Cargo Business Newswire Archives
Summary for May 11 through May 15, 2015:

Monday, May 11, 2015

CBRE: East Coast ports gaining ground, but L.A./Long Beach still #1

East Coast ports are growing at a faster rate than West Coast ports, according to CBRE's North America Ports Logistics Annual Report.

Despite the fact that East Coast ports are gaining ground, the Ports of Los Angeles and Long Beach still topped the report's first-ever "Ports and Logistics Index." The Southern California port complex has the commercial infrastructure to handle today’s super-sized container ships — plus, it features proximity to Asian export markets, a strong local economy and a deep industrial real estate market.

New York/New Jersey, the Seattle/Tacoma Alliance and Oakland round out the top five ports on the index, which ranks the top 15 North American ports based port infrastructure capabilities and the strength of the local industrial real estate market.

The 15 top North American ports (ranked in order) according to the CBRE index are: Los Angeles/Long Beach, New York/New Jersey, Seattle/Tacoma Alliance, Oakland, Savannah, Charleston, Metro Vancouver (Canada), Virginia (Norfolk), Houston, Baltimore, Everglades (Ft. Lauderdale), Port Miami, Montreal (Canada), and Jacksonville.

"Although the location needs of supply chain users are somewhat fixed given existing distribution centers and customer locations, these networks are always evolving and adjusting to meet increasingly complex inventory requirements," said David Egan, head of industrial research in the Americas for CBRE. "As ports across North America continue to address operational efficiencies caused by greater cargo volumes, labor disputes and a shortage of workers, supply chain users are exploring diversification strategies that move some portion of inbound cargo from the congested West Coast ports to East and Gulf Coast ports."

In terms of port infrastructure alone — measured by TEU volume, long-term growth in annual TEU volume and year-over-year growth in TEU volume — Los Angeles, New York/New Jersey and Long Beach took the top spots, with Savannah and Virginia (Norfolk) at #4 and #5, respectively.

With respect to the real estate ranking component, which was weighted less heavily in the overall rankings than port infrastructure, the characteristics measured included: a market's total size, availability of existing industrial space, demand activity, historical and forecasted construction rates, rent growth and each market's position in its own cycle. Los Angeles and Long Beach were the top-ranked markets in this sector, CBRE said, with Houston, Oakland and Seattle/Tacoma rounding out the top five.

For more of the World Property Journal story: www.worldpropertyjournal.com

China invests $2.5B in Argentina’s freight rail network

Argentina Economy Minister Axel Kicillof announced China's $2.4 billion+ investment in the country's Belgrano Cargas cargo rail network.

The funding will help the South American nation modernize its aging railroad and boost the key cargo sector.

The government, Kicillof said, has earmarked almost $224.6 million to save the Belgrano Cargas railway, but it is "the major backing of $2.47 billion in credit" from China that makes the project viable.

The plan is to renew or recover the rails, stations and cargo cars that comprise the network, which serves 17 of the country's 24 provinces, according to Kicillof.

"The Belgrano Cargas railroad is emblematic of Argentina, as it is the spinal column of the country's north, allowing the regional economies to place their products on the store shelves of the capital," he added.

For more of the Bernama story: www.bernama.com.my

Evergreen launches new Southeast Asia service

Taiwan’s Evergreen Marine announced it would soon launch a new service to Vietnam, Singapore and Malaysia in an effort to take advantage of the thriving economy of countries in the Association of Southeast Asian Nations (ASEAN).

Starting May 10, two 1,164-TEU ships will take turns covering the new route once a week, according to an Evergreen statement.

The vessels will alternate on the weekly rotation — from Haiphong (Vietnam) to Ho Chi Minh City (Vietnam), Port Klang (Malaysia), Singapore, Tanjung Pelepas (Malaysia) and back to Haiphong — taking a total of 14 days.

Evergreen said it is optimistic about strong demand from the 10-member ASEAN bloc, and the new service will take advantage of the solid economy in the region.

In the first quarter of the year, the economy in the ASEAN bloc registered year-on-year growth of 6.03 percent, the highest first-quarter increase in five years, according to an International Monetary Fund report.

The new route is the fourth service Evergreen Marine has launched in six months in the Southeast Asian market.

L.A./Long Beach port truckers sue trucking firm

Two Los Angeles and Long Beach port truck drivers filed a class action lawsuit against a Carson trucking company Sterling Express Services this week, alleging the firm violated state labor code and failed to pay them due wages by designating them as independent contractors instead of employees.

Short haul truckers Jose Vasquez of Lynwood and Elmer Montoya of Bellflower each filed a class action lawsuit against their former employer in Los Angeles County Superior Court in Compton.

Vasquez and Montoya allege that the company illegally deducted fuel, registration, parking and other costs and failed to make timely wage payments or pay overtime. The lawsuit also asserts that while they were considered independent contractors, drivers felt that they could not reject assignments offered by dispatchers. By making them independent contractors, the trucking company avoids complying with the California Labor Code and Industrial Welfare Commission, they say.

Representatives from Sterling Express did not respond by press time.

For more of the Press-Telegram story: www.presstelegram.com

Fire erupts on cargo ship in Honolulu Harbor

Firefighters responded to a fire aboard a 100-foot cargo ship in Honolulu Harbor that forced the crew to evacuate Tuesday night.

The fire department crew arrived at 7:46 p.m. to fight the fire on board a French-flagged 469-foot cargo ship, according to Capt. David Jenkins.

The fire seems to have been in the generator room, where onboard fire brigade crewmembers contained it to the compartment and activated a carbon dioxide extinguishing system. Light smoke was seen coming from the bow of the ship, and the fuel was shut off.

No injuries were reported and no fuel spills were detected.

For more of the Star Advertiser story: www.staradvertiser.com

 

Tuesday, May 12, 2015

NRF: U.S. imports back to normal as ILWU counts contract votes

Import cargo volume at major U.S. retail container ports is returning to normal as officials prepare to count votes on the ratification of the new West Coast labor agreement, according to the monthly Global Port Tracker report released today by the National Retail Federation and Hackett Associates.

"Dockworkers and management made a massive push to clear the backlog of cargo over the past several weeks and West Coast ports are getting back to normal despite concerns such as the Teamster picketing seen in Los Angeles and Long Beach earlier this month," said Jonathan Gold, NRF vice president for supply chain and customs policy. "We hope to see this month’s ratification vote go smoothly and then settle into a long period of efficient, dependable operations before we have to think about contract talks again. But there are still plenty of other issues impacting congestion that the ports need to work through."

The Pacific Maritime Association and the International Longshore and Warehouse Union tentatively agreed on a five-year contract in February. While ILWU leadership has recommended that members vote for ratification, votes won’t be counted until May 22. The lack of a contract and operational issues exacerbated congestion at West Coast ports after the previous agreement expired last July.

Ports covered by Global Port Tracker handled a record-high 1.73 million TEUs in March, the latest month for which after-the-fact numbers are available. Driven up by a sudden surge of released backlogged cargo after the labor dispute ended, the March number was up 33.1 percent from year-over-year.

April was estimated at 1.55 million TEUs, up 8.1 percent from 2014. May is forecast up 5.4 percent at 1.56 million TEUs, June up 3.7 percent at 1.53 million TEUs, July up 5.1 percent at 1.57 million TEUs, August up 3.9 percent at 1.58 million TEUs and September up 1.1 percent at 1.6 million TEUs.

Global Port Tracker covers the U.S. ports of Los Angeles/Long Beach, Oakland, Seattle/Tacoma, New York/New Jersey, Hampton Roads, Charleston, Savannah, Port Everglades, Miami and Houston.

Port of Long Beach retooling to become port of the future

When Jon Slangerup took over as head of the Port of Long Beach, he found that the port, which moves $180 billion in cargo a year, was headed into an epic logistics fiasco with cargo backed up for weeks. But "the biggest stunner," said Slangerup, "was how fragmented, silo-driven and inefficient the supply chain is."

In less than a year, Slangerup has traveled to 39 cities in the United States and 16 in Asia, Europe and Latin America to meet with vessel owners, shippers, freight forwarders, truckers, railroad operators, federal officials, environmental regulators, retailers and other customers.

He is promising them "a complete end-to-end deep dive on supply chain from origin to destination and every piece in between."

Together with officials from the Port of Los Angeles, "we will look at every possible way to improve that system," Slangerup said in an interview last week. "The goal is to cut costs and improve speed. When we are done, it will revolutionize the entire marine supply chain."

Long Beach’s 3,200-acre complex is well ahead of most other American ports in retooling to become what Slangerup calls "The Port of the Future." A 10-year $4.5 billion infrastructure program is half finished.

For more of the OC Register story: www.ocregister.com

OOCL announces new China East Coast Express 2 Service

OOCL just announced the introduction of a new service — the China East Coast Express 2 (CEC2) — created to supplement the company’s existing CEC service and expand market share in the Asia - U.S. East Coast markets.

The CEC2 will offer competitive connections from Cap Mep to New York in 26 days, according to OOCL. The first sailing will be the ZIM San Diego, scheduled for departure from Da Chan Bay on
May 30.

CEC2 port rotation is as follows: Da Chan Bay – Yantian – Cai Mep – Singapore – Colombo – (via Suez Canal) – New York – Savannah – Norfolk – (via Suez Canal) – Singapore – Da Chan Bay.

U.S.P.S. reports $1.5B loss in Q2

The U.S. Postal Service ended the second quarter of fiscal 2015 (Jan. 1, 2015 – March 31, 2015) with an operating revenue increase of $223 million, or 1.3 percent, over the same period last year, and a net loss of $1.5 billion.

The increase in operating revenue was driven by a 14.4 percent growth in shipping and package volume, the post office said. The net loss for the quarter was $1.5 billion compared to a net loss of $1.9 billion for the same period last year. Excluding a retiree health benefit prefunding expense, the net losses would have been $44 million and $447 million, respectively, for the quarters ended 2015 and 2014.

Operating expenses went down $160 million year-over-year, driven in part by favorable trends in workers’ compensation expenses. Excluding the decline in workers’ compensation expense for the quarter, operating expenses increased by $156 million.

Controllable income in the second quarter was $313 million, an increase of $52 million over the same period last year. This increase is mainly due to efforts associated with continued cost-cutting initiatives and enhanced revenue from strong shipping and package volume.

"Shipping and Package Services are a key business driver, however, operating margins in this business are lower than in mailing services," said CFO and Executive Vice President Joseph Corbett. "And, while we’re pleased to see a small increase in controllable income, to improve our margins, we’ll need to make investments in our network infrastructure and delivery vehicles."

Iran releases Maersk ship and crew

A Marshall Islands-flagged cargo ship seized by Iran has been released and the crewmembers are all in good condition, according to the ship’s operator.

Rickmers Ship Management told The Associated Press in an e-mail Thursday that the MV Maersk Tigris was released following a court order.

Iranian forces seized the ship April 28 as it crossed the Strait of Hormuz. It was taken to Bandar Abbas, the main port of Iran's navy, under escort by Iranian patrol boats. Iran alleged that the company that chartered the ship, Maersk Line, owed money to an Iranian firm.

Rickmers' spokesman Cor Radings said his company had confirmed that the ship had left the Iranian port with all 24 crew members on board and all of its cargo, and that it was expected to arrive in Jebel Ali late Thursday night or early Friday morning.

For more of the New York Times story: www.nytimes.com

 

Wednesday, May 13, 2015

CMA CGM to run Cuban logistics hub

The world’s #3 container line, CMA CGM, announced Monday that it had made a deal with the government of Cuba and Cuban company Almacenes Universales to build a logistics hub at Mariel port as part of a huge infrastructure investment.

CMA CGM will help run the hub, which sits 30 miles west of Havana, for the warehousing of import and export goods, distribution of shipping containers and storage of both full and empty containers at the port.

Funded by the Brazilian government, the first section of the port opened early last year, and received 57 ships carrying just 15,000 containers during its first six months of operations. The port is equipped to handle today’s super-sized post-Panamax ships, the ones that will only be able to pass through the Panama Canal once it is widened in December 2015.

The Mariel port will ultimately include about 130,000 square feet of warehouse space and 177 cubic feet of refrigerated storage.

"The platform of Mariel’s is a first step in Cuba’s land logistics development," Mathieu Friedberg, a vice president with CMA CGM, said in a written statement.

For more of the Wall Street Journal story: www.wsj.com

Maersk orders 10 newbuilds for more than $15B

Shipping giant Maersk Line is completing an order of 10 container megaships from Korea’s Daewoo Shipbuilding and Marine Engineering Co. worth more than $1.5 billion, according to two inside sources.

It would be the first time since 2011 that Maersk Line has returned to the market for ships of this size. Back then, it placed an order with DSME for 20 so-called Triple-E ships, which carry more than 18,000 TEUs each. The last two vessels from that order will be delivered to Maersk by July 2015.

"The new order — likely six firm ships and four options — will be announced in coming weeks and deliveries will start in 2017," one of the people said. "The ships will likely be deployed in the Europe-to-Asia trade loop as part of Maersk’s 2M alliance with [Swiss-based] Mediterranean Shipping Co."

Maersk 2M alliance with MSC moves 35 percent of all cargo between Asia and Europe and also controls a market share of 15 percent and 37 percent of goods moved on the trans-Pacific and trans-Atlantic routes, respectively. Ocean Three, another grouping, made up of CMA CGM SA, China Shipping Container Lines Co. and United Arab Shipping Co., controls a 20 percent market of all cargo between Asia and Europe and 13 percent and 7 percent across the Pacific and Atlantic oceans, respectively.

"All big names have either ordered or are in the market for ultra-large container ships," said Jonathan Roach, an analyst with London-based Braemar-ACM Shipbroking. "The orders are to fulfill capacity commitments within the alliances, rather than demand-driven, and this is creating a serious overcapacity in the water of around 30 percent. This means that freight rates will continue to be under pressure over the next couple of years."

The cost of shipping a container from Asia to Europe, the world’s biggest seaborne trade route, jumped 151 percent this week to $861 after 13 straight weeks of declines, according to the Shanghai Containerized Freight Index. But. Roach said the increase was the result of delayed general rate increases by all shipping lines, and prices are expected to fall over the next several weeks.

For more of the Wall Street Journal story: www.wsj.com

China Railway Construction unit to build rail/port projects in Russia

A division of China Railway Construction Corp has signed a memorandum of understanding to build rail and port projects in Russia, according to the firm’s stock exchange statement this week.

The agreement was one of a group of deals signed between China and Russia during a visit by Chinese President Xi Jinping to Moscow, marking the anniversary of the end of World War II in Europe.

China Civil Engineering Construction Corporation said it had agreed with Russian firm Tuva Energy Industrial Corporation to consult on and help source funds from Chinese institutions. Projects will include installing 255 miles of track across the central southern part of Russia from Elegest to Kuragin.

The other projects comprise a railway line connecting the Tuvan Republic, in the same area of Russia, to western China, and a port project in eastern Russia.

CECC said the firms would sign a contract for general contracting once the projects obtained funding.

Last week, Russian Transport Minister Maxim Sokolov said the countries would invest $19.7 billion in a rail link between Moscow and the Russian city of Kazan to be completed by 2020. Putin said the level of Chinese investment would be around $5.9 billion.

For more of the Reuters story: www.reuters.com

Port of Seattle names new senior director of public affairs

Julie Collinsas has been named senior director of public affairs at the Port of Seattle.

Collinsas is responsible for government relations, community outreach, strategic communications and airport public relations. As part of the executive team supporting the executive office and commission, she reports directly to the CEO.

Previously, as chief external-affairs officer at the Port of Tacoma, she oversaw government affairs, communications and community-relations functions. Collinsas also served on the CEO’s executive team.

For more of the Seattle Times story: www.seattletimes.com

Body found in cargo ship container at Philadelphia cocoa facility

Officials found a dead body on a container ship at a U.S. cocoa import facility in Philadelphia this week.

The port authority said the corpse could have been a stowaway who had traveled from West Africa.

The body was discovered as workers unloaded a cargo ship carrying cocoa beans that docked in the port on Thursday but had taken days to unload, according to Bob Blackburn, executive director of the Pennsylvania Regional Port Authority.

Police have not yet identified the corpse or determined cause of death.

For more of the Philly Voice story: www.phillyvoice.com

 

Thursday, May 14, 2015

Maersk Q1 profits up 57 percent

Denmark’s Maersk Line, the world’s largest container shipper, reported a 57 percent boost in first-quarter net operating profit after tax to $714 million.

The shipping giant transports about 15 percent of the world’s manufactured goods, said any gains it made from lower fuel costs were offset by a decline in freight rates and volumes.

"If you look at the profitability of the container industry over the last five years...most companies have been lossmaking," said Nils S. Andersen, CEO of parent company Maersk Group, to CNBC.

"(But) we see the chance of making money in the industry in being more competitive and giving the customers a better offer than our competition. The last year has given us very good profits, but the situation in the industry I regard as relatively stable, it's just not very attractive."

The first-quarter numbers are "indicating significant pressure on utilization," according to a note from Frode Moerkedal, an analyst at Platou Markets. "We would have assumed Maersk Line would ‘win’ the price war in the container market so the weak volumes are worrying, in our view."

A.P. Moller-Maersk’s first-quarter profit increased by 18 per cent to $1.3 billion, impacted by an after-tax gain from the sale of shares in Denmark’s Danske Bank, but revenues fell due to low oil prices and low economic growth, decreasing by 10 percent or $1.2 billion, and came in at $10.5 billion.

The figure was helped by income from the sale of a stake in Danske Bank, but lower oil prices weighed on the firm's oil production unit. Shares of the company fell 3 percent after the results Wednesday morning.

"There's a direct impact on the oil business itself and then it also impacts the turnover on Maersk Line negatively because we pass part of the saving onto our customers. But overall what we're doing as a result of lower oil prices is reducing costs in Maersk oil and Maersk drilling," Anderson said.

He added that the company still had plans to reduce costs by around 20 percent until the end of 2016.

Maersk shares fell as much as 3.2 percent, the most in a month. The stock declined 2.6 percent to 13,220 kroner at 9:33 a.m. in Copenhagen.

For more of the Bloomberg story: www.bloomberg.com

For more of the CNBC story: www.cnbc.com

Port of Long Beach commissioners take conservative budget approach

After a year of labor conflict and cargo backups, Port of Long Beach officials said they will be conservative about the upcoming year’s budget at this week’s board meeting.

Steven Rubin, the port’s managing director of finance and administration, recommended caution although he expects business to recover from the wintertime slowdowns associated with the labor negotiations between dockworkers and West Coast terminal operators.

Rubin said the current spending proposal contains no salary increases for port employees or any plans to raise staffing levels.

"I think that is the safest way to go," Harbor Commissioner Lori Ann Farrell Harrison said.

The budget proposal outlines $829 million in spending, which would be about 3 percent less than what commissioners authorized for the current fiscal year. More than two-thirds of the proposed spending would be allocated to capital projects, such as the Gerald Desmond Bridge Replacement Project.

The spending proposal also includes $20 million to create a new pool of chassis, Rubin said. A shortage of chassis, the trailers that truck drivers use to carry shipping containers, is widely viewed as a major factor behind heavy traffic congestion around the ports of Long Beach and Los Angeles.

Port of Long Beach Chief Executive Jon Slangerup said the chassis rentals will be considered a premium service provided by the port.

"We will not be doing this for free," he said.

The harbor commission is expected to vote on the budget proposal May 27.

For more of the Press Telegram story: www.presstelegram.com

K Line, Mitsui and Imabari Shipbuilding in joint venture for LNG transport

Kawasaki Kisen Kaisha (K Line), Mitsui and Imabari Shipbuilding, in a joint venture called Trinity LNG Transport, have entered into a long-term time charter contract for the USA Cameron LNG Export Project.

Mitsui has found eight LNG ships to deliver the gas from the Cameron LNG Export Project, signing time charter contracts for five ships last year and two more earlier this year. This latest charter contract is for the eighth ship, bringing the total maximum charter hire amount for the eight vessels to around $5.8 billion.

The LNG carrier to serve the project will be built by Imabari, have a capacity of 178,000m³ and will be equipped with an electronically-controlled dual fuel gas injection diesel engine (ME-GI).

The charter contract will begin in 2020 and will last a maximum of 25 years after delivery.

The Cameron LNG project is jointly owned by Sempra, GDF SUEZ, Mitsui and Japan LNG Investment, a company jointly owned by Mitsubishi Corporation and Nippon Yusen Kabashiki Kaisha (NYK). The terminal is located near the Gulf of Mexico.

For more of the LNG Industry story: www.lngindustry.com

Port Everglades container volume up 8 percent

In the six month period ended March 30, container volume at Port Everglades in Fort Lauderdale grew 8 percent to 545,194 TEUs.

"We continue to enjoy robust North-South trade between Port Everglades and Latin America and the Caribbean," said Port Everglades Director Steven Cernak in the statement.

"Our landside, or 'last mile,' connections are nearly complete," he added, touting the recent opening of Florida East Coast Railway's intermodal facility and the Eller Drive overpass from I-595 as well as ongoing improvements to roads inside the port.

"We are now focusing on our waterside improvements including new cranes, adding new berths, and deepening and widening our channels" to host mega-ships soon to cross the expanded Panama Canal, Cernak said.

Port Everglades' growth in containerized cargo for the first half of this budget year through March 30 was almost equally divided between imports and exports, the statement said. Imports grew nearly 8 percent to 271,715 TEUs and exports nearly 9 percent to 273,479 TEUs, compared to the same period a year earlier.

At least 6 dead after Amtrak train derails in Pennsylvania

At least six people died and dozens were injured, 11 critically, when a northbound Amtrak train derailed Tuesday night in Port Richmond, a suburb of Philadelphia.

After the derailment, emergency personnel swarmed over more than a half-dozen toppled train cars, trying to reach survivors.

Train 188, bound to New York from Washington with 238 passengers and five crew members aboard, had left 30th Street Station in Philly minutes before the accident, which occurred near a curve at Wheatsheaf Lane and I-95.

The accident has closed the country’s busiest rail corridor between New York and Washington, as federal NTSB investigators begin sifting through the mangled remains to determine what caused the derailment.

For more of the ABC News story: 6abc.com

 

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