Cargo Business Newswire Archives
Summary for September 2 through September 6:

Tuesday, September 3, 2013

Top Story

Drewry report: Hong Kong strike impedes Q2 container carrier performance

Ship-level and container-level reliability indicators dropped in the second quarter, according to a report from Drewry Maritime Research.

The quarterly report, "Carrier Performance Insight," found that even though East-West trade dependability has improved, the average on-time performance of container vessels on covered trade routes went down to 70.5 percent in the second quarter, from 72.8% in quarter one.

The average on-time performance has fallen for two straight quarters, the report said. It was foreseen that Asia-linked routes would have trouble adhering to schedules because of delays caused by the 40-day strike at the port of Hong Kong in April and May. 

"While Asia-Europe and trans-Pacific services would theoretically also have been affected by the strike, as our ship reliability results prove, it did not impair reliability in those trades at all," said Simon Heaney, research manager at Drewry.

Heaney said one reason for the difference in statistical impact had to do with the report's methodology, which used Hong Kong as the base port to capture ship arrival data for regional Asia services, while the impact on Europe and U.S.-linked routes were calculated using other ports.
"Another reason is operational," Heaney said. "In many cases carriers simply diverted scheduled calls at Hong Kong to nearby ports, which would have limited any potential knock-on delays."

Yang Ming was deemed the most reliable major carrier (defined as having a minimum of 100 voyage counts and 40 ship operated voyages per quarter) with an all-trades on-time average of 83.7 percent in the fourth quarter, according to the Drewry report.

Global Ports to buy Russian terminal operator for $1.5B

Container terminal operator Global Ports, owned by A.P. Moller-Maersk and a group of Russian billionaires, has announced a deal to buy Russia's second-largest port operator, National Container Company.

Global Ports will become the largest container terminal operator in Eastern Europe after the buy. The terminal operator will pay approximately $1.56 billion for NCC, comprised of $291 million in cash, an 18 percent share in the company worth $360 million and the assumption of NCC's debt, according to Russian business daily Vedomosti.

The agreement will give Global Ports control over ports in the St. Petersburg region and the option to buy a 50-percent stake in the Ukrainian port of Illichevsk for $60 million.

The acquisitions raise the company's total cargo throughput to 2.5 million tons and additional capacity of 1 million tons, according to Reuters.

For more of the Moscow Times story:

Cosco container vessel comes under fire at Suez Canal

The risk for container carriers traversing the Suez Canal during Egypt's current political upheaval was heightened Saturday after a Panamanian-flagged container ship, the COSCO Asia, came under fire in a northern sector of the canal.

The attack was foiled and the ship was undamaged, according to a BBC report.

Three people were arrested after opening fire with machine guns on the Chinese-owned container vessel as it passed through the canal, according to an army source.
The head of the Suez Canal Authority, Mohab Memish, had earlier referred to the incident as a terrorist attack.

Egypt is currently under a state of emergency after an army coup deposed the country's first elected president, Mohamed Mursi, two months ago, reacting to massive street protests against him.

"The transit of vessels through Suez has long been of concern to many. The proximity to land throughout much of the transit makes it an attractive target," said David Welch, of bomb disposal and counter-terrorism specialists Ramora UK.

"I would suggest that an attack on any primary sea line of communication or critical port would be high on the agenda of many terrorist groups. Imagine the chaos if they managed to disable or sink a large vessel across the canal."

"We do not have information on the existence of an organization that is targeting the movement of ships in the Suez Canal," an Egyptian source said. "The available information confirms that some elements ... were aiming to target the Suez canal as it is a vital and international facility and any incident there would have a large impact internationally."

A Maersk spokesman said the shipping giant would not alter its activities in Suez, "while we keep monitoring the situation and pay close attention to any updates or recommendations from local authorities."

For more of the Reuters story:

For more of the BBC story:

DP World reports first-half profits increase of 9.1 percent

Port operator giant DP World reported a 9.1 hike in profit in the first-half, better than predicted, on liquidating assets and expanding Hong Kong markets.

Net income increased to $264 million, or 31.8 cents a share, from $242 million, better than the mean estimate of $229 million forecast by three analysts polled by Bloomberg. Revenue dropped 1.3 percent to $1.51 billion year-over-year.

Asset sales in Australia, Europe and the Middle East yielded $249 million for the company.

"We have a strong balance sheet which provides us with the flexibility to support growth in our existing business, and expand capacity in line with market demand," CEO Mohammed Sharaf said in the statement. "Moreover, we have the financial resources to add to our portfolio should favorable assets at attractive prices become available."

DP World invested $544 million across its portfolio in 2013, striving to increase its global capacity to approximately 85 million TEUs in 2015.

For more of the Bloomberg story:

Maersk Kampala still fighting fire near Suez Canal

The Maersk Kampala, located south of the Suez Canal, continues to fight a fire that began in one container in the front cargo bay of the ship on Wednesday, August 28th as it was heading to the Suez Canal.

Crewmembers are safe and no one has been injured.

The fire reportedly started last Wednesday in the bottom container and a second container caught fire. Since the fire department tugs were unable to get close enough to the ship due to adverse weather conditions, the fire consequently spread to other containers, although it remains contained in the two foremost cargo bays of the ship.

The weather improved enough for fire fighting tugs to reach the vessel, soaking it Saturday and Sunday and reducing the fire to six containers. Fire department personnel were able to board and on Monday were able to access the containers that were still on fire and flood them with water.

For more of the MM&D story:


Wednesday, September 4, 2013

Top Story

Drewry report: Hong Kong strike impedes Q2 container carrier performance

The Institute of Supply Management index of factory activity rose to 55.7 in July, beating the average analyst forecast of 54 and hitting the highest level since June 2011. The reading indicates potential gains in the U.S. economy.

"This was an unambiguously positive report, signaling a further acceleration in manufacturing momentum in August," said Millan Mulraine, director of U.S. research and strategy at TD Securities in New York.

The new orders sub-index rose to 63.2 from 58.3, while employment dropped from 53.3 to 54.4.

The Commerce Department said U.S. construction spending increased by 0.6 percent to an annual rate of $901 billion, above the median prediction of a Reuters' survey of analysts.

Factory data for China and Europe also reflected higher PMIs for July, indicating a period of more robust global growth.

For more of the Reuters story:

ZIM announces weekly shipping service out of New Orleans

ZIM Integrated Shipping Services has announced a weekly shipping service out of the Port of New Orleans to the Caribbean and Mexico.

The Israeli shipping firm's Caribbean Gulf Service will run to Caucedo in the Dominican Republic, Altamira and Vera Cruz in Mexico and Kingston, Jamaica.

The CGS, operating from the port's Napoleon Avenue Container Terminal, will use five container ships. The service will connect to the company's Asian and other global trade routes through its Jamaican hub.

"This service will enhance options for shippers and importers not only for Central America and the Caribbean markets, but via ZIM's global network," said Gary LaGrange, port president and chief executive officer, in the statement. "ZIM's service now increases the port's competitive transit times to Asia and the rest of the world."

For more of The Times-Picayune story:

Port of Long Beach temporary headquarters behind schedule and over budget

Delays and increasing costs have plagued construction of the temporary Eastside headquarters of the Port of Long Beach, prompting the Long Beach harbor commission to change plans and contracts related to the building project.

The project, currently budgeted at $30.8 million, is $6.5 million higher than the original plan.

"It's overbudgeted and behind schedule," Commissioner Rich Dines said of the issues related to work on the eight-story office building at 4801 Airport Plaza Drive.

The Board of Harbor Commissioners voted Tuesday to suspend its contract with architectural firm Gensler until their work is evaluated and agreed to install a top city official to be project manager.

Del Davis, bureau manager of the city's Public Works Department's Public Service Bureau, will report back to the board in two weeks with a plan of action for the office building.

"We also were told we would be in the building in September; it is now September," Commissioner Doug Drummond said.

The plan was to move the 350 employees into the new building by the end of the year and port officials would search for a new permanent location downtown, but unexpected costs have pushed the move deep into 2014. The headquarters at the port has asbestos abatement and earthquake retrofits pending, which prompted the board to start work on this new, temporary building for port staff.

Upgrades and repairs to elevators and bringing restrooms into Americans with Disabilities Act code were responsible for over half of the project's budget increases, according to the Port Interim Headquarters Building Report.

For more of the Press Telegram stories: presstelegram.com1 and presstelegram.com2

The Virginia Port Authority's port of Hampton Roads set a record in July for the number of TEUs handled in a single month, according to a VPA statement.

Hampton Roads moved 205,137 TEUs, a 13.7 percent increase year-over-year, breaking the previously set single month record of 199,448 TEUS in October 2007.

"This is the first time in our history that we have eclipsed 200,000 TEUs in a single month," said Rodney W. Oliver, interim executive director of the VPA.

For the first seven months of the calendar year, container volume was up 7.2 percent from the same period a year ago.
Break-bulk tonnage increased in July to 37,584 tons, a 54.2 percent year on year increase.

For more of the Virginia-Pilot story:

Coast Guard helps to deliver baby on cargo ship

The U.S. Coast Guard doctors and civilian midwife delivered of a baby aboard a cargo ship 100 miles southwest of San Diego, according to USCG officials.

The crew of vehicle carrier Caribbean Highway called for assistance around 9 a.m. Monday because a 21-year-old crewmember was in labor, the statement said.

A helicopter crew flew a Coast Guard flight surgeon and a civilian midwife to the ship, where they helped the woman give birth at 7:50 p.m.

Mother and baby were taken to Sharp Mary Birch Hospital for further care.

For more of the Fox 5 San Diego story:


Thursday, September 5, 2013

Top Story

Drewry: Asia-to-Europe GRI stumbles in buyer's market

Drewry Maritime Research reports that the Shanghai-Rotterdam freight rate increased by only $18 to $2,498-per-FEU today, indicating the end of a series of successful attempts by container lines to increase freight rates on the Asia-Europe trade route.

The proposed price increases of $445-$500-per-TEU, which container shipping lines wanted to impose as of September 1, were not accepted by the market according to Drewry's weekly "World Container Index," which assesses freight rates with a contract validity of up to one month.

"With second quarter financial results showing mixed levels of profitability, many carriers must have hoped that price rises towards the end of the peak season would help to shore up their balance sheets," said Richard Heath, director of World Container Index. "Spot rates also have a significant influence on the outcome of contract rate negotiations which for many shippers on the Asia-Europe trade will be taking place in the fourth quarter."

Some lines have already announced mid-September GRIs after realizing the failure of this week's attempt to increase rates.

"National holidays in China starting at the end of September may create a small demand spike," said Martin Dixon, research manager freight rate benchmarking at Drewry. "However, if this does not materialize, there may be few other opportunities for carriers to increase rates in 2013."

Drewry emphasized that week-to-week increases in rates are less meaningful than how long the increase holds.

Maersk boosts public persona with social media

The number one global container carrier, Maersk Line, has been using social media sites such as Instagram, Twitter and Pinterest to give it a public relations edge in the normally low profile shipping sector. By boosting its online profile, Maersk thinks it is making it a more likely choice for freight forwarders.

"There is a lot to gain from it, such as better press coverage, higher employee engagement and better brand awareness," said Jonathan Wichmann, the line's head of social media.

The elevated profile helped the company recover from the PR catastrophe of last June, when the Maersk Norwich hit and killed a whale, arriving in Rotterdam with the huge mammal draped across its bow. Instead of keeping silent, the company posted photos on Facebook and created a Pinterest board entitled "In Memory of the Maersk Norwich Whale."

All of Maersk's ships have a Web page, and the shipping company has a presence on Twitter, Google+, LinkedIn, Vimeo, Flickr and Tumblr. Its corporate Facebook account has more than a million likes, in line with or exceeding more high profile brands like Carlsberg beer or Volvo automakers.

In comparison, Mediterranean Shipping Company, the second-biggest container carrier, has only 4,500 "likes," and CMA CGM, ranked number three, has about 11,000.

When Maersk Line publishes news on social media, it is often re-tweeted or shared, while fewer people take notice of its traditional advertising, according to Wichmann.

The line now plans to use social media to recruit its social media followers inn tracking down lost containers. Its 550 ships on average lose 18 containers a year they're hard to locate. The project requests that when people come across a beached container, they photograph it and upload the picture and serial number to Facebook or Instagram so that Maersk can retrieve it.

"Maersk Line has been the first social media mover within the shipping industry. I'm convinced others will follow," said Frederik Preisler, partner at Danish advertising company Mensch.

For more of the Reuters UK story:

India's July garment exports surge 19 percent to $1.27B

India's garment exports rose to 1.27 billion in July, a year-on-year boost of 19 percent, on increased demand from developed countries such as the U.S.

Garment exports to the U.S. has grown of 3.7 percent during the first five months of 2013, according to Apparel Export Promotion Council chairman A. Sakthivel.

Sakthivel noted the European market is still weak. The U.S. and Europe combined account for about 60 percent of the country's total apparel shipments.

"Demand for Indian products is still not increasing in the EU markets. Apparel exports are declining in Europe," he said.

Sakthivel said that although the depreciating rupee is advantageous in the short run, it is pushing up manufacturing costs. He said buyers are asking for discounts.

"Those exporters with high import content of products are facing huge problem as they have to pay more now which is putting dent on their profits," he said.

For more of the Times of India story:

Three U.S. ports awarded federal TIGER funds

The ports of Baltimore, Tucson and Oswego (NY) have received a total of $16.5 million in Transportation Investment Generating Economic Recovery grants from the Department of Transportation.

The Maryland Port Administration was awarded $10 million to expand capacity at the Fairfield Marine Terminal at the Port of Baltimore. An obsolete and dilapidated wet basin at the port will be replaced with a new 7.6-acre, rail-served cargo lay-down area within a strong export/import auto and roll-on/roll-off cargo terminal.

"This public investment in the Port of Baltimore is about jobs, jobs, jobs," said Sen. Barbara Mikulski (D-MD). "From the dock workers who unload the ships to the manufacturers who rely on cargo transported by the ships. (We're) preparing the port for the bigger ships that will soon be sailing through the widened Panama Canal, supporting jobs that will keep Maryland's economy rolling."

Pima County, Arizona received $5 million to build an intermodal ramp at the Port of Tucson to accommodate the handling of increased international cargo. The port will build a ramp off Union Pacific's mainline that runs through Tucson from coast to coast, allowing cargo containers to be unloaded there or transferred to trucks or other trains.

In New York, the Port of Oswego received $1.5 million, for upgrades to infrastructure and equipment. The port will construct a roadway, embedded with heavy rail track, connecting the port's main East Terminal to a six-acre open-storage area to facilitate increased traffic and new commodities. The development will nearly double the present storage and operation area for the port and relieve the current yard congestion and lack of space.

For more of the RT&S story:

Freight train derails in Montana

A freight train has derailed 4 miles east of Superior, according to Montana Rail Link spokeswoman Lynda Frost.

Frost said 23 cars of the 66-car train bound for Laurel derailed early Wednesday along a steep embankment above the Clark Fork River, and four cars are partially submerged in the river. She said the only spillage from the derailment is cedar chips and lumber.

The cause of the derailment is under investigation.

For more of the Republic story:

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