Monday, June 11, 2012
China’s May trade data far exceeds projections
China’s two-way trade in May was more than double analysts projections, thanks in part to surging U.S. demand for Chinese-made goods and crude oil imports, according to customs data.
Exports out of China rose 15.3 percent in May over the same period a year earlier while the expectation was reportedly for a 6.8 percent increase, as the global manufacturing giant’s trade with the U.S. ended up 12 percent in the first five months of 2012, compared to a meager 1.3 percent rise with the struggling European economies.
China’s imports were up 12.7 percent from May of 2011, easily outpacing expectations of 5 percent growth, according to a Reuters poll.
Crude oil imports into China posted an all-time high of 6 billion barrels a day; a traditional indicator of economic strength.
China’s annual trade growth to date is still behind the 20 percent increase recorded in 2010, as the Chinese government recently cut interest rates to help stimulate its economic growth amid slackened global demand, and is expected to slide below 8 percent in the second quarter; the sixth consecutive quarter of slowdown.
For the full Reuters story: www.cnbc.com
Report: Tardy container deliveries not just from late-arriving ships
Late container deliveries for the year to date have not just been the result of ships arriving behind schedule, but have also resulted from other non-vessel operations factors, according to a schedule reliability report.
SeaIntel Maritime Analysis’ monthly database that the industry trend firm claims tracks all cargo vessels transiting deep-sea routes found 79.1 percent of ship arrivals where on time for the year to date within a day on either side.
SeaIntel also reported that data culled from the online cargo-booking firm INTTRA’s database of 800,000 container status messages per day showed containers are delivered on time at a rate of 64.7 percent within the same one-day parameters.
“From this we see that the majority of late deliveries are due to the vessels being late – but only just,” according to SeaIntel’s report.
“The numbers show that 59 percent of late container deliveries are due to the vessels not being on time, however the remaining 41 percent will have been delayed due to other factors such as missed transshipments, rolled containers, gate-in too late etc.,” the report said.
“This shows that in order for the industry to improve reliability in the supply chain, almost as much focus need to be awarded to the processes around the shipment as to the actual operations of the vessels themselves,” SeaIntel said.
USMX to attend ILA wage scale meetings later this month
In a message posted to his membership online, James A. Capo, the chairman and chief executive of the employer group that deals with waterfront labor along the U.S. East and Gulf coasts, advised a bargaining committee would resume negotiations with their counterparts in Florida later this month after they apparently broke down there in March.
After approximately two weeks of heated public exchanges via letters posted on the websites of the United Maritime Alliance and International Longshore Union by each organization’s respective leaders, the two sides appear to be headed back to the bargaining table where new automated technology implementation has been a centerpiece of contention in the lead-up to a new master contract as the current one expires end of September.
Capo said in a letter to the USMX membership dated May 31 that the leader of the ILA, Harold Daggett, "fails to recognize…that the current Collective Bargaining Agreement mandates that both sides negotiate over the impact new technology might have on the work force."
Daggett responded to Capo’s charge in a letter posted on the ILA website a few days later.
"My concern is that USMX wants to effectively eliminate the workforce through automation. If that happens, the wage and benefit package will not matter, since there will be very few ILA members working in your new automated terminals," Daggett wrote.
Other un-resolved issues the two sides have openly discussed to date include jurisdiction over chassis maintenance and whether to weigh all import containers at the dock.
Capo contended in his May 31 letter that the ILA’s chief negotiator doesn’t want to negotiate on the central issues at hand between the two sides.
"Daggett has put forth several demands, or 'hurdles,' as he calls them, but has adamantly refused to negotiate or even discuss these or any other issues at the bargaining table unless management first agrees to his demands," Capo wrote.
Daggett subsequently invited Capo and the USMX to a meeting of his Wage Scale Committee that commences June 27 in Delray Beach, Florida that he said could run through June 29.
Russian billionaire’s ship suspected of carrying weapons to Syria
Russian billionaire Vladimir Lisin’s shipping company is alleged to have transported a cache of weapons from St Petersburg to Syria on a containership that docked at the Port of Tartus on May 26, one day after the massacre of over 100 people there that included children as part of Syrian President Bashar al-Assad’s brutal crackdown on civil unrest.
The containership Professor Katsman is registered to North-Western Shipping Company, which is owned by Universal Cargo Logistics, one of Lisin’s businesses.
UCL confirmed last week that the containership had docked at the Syrian port but that it was not aware of the cargo sealed in containers on board that had been given a pass by Russian customs officials.
The ship’s documentation said the contents on board were “general cargo and equipment.”
There is currently no United Nations embargo against Syria, a measure that Russia has opposed, as UCL has said it did nothing illegal by delivering the alleged weapons cargo.
For the full Brisbane Times story: www.brisbanetimes.com.au
Tuesday, June 12, 2012
PierPass fee to increase $3 per-FEU at L.A. -Long Beach terminals
Increased labor costs for off peak shifts are being cited as the reason for raising the so-called Traffic Mitigation Fee by 2.5 percent to $123 per-FEU, or $61.50 per-TEU, at container terminals in the Los Angeles and Long Beach port complex, effective August 1.
“Cargo volume since 2005 has been essentially flat. The shortfall between TMF revenues and OffPeak gate costs was $55 million in 2011 and $52.3 million in 2010,” the statement said.
Maersk Line re-organizes CFO post
Denmark’s Maersk Line announced chief financial officer Peter Rønnest Andersen is leaving the company as of June 19 and current chief of strategy and transformation, Jackob Stausholm will add finance oversight to his role, and title.
RailAmerica carload traffic rose 8 percent in May
RailAmerica Inc. announced its carload traffic rose 8 percent in May, thanks in part to increases in coal, forest products, and motor vehicle shipments.
RailAmerica reported in a statement that its total freight carloads for the month increased to 75,384, from 69,776 in May of 2011, when flooding disrupted shipments of coal on the Missouri & Northern Arkansas Railroad.
The rail operator said its volume of forest products grew across regions, while motor vehicle traffic increased into the U.S. Midwest and West.
RailAmerica said traffic “has been choppy so far this year” as the company “has been hurt by weaker shipments of coal as that industry struggles to compete with low-priced natural gas.”
RailAmerica announced last month that its board is considering a potential sale of the company.
Fedex Express to retire 24 aircraft
FedEx Express announced it plans to retire 24 aircraft from and take a charge of $84 million for the current quarter as the second largest package delivery undergoes an upgrade to its fleet with new Boeing planes.
Of the aircraft to be retired, 18 are Airbus A310-200, and the other six are Boeing MD10-10, the company said in a statement.
Fedex Express had already retired 5 aircraft this year and has plans to do the same with another 21.
"Along with the decisions to retire these 50 aircraft, we are also developing detailed operating and cost structure plans to further improve our efficiency," FedEx Express Chief Executive David Bronczek said in a statement.
Does wine from shipwrecks taste better?
Bottles of wine that are found in undersea shipwrecks tend to sell for large sums of money, such as the more recent example of 11 bottles that had been preserved for 200 years, and salvaged in 2010 from a vessel at the bottom of the lightless Baltic Sea. The bottles of bubbly were subsequently auctioned off in Finland for $136,000.
To test the theory of whether storing wine in ocean depths make for a better vintage, three Frenchmen – a vineyard owner, wine barrel maker and oyster farmer - reportedly stored barrels of the same 2009 Bordeaux in the cellars of Chateau Larrivet Haut-Brion in the southwest of France and in oyster beds off the Atlantic Coast.
After six months it seemed the Bordeaux from the sea was deemed to have tasted better as lab results showed that wine’s character was altered by osmosis.
For the full Daily Mail story: www.dailymail.co.uk
Wednesday, June 13, 2012
Report: Logistics costs rose to 8.5 percent of U.S. GDP in 2011
Logistics costs in 2011 rose 6.6 percent from the previous year to $1.282 trillion, or 8.5 percent of U.S. gross domestic product, as railroads gained market share and the ocean shipping sector continued to struggle, according to an industry report.
Although U.S. containerized volumes grew 4 percent last year to just under 30 million TEUs, waterborne trade did not fare as well, dipping 3 percent in 2011 with many ocean carriers finishing in the red as they try to make higher 2012 rates stick amid new tonnage being added, according to the 23rd Annual State of Logistics Report, released by the Council of Supply Chain Management Professionals.
Railroads fared better in 2011, with their collective revenue surging 15.3 percent over 2010, as intermodal market share grew with no capacity issues for that sector, according to the report.
Trucking companies are using intermodal rail to help offset new equipment costs and a growing driver shortage, as trucking rates were up between 5 and 15 percent in 2011, the report said.
The air cargo sector recorded a record year for export freight in line with the overall U.S. export increase of 6 percent in 2011, although total U.S. air shipment volume was down over 3 percent.
Imports into the U.S. increased 3 percent, a slowdown from 2010's 13 percent jump, although overall inventories returned to pre-recession levels due in part to growth among wholesalers and manufacturers, while retail inventories were flat, the report said.
Waterfront dispute over who plugs in backs up reefer freight at Port of Portland
A dispute between two unions over who has jurisdiction to maintain refrigerated units reportedly has cargo, including perishable products, backed up at the Port of Portland's Terminal 6 container terminal that is operated by ICTSI.
According to a report by the Oregonian, the International Longshore and Warehouse Union Local 8 is demanding the right to plug, unplug and monitor refrigerated containers at T-6, while the Port of Portland contends that has traditionally been the domain of the International Brotherhood of Electrical Workers.
Philippines-based terminal operator ICTSI's 25-year lease agreement, signed two years ago, reportedly had language written in that allowed for the continued use of the electrical workers in the reefer maintenance capacity.
The Oregonian reported a local arbitrator has made several rulings to date, with both sides in the dispute claiming the arbiter has ruled in their favor.
The ILWU issued a statement that says the labor agreement with the West Coast employer group, the Pacific Maritime Association, places the reefer work under their jurisdiction, while the Port of Portland has reportedly filed an unfair labor practice case with the federal labor relations board that contends the longshore force at T-6 has been causing willful, costly delays during the dispute.
Meanwhile, the Oregonian talked to shipping industry users of T-6 who have claimed truck wait times of up to six hours and some cargo diversions to other West Coast ports.
A ruling on the reefer dispute by the labor relations board could reportedly come as soon as this week.
For the full Oregonian story: www.oregonlive.com
MOL to reduce capesize fleet by 10-20 vessels
Japan's Mitsui O.S.K. Lines will reportedly scrap or lay up between 10 and 20 of its capesize vessels amid a struggling dry bulk freight market.
"Based on the current capesize market conditions, MOL believes that the cold lay-up of approximately 10 ships for six months to a year will help restore an appropriate vessel supply-demand balance in the future," the shipping company said.
"MOL has plans to scrap five vessels by the end of March 2013 and is considering the disposal of others," MOL said in a statement.
MOL scrapped company scrapped four vessels and temporarily laid up another 10 such ships in 2011.
Capesize vessel capacity averages 150,000 tons of dry bulk product.
According to a Reuters report, the average daily earnings for capesize ships are at the lowest level since December 2008 at $4,135.
For the full Reuters story: www.reuters.com
Report: Trucking industry recovers in Q1 with fewer failures
The U.S. trucking industry has experienced a strong first-quarter recovery in 2012 with fewer companies failing compared to the same period last year, according to a financial analysis.
In this year's first quarter, there were 160 trucking firms that went out of business compared to 295 such failures for the same period in 2011, according to the Paragon Report by Avondale Partners.
"Almost by definition, if a trucking company made it through the last couple of years of turmoil in the macro economy, industry marketplace and regulatory environment, it is a result of being fairly well capitalized and fairly well operated," the report's analysts said.
"Or put another way, if they made it this far through the tough times, then they can make it through easier times," they said.
Children's shoes tainted with lead seized at Port of Tacoma
Customs officials reportedly seized $2,300 worth of children's shoes tainted with lead at the Port of Tacoma recently.
According to U.S. Customs, the incoming cargo that arrived from Asia had already been targeted for scanning via the XRF analyzer that can detect toxins.
"When they screened these shoes, it came out with a high level of lead," said Judy Staudt of U.S. Customs and Border Protection.
Staudt said lead is usually detected in Chinese-made PVC pipe, but that finding it in shoes is a newer challenge.
For the full KING TV story: www.king5.com
Friday, June 15, 2012
Maersk's APM Terminals signs $500m China port deal
APM Terminals, the ports division of A.P. Moller-Maersk, signed a deal with Ningbo Port Group for a 25 percent stake in Ningbo's prospective new container terminal, according to an APM announcement. Reuters reported the deal is worth approximately $500 million.
The port group and APM will jointly invest in and operate berths 3, 4 and 5 of the Meishan Container Terminal, which is expected to be constructed and operational by December 31, 2014.
Ningbo, which handles 14.5 million TEUs annually, is the third largest port in China and the sixth largest container port worldwide. Container throughput at the gateway port to Eastern China grew 17 percent in four years (2006-2010), and it is expected the port will be at 80 percent capacity by 2012. The new Meishan Container Terminal will be able to handle an additional 2.8 million TEUs.
"This agreement creates important new port capacity needed for our customers in one of the fastest growing container markets in the world," stated Henrik Lundgaard Pedersen, CEO of APM Terminals Asia-Pacific region, based in Shanghai, China
Longshoreman's union sues Portland terminal operator ICTSI
On Thursday, the longshoremen's union filed a federal lawsuit against ICTSI Oregon, the private operator of Terminal 6 at the Port of Portland. The dispute, which has reportedly slowed cargo to a crawl the past two weeks at the port, is over who has the legal right to maintain refrigerated shipping containers at the port's only container terminal.
The International Longshore and Warehouse Union is seeking to make ICTSI meet the terms of a 4-year labor agreement, giving jobs to ILWU workers that have been traditionally done by non-maritime union workers since the 1970s.
The ILWU Local 8, which handles longshore work at Terminal 6, now claims jurisdiction to provide routine maintenance for refrigerated shipping containers—work that involves just two to four people per year—that has been performed by the International Brotherhood of Electrical Workers for the past forty years. The IBEW has a collective bargaining agreement with the port, and when ICTSI took over terminal operations in 2010, the agreement stipulated the disputed jobs would stay with IBEW.
Since a private company now operates the terminal, the ILWU contends the contested work should fall under a six-year collective bargaining agreement between ILWU and PMA that governs all West Coast ports.
The Port of Portland said the ILWU's actions have negatively impacted container workflow at the ports, and has filed an unfair labor practice charge with the National Labor Relations Board.
For more of the Portland Business Journal story: www.bizjournals.com
Experts predict summer volume rise for L.A. and Long Beach after May lows
Although cargo numbers were down at the Ports of Los Angeles and Long Beach in May, international trade specialists are projecting more volume in June.
Even though L.A. had a much better month than Long Beach, collective imports at the ports were down 2.42 percent in May to 620,659 TEUs year on year, and exports decreased by 0.08 percent, to 314,190 TEUs.
As the first and second largest ports in the country, L.A. and Long Beach reflect national economic trends. Reviewing seaports nationwide, Zepol Corp., which tracks international trade data, reported import cargo volumes were up 3.49 percent in May, compared to May 2011, at just under 1.6 million TEUs. Los Angeles and Long Beach ports had a 38.84 percent share of the U.S. import cargo in May.
"Consumer demand for durables has been weak for quite some time and dropped further in May, yet at the same time consumer confidence is at its highest level since 2007," said Ben Hackett, founder of Hackett Associates, which tracks cargo through the nation's busiest ports for the National Retail Federation, to the Los Angeles Times. "Confused? So is the average consumer."
For more of the Los Angeles Times story: www.latimes.com
Arctic route saves shipping line a record $650K on fuel
Dry bulk shipments that travel through the Arctic will see record traffic this year, as shipping lines using the route reduce their journey times by half compared to shipments that traverse the Suez Canal.
Nordic Bulk Carriers plans to use the Northern Sea Route to carry about six to eight 70,000 metric-ton shipments of iron ore from Russia to China starting in July, company director Christian Bonfils told Bloomberg. He projected that using the Arctic route rather than the canal will save 1,000 tons of fuel, or $650,000. The Murmansk-to-China trip takes 23 days using the northern route, as opposed to 43 days for the Suez Canal, according to Bonfils.
Nordic Bulk Carriers, based in Denmark, will be the heaviest user of the route, since it has four ships that have the world's heaviest hull reinforcement, perfect for navigating icy waters.
Russia is promoting the Arctic trip as a lane to ship oil, natural gas and minerals to the Pacific Ocean from the northern Atlantic, according to Bloomberg.
Read more of the BusinessWeek story: www.businessweek.com
Rena salvage operation reaches stage two
Eight months after the Rena ran aground off the coast of New Zealand, 940 of containers have been removed. Now the second phase of the work will address removing the ship from the ocean, according to Maritime New Zealand.
Rena crashed into the Astrolabe Reef off the Tauranga coast on October 5. The ship's captain and navigator were charged under the Maritime Transportation Act with operating a vessel in a manner to cause danger for "discharging a contaminant and three charges under the Crimes Act for altering ship documents," according to the New Zealand publication, Stuff.
For more of the Stuff (New Zealand) story: www.stuff.co.nz