Cargo Business Newswire Archives
Summary for April 20 through April 24, 2015:

Monday, April 20, 2015

Port of Tacoma CEO Wolfe to serve as head of Tacoma-Seattle port alliance

A tentative staffing plan for a shipping alliance between the ports of Tacoma and Seattle would allow Port of Tacoma CEO John Wolfe to retain his Tacoma role while assuming command of the new alliance.

Wolfe would serve in both positions for up to five years under the proposed organizational arrangement presented to the governing commissions of the two ports Tuesday at a joint meeting in Tacoma. His compensation under the plan is still to be determined. Currently, as CEO of the Port of Tacoma, he makes $257,088.

Both commissions agree they intend to name Wolfe as the allianceís first chief executive when the alliance begins functioning this summer.

Port of Tacoma commissioners said they want Wolfe to remain in his Tacoma job while also heading the alliance because the port has already begun several major projects, such as the upgrading of Terminals 3 and 4 to handle megaships and a $1 billion-plus construction of a methanol plant at the upper end of the portís Blair Waterway. Wolfeís continued leadership at the port would ensure that those projects are finished in a timely manner.

The port itself is undertaking the Terminal 3 and 4 upgrades, while a Chinese-American company is planning the methanol plant construction.

For more of the News Tribune story:

Ports of L.A./Long Beach cargo volume rockets in March

Cargo volume at the Ports of Los Angeles and Long Beach rocketed in March compared to the same time last year, a sign that the chronic congestion at the ports has significantly cleared, according to figures released by the ports.

March cargo figures at the Port of Los Angeles went up 17.3 percent compared to March 2014, with 800,063 TEUs handled. Imports in March were up 31.5 percent year-over-year to 480,898 TEUs, while exports were down 22.5 percent at 145,536 TEUs.

"Volumes were robust as our terminals worked aggressively to clear out the backlog of vessels," said Port of Los Angeles Executive Director Gene Seroka. "The number of ships waiting at anchor has reduced significantly, labor levels are strong and our container terminals are extremely active. We continue to work on a series of initiatives to improve efficiencies throughout the supply chain."

March cargo volume at the Port of Long Beach surged 32 percent year-over-year, making it the busiest March in the portís history.

Long Beach handled a total of 630,084 TEUs in March. Imports went up to 317,520 TEUs, a 42 percent increase compared to last year. Exports decreased 17.3 percent to 127,337 TEUs.

Empty containers increased 85.4 percent to 185,227 TEUs. As the severe congestion started to truly abate in March, a great many empties were waiting to be shipped.

March numbers increased after a new system to pool the chassis was implemented. Productivity was boosted after terminal operators and dockworkers agreed to a tentative contract settlement at the end of February.

CSX announces higher Q1 profit

This week, U.S. railroad CSX Corp. reported a higher quarterly net profit on increased freight volumes and higher rates charged to customers. They also announced a $2 billion share repurchase program.

The company reported a first-quarter net income of $442 million or 45 cents per share, which is an 11 percent increase year-over-year. This bested analyst expectations of 44 cents per share.

CSX reported quarterly revenue of $3.03 billion, just above the $3.01 billion it reported for the first quarter of 2014 and close to the $3.02 billion predicted by analysts.

The Jacksonville, Florida-based railroad said that the growing economy had helped drive an overall increase in freight volumes of 1 percent. Higher freight volumes improved CSX's pricing power and the company got a lift from lower fuel prices. The railroad's fuel bill for the quarter was $270 million, a 40 percent decrease from the $446 million it paid a year earlier.

CSX said that it intended to repurchase $2 billion worth of its shares over the next 24 months.

Shares of CSX, the third-largest U.S. railroad, rose nearly 2 percent after-market trading.

For more of the Reuters story:

CN Railway to spend $400M on upgrades

Canadian National Railway, beset by an alarming number of recent derailments, will spend $412 million to upgrade its feeder network in Western Canada to improve safety and capacity, the railway said on Thursday.

A Reuters investigation last month found that CN Rail's safety record deteriorated sharply in 2014, reversing years of improvements, as accidents blamed on poor track conditions increased.

The new program allocates approximately $82 million for branch lines in northern Alberta in 2015. CN plans capital spending of $2.1 billion in 2015 and the upgrade does not change that figure, a spokesman said.

The infrastructure upgrade, which includes heavier rails and new ties, focuses on feeder lines in Alberta, Manitoba and Saskatchewan. Feeder lines are sometimes built using lighter rail than main routes, but can still carry heavy traffic such as crude oil moving out of the northern Alberta oil sands.

"We are pleased that CN has responded in order to continue to provide safe and reliable transportation of our goods to market," Transport Minister Lisa Raitt in a statement.

As part of the program, CN plans to upgrade its Slave Lake subdivision, a 133-mile section of track in northern Alberta.

Data obtained by Reuters shows that four CN trains derailed along that section in 2014, more than on any other subdivision. In June, two trains derailed in the same place in just two days. The data indicates that at least three of the incidents were caused by track problems.

For more of the Reuters story:

Vessels evacuated after explosion at chemical plant

Ships berthing at Gulei Port in Zhangzhou, in southeast China's Fujian province, were evacuated after explosions at a local chemical plant on April 6, according to China's Ministry of Transport.

Oil leaking from a unit producing paraxylene caught fire and led to blasts at three nearby chemical oil tanks at Tenglong Aromatic Hydrocarbon. The huge fire burned for three days.

Approximately 30,000 people were evacuated from the surrounding area, several reporting injuries.

For more of the Splash 247 story:


Tuesday, April 21, 2015

Drewry: Low Asia-North Europe spot rates could fall further

Asia-North Europe spot rates have fallen to near record lows, according to the latest issue of Container Insight from Drewry Maritime Research, in which Drewry analyzes how much further they could fall.

Shipping lines successfully cut costs faster than unit revenues were falling in 2014. Drewry reports that the container industry made a collective operating profit of approximately $6 billion last year, up from $2.7 billion in 2013. However, profits were sparsely spread between carriers. The overall margin was still low at around 2.8 percent of industry revenue.

While the researchers expect cost-cutting measures to continue, they say carriers need to pay attention to rising rates if they want to remain in the black. They think carriers can make an overall profit in 2015 similar to 2014,. Costs are being helped by lower bunker fuel and some network improvements through the mega-alliances. But they also note the forecast could easily falter since freight rates in many Asia export trades are in a tailspin.

The freight rate decrease is most damaging to container lines in the Asia-to-North-Europe route. The Shanghai-to-Rotterdam assessment of the World Container Index fell for 11 consecutive weeks to slump to its lowest point since December 2011, according to analysts. As of April 16, the WCI benchmark put average rates at around $480 per-TEU, although lower prices will have been available to the market.

Drewry says carriers need to raise spot rates fast, or face the anger of BCO clients who have signed contracts at higher rates and will likely want to renegotiate to get closer to the average spot market rate. If the spot rate stays down, the researcher s say shipping lines will need to lay up ships.

In summary, Drewry says although spot rates are probably close to the bottom, they can still drop a bit more until the higher-cost carriers are forced to pull capacity. The researchers conclude that rushing GRIs through in an oversupplied market will be a very tough sell.

U.S. agencies call for more oil train inspections

Train operators that haul oil must have detailed information on hand about the possible risks of their cargo in case of an accident. They must perform more thorough checks before moving on the tracks, according to U.S. transportation officials.

Officials of the Federal Railroad Administration and the Pipeline and Hazardous Materials Safety Administration have been studying how to make oil train deliveries safer ever since a shipment derailed in Lac Megantic, Canada, in 2013, resulting in 47 deaths. In March there was an oil train accident in Galena, Illinois. There were no injuries involved in that incident.

A national oil train safety plan is coming in a few weeks that will demand tougher tank cars and other improvements. The FRA and PHMSA announced last week that new measures are meant to reduce the chance of a routine train mishap leading to the kind of fiery explosion that followed several other oil train accidents.

On Friday the FRA asked shippers to account for who handled crude oil involved in any mishap and what the operator knew about the possible volatility of the cargo. Rail operators must also do more to find flawed tanker wheels and quickly have them replaced, the FRA said.

Early analysis indicates that a defective wheel contributed to last month's oil train derailment and fire in Galena, according to the FRA.

For more of the Reuters story:

Port of Portland head addresses Terminal 6 issues

Bill Wyatt, executive director of the Port of Portland, acknowledged the loss of almost 100 percent of Terminal 6 business to attendees of the portís Gateway to the Globe lunch last week.

"Iím just going to say it plainly: Itís hopelessly naÔve," he said, referring to the idea that the port could go back to running Terminal 6. This is what some have suggested if ICTSI Oregon, the terminalís private operator, should buy out the 22 years remaining on its lease and depart.

In terms of securing a new terminal operator, Wyatt said: "Letís be honest. If ICTSI is unable to succeed in Terminal 6, no one, and I mean no one, would be foolish enough to come to Portland and enter the container business."

Because of delays caused by a labor-management dispute between Local 8 of the International Longshore and Warehouse Union and ICTSI Oregon, the terminalís operator, both Hanjin and Hapag-Lloyd have terminated all business at the Portland port this year.

Wyatt said it took two years of searching to find anyone willing to take on the financial risk of running the container terminal. And, he said, ICTSI Oregon was the only company that submitted a proposal.

Wyatt said it would take assurances by both management and unions to restore confidence in the container terminal. He said the port would, in time, attract new shipping lines. He intimated that ICTSI Oregon is the portís best bet and would remain for the foreseeable future.

Wyatt called for both sides to negotiate and to quit blaming each other for the slowed productivity that has occurred since two reefer maintenance jobs were given to the electrical union rather than the ILWU.

For more of the Portland Tribune story:

Suez Canal dredge on track to finish by July 2015

The Suez Canal Authority says its expansion project is due to be complete in July this year.

The head of the Suez Canal Authority, Mohab Mamish, reportedly said plans are underway for an inauguration ceremony in August. He noted that dredging work for the project will actually be finished before the July deadline.

Mamish said that approximately 1.5 million cubic meters of sand are being dredged each day, with as many as 37 dredgers working on it.

Egypt said it awarded contracts to six dredging companies for the huge project: National Marine Dredging Company of the UAE, Royal Boskalis Westminster, Van Oord, Jan de Nul Group and Deme Group and Great Lakes Dredge and Dock Company.

Truck fire backs up traffic at N.J.ís Global Terminal

A container truck that caught fire at Global Terminal Thursday afternoon was extinguished, but not before causing delays at the facility on the Jersey City/Bayonne border, according to Port Authority police.

The police and the Bayonne Fire Department responded to Global Terminal where the truckís cab was on fire, said Port Authority police spokesman Joe Pentangelo.

The fire was extinguished by approximately 1 p.m., Pentangelo said, adding that a fuel spill from the vehicle dumped about 20 gallons of fuel into a sewer basin at the facility.

Global Terminal closed temporarily for safety concerns.

For more of The Jersey Journal story:


Wednesday, April 22, 2015

Internet of Things could boost supply chain/logistics operations by $1.9T

By William DiBenedetto

A big reason for the rise in mergers and acquisitions is that logistics, 3PLs and transportation companies realize they can create technological synergies and efficiencies along the supply chain by combining their e-commerce and transportation management platforms.

Earlier this month DHL and Cisco Consulting Services released a Trend Report noting that the so-called Internet of Things (IoT) will boost supply chain and logistics operations by nearly $2 trillion over the next decade. IoT is generally defined as the connected network of physical objects, or "things," embedded with electronics, software, sensors and connectivity to enable greater value and service through the exchange of data with the manufacturer, operator and/or other connected devices.

The numbers are huge. According to Ciscoís economic analysis, IoT will generate $8 trillion worldwide in "Value at Stake" over the next decade. This will come from five main drivers: innovation and revenue ($2.1 trillion); asset utilization ($2.1 trillion); supply chain and logistics ($1.9 trillion); employee productivity improvements ($1.2 trillion); and enhanced customer and citizen experience ($700 billion).

The $1.9 trillion in Value at Stake for the logistics industry over the next 10 years means that "bountiful opportunities exist for logistics providers to leverage IoT in their organizations in order to increase productivity, re-engineer existing processes and provide new services that challenge traditional business models," according to Rob Siegers, president of global technology at DHL Customer Solutions and Innovation. "However, (deriving) significant commercial value from IoT will ultimately depend on how well connected assets, such as containers or parcels, are networked along the entire supply chain. This of course entails close cooperation and collaboration between all players in the logistics industry."

"By connecting the previously unconnected, we create incredible potential for businesses to improve the speed and accuracy of decision making through the analysis and application of digital information," says Edzard Overbeek, senior vice president, Cisco Services. "It enables dramatically faster cycle times, highly dynamic processes, adaptive customer experiences and, through the ecosystem of people and technology, the potential for breakthrough performance gains."

This means that transportation and logistics will examine, or re-examine, how their TMS, WMS, smart containers, and digitization and communications protocols are connected and working together in the IoT age. DHLís Global Connectedness Index last year revealed the overall level of global connectedness remains somewhat limited.

Connectivity is occurring to a degree, but thereís work to do. Some recent examples:

  • CMA CGM this month launched a real-time container tracking mobile application for its clients. This came after the company announced its investment in startup TRAXENS, which specializes in container geolocation.

  • "Total logistics cost is only part of the picture for todayís ever changing, dynamic supply chains," says Damian Burke, a director of business development for Ryder. He says using supply chain scorecards, more granular metrics or key performance indicators (KPIs) can be tracked to gain insight from past performance, permit enhanced overall management and to proactively drive continuous improvements.

  • Hong Kong-based SITC Shipping Group and SIPG container shipping arm Hai Hua announced in February they will upgrade their entire container fleet to smart containers using products from Loginno.

  • Dot Foods and Victory Packaging recently upgraded their warehouse management systems to the "next generation" IBS Dynaman Warehouse Distribution Management System. IBS stresses the importance of building a company/supplier partner relationship that includes the right technical tools, functionalities, support and clarity on desired outcomes, KPI goals, costs and benefits.

IoT holds promise for "far-reaching payoffs for logistics operators and their business customers and end consumer," according to the DHL-Cisco Trend Report. "These benefits extend across the entire logistics value chain, including warehousing operations, freight transportation, and last-mile delivery." Areas such as operational efficiency, safety and security, customer experience, and new business models would be impacted. "With IoT, we can begin to tackle difficult operational and business questions in exciting new ways."

Port of Oakland to launch 4-point plan to clear cargo

Port of Oakland officials are developing proposals to hasten containerized trade flow through their five marine terminals, hoping to speed up cargo delivery and reduce wait times for truckers.

"Our customers donít want to wait for their cargo when it comes off the ship," said Port of Oakland Executive Director Chris Lytle. "We hear them and we understand their urgency, so weíre acting on it."

According to the port statement, the four-point plan includes:

  • Operating on Saturdays every week to alleviate weekday crowding inside terminals

  • Staging locations outside terminals where cargo could be dropped off or picked up after hours

  • Implementing electronic monitoring to measure wait-times at terminal gates

  • Launching a "gray" chassis fleet that permits harbor truckers to use any chassis at any terminal to haul cargo over the road.

The cargo acceleration program is intended to address slowdowns and long waits. Regular Saturday gates would spread cargo pickup and delivery over an extra day each week. Offsite locations would enable truckers to transact business without entering terminals. Monitoring would provide drivers with up-to-the-minute wait times so they could avoid peak periods of activity. The gray chassis pool should minimize periodic shortages of chassis that delay cargo delivery.

All four plans could be pilot-tested within two months, the statement said, to gauge their success in facilitating faster cargo movement.

Port officials said a cargo glut in recent weeks has slowed deliveries to some importers, due to vessels reaching Oakland off-schedule and in bunches after delays at congested Southern California ports.

Prologis buys KTR Capital for $5.9B

Warehouse and distribution center operator Prologis said it will acquire the real estate assets and operating platform of KTR Capital Partners and its affiliates for $5.9 billion.

Under the terms of the agreement signed by Prologis, it will now be the owner of U.S. Logistics Venture, a consolidated joint venture with Norges Bank Investment Management, manager of the Norwegian Government Pension Fund Global. Prologis holds the majority stake in the venture.

"This transaction will deliver accretive returns to our shareholders and will enhance our important and successful partnership with NBIM, which will now exceed $11 billion on two continents," said Prologis chairman and CEO Hamid Moghadam.

The acquisition is comprised of a 60-million-square-foot portfolio that includes 322 properties, and is in line with the U.S. logistics property owner's investment strategy with nearly 95 percent overlap of its existing assets in the country.

It also includes a well-located land bank spanning across 3.6 million square feet that is currently under construction and has a build-out potential of 6.8 million square feet.

The deal, which is subject to customary closing conditions, is expected to be concluded within 30 to 60 days.

The recent purchase adds to Prologis' existing assets in Southern California, New Jersey, Chicago, South Florida, Seattle and Dallas.

For more of the Reuters story:

Singapore firm to move headquarters from Norfolk to Port of Richmond

R1 International, a natural rubber supplier based in Singapore, will trade its base in Norfolk for new digs at the Port of Richmond by the end of May.

Frans de Jong, president of R1 Internationalís U.S. operations, said the company is in the process of signing a lease for a 76,000-square-foot warehouse at the Richmond port.

R1, which ships giant slabs of rubber in 20-ton containers, could cut its storage costs in half with the move to Richmond. De Jong said the move will also allow it to escape the congestion that is overwhelming Norfolk International Terminals. Large ships in Norfolk lead to longer wait times for unloading, he said.

"They create these surges of activity, which create congestion. Itís been going on for a long time," de Jong said. "Itís something I donít see going away because itís all due to this population density."

When the lease agreement is finalized, R1ís natural rubber will start riding the James River Barge Service, which runs from Norfolk to Richmond three days a week. Joe Harris, a spokesman for the Port of Virginia, said that may increase to four days a week, thanks to increased popularity in the Port of Richmond.

For more of the Richmond Biz Sense story:

Ships run aground in Suez Canal

The Danish-flagged Susan Maersk ran aground in Egypt's Suez Canal in heavy mist on Saturday morning, delaying traffic through the trade route for several hours, the canal authority said.

A Maersk Line spokesman said no damage or injuries were sustained, and the ship was seaworthy and waiting to be pulled off the sand.

Another ship in the same convoy, the Liberian-flagged Margaret Oldendorff, also ran aground. The two incidents delayed traffic for several hours, officials said.

For more of the Reuters story:


Thursday, April 23, 2015

AAPA study: Fixing surface transportation network will cost $29B

Replacing and repairing the crumbling roads, rail, tunnels, and bridges linking seaports to the surface transportation network will cost at least $28.9 billion over the next decade, according to an economic study cited by the American Association of Port Authorities.

The Martin Associatesí report says the, "2014 National Economic Impact of the U.S. Coastal Port System," was debuted at AAPAís 2015 Spring Conference in Washington, D.C. The report underscored the need to invest in infrastructure and technology to support global trade.

AAPA President and CEO Kurt Nagle agreed with the assessment, noting the need for more federal investment to strengthen land connections to U.S. ports. "On the land-side alone," Nagle said, "AAPAís U.S. member ports have identified at least $28.9 billion in needed investments by 2025. These necessary road, rail, bridge and tunnel improvements are crucial to enable our seaports to efficiently handle their expected cargo volumes, continue providing dramatic economic and job impacts, and enhance Americaís international competitiveness."

In AAPAís 2015 The State of Freight report, U.S. port authorities were asked to identify infrastructure investments needed at and near their ports to keep freight moving efficiently.

"The nation's unsurpassed goods movement network needs immediate and significant investment in the arteries that carry freight to and from its seaports" the study said.

In AAPAís freight transportation infrastructure report, U.S. port leaders indicated the need for immediate and significant investment in the landside arteries that carry freight to and from the nationís seaports. They asserted that without adequate investment in the connecting infrastructure with Americaís ports, the nationís economy will suffer, the jobs that ports produce and the international competitiveness they sustain will erode, and American workers, families and employers will experience burdensome and costly hardships.

Nagle said that funding the "first and final mile" landside connection is vital to the long-term ability of ports to efficiently move cargo and create jobs.

"While ports and their private-sector partners are investing heavily into their facilities as international trade continues to grow, many of these connectors are antiquated, in disrepair, and are creating congestion issues that need to be urgently addressed," Nagle said.

The portsí land connections total only 1,200 miles of the 57,000-mile national highway system, but 99 percent of U.S. international trade passes through them, he said.

U.S. seaport activity last year generated $4.6 trillion of total economic impact in the U.S. and generated $321 billion of federal, state, and local tax revenues, the AAPA study reported.

"The fact is that while over a quarter of the U.S. economy is accounted for by port cargo activity, freight connections to our ports are crumbling, putting our economy at risk and reducing America's competitiveness in global markets," Nagle said.

Hapag-Lloyd orders five 10,500-TEU ships

Shipping giant Hapag-Lloyd has placed an order for five vessels to boost its trade in Latin America in anticipation of the opening of the expanded Panama Canal on April 1, 2016, the company announced Monday.

Hapag-Lloyd, which completed a merger with Chile's CSAV in December, said it had placed an order for five 10,500 TEU ships, expected for delivery between October 2016 and May 2017.

"They will be deployed primarily on South American routes. When the expanded Panama Canal opens next year, Hapag-Lloyd will therefore have the optimal fleet for this trade," the statement said.

Hapag-Lloyd said since its merger, Latin America represented more than a third of its total transport volumes versus around 22 percent previously - with the group among the top four lines in the region.

The new order adds to a previous one made by CSAV in 2013 for seven 9,300 TEU ships to be used in the Latin America trade - with five of those already delivered and the remaining two to be delivered later this year, Hapag-Lloyd said, adding it had other vessels operating on this route.

As of December 2014, Hapag-Lloyd's global fleet comprised a total of 191 container ships.

For more of the Reuters story:

Hamburg SŁd resumes West Coast Americas Service

Hamburg SŁd announced this week that its West Coast Americas Service (WAMS) will resume direct Oakland calls starting with the voyage of Cap Palliser on May 16, 2015.

The Hamburg SŁd statement announced that this completes the re-start phase of full network operation of its U.S. West Coast-based services following the protracted port labor dispute that was resolved in February.

The shipping line reports that its direct all-water service to and from all major West Coast ports and Asia, Latin America, and Europe, including the Mediterranean and Oceania, is being offered with a total of 10 weekly arrivals and departures. Hamburg SŁd maintains full service offices in Long Beach, San Francisco and Seattle.

China to invest $46B to link Pakistanís Gwadar port to Xinjiang region

Pakistan announced that Chinese President Xi Jinping is scheduled to visit the nation on April 20 to launch energy and infrastructure projects worth $46 billion to generate opportunities for firms hit by slack growth at home.

"The Chinese president will attend a joint session of Parliament and important agreements in various fields will be signed during the visit," Foreign Office spokesperson Tasneem Aslam said.

Xiís trip is expected to focus on a Pakistan-China Economic Corridor, a prospective $46-billion network of roads, railways and energy projects linking Pakistanís Gwadar port on the Arabian Sea with Chinaís far-western Xinjiang region.

It would shorten the route for Chinaís energy imports, bypassing the Straits of Malacca between Malaysia and Indonesia, a bottleneck at risk of blockade during wartime.

Also being finalized is a long-discussed plan to sell Pakistan eight Chinese submarines. The deal, worth between $4 billion and $5 billion, according to the press, might be among those signed on the trip.

For more of the Express Tribune story:

$6M in elephant tusks seized in Thailand

Thai customs said it seized four tons of African elephant ivory worth $6 million at a Bangkok port in a container.

The 739 pieces of tusk were found inside a container that arrived at the port on April 18 after being shipped from the Democratic Republic of Congo destined for Laos, according to Thai customs.

"The pieces weigh around 4,000 kilograms (four tons) and are worth around 200 million baht ($6 million)... it is the biggest ivory seizure in Thai history," the statement said, adding they had been declared on the cargo list as beans.

For more of the Yahoo News story:


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