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Summary for September 20 - September 24, 2010:
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Monday, September 20, 2010

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Is rail indicating an economic lift?

Turn on the television news of late or scan the front pages of a newspaper and you may come away with the impression that the U.S. economy is either stuck in the mud or sliding downhill toward a cliff.

But one early indicator of economic activity, freight carried by U.S. railroads, offers signs that business is picking up overall and particularly in some key industries.

Fort Worth-based BNSF Railway's total freight shipments are up 8.6 percent so far in the third quarter compared with a year ago and up 6.7 percent for the year, according to the railroad's latest report, for the week that ended Sept. 11.

Nationwide, total rail car loads of freight were up 5.7 percent in August from 2009 levels and were at their highest level since 2008. The last week of August saw the highest level of shipments of any month this year.

In its monthly compilation of railroad and economic data, the American Association of Railroads shows average weekly railroad traffic grew sharply in the first four months of the year, leveled out and even declined slightly through July, and then turned sharply higher in August.

A close look at key business segments served by railroads reveals some intriguing details.

Rail shipments of intermodal containers, which largely carry goods from manufacturers to retailers' regional distribution centers, have surged. BNSF container shipments are up 9 percent for the year and up nearly 20 percent since July 1.

-Fort Worth Star-Telegram

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ATA files clean truck appeal; L.A. adjusts implementation

While the American Trucking Associations has filed to appeal a ruling in favor of the Port of Los Angeles, port officials will recommend an adjusted implementation schedule for the agreement the association is disputing.

The ATA filed its request for an appeal in the 9th U.S. Circuit Court of Appeals Sept. 16. Judge Christina Snyder had committed several legal errors in her Aug. 26 ruling, which upheld the port’s agreement carriers must sign to work the port, the association said.

Snyder’s Sept. 10 final judgment dissolved the preliminary injunction that had been in place, which had prevented the port from fully enforcing the agreement. The ATA had not disputed the stricter truck emissions standards, but had sued over other program aspects, including requiring all drivers be carrier employees and requiring carriers follow preferential hiring rules.

Port representatives have said they will recommend the Los Angeles Board of Harbor Commissioners approve an adjusted compliance timeline at the board’s Sept. 27 meeting. The proposed schedule would begin requiring 20 percent of drivers be employees by Dec. 31, 2011, increasing to 66 percent a year later and 100 percent by Dec. 31, 2013.

The ATA’s appeal request states the U.S. Constitution’s Commerce Clause restricts states’ regulation power and the “dormant” commerce clause prohibits legislation excessively burdening interstate commerce.

It allows a market exemption if the port’s actions are considered that of a business proprietor, not as a regulator. Synder’s view that the port is a proprietor is too broad, the association said.


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Long Beach mayor vetoes $60 mil port admin building

Long Beach Mayor Bob Foster announced Sunday evening that he has vetoed two items, reducing $2.7 million of General Fund spending and canceling the Harbor Department's plan to construct a $60 million administration building.

The veto puts a stop to Harbor Department plans to build a $60,432,000 administration building. Foster noted in a press release that the department "committed to seek out less costly office space" and that the vetoed amount includes money that will be needed to relocate the Port of Long Beach maintenance yard as the Gerald Desmond Bridge is renovated. When that money is needed it can be appropriated through a first quarter budget adjustment.

-LB Post

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Maersk Distribution integrates with Damco

The logistics arm of A.P. Moller-Maersk announced that Maersk Distribution Services Inc. (MDSI) will be integrated into its Damco freight forwarding unit.

Maersk Distribution, according to its parent company, earns $200 million in revenue per year in North America, employing more than 600. The company focuses warehousing and distribution at 18 facilities.

Close to 200 containers still missing off Mumbai harbor

More than five weeks after two foreign ships collided off Mumbai harbour, 189 cargo containers which fell off one of the vessels remain unaccounted for, a top company official said here Thursday.

The containers, including a few containing hazardous material, fell off the Panamanian ship, MSC Chitra, after its collision with a St. Kitts vessel, MV Khalijia-III, near the entrance of Mumbai harbour Aug 7, said MSC Agency (India) Private Limited CEO Captain Deepak Tiwari.

'According to our calculations, 189 containers are unaccounted for so far. These have fallen (in the Arabian Sea) and are perhaps in the vicinity of the vessel,' he told mediapersons Thursday afternoon.

Out of the missing containers, nine contained hazardous materials. Six of these nine containers carried caustic soda which is soluble in water, he said.

One container contained organophosphorous pesticide while another contained phosphene, which is used for fumigating or debugging of grains, he said.

Tiwari said that these materials were stored in airtight metal flasks which float. Some of the floating flasks have even been recovered, he said.

-Bombay News

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Tuesday, September 21- Wednesday, September 22, 2010

Top Story

Top three shipping lines to cooperate against piracy

The top three global container-shipping companies jointly announced they would cooperate with each other over anti-piracy efforts in the Gulf of Aden and the Indian Ocean.

The cooperative measures between CMA CGM, MSC and Maersk Line includes information exchange on safety measures, piracy policies and procedures as well as coordination to ensure the issue is addressed with all relevant stakeholders, the shipping companies said in a statement.

“Our first and foremost concern is the safety and security of our crews. Piracy continues to be a problem for the shipping industry and if we want to address it effectively, we as ship owners must cooperate,” the lines said.

 “Following the ‘Anti-Piracy Best Management Practice’ is an important step in preventing hijackings and we fully support the use and further development of the BMP,” the shipping group said.

 “The root causes of this problem cannot be addressed overnight. Therefore, it is imperative that the naval forces have a strong and dynamic mandate to match the constantly changing situation in the area. It is also vital that the acts of piracy do not go unpunished, which is why appropriate legal frameworks for prosecuting pirates are needed,” CMA CGM, MSC and Maersk Line said.

The three liner organizations said they also support proposals that include a regional coast guard and possible transit corridors to East Africa.

Gloss paper imports from China, Indonesia face duties

Glossy paper imported from China and Indonesia will face duties in the U.S. after the Commerce Department ruled the products receive unfair subsidies and are dumped into the American market at a discount.

The duties affect $260 million of paper used for magazines, and the dumping duties will reach as much as 135.83 percent for China and 20.13 percent for Indonesia, the department said yesterday in an e-mailed statement. Countervailing duties for subsidies will be as much as 17.94 percent for Indonesia and 178.03 percent for China.

NewPage Corp., Appleton Coated LLC and a unit of Sappi Ltd. sought the duties, citing Chinese and Indonesian policies of debt forgiveness, cheap electricity and low-cost access to timber for domestic producers.

The Commerce Department imposed preliminary duties in April and May. Paper importers have been depositing those duties since then, and the tariffs will become final after the U.S. International Trade Commission makes a separate ruling scheduled for Nov. 4.

Gold East Paper Jiangsu Co. must pay combined duties of 25.24 percent, the department said. Chinese companies not listed in the case face a 153.47 percent duty, according to the statement.

Asia Pulp & Paper, a unit of Indonesia’s Sinar Mas Group, must pay a 38 percent duty on its exports, according to a company statement.


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Port of Baltimore cargo dipped 2 percent for FY10

Cargo volume at the state-owned Port of Baltimore terminals fell 2 percent in fiscal year 2010, but is showing signs of a rebound after a strong second half of the year.

The port handled 9.1 million tons of cargo in the fiscal year, which ran from July 1, 2009, to June 30, 2010. That was down from 9.3 million tons in the previous fiscal year.

The decline was weighed down by declines of 27 percent and 31 percent in paper products and roll-on/roll-off cargo, respectively. Those are two of the port’s key niche cargos. The so-called “ro-ro” cargo includes farm and construction equipment and is deeply affected by a slowdown in new building across the country. Paper cargo has been impacted by declines in magazine and newspaper readership.

But other categories saw strong improvement. Automobile cargo rose from 521,000 tons in fiscal 2009 to 659,000 tons in fiscal 2010, a rise of 26 percent. Paper pulp rose 13 percent from 426,000 tons to 483,000 tons.

Containerized cargo, which includes many consumer goods that have been slower to sell in the recession, rose 2 percent, from 6.5 million tons to 6.7 million tons.

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Pasha granted permission to carry inter-island cargo in Hawaii

The state Public Utilities Commission has granted Pasha Hawaii Transport Lines permission to carry cargo through the islands on an interim basis through 2013.

Monday's decision means Pasha may operate among the ports of Honolulu, Kahului, Hilo, Nawiliwili, Barbers Point and Pearl Harbor.

The commission found Pasha's proposed intrastate operations will foster competition and provide customers with a choice of water carriers.

In addition, the PUC says a second water carriers, in addition to Young Brothers Ltd, will minimize any potential harm or inconvenience to the public if existing services are disrupted.

The PUC and the state consumer advocate will evaluate the impact of Pasha's service on the inter-island shipping industry.


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Gambler jumps to death from cruiseship after losing $650K

A 51-year-old mainlander jumped off a 13-deck "floating casino" off Sai Kung after losing HK$5 million playing baccarat.

The gambler, identified by police only as Xu, made his fatal leap off the Star Cruises vessel SuperStar Aquarius as it sailed back to Hong Kong from international waters shortly before 9am yesterday.

Rescuers searched for Xu for almost an hour before fishing him out of the water. He was certified dead by the ship's doctor.

Xu apparently boarded the ship on Saturday for a two-day gambling trip. He was seen betting at the baccarat table right after dinner.

According to several passengers, he gambled until closing at 8am yesterday and lost almost HK$5 million.

He was seen wandering on the deck for about an hour before jumping.

-The Standard

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Thursday, September 23, 2010

Top Story

Panama Canal debate kicks off inaugural Long Beach event

The specter of the Panama Canal’s scheduled widening in 2014 and its impacts on North America’s West Coast shipping business is at the core of a new “Point/Counterpoint” educational forum being kicked off by the Center for International Trade and Transportation (CITT) at California State University, Long Beach (CSULB), on Oct. 6.

The free event, which is open to the public, is being billed as: “Panama Canal Expansion: The Battle for Jobs and Cargo. Who Wins? Whose Loses? Who Decides?”

The “Point/Counterpoint” event features two scheduled speakers: Paul Bingham of Wilbur Smith Associates in Virginia, and Mary Brooks from Canada’s Dalhousie University in Halifax.

“The Panama Canal expansion is one of those issues that everybody talks about, yet nobody is clear on the implications for the Southern California ports,” said Marianne Venieris, executive director for CITT. “When the expanded canal opens, importers will have to be aware of other trends that are emerging that could threaten cargo growth through the ports of Los Angeles and Long Beach. “On the other hand, some of these trends could end up favoring west coast ports.”

The expanded Panama Canal will make it possible for larger ships and more Asia-sourced cargo to transit through to U.S. Gulf and East Coast ports, which could impact West Coast port activity.

“The issue is how much of an advantage does the Panama Canal give shippers like Wal-Mart and Home Depot in getting their goods to their final destinations,” Venieris said.

“It’s important for our ports because if there are no containers coming in, there’s no business and then there’s no money. It’s not only the ports that will be affected, but also the railroads, trucking, warehouses… pretty much all businesses involved in international trade,” she said.

Veneris said she hopes the Point/Counterpoint series will become a regular event as a follow-up to the annual CITT Town Hall meetings, which concluded in 2009 after a 10-year run.

For more information on Point/Counterpoint, visit, call 562/985-2872, or email

Long Beach’s Cordero awaits Senate confirmation for FMC top post

President Obama has nominated Long Beach attorney Mario Cordero, a member of the Long Beach Board of Harbor Commissioners, to a post on the Federal Maritime Commission.

The White House said the president on Monday forwarded Cordero’s name to the Senate for confirmation as a commissioner to a term that would expire June 30, 2014.

The Federal Maritime Commission is an independent regulatory agency responsible for the regulation of ocean-borne transportation in the foreign commerce of the U.S.

Cordero is a workers’ compensation defense attorney for the law offices of Wayne Singer, and practices in Long Beach and San Francisco. He is currently serving his second six-year term on the Long Beach Board of Harbor Commissioners, where he has spearheaded the Port of Long Beach’s Green Port Policy.

-Metropolitan News-Enterprise

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CARB runs final series of truck regulation workshops

California is having a final series of workshops to gather feedback for amendments to two key truck regulations.

The state’s Air Resources Board will solicit input on modifying the truck and bus and drayage truck regulations and provide presentations at the workshops.

The recession resulted in significantly reduced emissions, so the board is revisiting these rules and will consider amendments at its December meeting. “The amendments do not exist in hard copy form yet,” said Karen Caesar, a CARB spokeswoman.

CARB staffers presented the board with an updated emission inventory April 22 and summarized how the recession resulted in less business activity, which in turn yielded lower emission levels than forecast. Board members asked staffers to develop amendments to reduce economic impact on businesses while still meeting federal air standards.

Workshops will be Sept. 30 in Sacramento, Oct. 4 in El Monte, Oct. 5 in San Diego and Oct. 12 in Fresno. For those unable to attend in person, a webcast will be available during the Sacramento workshop, available that day at .


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Greece deregulates trucking industry

Greece passed a law on Wednesday opening the freight sector up to competition, as truckers ended a blocade of major highways and unionists mull over their next moves.

The new legislation will significantly reduce freight prices by issuing new public-duty operator licences for the first time in 40 years, at a fraction of company start-up costs, as the government attempts to stave off recession.

But trucker unionists argued that it was unfair to existing operators, who paid up to 300,000 euros (400,000 dollars) for their licences.

Since September 13, some 2,000 truckers demonstrated in central Athens, caused major traffic disruptions while others camped all night outside Parliament, where television screens projected the reform bill debate.

Early Wednesday, in a last-minute bid to stop the law, truckers blocked major highways near Athens, but the movement ended late in the day.

The union said it would hold a general assembly late Wednesday to decide the future of its strikes.

Truckers cannot strike, since being placed under civil mobilisation after protests in July crippled the country's fuel supplies.

To avoid arrest, they allowed private company vehicles to supply the market, since new strikes were launched 10 days ago.


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Agents seize $12 mil worth of fake sunglasses at L.A.-Long Beach

Federal agents at the Los Angeles-Long Beach port complex seized thousands of pairs of knockoff sunglasses estimated to be worth more than $12 million, authorities said Wednesday.

The 78,600 pairs of sunglasses that arrived in three shipments from China look "confusingly similar" to designer brands such as Coach, Gucci and Emporio Armani, said officials with U.S. Customs and Border Protection.

"'Confusingly similar' means it is an imitation that is not an exact copy," said Jaime Ruiz, a spokesman for the agency. "Usually they modify the logo, so from a distance you can't tell the difference. They do this because they know the penalty for an exact copy is higher."

Officials said counterfeit products hurt legitimate manufacturers and that fake designer sunglasses may not be impact-resistant nor offer proper UV protection.

In fiscal 2009, U.S. ports had 14,841 cases of intellectual-property-rights seizures, worth $260.7 million, according to U.S. Customs and Border Protection. In that year, the total value of all seized commodities presenting potential safety or security risks was $32 million.

Counterfeit sunglasses accounted for 9% of that total, or $2.9 million.

-L.A. Times

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Friday, September 24, 2010

Top Story

Trans-Pacific carrier group forms advisory board

Sixteen trans-Pacific exporters will now form an ocean carrier group’s advisory board on matters involving that trade lane.

The Westbound Transpacific Stabilization Agreement (WTSA), representing 10 major container lines in the U.S.-Asia shipping market, announced it has formed the advisory board with hopes of “strengthening overall long-term shipper-carrier relations; addressing specific short-term contracting, operational and service issues, many related to the recent global recession; and exploring best practices in areas of day-to-day interaction such as booking, documentation and demand forecasting.”

The newly formed advisory board member companies, which represent a cross-section of shippers of agriculture, commodities, industrial equipment and their third party logistics providers, are: Allenberg Cotton, American Chung Nam, Anderson Hay, Baillie Lumber, Calcot, Cargill, Caterpillar, Cellmark, Consolidated Grain Barge, DuPont, Rayonnier, Sabic International, Scoular, Sims Metal, Smithfield Foods, and Vanguard.                       

The advisory panel grew out of what the WTSA described in a statement as a series of meetings with customers over the past two years.

“Both sides wanted this initiative,” said WTSA executive administrator Brian M. Conrad. “They felt they needed a forum to sit down, candidly exchange ideas, learn more about each other’s businesses, and focus on solutions, he said.”

"This board has started an open and frank dialogue that has the potential to create a long term benefit for the whole shipping community," said board member Mike Ruder, director of logistics for Calcot, Ltd.

Advisory board members will serve two-year minimum terms, followed by staggered membership rotations, the WTSA said.
U.S. exporters have expressed frustrations this year over transportation service issues such as higher rates, equipment shortages and difficulty securing containers.

The WTSA said advisory board discussions will include “ways to structure mutual service commitments in contracts; more efficient processes to improve equipment availability; better demand forecasting to help both shippers and carriers plan their space and equipment needs throughout the year; and better coordination in the timing and communication of rate adjustments to accommodate exporters’ forward sales.”

“We see an opportunity for direct dialogue on critical issues at a senior management level, to get at the core of some longstanding differences,” said WTSA chairman and Hanjin Shipping Co. CEO Y.M. Kim. “It will help us more fully understand the commercial realities at play on both sides, and hopefully result in significant benefits to our various industries over the long term," he said.

"We've moved beyond simply venting frustrations to developing concrete actions to address the needs of both parties," a shipper representative on the advisory panel was quoted as saying in the WTSA statement. "In this age of increased volatility and competition both shippers and carriers need fresh approaches to solve today's tough challenges," the shipper said.
The WTSA members include: APL, Ltd., Hyundai Merchant Marine Co., Ltd., COSCO Container Lines, Ltd., Kawasaki Kisen Kaisha, Ltd. (K Line), Evergreen Line, Nippon Yusen Kaisha (N.Y.K. Line), Hanjin Shipping Co., Ltd., Orient Overseas Container Line, Inc., Hapag Lloyd AG, and Yangming Marine Transport Corp.

Niche terminal concept explored in Jasper County

Bumper stickers in this small town at the southern tip of South Carolina proclaim "Jasper Port Now!" but it will likely take decades to develop a major container port in Jasper County on the South Carolina side of the Savannah River.

In the meantime, one state lawmaker suggests a smaller "niche" port could provide jobs much more quickly.

State Sen. Tom Davis, R-Beaufort, says a port focusing on barge traffic, smaller shippers and refrigerated foods could jump start the port in as little as three years.

It could also, he said, ease some of the tension between South Carolina and Georgia where Charleston and Savannah have long competed for container shipping business.

For more than two decades, residents on the north side of the river have been awaiting a terminal, an idea first floated by local leaders in the late 1980s.

-Bloomberg Businessweek

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U.S. soybean export demand increases

Soybeans rose, approaching a 15- month high, after government reports showed increasing demand for supplies from the U.S., the world’s biggest producer and exporter.

U.S. shippers sold 120,000 metric tons to China, the Department of Agriculture said today, bringing this week’s total to 741,000 tons.

Exporters also sold 120,000 tons to unknown destinations. Processors used 3.843 million short tons in August, up 6.9 percent from a year earlier, the Census Bureau said today.

Soybean futures for November delivery rose 5 cents, or 0.5 percent, to close at $10.935 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price reached $10.9825. On Sept. 20, the oilseed climbed to $10.995, the highest level since June 2009. The commodity has gained 21 percent since June. 30.


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Report: Arctic Ocean shipping stakeholders urged to cooperate

Arctic stakeholders must cooperate if they are to properly utilize shipping channels that will open up as sea ice in the Arctic Ocean melts due to climate change, said a University of Alaska Fairbanks administrator.

During a workshop in Fairbanks late last year, participants from entities as diverse as cruise ship and cargo transport companies, wildlife conservation groups and state government departments came together to provide guidance for policymakers as they approach the issue of opening the Arctic Ocean to marine transport.

A report detailing the results of the workshop was recently released to the public.

"Considering a Roadmap Forward: The Arctic Marine Shipping Assessment" highlighted three concerns related to increased vessel traffic in the area: enhancing Arctic marine safety, protecting indigenous populations and the environment, and building a better marine infrastructure in the region.

Search and rescue capability on the Arctic was among the largest safety concerns, said Mike Sfraga, vice chancellor of UAF. Sfraga was responsible for overseeing the workshop, and co-edited the report, along with Lawson Brigham.

Ultimately, the purpose of the workshop was not to set concrete Arctic policy, Sfraga said, but simply to help illustrate focus areas for policymakers.

He said the workshop worked off of the results of the Arctic Marine Shipping Assessment, a report on Arctic vessel activity from the Arctic Council, an intergovernmental forum of stakeholders including Canada, Finland and the United States.

-Alaska Journal of Commerce

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Air traffic controller questioned cargo pilot before near-miss

An air traffic controller asked a cargo pilot why he didn't make a turn as ordered in the moments before his plane's near-collision with a US Airways jet over Minneapolis.

The National Transportation Safety Board said Thursday the planes came within 50 to 100 feet of each other as they passed in clouds Sept. 16.

The NTSB says controllers told the US Airways crew to turn left, which put it in the path of the cargo plane taking off from a parallel runway.

But tower radio traffic archived by, a website that streams such traffic from airports around the world, shows the controller told the Beech 99 cargo plane to turn left, too. Soon after, the controller asked the pilot why he hadn't started his turn.

The pilot's response was unclear.


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