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Summary for May 20 - May 24:
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Monday, May 20, 2013 Top StoryMaersk plans to double shipping rates in July
CEO Nils Smedegaard Andersen said he had "no doubt" Maersk Line would be successful in its plans to increase rates from the current $731-per-TEU rate to $1481-per-TEU starting July 1. However, the company cut its forecast for a rise in demand in 2013 to 2-4 percent from its earlier prediction of 4-5 percent. Shipping has been struggling over the past five years due to broad weakness of the global economy and a surge in orders for huge new container vessels by major shipping companies, right as the 2008 financial crisis hit. Companies are now taking delivery of those vessels, in the midst of vessel overcapacity that is driving down freight rates. Korea's Daewoo Shipbuilding & Marine Engineering will deliver the first of Maersk's 20 new mega vessels later this year. Maersk Line ships comprise approximately 15 percent of world's container shipping capacity, however, the company announced that the line rebounded with a $204 million profit in the quarter from a $599 million loss year over year, besting expectations. All major container lines are anxious to raise the industry's freight rates, after a drop in the past two months that left the lines trading at a loss. "To be honest, we just have to get used to the fact that these are harder times, and that there will be harder times ahead," Andersen said at a teleconference. "The fact that they keep their outlook unchanged at a time when Asia to Europe freight rates are at an absolute low, is an important signal (for the full year results)," said Sydbank analyst Jacob Pedersen. For more of the Reuters story: reuters.com Protesting ILWU dockworker gets tapped by semi at Columbia Grain TerminalA Portland longshoreman sustained minor injuries after getting hit by a truck while picketing at the Port of Portland's Columbia Grain terminal. The worker is recovering at home after injuring his knee, elbow and back, according to Jennifer Sargent, a spokeswoman for the International Longshore and Warehouse Union. She declined to release his identity. The union says the incident occurred Thursday when a truck driver got into an argument with workers while trying to cross a picket line and his vehicle moved forward. Bruce Holte, ILWU Local 8 president, said, "The District Attorney's office is reviewing video of the semi truck driving into the picket line, and we believe any fair process will result in charges being brought against the driver." The operator of the Marubeni-Columbia River grain terminal has locked out ILWU dockworkers since May 4 due to an ongoing contract dispute. Columbia Grain said they initiated the lockout because ILWU workers were slowing operations at its terminal, where wheat, corn, and other U.S. commodities arrive by train and barge to be exported primarily to Asian countries. "With bargaining stalled and the longshore workers engaging in 'inside game' tactics, including slowdowns, work-to-rule, and demands for repeated inspections of the same equipment – all designed to negatively impact Columbia Grain's operations – we have decided that a lockout is our best alternative," Marubeni said in a written statement in early May. Bruce Holte, president of ILWU Local 8, said Columbia Grain hired replacement workers at the start of negotiations in the fall, indicating that the company never intended to come to an agreement. Columbia Grain is a member of the Pacific Northwest Grain Handlers' Association, which also includes Mitsui's United Grain in Vancouver, which locked out ILWU Local 4 members on February 27, claiming equipment sabotage by an ILWU official. However, no charges have been filed. For more of the News Tribune story: thenewstribune.com Hong Kong April container volume falls 12 percent on strikeHong Kong container throughput dropped 12 percent in April year-over-year due in part to the 40-day strike at billionaire Li Ka-shing's port operations, which rerouted traffic and slowed trade at Hongkong International Terminals. The facility handled 1.734 million TEUs in April, compared with 1.976 million TEUs in April 2012, according to data from the Port Development Council. Throughput at the world's third-largest container port declined 7.8 percent from March, since the dockers walked out on March 28, demanding higher wages. The strike has since been resolved. Shipping lines were forced to divert vessels from Hong Kong to nearby ports, including neighboring Shenzhen, southern China. The April monthly volume is the lowest since November 2009, excluding February traffic, traditionally slower due to the Chinese New Year holiday. Shenzhen's container terminal throughput for April was 1.85 million TEUs, a drop of 0.5 percent on year, according to the Shenzhen Ports Association. The labor action may have cost the company $13 million, according to Citigroup. For more of the Bloomberg story: businessweek.com Corps awards contract to dredge PortMiami harborPortMiami is poised to deepen its shipping channels from 44 feet to 52 feet, a depth that will accommodate the ultra large container vessels that will come to call after the widening of the Panama Canal is completed in 2015. The U.S. Army Corps of Engineers has awarded the dredging contract to Great Lakes Dredge and Dock of Oak Brook, Illinois. In addition to dredging the channels to a depth of 50 to 52 feet, it will widen a section of one of Miami's channels. The project will include the creation of nine acres of artificial reef and the restoration of more than 16 acres of sea grass in northern Biscayne Bay. Hard coral colonies will be relocated. Miami-Dade County Mayor Carlos Gimenez called the contract award a "major milestone'' for the port and said the deep dredge project was "vital to the future success and growth of our seaport.'' For more of the Miami Herald story: miamiherald.com Cargo ship worker recovering after being struck by containerA worker on a cargo ship docked in South Florida is in the hospital recovering from injuries that occurred after officials say he was struck by a cargo container. The 52-year-old man was working on the upper deck of a ship at Port Everglades when he injured his leg in Sunday's accident, according to Broward Sheriff Fire Rescue officials. For more of the Miami Herald story: miamiherald.com
Wednesday, May 22, 2013 Top StoryCargo volume up 4.7 percent at Georgia ports
"Our total tonnage makes April the highest volume month on record," said Curtis Foltz, GPA executive director. "And with companies like Haier appliances, Kent bicycles and Pep Boys recently choosing the Port of Savannah, our drawing power for cargo is only getting stronger." The GPA reported a 4 percent surge in container traffic for April, moving 258,951 TEUs, 10,040 more TEUs than in April 2012. Foltz said April container volume was 11.3 percent higher than March 2013 figures. For more of the Savannah Morning News story: savannahnow.com/latest-news Cosco Pacific sells Cosco Container Industries stake to parent company for $1.2BCosco Pacific, the container terminal arm of China Ocean Shipping Group Co., will sell its stake in Cosco Container Industries to the parent company for $1.2 billion. The container terminal operator will sell CCI, which includes a 21.8 percent holding in China International Marine Containers, to a unit of China Ocean Shipping Group Co., according to the Hong Kong stock exchange filing. The sale allows the company to "realize a return on its investment in CIMC," according to a Cosco Pacific statement. Cosco Pacific's first-quarter net income fell 14 percent year-over-year to $66.1 million as operating costs from the terminal business increased. CIMC's quarterly profit fell to $35.7 million from $61 million a year earlier, according to Bloomberg. The deal is subject to approval by the shareholders of both Cosco Pacific and controlling shareholder China Cosco Holdings Ltd., according to the filing. For more of the Bloomberg story: bloomberg.com September fundraiser for L.A.-Long Beach International Seafarers Center honors Guy FoxA fundraising event to benefit the International Seafarers Center will be held aboard RMS Queen Mary on Sept. 18. The 2013 Maritime Industry Salute dinner and 13th Annual Boat Races of San Pedro Bay fundraiser will honor Guy Fox, president and CEO of Guy Fox & Associates, Inc. and chairman of the District Export Council of Southern California. Proceeds from the night's event benefit the International Seafarers Center, the only organization that offers support to visiting ships' crews throughout the entire Los Angeles/Long Beach Harbor complex. The organization provides aid to sailors far from home, including transportation, recreation, spiritual outreach (for many different faiths), mail, Internet and telephone access, and other key services. "The ISC, which first opened more than 31 years ago, is the last open refuge serving the needs of our seamen in the ports of Long Beach and Los Angeles," said James Dillman, ISC dinner chairman and Metro Ports president. "The center relies on this event as its primary source of funds to sustain the center. We are calling upon the generosity of the maritime industry and the local business community to support the center through this fund-raising effort." The evening starts with a reception on the quarterdeck of the Queen Mary. Soon after, the fireboat and harbor boat parade will usher in the 13th Annual Boat Races of San Pedro Bay, followed by dinner. Tax-exempt tickets and sponsorship tables are still available. Port of Olympia's former finance director sues port for wrongful terminationThe Port of Olympia's former finance director has sued the port and its executive director, Ed Galligan, alleging wrongful termination and retaliation against him in violation of state whistleblower laws. Kevin Ferguson filed the suit in Thurston County Superior Court, seeking a variety of damages, "including past and future compensatory, economic, non-economic, general and emotional distress damages." The port had no comment. In his suit, Ferguson says the port hired him in February 2009, after a span of about eight months when the port had no finance director. He said he grew into his role, receiving a performance review with high marks, a pay raise, and commissioner approval. When Galligan didn't take action, Ferguson alleges, he took the issues to two port commissioners. After Galligan heard of the meeting, he "belittled and berated" Ferguson, Ferguson alleges, said "not to talk with any commissioners unless it involves fraud or gross negligence." Later, Ferguson wrote a letter to port commissioner Jeff Davis, alleging nepotism, waste of port funds and contract irregularities at the port. Following an investigation in which the port's legal council found no wrongdoing by the port, Galligan fired Ferguson. For more of The Olympian story: theolympian.com Two FBI agents die in maritime counter terrorism training exerciseTwo FBI agents died while training off Virginia Beach, falling to their deaths when a helicopter had trouble during a "maritime counterterrorism exercise," according to an agency spokeswoman. Special Agents Christopher Lorek and Stephen Shaw were killed when they fell into the water Friday. Both were members of the bureau's elite hostage rescue team, a group known for rescuing an Alabama boy from a kidnapper in an underground bunker and other high profile rescue efforts. "The FBI agents were participating in a maritime counterterrorism exercise involving helicopters and a ship," Special Agent Ann Todd, an FBI spokeswoman, wrote in an email Monday night. "The agents were in the process of fast-roping from the aircraft onto the ship when the helicopter encountered difficulties. The agents tragically fell a significant distance and suffered fatal injuries." "They're really the best of the best as far as civilians. Their only counterpart would be something like Navy SEAL Team 6 or U.S. Army Delta," said Clint Van Zandt, a former FBI hostage negotiator who deployed with the rescue team. For more of the Washington Post story: washingtonpost.com
Thursday, May 23, 2013 Top StoryChina preliminary manufacturing PMI down in May
A 49.6 reading for a Purchasing Managers’ Index released by HSBC Holdings Plc and Markit Economics, compared to with a final 50.4 for April and 50.4 estimate in a Bloomberg News survey. A reading above 50 indicates growth. Asian stocks dropped on the news, which may put pressure on the new government’s policy to tolerate slower growth after Premier Li Keqiang last week indicated reluctance to add stimulus. “The slowdown is really bad,” said Ken Peng, a BNP Paribas SA economist headquartered in Beijing. “It’s a big probability now that China’s GDP growth rate in the second quarter will be lower than in the first quarter.” HSBC will release the final China PMI reading on June 3. The preliminary, or flash PMI is based on about 85 percent to 90 percent of responses from more than 420 manufacturers. For more of the Bloomberg story: bloomberg.com Tacoma's April container volumes up 35 percentContainer volumes through the Port of Tacoma were up 35 percent to 617,076 TEUs year-to-date through April, according to a port statement. Year-to-date breakbulk volume decreased 23 percent to 64,774 short tons. Grain volumes were down 39 percent. Last year's drought in the U.S. Midwest appears to have shifted global sourcing from North America to South America, according to the port. Damco reports 5 percent rise in profitsFreight forwarding and logistics firm Damco recorded first quarter profits of $195 million, 5 percent higher than the first quarter of 2012, according to a company statement. The company reported a 6 percent increase in first quarter net revenue with $773 million, compared to $728 million in 2012. EBIT ended up at $9 million for the first quarter, compared to $13 million a year ago. First quarter ocean freight volumes were up modestly by 1 percent, year-over-year. “Overall our performance in Q1 has been satisfactory,” said Rolf Habben-Jansen, CEO of Damco, “with solid growth in most products and underlying trading only slightly below 2012.” Foxx sails through initial Senate confirmation hearingAnthony Foxx, Secretary-designate of the Department of Transportation, reportedly received a warm welcome from the senators at his confirmation hearing this week. Insiders predict Foxx will get easy confirmation from the Senate Commerce, Science and Transportation Committee, followed by the full Senate. Sen. Jay Rockefeller, D-W.Va., who chairs the committee, told Foxx he can’t do his job effectively without revenue and told him to push Congress to give him what he needs. “You have a huge job in front of you,” Rockefeller said. “The challenges are many and the solutions are hard.” Problems that await the office constellate budget problems, including the sequestration, and an inadequate fund to support the crumbling infrastructure of U.S. highways and transit systems. In accordance with Senate custom, North Carolina’s senators, Democrat Kay Hagan and Republican Richard Burr, introduced Foxx to the committee. Burr touted Foxx as a “homegrown talent” who had worked in all three branches of the federal government before being elected Charlotte’s mayor. For more of the McClatchy story: mcclatchydc.com Injured dockworker rescued from holdFire officials rescued a 23-year-old dockworker from the cargo hold of a ship being unloaded at the Port of Wilmington, Delaware, last week after a 2,000-pound coil of wire rolled onto him. Submit Your Press |
A.P. Moller-Maersk is "100 percent certain" it can more than double freight rates in July, even though market weakness has seen prices fall by 33 percent since March.
The Georgia Ports Authority handled 2.4 million tons of cargo in April, a 4.7 percent increase year-over-year. The numbers reflect a strong performance in containers, bulk and Roll-on/Roll-off cargo, according to a port statement.
According to preliminary readings, China’s manufacturing sector is contracting in May for the first time in seven months, signaling weaker economic expansion.