Monday, August 26, 2013
U.S. report: Record global consumption of petroleum in 2012
Global consumption of petroleum products, including gasoline, diesel fuel, jet fuel, and heating oil, reached a record high of 88.9 million barrels per day in 2012. Even though consumption fell in North America and Europe, it was replaced and exceeded by growth in Asia and other regions, according to a report by the U.S. Energy Information Administration.
Asia beat North America as the world's largest petroleum-consuming region in 2009. Between 2008 and 2012, Asia's petroleum use increased by 4.4 million barrels per day, the report said. China and India drove most of Asia's demand hike, growing 2.8 million and 800,000 barrels per day, respectively. If China's use of petroleum is forecast replace the U.S. as the world's biggest oil importer in fall 2013, according to the EIA.
North American petroleum use, dominated by the U.S., has dropped since 2005, and the fall accelerated during the economic crises in 2008 and 2009. While consumption increased in 2010 due to a recovering economy, in 2011 and 2012, higher oil prices and an advent of vehicles with increased fuel efficiency drove U.S. use down. Gasoline consumption dropped between 2010 and 2012 when the corporate fuel economy standards led to improved vehicle fuel economy.
Europe's use of petroleum has gone down each year since 2006, in part because of collective government policies that encouraged energy efficiency, but also due to Europe's overall weak economic performance.
Shanghai declared a free trade zone
The State Council approved a free-trade zone for Shanghai Thursday, according a statement posted on the website of the Ministry of Commerce. The free-trade zone will cover four bonded areas ranging from Waigaoqiao to the Pudong airport within a total area of 28.8 square kilometers, the statement said.
The State Council has submitted to the legislature a proposal to alter some laws and administrative approvals regarding foreign investment, according to the commerce ministry statement.
Shares of Shanghai Port, operator of the city's harbor, rose 10 percent midday Friday.
"Construction of the free-trade zone will lure foreign companies and boost the number of overseas travelers entering the city," Jiang Ya and Zhao Xueqin, analysts at Citic Securities Co., wrote in a report.
The move "adapts to the new global trade trend and is a significant measure to adopt the more active opening-up strategy," the website statement said. "The main task is to explore new ways and models for China's opening-up, accelerate the change of the government's role, promote the transformation of economic growth and optimize the structure of the economy."
For more of the Bloomberg story: bloomberg.com
Hours-of-service truck driver regs upheld in federal appeals court
In August, a federal appeals court in Washington D.C. upheld, with one exception, the new hours-of-service regulations that oversee truck drivers and how long they are permitted to drive without taking a break, according to a statement from the law offices of Brian Timothy Meyers.
The decision addresses the latest case in the continuing conflict between federal regulators and trucking companies over HOS rules. The new rules, announced by the U.S. DOT's Federal Motor Carrier Safety Administration, went into effect July 1.
The new HOS rules added several safety limitations with regards to trucking hours. The new rules implement a maximum average workweek for truckers of 70 hours, and, for truckers who reach the 70-hour weekly limit, allow them to return driving only after they rest for 34 consecutive hours, the statement said. The new rules prohibit truckers from driving longer than 8 hours unless they take at least a 30-minute break.
During the litigation recently before the federal appellate court in Washington, the American Trucking Associations argued that the new rules would add to the industry's costs without improving safety, maintaining that additional and longer break periods would reduce productivity by 3 percent, and cost the industry $18 billion annually, the statement said.
Ultimately, the court's decision upheld the rule changes stating that these "highly technical points" were best left up to the FMCSA, according to the statement. The only exception the court made was to eliminate the 30-minute break rule as it applied to short-haul drivers.
China's Guangxi port provides intermodal option for container lines
The Fangchenggang port, the biggest in China's Guangxi province, offers the new opportunity for container shipping lines to use intermodal rail to connect Fangchenggang and the factories in Kumming.
With the new sea-rail intermodal container service between the two cities, fertilizer manufactured at the factories can now be loaded into containers and taken straight to the port and on to ships.
Last year, Fangchenggang handled more than 100 million tons of cargo, mainly coal, iron ore and fertilizer, 11 per cent more than in 2011. In the first five months of 2013, containers handled in Guangxi rose 11.23 percent to 372,772 TEUs year-over-year.
CMA CGM said its major shipments from Guangxi were chemical products such as fertilizer, seafood and machinery, which originate from Yunnan, Guizhou, Hunan and Guangxi.
For the factories of land-locked Kunming, the Fangchenggang port provided entry to markets in Indonesia and other overseas markets.
The biggest port in Guangxi also benefits container lines as they are taking advantage of the Fangchenggang-Kunming link to offer services that have substantially cut transit costs.
"Hauling a container of fertiliser from Kunming to Fangchenggang used to cost $3,267 by road but it's just $1,306 through the sea-rail intermodal service," said one phosphate fertilizer exporter in Kunming.
Guangxi is the nearest Chinese gateway to Southeast Asia. Trade between China and Asean countries has grown 7.3 times to $400 billion over the past 10 years.
For more of the South China Morning Post story: scmp.com
At least 6 die in Mexico train derailment
At least six people died when a cargo train nicknamed "La Bestia," or "The Beast," derailed in southern Mexico on Sunday, according to state officials. It is known that many would-be migrants hitch rides on The Beast heading to the U.S. border.
Ambulances were unable to reach the accident scene in Huimanguillo in the remote southern state of Tabasco due to difficult terrain.
Officials said eight of the 12 cars overturned.
"This train carries a lot of (illegal) migrants from Central America," Cesar Burelo, emergency services director in Tabasco, said in an interview. "(Those six) were the visible dead. It could be that as the structure of the train is removed ... more bodies could appear."
"It's very likely that (surviving travellers) have left the scene," Burelo said.
Officials said 16 people were being treated in hospitals in nearby Choapas, Veracruz.
For more of the Reuters story: uk.reuters.com
Tuesday, August 27, 2013
Drewry: Top four terminal operators are PSA, Hutchison, APM and DP World
The four top terminal operators in the world are PSA International, Hutchison Ports, APM Terminals and DP World in terms of equity TEU and portfolio terms, according to the "Annual Review of Global Container Terminals Operators" report from Drewry Maritime Research.
The report says that DP World and APM Terminals are highly active in terms of acquisitions, divestments and developments. ICTSI and TIL are active in terms of portfolio expansion.
Drewry says carriers have been selling stakes in terminals to raise cash, but tend to retain majority control for the most part, seeing little change in their terminal portfolios, but not expanding either. Deals involving CMA CGM's Terminal Link and MSC/TIL have been the most significant.
Drewry says that several companies they do not yet term international terminal operators are growing fast, including China Merchants, Gulftainer, Bolloré and Yildirim.
"Within the global/international terminal operator club there are widely varying strategies and levels of activity," said report editor Neil Davidson. "Some operators are very active with their portfolios whilst others are seeing little change. More M&A activity is highly likely, especially in carrier owned portfolios. Plus, waiting in the wings, there are a number of aggressive new players, some of which will soon qualify as global/international operators."
According to Drewry, the top ten terminal operators based on throughput, are PSA International at 50.9 million TEUs, Hutchison Port Holdings at 44.8 million TEUs, APM Terminals at 33.7 million TEUs, DP World at 33.4 million TEUs, COSCO Group at 17 million TEUs, Terminal Investment Limited at 13.5 million TEUs, China Shipping Terminal Development at 8.6 million TEUs, Hanjin at 7.8 million TEUs, Evergreen at 7.5 million TEUs, and Eurogate at 6.5 million TEUs.
Cosco Pacific first-half profit triples on sale of container maker
Container terminal operator Cosco Pacific said its profits more than tripled in the first half of 2013 due to the sale of its stake in China International Marine Containers Group, the world's largest container manufacturer.
Net income increased to $560.3 million from January to June, compared to $179 million year-over-year, according to a company statement. Sales increased 7.6 percent to $395 million.
Cosco Pacific made $393.4 million from selling its part of the container group to parent company China Cosco Holdings. Discounting this gain, Cosco Pacific's profits in the first half of the year decreased 3.6 percent to $143.8 million.
The company's terminals, Cosco Pacific's terminals, largely located in China, handled 9.7 percent more containers in the first half.
For more of the Bloomberg story: bloomberg.com
Greenfleet port truckers go on 24-hour strike, demand right to unionize
Fifteen or more truckers who drive trucks at the Port of Los Angeles and Long Beach staged a 24-hour strike of employer Green Fleet Systems, alleging that company supervisors have been illegally dissuading them employees from joining a union.
Some Green Fleet drivers who have attempted to join Teamsters Local 848 claim that Green Fleet hired "union busters" to intimidate them from joining the union.
Green Fleet denied the accusation.
"What they're trying to do is divide and conquer trucking companies and make false accusations that the majority of drivers want union representation," said Alex Cherin, an attorney with Englander, Knabe and Allen, a Los Angeles law firm that represents Green Fleet.
The demonstration is part of a week of scheduled actions by unions representing workers in a variety of sectors, including fast food and logistics, according to the L.A. Times. It has been difficult for the Teamsters to unionize port truck drivers, since all but 10 percent are independent contractors.
A complaint filed with the National Labor Relations Board alleges that a Green Fleet supervisor asked an employee to sign an anti-union petition. A Green Fleet supervisor also pledged better pay and benefits if workers did not join the union, the complaint says.
"The few trucking companies with bona fide employees like Green Fleet Systems are routinely violating workers' legal right to form a union at their workplace," said Fred Potter, director of the International Brotherhood of Teamsters' port division. "Industry-wide change is needed."
For more of the L.A. Times story: latimes.com
FDA and CBP to start pilots to benefit importers
The FDA and U.S. Customs and Border Protection are poised to start pilot programs in September to aid importers who "have secured their supply chains and internal controls."
The FDA said it would begin accepting applications to participate in its Secure Supply Chain Pilot Program, which will run from February 2014 through February 2016. Through the SSCPP, the agency plans to prevent the importation of adulterated, misbranded, or unapproved drugs, expediting the entry of covered products. The FDA will pick no more than 100 participants, with no more than five drugs per applicant beginning September 16, 2013 through December 31, 2013.
Within the next month, CBP is expected to announce the start of a test pilot for its Trusted Trader Program, through which it hopes to manage both supply chain security and trade compliance. In March of this year, CBP announced the formation of a Trusted Trader subcommittee within its Advisory Committee on Commercial Relations, aiming to create a pilot program by September.
Traditionally, CBP trusted traders are those companies who are members in either its C-TPAT or ISA programs. C-TPAT is a voluntary supply chain security program while ISA is a joint government-business initiative focused on internal controls that strengthen compliance with CBP rules and regulations regarding classification, valuation, etc.
Through the pilot, CBP will offer improved incentives and benefits by consolidating its current C-TPAT program with its ISA program.
For more of the National Law Review story: natlawreview.com
Cargo ship rescues 109 people off coast of North Africa
The cargo ship Celia rescued 109 Libyan immigrants after discovering their boat in trouble in rough seas 30 nautical miles from the North coast of Africa.
Italy's coast guard said it had received a distress call over a satellite phone from the migrant vessel, when it alerted the 333-foot Celia, which was in the region.
For more of the Global Post story: globalpost.com
Wednesday, August 28, 2013
TSA lines recommend October GRI for U.S.-Asia route
Container lines in the Transpacific Stabilization Agreement are recommending a U.S.-Asia rate increase by October 1, citing a pressing need to reverse low rates for remainder of the year and the probability of a market upturn in the fourth quarter.
Member carriers in the TSA Westbound section announced the intention to raise freight rates from the U.S. by at least $100 per-FEU, by no later than October 1, 2013. Several TSA-Westbound lines have already announced individual increases, either across-the-board or in in key market sectors, that would go into effect in September.
"Rates have drifted down even more than usual during the typical summer slack period, to unsustainable levels," said TSA Westbound executive administrator Brian M. Conrad. "Not only are we headed into the busiest time of year for the trade, but we are also seeing signs in the market that U.S. exports to Asia are poised for recovery in coming months."
Conrad said the lines regard the $100 per-FEU GRI as a minimum, given current rate levels. "Anytime the lines undertake a GRI, they are mindful of the price sensitivity for many westbound cargoes and the need for an incremental approach in restoring rates," he said. "At the same time we need to be clear that the recommended GRI will not, by itself, raise rates to levels that make an adequate contribution to round trip revenue."
Conrad said trans-Pacific carriers will be looking at further opportunities for revenue recovery in late 2013 and early 2014.
The TSA is a research and discussion forum of major container shipping lines serving the trade from Asia to ports and inland points in the U.S.
State grain inspectors: Unsafe to cross picket lines at United Grain terminal
The Washington state Department of Agriculture has said that it will cease to provide grain inspections at the United Grain terminal at the Port of Vancouver, Wash., unless steps are taken to make it safer for its inspectors to cross picket lines.
The director of the state Department of Agriculture, Don Hover, wrote an Aug. 19 letter to the U.S. Department of Agriculture, writing that as the behavior of pickets from the International Longshore and Warehouse Union "escalates, more staff are feeling unsafe in crossing the picket lines and are opting not to do so."
This is the latest in the conflict between ILWU longshore workers and United Grain management, who have locked out the workers since February 27. United Grain, owned by Japanese firm Mitsui, justified the lockout due to sabotage by a member of the union negotiating team, which ILWU denied. No official charges were filed. ILWU alleged the lockout happened because the employers didn't want to "reach a fair agreement" with the union workers.
The possibility that state agricultural inspectors might stop their work at United Grain means that the 16 percent of total U.S. grain imports that go through the Port of Vancouver and on to global markets could stop moving altogether.
Pat McCormick, spokesman for the Pacific Northwest Grain Handlers Association, of which United Grain is a member, said that if the state declines to conduct inspections, the company expects federal inspectors to "provide the services required under federal law."
In an email to The Columbian, Jennifer Sargent, on behalf of the ILWU, said United Grain is "failing to take responsibility for its own provocative moves" that have led to increased tensions at the port and to an unsafe environment.
For more of The Columbian story: columbian.com
Port of L.A. starts process to revamp Yang Ming terminal facilities
The Port of Los Angeles is giving the green light to the environmental review of a project to deepen berths at the Yang Ming terminal to 53 feet in order to accommodate large post-Panamax ships with capacities of up to 14,000 TEUs, according to a port statement.
The environmental review, to begin this fall, is the first step in Yang Ming's plan to update its POLA facilities to increase cargo volume.
The Port of Los Angeles and Yang Ming have signed a term sheet agreement to pave the way for the terminal revamp, the statement said. The port will invest $122 million in improvements, including construction of a new 1,260-linear-foot wharf at Berths 126-129, dredging to a depth of -53 feet at the newly constructed wharf, and expansion of the West Basin Intermodal Container Transfer Facility, which is a partnership between Yang Ming, China Shipping and Ports America.
The agreement will extend Yang Ming's West Basin Container Terminal lease, which was scheduled to end in 2021, to 2030. This should provide the between $365 and $525 million in port revenue, depending on cargo volumes, the port said.
Insider: Hyundai Heavy to make $1.4B ship deal with United Arab Shipping
Hyundai Heavy Industries of South Korea is close to clinching a $1.4 billion order to build 10 container ships for the United Arab Shipping Company, according to an inside source, Reuters reports.
Under the deal, UASC will buy five of the largest cargo ships ever made, each with a capacity of 18,800 TEUs, plus five with a 14,500-TEU capacity.
The exact amount of the deal could change, the source said, since the contract hasn't yet been signed. Hyundai Heavy Industries, the world's largest ship builder, had no comment, and UASC was not available to confirm or deny the transaction.
For more of the Reuters story: reuters.com
Pre-Civil War shipwreck found off New Jersey coast
The wreck of the U.S. steamship Robert J. Walker was discovered off the coast of New Jersey, according to NOAA.
The Walker, which sank in a collision with a schooner more than 153 years ago, was built in 1847 as one of the first U.S. government iron-hulled, side-wheel steamers.
It was hit by a commercial schooner on June 21, 1860, and sank within 30 minutes, killing 20 crewmembers out of a total of 66.
For more of the Strait Times story: straitstimes.com
Thursday, August 29, 2013
CMA CGM second quarter profits up by nearly 60 percent
CMA CGM reported a second quarter profit that reflects an almost 60 percent year-over-year increase.
The line posted a net profit of $268 million in the second quarter, with most of it stemming from the sale a 49 percent stake in container arm Terminal Link to China Merchant Holdings International. The company reported a profit of $169 million in second-quarter 2012.
CMA CGM has made progress in restructuring its considerable debt, reducing it from a reported $4.6 billion at the year’s start to $3.8 billion as of June 30, a decrease of $385 million since the end of the first quarter.
In the second quarter, CMA CGM reported consolidated revenue of $4 billion, up 5.6 percent from the first quarter and down 2.4 percent compared to the second quarter of 2012.
The year-over-year decline was attributed to an 8.6 percent drop in freight rates over the period, the statement said. The line reported a 6.9 percent increase in volumes carried in the second quarter, at 2.9 million TEUs.
The container line said it expects a 2013 profit in line with 2012 results.
CMA CGM allied itself with Maersk Line and Mediterranean Shipping Company this year to create the P3 Network, an operational alliance on East-West trades, which is expected to come into effect in the second quarter 2014.
Judge orders ILWU to stop disrupting Port of Portland over reefer jobs
William Schmidt, a federal administrative law judge, has issued a strong decision ordering longshore union officials to stop disrupting operations at the Port of Portland’s container terminal and to stop seeking jurisdiction over jobs that don’t belong to them.
Schmidt’s 52-page decision sides with the port and terminal operator ICTSI, saying that union electricians with the International Brotherhood of Electrical workers –- not longshore workers with the International Longshore and Warehouse Union -– are entitled to plug, unplug and monitor refrigerated containers known as reefers.
The National Labor Relations Board judge found that dockworkers were responsible for enacting unfair labor practices and during one 10-day period “orchestrated a systematic sabotage” of terminal operator ICTSI Oregon Inc.’s operations at Terminal 6.
Schmidt issued a recommended order directing the ILWU and its locals to halt slowdowns and work stoppages and to quit threatening to shut down ICTSI. The judge also told the ILWU to stop filing grievances and lawsuits against ICTSI and shipping companies.
A union spokeswoman said late Wednesday she was unaware of the decision and they would review before issuing a statement.
For more of The Oregonian story: oregonlive.com
China considers removing capacity limits to let VLCCs into ports
China seems to be paving the way for some of its ports to receive mega ships, which may allow the massive carriers of mining giant Vale to call.
China’s shipowners have opposed Vale’s access, worrying that it would worsen overcapacity and lower their market share.
If Valemax carriers are allowed in China, the company could better compete, as it could cut transport costs by a third. And using the big ships would cut shipping costs for China’s steel mills.
In 2012, China's Ministry of Transport banned the huge ships from its ports, citing safety concerns after the first 400,000-deadweight-ton Valemax docked at Dalian Port in December, 2011.
The ministry said ships that call at China’s ports could not exceed the port’s minimum capacity, indicating that big ports could handle a maximum of 300,000 tons of iron ore cargo. Thus, Valemaxes have not been allowed into Chinese ports.
But China has been upgrading port infrastructure and their true capacity is larger than their approved capacity. And the demand for oil and dry bulk goods has been strong.
In a recent draft document on their website, the transport ministry said “ports may be allowed to receive ships based on the inherent capacity of their infrastructure, pending regulatory approvals.”
For more of the Reuters story: uk.reuters.com
Port Metro Vancouver breaks cargo records in first half
Port Metro Vancouver is has shipped record amounts of coal through its terminals in the first half of 2013.
Boat carrying 100 refugees sinks off Christmas Island
A boat with approximately 100 asylum seekers sank in the Indian Ocean last week and rescue teams were deployed, the Australian Maritime Safety Authority said in a statement.
The boat sank about 140 miles north of Christmas Island, where Australia runs a detention camp for asylum seekers.
For more of the Times of India story: articles.timesofindia.indiatimes.com