Cargo Business Newswire Archives
Summary for September 16 through September 20:

Monday, September 16, 2013

Top Story

Port of Oakland's Chris Lytle strives to revive port's business

New at the helm of the Port of Oakland, Chris Lytle, a shipping industry lifer who most recently ran the successful Port of Long Beach, is striving to turn around the Bay Area port, which faces many challenges in its quest to compete with West Coast rivals.

Plagued by a strip club public spending scandal earlier this year that led to the departure of former Executive Director Omar Benjamin, the port is also dealing with a crippling $1.3 billion debt resulting from mismanaged infrastructure projects. Consequently, the port has indefinitely postponed a rail and warehouse project that would make it more competitive and generate thousands of jobs.

Shutdowns over the summer sprang from conflicts between truckers, longshoremen and terminal operators, and caused shipping companies to reroute cargo.

Industry insiders were relieved when Lytle was taking over the Oakland port, hopeful that he could bolster the port's flagging reputation.

"Oakland faces a number of challenges, but I think that in Chris (Lytle) they have somebody who provides some light at the end of the tunnel," said John McLaurin, executive director of the Pacific Merchant Shipping Association. "His hiring was critically important."

Lytle's first weeks at the port in July coincided with a big cargo bottleneck that led to a trucker protest that shut down the majority of the complex. Lytle had lunch with truckers at a nearby taco truck and won admiration from all sides. "Every time he has said he was going to do something, he's done it," said Mike Villeggiante, a longshoremen's union leader.

"If you have labor fighting with truckers and truckers fighting with terminal management, it becomes an endless cycle," he said. "One of my big pushes is to get all these groups to work together. If everyone isn't pulling in the same direction, it's just not going to be successful."

Work has begun on a $500 million project to build a rail yard and warehouses on the city's half of the former Army base, which Lytle says can boost both exports and imports. He plans to use his industry contacts to enhance rail service and court major shippers.

"One thing I am adamant about here is that you have to have a customer focus," he said. "The sense is there has not been a customer focus in Oakland."

For more of the San Jose Mercury News story:

Two new marine highways established by DOT

U.S. Transportation Secretary Anthony Foxx has designated two new marine highways, according to an agency statement.

The Occoquan, Potomac, and Anacostia Rivers combine to make the M-495 Marine Highway Crossing, which connects ports in the District of Columbia, Northern Virginia, and Maryland for passenger services, the statement said. The new waterway is sponsored by the Northern Virginia Regional Commission.

The DOT designated theupper Missouri River as the M-29 Marine Highway Connector, linking the upper Missouri River between Kansas City, Missouri, and Sioux City, Iowa. The Port Authority of Kansas City, Missouri sponsored this new marine highway.

A marine highway is a designated route for transporting cargo via water, reducing pollution and congestion on roads. Since 2009, the Department of Transportation has designated 21 marine highway routes, investing $130 million in related projects and services.

U.S. industrial production rose in August

Output at factories, mines and utilities rose 0.4 percent in August, the highest in six months, according to a report from the Federal Reserve. The industrial production reading was less than the 0.5 median prediction of 85 economists surveyed by Bloomberg.

Manufacturing, which comprises 75 percent of overall industrial production, grew by the most in a year.

Vehicle sales are the best in six years, driving factory activity and manufacturers like Ford to increase the capacity of their plant facilities.

"Companies have to increase production in order to keep up with demand," said Brett Ryan, a U.S. economist at Deutsche Bank Securities, whose firm has been the second-best forecaster of production over the past two years, according to Bloomberg. "You have an elevated level of unfilled orders, so that bodes well for production."

For more of the Bloomberg story:

Port Canaveral channel improvement expected to move forward

Contingent on approval from the Army Corps of Engineers and Congress, the widening and deepening of Port Canaveral harbor is slotted to begin this fall, according to a port statement. Completion of Phase 1 of the project is scheduled for late 2014.

Port Canaveral's channel will be widened by another 100 feet and deepened an average of 2 feet along the length of the harbor to accommodate larger ships. The improvements are designed to improve navigational and safety margins, in line with
the growth of Port Canaveral's cruise and cargo trade, the port said.

"Already a thriving and growing cruise Port, we rapidly are expanding to become one of Florida's major container ports," said port CEO John E. Walsh. "Widening and deepening of the Port's harbor is one of the best investments for our state. We already have begun early efforts to continue deepening to eventually get to 50-to 55-feet deep." 
Canaveral channel improvement costs total $57 million to date, with the port authority paying $19.4 million and the Florida Department of Transportation responsible for $37.6 million, the statement said.

As part of overall cargo services expansion, Port Canaveral is constructing two new cargo berths and has acquired two new post-Panamax ship-to-shore cranes. 

Matson molasses spill expect to kill fish

As much as 233,000 gallons of molasses spilled Monday from a pipe used to load molasses from storage tanks to Matson Navigation Co. ships sailing to California.

Thousands of fish are expected to die in Honolulu waters after a leaky pipe caused 1,400 tons of molasses pour into the harbor, according to a spokesperson from the state's Department of Health.

The high concentration of molasses is making it difficult for the fish to breathe, said department spokeswoman Janice Okubo.

Matson repaired the hole and the pipe stopped leaking Tuesday morning, spokesman Jeff Hull said.

For more of the USA Today story:


Tuesday, September 17, 2013

Top Story

Drewry: Shipping rates to drop after peak season

Container shipping costs have continued to rise, but because the increase hasn't been seen across all trades, Drewry Maritime Research expects rates to fall in the final months of the year. Peak season volumes have lifted pricing on cargo from Asia, but as the season passes the ongoing capacity glut will likely drive rates back down, Drewry said.

Drewry's Global Freight Rate Index, which gauges the average across all main trade routes except for intra-Asia, increased for the second straight month in August to $2,159 per-FEU, a hike of 4.7 percent compared to July. This put the index at its highest level since April 2013.

The index recovered on trades in the eastbound transpacific, South Asian exports, and imports from China to the Middle East, South America and Africa. Trades with falling rates included Oceania region imports and exports, while elsewhere pricing remained stable, Drewry said.

Drewry's Intra-Asia Freight Rate Index, an average of all regional trades excluding South Asia and the Middle East, rose 2 percent in August to its highest level since February 2013.

Biden supports U.S. port improvement projects

Vice President Joe Biden expressed support for expediting port improvement projects on the U.S. East Coast on Monday, after touring the Port of Savannah, according to a statement from the Georgia Ports Authority.

Biden was accompanied on the tour by U.S. Secretary of Transportation Anthony Fox, Senators Saxby Chambliss and Johnny Isakson, Congressman Jack Kingston, Atlanta Mayor Kasim Reed, and Savannah Mayor Edna Jackson.

Deepening the Savannah River to 47 feet will enable the port to accommodate the post-Panamax vessels expected to call in greater numbers after the widening of the Panama Canal, set for completion in 2015.

Congressman Kingston said the nation cannot afford to delay the Savannah Harbor deepening.

"Failure to complete the harbor expansion would spell disaster not just for Georgia but for the region," Kingston said. "After 14 years of study, we not only know that it can be completed in an environmentally-sound manner but that it will provide enormous economic benefit for our region."

Lower prices per container slot on Post-Panamax ships will save U.S. companies shipping goods through Savannah 20 to 40 percent on transportation, which translates into lower costs for the export of manufactured goods, the statement said.

Georgia Governor Nathan Deal and the Georgia legislature have allocated $231 million toward the project, which needs an okay from Congress on federal funding to meet the current construction budget of $652 million.

"Falling on the heels of U.S. Army Under Secretary Joseph Westphal's visit to Savannah, Vice President Biden's visit makes it clear that momentum is building for this harbor expansion," said Curtis Foltz, executive director of the Georgia Ports Authority. "We look forward to starting the project, which the U.S. Army Corps of Engineers has shown will yield some $213 million a year in transportation savings."

Port of Long Beach posts busiest cargo month in 6 years, L.A. stabilizing

The Port of Long Beach in August posted its busiest month for cargo movement in six years, as retailers stocked up for the 2013 holiday season.

Long Beach handled 630,292 TEUs in August, surging 16 percent year-over-year. Imports jumped 19.2 percent to 327,817 TEUS, while exports rose 20.2 percent to 154,118 TEUs. Empty containers shipped overseas to be refilled went up 5.8 percent to 148,357 TEUs.

The expansion of trade at the port is due, in large part, to shipping lines MSC and CMA CGM moving their West Coast hubs to Long Beach from the Port of Los Angeles at the beginning of the year.

Cargo volume at the Port of Los Angeles remained even last month, indicating port container trade is finally starting to recover after the loss of MSC and CMA CGM. The port posted an overall goods flow of 709,675 TEUs, up 0.4 compared to August 2012 figures. Imports in Los Angeles dipped 1.41 percent to 355,682 TEUs as exports fell 3.84 percent to 158,484 TEUs. Empty containers, however, were up 7.96 percent in August.

"As the economy continues to slowly improve, retailers are stocking up for their most important sales season of the year," said Jonathan Gold, National Retail Federation vice president for supply chain and customs policy. "Merchants have been very cautious so far this year, but our forecasts show that they plan to make up for it in the next few months."

For more of the Long Beach Press-Telegram story:

Chinese firms sign deals worth $2.8B with U.S. soybean exporters

Chinese importers signed agreements with U.S. agricultural companies on Monday to purchase 4.83 million tons of soybeans, at a value of approximately $2.8 billion.

Representatives of Chinese firms signed 13 separate letters of intent with officials from Archer Daniels Midland, Bunge, Columbia Grain and others, at an event hosted by the U.S. Soybean Council. The Chinese companies making the deals included COFCO, Sinograin, and Chinatex.

The soybeans will be shipped in the current marketing year, which started Sept. 1.

For more of the Reuters story:

Hong Kong dockworker dies in horrific fall

A container terminal worker died when a steel bar pierced his heart after a tragic fall in Tsing Yi, an island in the urban area of Hong Kong.

The worker was reportedly not wearing a safety harness when he fell while working on a platform at a logistics center under construction near Container Terminal No 9.

Wong fell 13 feet onto steel reinforcing bars, and one of them impaled his heart.

The accident is under investigation.

For more of The Standard story:


Wednesday, September 17, 2013

Top Story

Handysize fleet to see profits rise on China building expansion

As China plans the highest rate of construction in 10 years, increased log shipments will add to a commodity boom that is already boosting cargo rates for vessels at the smallest end of the world fleet.

Daily rates for 550-foot-long Handysizes will climb 29 percent to $9,750 next year, according to the median estimate of nine analysts surveyed by Bloomberg. Global trade in logs is forecast to expand by 10 percent to 4.5 billion cubic feet this year, according to Wood Resources International.

The combination of China's growing demand for wood and record global demand for dry-bulk commodities is helping to absorb the largest excess in capacity since 1986 as the Handysize fleet is growing at the slowest rate in four years.

"We're seeing more cargoes for log carriers and other smaller dry-bulk segments and fewer new ships being delivered," said Marius Magelie, an analyst at ABG Sundal Collier in Oslo whose recommendations on the shares of shipping companies returned 34 percent in the past two years. "Rising demand for dry-bulk cargoes will buoy all classes of shipping."

For more of the Bloomberg story:

Seattle longshoremen stage protest over Tunnel-related jobs

Dockworkers picketed the site of a major Seattle tunnel excavation Tuesday, asserting that the project contractor, Seattle Tunnel Partners, is in violation of a contract it signed to hire International Longshore and Warehouse Union members to work the barges that transport the excavated tunnel dirt.

The jobs in question have been given to construction workers from other unions.

Approximately 30 protesters blocked some workers from accessing the tunnel work site, starting their daylong demonstration at 6 a.m. outside the King Street construction site entrance.

For more of the KIRO TV story:

Georgia Ports Authority sets cargo records in FY 2013

The Georgia Ports Authority posted a record 27 million tons of cargo in the fiscal year ending June 30, a 2.4 percent increase year-over-year, according to Georgia Ports Authority Executive Director Curtis Foltz.

GPA container volume for the fiscal year was more than 315,000 TEUs, another record for the authority. Auto and machinery units rose 11.7 percent to 637,000 and Georgia handled 2.5 million tons of bulk cargo, up 62 percent from 2012. Foltz said the total tonnage growth was due to the diverse cargo mix, including the container trade, agribulk, and breakbulk cargos, and autos and machinery.

In his State of the Port address, Foltz touted not only the cargo increases, but also an influx of new business and inroads in leasing and port distribution space.

"Not only did the ports authority achieve strong growth across major segments of our business, but the private sector responded with the lease or development of more than 1.1 million square feet of distribution center space," said Foltz. "Of the added space, more than 300,000 square feet is dedicated to cold storage – strengthening Georgia's position in the expanding cold chain logistics market."

New customers contributing to the distribution center growth included Nordic Logistics, Gulf States Cold Storage, appliance maker Haier America, medical supplier Dukal, third-party logistics provider OHL, Kent Bicycle, Giumarra International Berry and Huffy Bicycles.

Asia's richest man: Shanghai FTZ could adversely impact Hong Kong

Shanghai's new free trade zone will put pressure on Hong Kong to become more competitive, according to billionaire Li Ka-Shing, Asia's richest man.

"It (the FTZ) will have a big impact on Hong Kong," Li said. "The free convertibility of the yuan will be favorable in the development of Shanghai."

China will allow unlimited exchange of its yuan currency in its first free-trade zone in an unprecedented effort to bolster its economy. The vision is for Shanghai to become a global trade and financial hub, which experts say would challenge the free economy of Hong Kong.

"If Hong Kong does not catch up, it will lag behind others," Li said, adding that Hong Kong's GDP is already lower than that of rival Singapore. He also said that the Hong Kong pro-democracy movement Occupy Central could hurt the city's economy.

After starting out in business as a plastic flower-maker, Li is now head of a huge empire through Cheung Kong Holdings and Hutchison Whampoa, with international assets in ports, retail, property, telecoms, and utilities. His estimated worth is $31 billion, according to Forbes magazine.

Hong Kong has positioned itself as China's business gateway but is struggling with high labor and rental costs.

"In one to three years' time, if Hong Kong cannot revamp itself, it will lose its competitiveness to the trade zone," said chief China economist of ANZ Banking Group, Liu Ligang.

For more of the Bangkok Post story:

Cargo ship rescues 270 migrants off Malta

A cargo ship picked up approximately 270 migrants found floating on a large dinghy 90 miles off Malta.

The rescue took place Monday night, after a priest notified Italian and Maltese rescue agencies about the boat.

The ship is expected to transport the group to Italy.

For more of the Times of Malta story:


Thursday, September 19, 2013

Top Story

FedEx first quarter profits up 6.5 percent on cost cutting

FedEx Corp. delivered first quarter profits that beat analyst forecasts, after deploying cost cutting measures that shifted more packages to cheaper shipping methods and significantly cut its air capacity to Asia.

The company's stock rose 5 percent to $116.25 yesterday, hitting its highest value in more than six years. FedEx shares have increased by 27 percent this year.

Net income in the quarter ending in August jumped 6.5 percent to $489 million, or $1.53 a share, FedEx said in a statement. That bested analyst projections of $1.50 a share, the average of 28 analysts surveyed, according to data compiled by Bloomberg. Sales increased 2.1 percent to $11 billion.

"I'm glad to hear that they are embracing the new reality -- that packages don't absolutely have to be there overnight anymore," said Logan Purk, an analyst at Edward Jones. "With each quarter we're seeing them take steps, sometimes small steps, but at least steps in the right direction. Cheaper and slower is the way to go."

DOT: U.S. shipbuilding activity highest in two decades on shale surge

Activity at U.S. shipyards is the highest in almost 20 years as domestic oil and gas production extracted from shale rocks boosts cargoes, according a Department of Transportation official.

Fifteen tanker and container ships are on order or under construction in the U.S., with options for "many more," making this the biggest boom in almost 20 years, said Paul Jaenichen, acting maritime administrator at the DOT, speaking at the TradeWinds Jones Act Shipping Forum in New York.

"America's Jones Act fleet will benefit from this new and abundant cargo source," Jaenichen said.

The Jones Act requires that cargo shipped between U.S. ports be transported on domestically built vessels with American crews.

Hire rates for tankers in the U.S. increased to a record $100,000 a day for a one-year charter, according to Bob Flynn, president of shipbroker MJLF & Associates.

"We need another shipyard or two," he said. "It wouldn't surprise me if the next boil on this market pushed rates up to $85,000 a day, for sustainable, five-year deals."

For more of the Bloomberg story:

Hampton Roads cargo volume up in August

The port of Hampton Roads had a strong cargo-handling month in August, with volume up 5 percent year-over-year, according to the Virginia Port Authority.

The port handled 198,329 last month, increased from 188,658 in August 2012. Imports went up 8.8 percent, with exports rising 1.8 percent.

General cargo was up just under 10 percent year-over-year, at 1.65 million tons.

The VPA said rail container shipments rose approximately 16 percent in August over the same month last year.

ICTSI teams with PSA to build and run Columbia port

International Container Terminal Services Inc. has partnered with PSA International Pte. Ltd. (PSA) to build and operate a container port terminal in Colombia.

The partnership will develop, construct and operate the container port terminal and ancillary facilities, according to ICTSI chairman Enrique K. Razon Jr. The port will be located in the Peninsula of Aguadulce, Buenaventura, Valle del Cauca, Colombia.

PSA has invested in Sociedad Puerto Industrial Aguadulce SA, a subsidiary of ICTSI, which holds a 30-year concession for the port project granted by the Colombian government.

"We are excited about the prospect of working with PSA to develop a terminal that we know will be key to Colombia's trade growth," said Razon.

The deal stipulates that PSA subsidiary PSA Colombia Pacific will purchase 45.64 percent of SPIA shares.

After the transaction, ICTSI and PSA would jointly own 91.28 percent of issued and outstanding share capital of SPIA.

For more of the ABS-CBN News story:

PortMiami security guards arrested from luggage

Two Port of Miami security guards have been arrested for stealing from cruise ship passengers, according to the Miami New Times.

Jean Russell Thomas and Sherece Nelson were arrested as the result of an investigation started after passenger reported an iPad missing from her luggage.

On September 5, police found a Craigslist posting from Thomas advertising the sale of two iPads, and one matched the description of the stolen iPad.

An undercover officer arranged to buy the iPad for $450. Nelson, another Port of Miami security officer, showed up at the transaction to act as a lookout.

For more of the Miami New Times story:

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