicopter continued searching for the missing crewmembers Tuesday.
For more of the ABC News story: abcnews.go.com
Wednesday, March 20, 2013
G6 Alliance issues port rotations for new Trans-Pacific trade route service
The G6 Alliance expanded their cooperation to the Trans-Pacific trade earlier this year, and the six member lines recently announced the port rotations of the new service.
The joint effort will begin in May with six coordinated services in the Asia-to-North America East Coast trade. More than 50 vessels with capacities between 4,500 and 8,000 TEUs will connect about 30 ports in Asia, United States and Canada East Coast, Central America, Caribbean, Indian Sub-continent, Mediterranean and the Middle East to form a fast and reliable service product.
"Each G6 Alliance member can now offer their clients a significantly increased range of port calls and numerous weekly departures," member carriers said in a statement. The members of the G6 are APL, Hapag-Lloyd, Hyundai Merchant Marine, Mitsui O.S.K. Lines, Nippon Yusen Kaisha and Orient Overseas Container Line.
Three of the enhanced services will sail the Suez Canal while the other three loops will transit the Panama Canal.
The port rotations of the new G6 Alliance services are as follows:
U.S. industrial production in February tops expectations
Industrial production in February was higher than anticipated due to a manufacturing rebound, which is a positive sign for the U.S. economy.
The Federal Reserve announced that industrial production grew 0.7 percent last month. Economists polled by Reuters had forecast industrial output to rise by only 0.4 percent.
Manufacturing output rose 0.8 percent during February 2013, bouncing back from January's decline.
Industry capacity utilization, a measure of how fully companies are using their resources, rose to 79.6 percent in February, the highest average since March 2008, which was 80.1 percent.
For more of the Reuters story: reuters.com
Port of Charleston container volume up 11 percent
Container volume at the Port of Charleston rose almost 11 percent in February year over year, the port announced, with 131,634 TEUs handled. February marked the 12th consecutive month of year-over-year growth at the port.
"We are going into the strong part of our year," said SCPA President and CEO Jim Newsome during the meeting. "All of the lines are making their service deployment decisions that come into effect in May, and we expect to see additional big ships in our harbor from more carriers."
Container volume for the first eight months of the fiscal year are up more than 11 percent to 1,024,121 TEUs, handled from July to February. That's up from 920,547 TEUs during the same period in 2012.
Before the meeting, the SCPA board was joined by U.S. Sen. Lindsey Graham and LTC Ed Chamberlayne of the U.S. Army Corps of Engineers Charleston District to discuss the progress of Charleston's harbor deepening project. The project's feasibility study is halfway to the completion point.
Graham reported that new legislation would be introduced in Congress to institute a more merit-based approach to harbor improvement projects by fully utilizing the Harbor Maintenance Trust Fund. He predicted that Charleston's project would be competitive for federal funding, which would cover 40 percent of the project construction cost.
2012 profits for China Shipping Development drop 93 percent
China Shipping Development Co., the commodities carrying arm of China Shipping, announced that 2012 annual profits dropped 93 percent on low shipping rates.
Net income fell to $11.9 million from a profit of $170 million a year earlier, the company said in a filing to the Shanghai stock exchange Tuesday.
The Shanghai company was expected to post a net loss of $39 million based on the average of 10 analysts' estimates complied by Bloomberg. Sales fell 9.2 percent.
China Shipping Development tried to delay receiving new ships in August after slumping rates caused a net loss of $79 million in the first half. Weak demand and overcapacity in global and domestic markets caused a downturn in freight rates, China Shipping said in a statement in January when it warned of a "considerable decline" in annual profit.
The Baltic Dry Index, the benchmark for hauling commodities, averaged 920 last year, the lowest since 1986, according to the Baltic Exchange.
For more of the Bloomberg story: bloomberg.com
BP fails in effort to take gross negligence off the table in oil spill trial
BP lost in its bid to eliminate the charge of gross negligence that could impose fines as high as $17.6 billion in the trial over liability with regards to the 2010 oil spill in the Gulf of Mexico.
"I'm not going to grant that motion," said U.S. District Judge Carl Barbier in New Orleans to a BP attorney. "I don't see any point in arguing it."
BP lawyer Andrew Langan had asked the judge to disallow a gross-negligence finding as lawyers for the plaintiffs suing the company rested their case.
A finding of gross negligence would mean the oil company would be held liable to the United States for up to $17.6 billion in Clean Water Act fines, plus punitive damages to claimants who were not a part of the original $8.5 billion settlement BP reached with most private party plaintiffs in 2012.
The explosion aboard the Deepwater Horizon killed 11 workers and spilled more than 4 million barrels of oil into the Gulf of Mexico.
The accident triggered hundreds of lawsuits against well owner BP, and Transocean and Halliburton, which provided cement services.
In this trial that began Feb. 25, Judge Barbier will determine responsibility for the disaster and whether one or more of the companies acted with willful or wanton misconduct or reckless indifference -- the legal requirement for establishing gross negligence.
For more of the Bloomberg story: bloomberg.com
Thursday, March 21, 2013
FedEx profits fall 31 percent, annual outlook adjusted
FedEx slashed its fiscal outlook for 2013 after profits dropped 31 percent in the latest quarter, as customers continue to use its cheaper, slower shipping options and the company earns less on each package it carries.
The company said it would decrease its flights between the U.S. and Asia and may ground some cargo planes.
The news took investors by surprise, and the stock fell 6.9 percent, its biggest one-day plunge in 18 months.
FedEx’s revenue actually rose 11 percent for the quarter. The profit drop reportedly reflects a cost-consciousness among American businesses in an uncertain economy.
“Freight is moving, but customers and shippers are trading down,” said Logan Purk, an analyst with Edward Jones to the NY Times. “Businesses aren’t paying for two days express shipping as much and are willing to put their goods in a boat and wait two weeks instead to cross the Pacific. A lot of consumers are in belt-tightening mode and don’t want to pay for express.”
FedEx, which operates the globe’s largest cargo fleet, will likely get rid of some of its older planes, such as the Boeing 727s and MD-10s. The company said that it would start to reduce service to Asia, which has too much capacity, on April 1.
“There’s a new mind-set for shoppers and businesses: people and companies have adjusted their supply chain to slower shipping,” said Kevin W. Sterling, an analyst with BB&T Capital Markets to the NY Times. “The problem for FedEx is that it’s very expensive to operate an airplane, and it takes time to park a plane. That can’t be done overnight.”
For more of the New York Times story: nytimes.com
Port of Tacoma February container volume up 47 percent
Port of Tacoma container volumes in February were jumped 47 percent year over year.
Imports posted the largest increase, with a 62 percent year-to-date gain to 114,176 TEUs. Exports rose 41 percent to 81,567 TEUs.
The hike in global container volumes reflected shippers preparing for Lunar New Year, when factories in several Asian countries are closed for one to two weeks.
The increased volumes also reflect the addition of the Grand Alliance, which began calling at the port’s Washington United Terminals in July 2012.
Fewer breakbulk vessels calling Tacoma this February compared to February 2012 resulted in the 18 percent decline.
Chinese manufacturing index up in March
Manufacturing in China got a boost in March, indicating the country in on track for solid growth in 2013.
HSBC’s index of the Chinese manufacturing sector showed a reading of 51.7 points in March, a better than anticipated increase from February’s reading of 50.4, but lower than January’s level.
The purchasing managers’ index reading “implies that the Chinese economy is still on track for gradual growth recovery,” Qu Hongbin, chief China economist for HSBC, wrote in a statement for the data release. “Inflation remains well behaved, leaving room for Beijing to keep policy relatively accommodative in a bid to sustain growth recovery.”
Improved exports of Chinese goods and government mandates to improve infrastructure helped improve the country’s economy in 2012. Officials are favoring a slow rate of improvement to lower the risk of inflation, loan defaults and bad investments.
For more of the New York Times story: nytimes.com
Crowley adds Saturday sailing to Bahamas
Crowley Maritime’s liner services group announced that it will a second weekly southbound sailing from Port Everglades, Fla., to Nassau, Bahamas, starting Saturday, March 23.
The new sailing will be added to Crowley's current schedule, which includes a Friday sailing from Jacksonville, Fla., and a Tuesday sailing from Port Everglades.
“It’s important for us to listen and be responsive to our customers,” said Tony Otero, vice president, Caribbean Services. “Based on their input, we adjusted our Bahamas service schedule to offer them more flexibility to get their products and other cargo to market.”
Crowley offers both full-containerload and less-than-containerload services to Nassau.
Two cargo ships collide, oil spills into Yangtze River
Two cargo ships, the CMA CGM Florida and the Panamanian-flagged Zhoushan collided this week, spilling oil into China’s Yangtze River. No injuries were reported.
Approximately 178,000 gallons of fuel from the CMA CGM FLORIDA spilled into the river, covering 124 nautical miles, according to Shanghai Daily.
Rescue vessels continue to evaluate the leaks and possible environmental impact caused by the incident.
The Florida container vessel had reported that water had flooded one of its cabins. Some of its containers were damaged or displaced from the collision’s impact.
For more of the UB Alert story: ubalert.com