Cargo Business Newswire Archives
Summary for August 5 through August 9:

Monday, August 5, 2013

Top Story

U.S. Senate Republicans block $54B transportation bill

Senate Republicans blocked a $54 billion transportation and housing bill Thursday afternoon right before leaving for a month-long recess.

The Senate voted 54-43, six votes short of the 60 needed to invoke cloture on the Transportation, Housing and Urban Development Appropriations Bill, which provides funding for housing and transportation agencies.

Sen. Susan Collins, R-Maine, was the lone Republican who voted in favor of moving forward with the bill and urged her colleagues to follow suit. "Think very carefully bout this vote," Collins said. "It would be so unfortunate if we go home to our constituents in August and are forced to tell them that we're unable to do our job."

The failed vote was a victory for Republicans and Senate Minority Leader Mitch McConnell, R-Ky., who had stepped up his opposition to the bill in recent days.

"The vote we just had was, symbolically, very, very significant," McConnell said after the vote. "There is no question that if cloture had been invoked on this particular appropriations bill, which was even more than what the president asked for, your storyline tomorrow would have been Congress, on a bipartisan basis, walks away from the Budget Control Act."

Republicans said they opposed the appropriations bill because it exceeded the spending levels set by the Budget Control Act of 2011.

Continuing sequestration will force cuts to all government programs, including transportation. While highway programs are generally exempt from sequestration, there will be growing pressure on lawmakers to change that, said James Burnley, who was secretary of transportation under President Ronald Reagan.

A Congressional Budget Office official testified July 23 that the Highway Trust Fund, which pays for road and transit projects, will go bankrupt in fiscal 2015 unless Congress deeply cuts spending or raises the federal gasoline tax by 10 cents a gallon.

"I can't understand why Republican leadership over here would twist arms to derail a bipartisan bill that creates jobs all over America," Senate Majority Leader Harry Reid, D-Nev., said after the vote.

For more of the Bloomberg story:

U.S. Manufacturing Index surges

Manufacturing in July expanded at the fastest pace in more than two years, triggered by increases in orders and production that signal companies are growing more optimistic about the country's economy.

The Institute for Supply Management's factory index surged to 55.4, from 50.9 in the prior month, besting the highest projection in a Bloomberg survey of analysts. Readings above 50 indicate expansion.

A separate report showed first-time claims for unemployment dropped to the lowest rate in five years.

Strength in U.S. manufacturing, which accounts for about 12 percent of the world's largest economy, highlights the Federal Reserve's opinion that the expansion will grow as the effect of federal budget cuts lessens.

"The Fed has been looking for an acceleration in second-half growth, and this is probably the first real sign that that's going to happen," said Michael Feroli, a former Fed staff member who is now chief U.S. economist for JPMorgan Chase. "It probably gives them some comfort that their forecast may be shaping up."

The Standard & Poor's 500 Index climbed 1.3 percent to 1,706.87 at the close of trading in New York, topping 1,700 for the first time.

The 4.5-point jump in the ISM gauge from June was the largest since June 1996. The median forecast of 84 economists surveyed by Bloomberg called for the index to climb to 52.

For more of the Bloomberg story:

Computer problems in at NJ port benefits Port of Virginia

The Port of Virginia is getting a cargo surge at the expense of a Maher container terminal in New Jersey, which is grappling with a new software system.

An official at Virginia International Terminals, the state-formed terminal management company, and a local trucking company executive said both rail and truck traffic are increasing directly due to Maher Terminal's delays because of the computer system glitches.

"The trucking community has absolutely seen an increase in diversion freight from the Northeast," said Ed O'Callaghan, who leads the Tidewater Motor Truck Association.

Maher Terminals, the largest container terminal at the Port of New York and New Jersey, has had problems with a new terminal operating software system designed by Navis and installed in early June. The companies predicted a "return to …exceptional service levels," but in the meantime, shipping companies are looking elsewhere, and especially at Hampton Roads, to reroute their goods and get them moving.

Hapag-Lloyd, a German steamship line, urged its rail and local cargo customers on July 26 to seek out alternative ports, noting that the Navis problem was compounded by a dearth of longshoremen at the piers because of "summer vacations" and a "shortage of trucking power."

For more of the Daily Press story:

Emergency U.S. rail rules implemented after Quebec oil train tragedy

U.S. train regulators imposed emergency rules to kepp parked trains from breaking loose, reacing to last month's derailment in Quebec that killed dozens of people and put rail safety in question.

The Federal Railroad Administration orders stops operators from leaving trains carrying hazardous materials unattended without advance authorization and requires employees to tell dispatchers the number of hand brakes used. It also requires that workers responsible for securing trains participate in daily job briefings.

"While we wait for the full investigation to conclude, the department is taking steps today to help prevent a similar incident from occurring," U.S. Transportation Secretary Anthony Foxx said in a statement announcing the order.

Regulators said they were responding to the July 6 accident in which a 72-car train loaded with crude oil rolled from a stop into the town of Lac-Megantic, causing the worst rail disaster in Canada in a century. Forty-seven people died in the resulting explosion, and 40 buildings were leveled.

For more of the Business Week story:

Malaysian officials: 36 Indonesians still missing after boat capsized

Malaysian rescuers found a fourth body at sea Monday as authorities said they may soon end the search for 36 other Indonesians missing after their boat sank on the way home to celebrate Eid al-Fitr.

The wooden boat was believed to be smuggling 44 people including women and children from Malaysia's southern state of Johor to Indonesia's Batam Island. It sank in rough seas late Thursday and four men were rescued the following day.

"The body was found by a fishing vessel, and MMEA has recovered it. Chances of finding any survivors now are very slim," said Asharudin Che Ami, an official with the Malaysian Maritime Enforcement Agency.

The boat capsized in high waves about 13 nautical miles off the coast with maritime authorities saying it was "not seaworthy".

For more of the Channel News Asia story:


Tuesday, August 6, 2013

Top Story

Report: Domestic container volume up 9 percent

Domestic container volume in the second quarter of 2013 showed 9 percent year-over-year gains, largely because of a strong big box segment, according to the Intermodal Association of North America's "Intermodal Market Trends & Statistics" quarterly publication. Total intermodal traffic rose by 2.4 percent for the quarter.

International volume fell 1.3 percent in Q2 after 3 percent gains reported in Q1. The decrease was due to unexpectedly weak shipments in June, with loads falling 6 percent since 2012.

"Domestic container volume was the core of intermodal growth in both the second quarter and year to date figures," said Joni Casey, President and CEO of IANA. "Despite some segments slowing in Q2, the 'Market Trends and Statistics' data confirm the industry's underlying momentum."

Intermodal trailer volumes fell 2.5 percent compared to Q2 2012. Intermodal marketing company volume slowed and intermodal loads ended up gaining only 1.1 percent, as opposed to 2.2 percent in Q1. However, while weaker imports and related transloads may have contributed to the second quarter performance, stronger gains in highway volume helped mitigate the slowed intermodal business growth.

The Southeast region was the clear leader in the second quarter of 2013, according to IANA's Market Trends data, with intermodal increasing 8.1 percent compared to 2012.

Regional traffic in the Southeast U.S. grew 8.1 percent compared to Q2 2012, with domestic container volume up 12.4 percent, besting the industry average of 9 percent growth. Southeast international intermodal posted a 6.7 percent gain compared to a 1.3 percent drop nationwide.

Gridlock relieved at NJ Maher Terminals after computer system altered

Cargo bottlenecks are easing at the Port of New York and New Jersey as Maher Terminals scales back a new Navis computer terminal system blamed for significant freight shipment delays.

Service at Maher's facility in Elizabeth has "returned to acceptable levels," according to a statement from Maher and Navis, the technology company responsible for the cargo-handling system. Some of the automated components of the system that are not being currently implemented will be added at a later date, according to the companies.

Maher, which handles a third of the port's volume, launched the system in June to increase efficiency. As a result, the computers often shut down, forcing the terminal to close for hours at a time, according to Jeff Bader, president of the Association of Bi-State Motor Carriers trade group.

"The worst days were in the early part of June when they turned the system over," said Bader, who is also chief executive officer of Golden Carriers Inc. in New York. "The truck lines were four to six hours on a good day and the drivers just waited in line. It was a nightmare. It was a horror show."

A day earlier, National Retail Federation CEO Matthew Shay urged the Port Authority of New York and New Jersey and the New York Shipping Association to work with terminal operators to resolve the congestion.

Maher shifted capactiy from its Elizabeth terminal to the other five terminals at the port while it tried to resolve computer issues, said John Nardi, president of the shipping association, which represents terminal operators including Maher.

While Maher's operations are improving, the other terminals are still struggling with road congestion and cargo backlogs, Nardi said.

"When Maher sneezes, the port catches a cold," Nardi said. "When they have a problem it tends to impact everybody because of their size."

For more of the story:

Sri Lanka opens $500M container terminal built and run by China

Sri Lanka, an island country in the North Indian Ocean off the southern coast of India, opened the $500 million Colombo International Container Terminal, which will be able to accommodate the largest post-Panamax vessels.

China Merchants Holdings International built and will operate the terminal, estimated to handle a capacity of 2.4 million TEUs a year and increase Colombo's capacity by almost half, according to the Sri Lanka Ports Authority. President Mahinda Rajapaksa inaugurated the facility.

Sri Lanka's long-term strategy is to add 7.2 million TEUs of capacity and deeper berths at its main port to attract larger vessels. China has committed at least $3.7 billion since 2005 to help expand ports to power trade.

"Sri Lanka has been looking toward China because of the availability of funding," said Dushni Weerakoon, deputy director at the Institute of Policy Studies in Colombo. "With Sri Lanka's plans to create a hub concept, expansion of the Colombo port makes good economic sense."

The Ports Authority is also building another container terminal with an annual capacity to handle 2.4 million TEUs at the Colombo port, slotted to be operational early next year, Chairman Priyath Wickrama said. Colombo's three other terminals have the capacity to handle 5 million TEUs.

China Development Bank provided a $350 million loan to China Merchants in May 2012 for the company's terminal, in which the port operator holds an 85 percent stake. The state-run Sri Lanka Ports Authority owns 15 percent. China Merchants Holdings will operate CICT for 35 years and the state-run Sri Lanka Ports Authority (SLPA) will step in afterwards.

The investment will help China secure another maritime supply route, building on a string of major investments over the past 18 months, according to Bloomberg. In January, China signed an agreement to buy the Pakistani port of Gwadar. Beijing is also developing a $14 million "dry port" in the Nepalese city of Larcha, near Tibet, and has funded the development of a $450 million deep-sea port at the southern Sri Lankan city of Hambantota, which opened in June last year.

Sri Lanka's port developments have helped attract $2 billion worth related private investments, Wickrama said.

For more of the Bloomberg story:

For more of the International Business Times story:

PortMiami added to Maersk's Transpacific 7 service

The first call for the TP7 Service began at PortMiami with the arrival of the Maersk Kristina, a 6,700-TEU container ship, according to a port press release. The service's lineup will include additional 8,700-TEU cargo vessels. The South Florida Container Terminal Miami will handle the new service at the PortMiami cargo yard.

"The arrival of Maersk's TP7 Service underscores the importance of PortMiami's $2 billion investment in infrastructure improvement projects," said PortMiami Director Bill Johnson. "The deepening of our channel, along with new on-dock rail and the completion of the port tunnel are all critical for the new generation of larger container vessels.

The new weekly TP7 Service at PortMiami offers faster transit times from Southeast Asia to the East Coast of the United States, according to a port statement. PortMiami will be the only direct service to Yantian, China, and Kaohsiung, Taiwan in the market.

Westbound rotation includes: Savannah- Charleston-Miami-Tangier-Valencia-Suez Canal-Jeddah-Kaohsiung-Ningbo-Shanghai- Yantian Hong Kong.

Eastbound rotation includes: Kaohsiung- Ningbo-Shanghai-Yantian-Hong Kong- Tanjung Pelepas-Suez Canal-Tangier- Savannah-Charleston-Miami.

U.S. wins chicken trade dispute with China

The U.S. won a longstanding trade dispute with China on Friday when the World Trade Organization found Beijing had broken international rules by imposing anti-dumping duties on U.S. chicken broiler parts.

The U.S. complaint was regarded as one of a string of tit-for-tat disputes between the countries, and followed a U.S. ban on imports of Chinese cooked chicken.

The ruling, which cited damage done to exporters like Pilgrim's Pride, Tyson Foods and Keystone Foods, may help boost the trade of U.S. poultry exporters.

An official with the U.S. Trade Representative's office estimated that the United States has lost about $1 billion in broiler product sales since the duties were imposed by China in 2010.

For more of the Reuters story:

Coast Guard rescues two burned crew from cargo ship near Columbia River

A Coast Guard helicopter lifted two burned crewmembers from a cargo ship about 15 miles southwest of the mouth of the Columbia River.

The operator of the bulk cargo vessel Alexandros Theo called for help Monday morning. The Coast Guard sent a helicopter crew from Astoria, Oregon, and a boat from Ilwaco, Washington.

The two men were hoisted aboard the helicopter and flown to medics at the Coast Guard's Astoria air station.

The men did not suffer life-threatening injuries, according to Coast Guard spokesman Zac Crawford.

For more of the The Republic story:


Wednesday, August 7, 2013

Top Story

GM plans to cut $1B in logistics and materials costs by 2016

General Motors announced its intention to reduce material and logistics costs in North America by $1 billion by 2016. The company aims to up its North America profit margin by 1 percentage point, said GM North America Chief Financial Officer Chuck Stevens at a recent investor's conference.

GM will approach cost reduction on several fronts. The company is working with suppliers to bring parts plants closer to GM assembly plants. Rail lines will be extended directly to the plants, stamping plants will be added to assembly factories that don't currently have them.

"The challenge is how do you do logistics efficiently and frankly minimize cost, because that cost you save there can be, you can put into reinvesting in the product, you can put into strengthening our fortress balance sheet," said Grace Lieblein, vice president of GM global purchasing and supply chain.

All automakers are reevaluating logistics costs, said Michael Robinet, managing director of IHS Automotive Consulting in Northville, in a telephone interview.

"Logistics is definitely rising in focus at virtually every manufacturer," he said.

For more of The Detroit News story:

Seattle port commissioners vote to contribute to tunnel project

Seattle port commissioners voted this week to contribute funding to replace the crumbling Alaskan Way Viaduct. The port will fund $ $267.7 million of the $3.1 billion project.

The funding deal between the state and the port fulfills a 2010 memorandum of agreement between the two entities. The Port of Seattle will sell two sets of 25-year bonds in order to make two large contributions toward the tunnel project, one in May of 2015 and one in May of 2016. The highway will be largely paid for by state gas taxes and tolls.

"We're grateful to have such a strong partnership with the Port of Seattle," said Washington State Transportation Secretary Lynn Peterson. "The Port's contribution is essential to our shared effort to build a new SR 99 corridor that keeps freight – and Washington's economy – moving."

The Port will reap some benefits from the deal, including an overhead ramp along Highway 99 that should be completed year's end, giving trucks a route to Terminals 30 and 46 that will bypass train tracks and rail congestion. The project will also give trucks a surface route along the waterfront to Interbay and Ballard, replacing the existing viaduct exit.

"If Washington State is going to keep family wage jobs, we've got to keep freight and goods moving through our region," said Port Commissioner Bill Bryant. "That's why the port helped pay for underpasses and overpasses in the Kent-Auburn valley, and why the Port of Seattle is fulfilling its commitment to help pay for a reconfigured SR 99 and tunnel."

Tunnel-boring machine "Bertha" began its journey last week in Sodo, heading toward South Lake Union.

Metro Ports Canada to run terminal at Port of Prince Rupert

Metro Ports Canada, owned by Nautilus International Holding Corporation of Wilmington, Calif., has made a deal with Pinnacle Renewable Energy to operate its Westview Terminal at the Port of Prince Rupert in British Columbia, according to a company statement.

The Westview Terminal provides wood pellet railcar receiving, storage and ship loading services, and can dock Panamax class vessels up to 75,000 deadweight tons. The terminal includes a private rail siding, high-speed railcar unloading system and high-capacity shiploader.

"Metro Ports Canada is most pleased to bring its services to the west coast of Canada," said James Callahan, president and CEO of Nautilus International Holding Corp.

Pinnacle Renewable Energy is the largest producer of wood pellets in the world and the largest exporter of pellets to Europe and Asia from Canada.

Cosco Pacific wants stake in Qingdao Port

Container giant Cosco Pacific wants a stake in Qingdao Port, the mainland's biggest port for crude oil and iron-ore imports, before the port operator goes public in Hong Kong next year.

Cosco Pacific already has two terminals at the port, and has announced its intentions to be the group's promoting shareholder before its listing.

"We heard through informal channels that the company's going to be listed in Hong Kong," said Alex Chen Bin, general manager of investor relations at Cosco Pacific. "We are now in discussions, but nothing can be announced yet."

Qingdao Port was reported two months ago to be planning an initial public offering of up to $300 million, but the amount is said to have risen to $500 million since then.

China Merchants Holdings also wants to invest in the port at Qingdao, according to a statement made by executive vice-chairman Li Jianhong in June.

"Qingdao Port has a wide variety of cargo-handling capabilities, including iron ore, coal, fertilizers and paper," said a high level China Merchants manager, who asked not to be named. "For terminals handling bulk cargo, a comprehensive logistics system with seamless connectivity is particularly important."

For more of the South China Morning Post story:

Four dead after fishing boat accident off French Polynesia

At least four people are dead and four are missing after the Zun Yang 26, a Chinese fishing vessel, was about to sink in rough seas about 50 kilometers off Rapa in the south of French Polynesia.

The French high commission says a rescue aircraft was sent to the ship, and dropped floats meant to be accessed from the sinking ship. However, nine of the 14 crew jumped into the ocean, and only one was saved.

The remaining five sailors were lifted off the ship and taken to Rapa.

For more of the Radio New Zealand International story:


Thursday, August 8, 2013

Top Story

Maersk Line foresees improved results in 2013

Maersk foresees better profits in 2013 due to an increase in rates and trade, according to Tim Smith, head of the line's North Asia division.

Maersk Line, which moves 15 percent of the world's maritime containers, rebounded to a profit in the third quarter after four consecutive quarters of loss. The boost is attributed to higher shipping rates.

"We hope to be able to build on this momentum and deliver overall returns which provide an acceptable return on the capital we invest," Tim Smith said in a Reuters telephone interview. "In this regard, we believe 2013 provides some potential to deliver a better result than 2012, although market conditions remain challenging."

Maersk Line decreased Asia-Europe capacity further in the fourth quarter, reducing its total 2012 capacity by 21 percent on its Asia-Europe before reinstituting some of those sailings in December. "We are moving up and down on a great roller-coaster the whole time," Smith said.

Smith predicts Asia-Europe container volume could rise 4-5 percent in 2013 compared with an estimated increase of 5-6 percent in Asia-U.S. trade. That would be a substantial boost compared to last year's estimated flat volume growth in Asia-Europe and a 2.9 percent rise in Asia-U.S. trade, according to shipbroker Clarkson.

Transpacific demand will depend on the outcome of U.S. budget talks. "It seems like they got past the immediate deadline but there is still quite a lot of work the government needs to do to get the economy sorted out," said Smith, "hopefully not to dampen demand too much."

For more of the Reuters story:

Wilhelm Wilhelmsen second quarter profit up 25 percent

Shares of vehicle transport giant Wilhelm Wilhelmsen rose in Oslo as a recovery in car sales in North America and Europe improved the company's earnings prospects.

The shipping company posted second-quarter net income of $92 million, up 25 percent from $70 million a year ago, and better than the $57 million average of eleven analyst estimates compiled by Bloomberg.

The company is benefitting from higher demand for autos and other vehicles as the global economy rallies. Wilhelmsen reported second-quarter earnings Thursday that bested estimates, due to increased car sales and increased demand for construction, mining and agricultural vehicles.

Shares in the company, which operates about a quarter of the global car carrier fleet, gained up to 3.1 percent to $8.90, the biggest intraday advance since July 11. Almost 38,000 Wilhelmsen shares have been traded so far today, more than 85 percent of the average daily volume during the last three months.

"The volume decline recorded in the latter half of 2012 and beginning of 2013 has leveled off with positive development for both cargo segments," Wilhelmsen said in a statement, adding that it "anticipates that volumes shipped by the group's fleet will remain at present level."

For more of the Bloomberg story:

Nippon Yusen diversifies into oil and gas development

Nippon Yusen K.K., Japan's biggest shipping line, said development of deep-sea Brazilian oil and Australian gas will increase the demand for drill-ships and shuttle-tankers, projecting that its energy division will report its first annual profit.

The shipping line's energy arm will post an operating profit of approximately $52 million in the year starting April 2015 after turning a profit this fiscal year, according to Hitoshi Nagasawa, energy division head, who did not provide a specific profit figure for this year.

The company, expanding into oil and gas development, has invested in a drill ship, production vessels and crude tankers to drive growth. Demand for oil services has grown as energy companies explore in more remote areas.

Nippon Yusen predicts operating profit from the energy unit will rise to $104 million by fiscal 2020, said Nagasawa.

"Shipping is a volatile market," Nagasawa said. "We're targeting a more stable income portfolio. We want to move closer upstream in the energy market."

For more of the Bloomberg story:

ILWU sues Port of Portland for public records charges

The International Longshore and Warehouse Union has filed a lawsuit against the Port of Portland, saying that when the port charged the union $200,000 in records charges, it was violating the Oregon Public Records Act.

ILWU made requests for public records in June, September and December 2012, and the lawsuit says it was charged "arbitrary and excessive" fees to find the records and was told more fees would be assessed for lawyers to review and segregate the records before release, according to a union statement.

The lawsuit—the latest volley in a contentious labor battle between the ILWU and and grain terminal owners in the Pacific Northwest—was filed on July 25 in Multnomah County circuit court.

ILWU wants the port to waive or reduce the fees and release the requested information.

The Port of Portland said it did not deny access to records and that the high fees were because of the broad scope of the information requests, which will take hundreds of hours to compile.

For more of the Reuters story:

Hong Kong seizes $5.3M in illegal animal goods from Nigerian tanker

Hong Kong customs officials this week seized more than 1,100 ivory tusks, 13 rhino horns and five leopard pelts. Discovered in a container shipped from Nigeria, the illegal goods are estimated to be worth $5.3 million.

Customs officials detained "two suspicious containers" for inspection, according to a Hong Kong press release. Authorities found the animal products "inside 21 sealed wooden crates at the rear of one of the containers."

Authorities have not made any arrests in this case so far.

For more of the CNN story:

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