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Summary for October 1 - October 5, 2012:
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Tuesday, October 2, 2012 Top StoryWest Coast Longshoremen walk out Friday to protest leader's conviction; ILWU-Grain terminal talks continue after contract expires
ILWU President Robert McEllrath was convicted of obstructing a train at a protest in Longview, Wash. last year and sentenced to one day in jail and an 89-day suspended sentence, plus $534 in fines. Portland turned truckers away from Terminal 6, forced to close at 3:30 p.m. Friday. "It's my understanding that many workers walked spontaneously after hearing about the guilty verdict," said Jennifer Sargent, a spokeswoman for the International Longshore and Warehouse Union, on Friday. "I don't yet know the magnitude." Longeshoremen were back to work Saturday but started implementing slowdown tactics at Portland's Terminal 6, according to yard operator ICTSI Oregon. ILWU members worked at a "fairly normal pace" Saturday morning, loading and unloading a Hanjin Shipping vessel at Terminal 6, said Elvis Ganda, ICTSI Oregon chief executive. "However the night shift was back to its usual slowdown tactics," Ganda said, "and we were seeing production at about 36 percent less than the dayside production." ILWU's Sargent did not respond Monday to a request for comment. Happening concurrently with Portland's shutdown, on Friday Northwest grain terminal owners announced they would continue to operate their grain terminals through mid October after the one-year union contract expired on Sunday. The Pacific Northwest Grain Handlers Association and the ILWU agreed Friday to avert a lockout by continuing negotiations through mid-October, with longshoremen agreeing to continue work at the grain terminals in the Portland area and Puget Sound. A walk out now during harvesting season could back up grain shipments as far as the Midwest. For more of the Oregon Live stories: New report measures health of U.S. seaports and surrounding real estateThe fourth annual seaport report, which analyzes the health of major domestic container seaports and surrounding real estate, reports that U.S. ports are boosting infrastructure development in order to compete and be prepared for trade flow shifts once the Panama Canal expansion is complete in 2014. The strength of the port commercial real estate sector is better than in the broader industrial market, according to the Jones Lang LaSalle report. Public and private money is flowing into port infrastructure projects due to the widening of the Panama Canal and the growth of U.S. ports. At least 13 billion in public funds have been set aside for port development over the next 10 years. Large spaces are hard to come by, since only 20 blocks of space are typically available for those who need big space within five miles of a major U.S. port. There are fewer than 10 existing warehouse or distribution facilities of more than 500,000 square feet within a 15-mile radius surrounding the major seaports, according to the report, and fewer than 60 blocks greater than 250,000 square feet. "This not only provides opportunities to develop smaller distribution centers or redevelop old or obsolete product, but also to evaluate supply chain requirements, adapt potential transportation routes, and assess competitive drayage options," said John Carver, head of Jones Lang LaSalle's ports airports and global infrastructure group. The Jones Lang LaSalle Port Index, which ranks ports on terminal operating and real estate market factors, ranked the Port of New York and New Jersey at the top of the list for the first time in 4 years. The ports of Los Angeles and Long Beach, usually at the top of the list, followed closely at 2 and 3. These three major seaports support huge local population centers; second, infill vacancy around the ports remains and new development is valued; plus they are all connected to a wide selection of adjacent markets that can facilitate "big-box" logistics space, according Aaron Ahlburn, head of industrial research for Jones Lang LaSalle. The next ten most competitive shipping hubs in terms of operations and real estate were ranked as follows: Savannah, Jacksonville, Baltimore, Houston, Tacoma, Virginia, Charleston, Oakland, Seattle, and Miami. 74 percent of logistics companies exceeded 2011 profit forecasts, report saysDespite a sluggish economic climate, 74 percent of the North American logistics companies surveyed achieved or exceeded revenue projections in 2011, according to the 19th annual survey of Third-Party Logistics Providers, sponsored by Penske Logistics. Companies that did not meet their financial forecasts were up from 14 percent in 2010, to 26 percent in 2011. The findings analyze responses from 31 CEOs of large third-party logistics company in North America, Europe and the Asia-Pacific region whose companies made $45 billion in revenue in 2011. The survey is being presented today in Atlanta at the annual conference of the Council of Supply Chain Management Professionals by author Dr. Robert Lieb, professor of supply chain management at Northeastern University, and by Joe Gallick, senior vice president of sales for Penske Logistics. 38 killed in ship collision off Hong KongAt least 38 people were killed in a vessel collision Monday off the Lamma Island on the southwest of the Hong Kong Island, according to the Hong Kong Information Services Department. One ship, which capsized after the crash, carried more than 120 passengers and crew. It was rented by the Hong Kong Electric Company to send some staff and family members for a cruise to watch holiday fireworks at the Victoria Harbor. The other vessel, which was damaged but did not sink, was a regular ferry operated by the Hong Kong and Kowloon Ferry Company. It also carried a number of passengers. Six crewmembers from both vessels have been detained, according to the Hong Kong Special Administrative Region government, under investigation for "endangering people's lives at sea." For the rest of the China Daily story: chinadaily.com.cn
Wednesday, October 3, 2012 Top StoryPanama Canal expansion approaches halfway point
"The Panama Canal Expansion Program is moving forward at a good pace" said Panama Canal Administrator and CEO Jorge Quijano. Three of the four dry excavation projects have been finished, and the fourth project was 67 percent through as of the beginning of September. The dredging of the Pacific and Atlantic entrances almost done and the dredging of the Gatun Lake is 76 percent complete. About a third of the work has been done on locks design and construction. The locks gates are being manufactured in Italy and the first four gates will be shipped to Panama during the first quarter of 2013, and the last four gates should arrive during the first quarter of 2014. Concurrently valves are being manufactured in Korea and valve components are being incorporated into the lock structure. The contractor is set to complete the main lock structure and begin pre-commissioning tests during the first quarter of 2014, and the flooding of the locks and final commissioning will begin in September 2014. A.P. Moller-Maersk questions Vitol about embargoed Iranian oil shipmentA.P. Moller-Maersk has asked oil trader Vitol if it used a Maersk tanker to ship Iranian fuel oil under sanctions from the West. Vitol chartered the Maersk Producer in early September, and according to a document seen by Reuters, the Producer received Iranian fuel oil cargo Sept. 8. It was loaded onto the Producer from Vitol's floating storage off Malaysia and then sent to storage in Singapore. "Not at any point did we know that the vessel would be used to transport oil under embargo and we will bring this up for discussion with Vitol at the highest level," said Per Juul, managing director of the agent for Maersk, to Reuters via email. Vitol's Bahrain office bought the fuel oil, Vitol admitted last week. The company now says it has ordered a halt to trade with Iran. Vitol said it would cooperate fully in talks with Maersk. For more of the Reuters story: reuters.com U.S. cities that send the most exports to ChinaU.S. exports to China were more than $100 billion last year, and the value of products being shipped there is growing fast. In 2011, crop production, computers and electronics, chemicals, and transportation equipment were the four largest U.S. exports to China. China is the biggest receiver of U.S. goods from 28 individual states. NBC News reviewed the nine American metropolitan areas and cities that export the most goods to China, in terms of dollar amounts rather than as a percentage of total exports, so some of the cities are just top exporters in general. Los Angeles-Long Beach-Santa Ana, Calif. was number one, exporting $8 billion or 11 percent of its total exports to China. Its top export items include computers and electronic products. The New York-Northern New Jersey-Long Island area in New York and New Jersey sent $7.44 billion in exports to China, or 7.1 percent of its total exports. Almost 25 percent of the exports are miscellaneous manufactured commodities. Seattle-Tacoma-Bellevue, Wash. Area sent $6 billion in goods to China in 2011, or 14.6 percent of its total exports, much of it in transportation equipment from Boeing and others. Houston-Sugar Land-Baytown, Tex. exported 5.1 percent or $5.33 billion in goods to China, with petroleum and coal products its largest export. Minneapolis-St. Paul-Bloomington, Minn.-Wis. came in fifth, sending $4.2 billion in exports to China, with crop production as its largest cargo. For more of the NBC News story: bottomline.nbcnews.com Rena owners to pay $27.6M settlementThe owners of the Rena, Daina Shipping Company, will pay 27.6 million to settle the claims of the New Zealand government and several public bodies, including Maritime New Zealand, relating to the grounding of the vessel at Astrolabe Reef on October 5, 2011. The figure will rise to $38 million if the company gets resource permission to leave part of the wreck where it is on the reef. The government has paid $47 million for Rena salvage and cleanup so far. Transport Minister Gerry Brownlee said he was satisfied with the deal. Under Maritime Law, Daina Shipping was only required to pay a maximum of $11.3 million compensation for losses caused by its grounding, he said. The settlement will not affect the government's prosecution of Daina Shipping under the Resource Management Act. For more of The New Zealand Herald story: nzherald.co.nz One dies in Seattle fishing boat collisionEarly Friday morning, one crewmember died when the fishing boat Maverick sank after being hit in the fog by another fishing boat 30 miles off Washington coast, according to the Coast Guard. The other three aboard the boat survived the capsizing. The 90-foot Viking Storm hit the 40-foot boat as the Maverick was drifting, and the Maverick reportedly went down quickly. The investigation into the crash will take months, the Coast Guard said. "It was very, very thick fog, visibility about 40-foot," said Lt. Cmdr. Matthew Denning, chief of marine investigation in Seattle said Monday. Kelly Dickerson, 32, was trapped in the forward part of the ship and the Maverick sank bow first. Of the remaining three crewmembers, one made it out of the boat and broke a window to help free the other two. For more of the Seattle Times story: seattletimes.com
Thursday, October 4, 2012 Top StoryPSA Singapore to spend $2.9 billion to expand port facilities
Work to be done in phases 3 and 4 includes 15 new berths, an automated container yard and rail-mounted gantry cranes. Expected to be finished in 2020, the improvements will increase Singapore's capacity to 50 million TEUs annually. This year, through August, the port has handled 20.88 million TEUs. For more of the Bloomberg story: bloomberg.com China's manufacturing remains in slowdown mode, logistics federation saysChina's manufacturing experienced another contraction in September, but improved from August figures, which may indicate the economic downturn is bottoming out, according to the Washington Post. The China Federation of Logistics and Purchasing reported its monthly purchasing managers' index was 49.8 points, 0.6 higher than in August. Numbers below 50 on the 100-point scale indicate a contraction. China's economic growth fell to a three-year low of 7.6 percent in the last quarter ending in June. This has hurt Chinese manufacturers who depend on high growth. Analysts were forecasting a turnaround in late 2012 or early 2013, but weakness in Europe and U.S. export markets may curtail any rebound. China's slowdown in manufacturing is due mainly to government lending and investment curbs implemented to cool inflation and promote rapid growth, but the country was hurt by the surprisingly sharp decline in export demand. The logistics federation said production figures stood at 51.3, up 0.4 from August, and that clothing, auto manufacturing, food-processing, electronics and some other industries showed some expansion. For more of the Washington Post story: washingtonpost.com Bids open for operation of new $1.9 billion container facilities at Port of MelbourneBids opened Wednesday to manage the new Webb Dock container port, automotive terminal and inspection hub at Australia's Port of Melbourne. Ports Minister Denis Napthine said the two automotive EOIs (expressions of interest) will be open until November 14 and the container component will be open until December 5. Napthine said by 2035 it was expected trade through the ports would be 8 million TEUs. "Clearly decisions were needed to make sure that Melbourne and Victoria have the capacity to deal with that container trade for our exporters and for our importers," he told reporters. "The last thing we needed in this state was for ships to be delayed because of lack of berthing space or even worse, ships to be diverted to Sydney or Brisbane because we didn't have the capacity here in the Port of Melbourne or at other ports." For more of the News.com.au story: news.com.au American Society of Civil Engineer report says port infrastructure improvements are crucial to export growthKeeping U.S. ports competitive and preparing them for the newest breed of VLCCs will cost more than $30 billion by 2020, twice what is being spent today, according to a September report issued by the American Society of Civil Engineers. The ASCE has commissioned a series of reports on the difference between current infrastructure spending and the funds needed to repair or replace systems at the end of their lifespan. "To remain globally competitive, this is a critical time for investment," said Andrew W. Herrmann, president of ASCE. The report asserted it is crucial to improve 300 commercial port facilities, dredge deeper channels, replace dams and locks on 12,000 miles of inland waterway, and relieve traffic congestion around ports. Without massive new investments, the report estimated U.S. export losses of $270 billion by 2020 and a $697 billion drop in gross domestic product. That loss of production corresponds to 738,000 jobs, according to the report. The need for port investment is particularly acute on the East Coast. Norfolk and Baltimore can accommodate the new megaships that will call after the Panama Canal expansion, but at this point few others can, although dredging efforts are underway at several East Coast ports. New York has a concern all its own – the Bayonne Bridge needs to be elevated in order for the bigger ships to pass through. For more of the Washington Post story: washingtonpost.com CH Robinson opens ChemSolutions logistics divisionGlobal third-party logistics company, CH Robinson Worldwide, will launch a new division called ChemSolutions, which will provide logistics solutions to chemical manufacturing and distribution. ChemSolutions will offer multi-modal transport solutions to chemical shippers and guarantee the safety and sustainability of shipments. Developments in Eastern European manufacturing units have increased the demand for transportation solutions. Most of the shipping is taking place in countries stretching from East to West Europe or is transcontinental. However, since the European truck industry lacks service capabilities, 3PL carriers like C.H. Robinson are taking advantage of the new opportunity. For more of the NASDAQ story: community.nasdaq.com Follow-up on Monday's fatal boat collision in Hong KongHong Kong's Chief Executive Leung Chun-ying was criticized for allowing Beijing official Li Gang to play a role a high-profile news event after a tragic board collision on Monday killed 38. The tragedy happened when a boat transporting 120 staff and family members of a power company to watch a fireworks display crashed into a commuter ferry and quickly sank. Hong Kong citizens dressed in black Thursday and had a moment of silence for three minutes at noon as they observed the first of three days of official mourning. Friends and relatives of those killed in the crash sailed to the scene Hong Kong's southwestern coast to take part in a traditional Chinese mourning ritual by tossing spirit money in honor of the victims. While Hong Kong went back under Beijing's control 15 years ago, the city typically enjoys an unusual degree of autonomy. "It's unusual for Hong Kong officials to let their counterparts from mainland China play such a high-profile role in events they're not involved in," according to the Washington Post. "Leung Chun-ying should not have allowed Li Gang to interfere in such a high-profile way," said Hong Kong's Apple newspaper. "In this way, many residents feel deeply that Li Gang and the Central Liaison office are the real captains of the ship." For more of the Washington Post story: washingtonpost.com
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It was a busy day for labor-management disputes Friday. Longshoremen walked off the job at Portland and other West Coast ports to protest the conviction of the head of their union. It's also the day that PNW grain terminal managers and the ILWU announced that talks will continue through mid October after their one-year contract expired on Sunday.
According to the Panama Canal Authority, the expansion is reaching its halfway mark. As of August 31, the progress toward total completion of the project was estimated at 44.5 percent.
PSA Singapore Terminals will spend $2.9 billion to develop phases 3 and 4 of the Pasir Panjang terminal, according to a statement issued this week.