Cargo Business Newswire Archives
Summary for October 26 - October 30, 2009:
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Monday, October 26, 2009

Top Story

Army Corps to commence Delaware River deepening

The Army Corps of Engineers has decided to allow dredging to deepen the shipping channel of the Delaware River despite objections from Delaware state officials, clearing the way for a project long sought to benefit ports in the Philadelphia region.

Jo-Ellen Darcy, assistant Army secretary for civil works, decided Friday to continue to rely on her predecessor's determination that a permit from Delaware was not needed to proceed, according to officials familiar with the issue.

The spoil from the project will be deposited in abandoned coal mines in northeastern Pennsylvania under the current plan, officials have said.

Dan Fee, spokesman for the Philadelphia Regional Port Authority, said the work may begin by the end of the year as an extension of the contract for annual maintenance dredging.

Pennsylvania has committed $30 million for the initial part of the project. The work will proceed with state and already-appropriated federal money.

The Delaware River's current depth of 40 feet does not accommodate most modern ships and puts Philadelphia's port at a competitive disadvantage, since depths at other Eastern ports, including New York and Baltimore, approach 50 feet. The project would deepen the shipping channel to 45 feet.

-Philadelphia Inquirer

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Columbia River rock blasting begins Nov. 1

The U.S. Army Corps of Engineers announced it would begin blasting basalt from the bottom of the Columbia River Nov. 1 as part of the project to deepen the river’s ship navigation channel from 40 feet to 43 feet.

The Corps said the blasting work will take place along a one-mile stretch of the river between River Miles 87 and 89 near St. Helens, Ore.

The contractor will drill holes into the basalt from a barge-mounted rig and detonate blasting agent to fracture the rock before removing the rock with an excavator.

Blasting operations are to be completed by Feb. 28, the Corps said.

IATA survey shows airline exec confidence is up

Airline executives expect improved results and a rebound in cargo volumes in the coming year, a "turning point" for a sector closely linked to economic trends, a survey released on Monday showed.

The International Air Transport Association, a Geneva-based body representing 230 airlines, said confidence had grown markedly among major carriers in Asia, Europe and the Americas.

"This does look like a turning point," IATA said of the quarterly business confidence poll.

Chief financial officers and heads of cargo have taken some solace in a return to economic growth, which has begun to boost demand for air travel and shipments, with stable fuel prices further helping soothe nerves, the survey found.

"Over 73 percent of airline CFOs said that profitability over the next 12 months will improve," IATA said. "Almost three quarters of respondents now expect freight volumes to rise over the next year -- up from just over half (in the) last survey."


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Summit: Cargo theft on rise

Cargo theft is on the rise and needs a national strategy to contain it, experts say.

More than two trucks are stolen in the United States every day, said Ed Petow, the Fort Lauderdale, Fla.-based law enforcement liaison and director of quality control for FreightWatch International, a Dublin, Ireland-based logistics security agency, during last week's national cargo theft summit in Arlington, Va., sponsored by the National Insurance Crime Bureau. The cost of such theft, which includes goods stolen from warehouses and other facilities as well as direct theft of and from trucks, is considerable.

Depending on the source used, cargo theft costs between $25 billion and $30 billion annually, U.S. Rep. Cliff Stearns, R-Fla., told the summit.

Cargo theft patterns have changed somewhat in recent years. The highest rate of thefts used to be at truck stops, but now the highest rate is at staging areas where trucks are loaded.

-Business Insurance

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OOCL to increase Europe-Asia rate 100 per-TEU

Hong Kong’ss Orient Overseas Container Line (OOCL) announced a rate increase on the eastbound trade between Europe and Asia of $100 per-TEU starting November 1.

"Considering that current levels are unsustainable for the long-term, OOCL would like to advise that we will introduce a rate restoration program to restore freight rates to a more sustainable level," the shipping line said in a statement.


Tuesday, October 27, 2009

Top Story

Canadian Pacific Q3 soars despite revenue drop

Canadian Pacific Railway Ltd. (TSX:CP) says the sale of two large properties helped boost its third-quarter profit despite a 20 per cent drop in revenue from operations as most of its freight segments showed the effect of a slow economy.

Canadian Pacific says its third-quarter profit was $195.4 million or $1.16 cents a share, including $68 million from the sale of two properties. A year ago, the railway's profit was $170.7 million or $1.10 cents a share.

-Canadian Press

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Paccar Q3 profits plunges 96 percent

Paccar Inc. shares came under pressure early Tuesday after the company said the difficult economic climate for moving freight and selling trucks led to a 96% plunge in third-quarter profit.

At last check, Paccar's stock was down $2.06 at $37.19. Still, the shares are up 67% over the past year.

The Bellevue, Wash.-based truck maker posted earnings of $13 million, or 4 cents a share, down from $299 million, or 82 cents a share, a year ago.

Sales fell to $1.76 billion from $3.68 billion.


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DP World forecasts some stability

Port operator DP World DPW.DI said on Tuesday it expects pricing pressures to continue due to excess capacity in the global shipping industry, but sees some stability returning.

DP World also said its non-container revenues in 2009 would decline by 30 percent, Chief Executive Mohammad Sharaf told investors on a conference call.

The company said it cut around 1,300 jobs as part of a previously announced 12,000 job reduction initiative at parent company Dubai World.


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Broward County airport, port might open to Cuba travel

Broward residents who want to fly to Cuba may have an option closer to home than Miami in the future.

On Tuesday, County Commissioners will vote on whether to ask the federal government to designate the Fort Lauderdale-Hollywood International Airport as a point of entry for flights to and from Cuba. County officials also want to designate Port Everglades as another point of entry.

The airport is expanding its Customs and Border Protection facilities to double capacity to process international passengers by the end of the year.

Just this year, the U.S. government eased travel restrictions to Cuba, allowing those who have family there to visit more frequently.

-Miami Herald

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Crowley christens 7th ATB in New Orleans

Jacksonville-based Crowley Maritime Corporation announced the christening of the seventh of 10 new 185,000-barrel Articulated Tug-Barge (ATB) tank vessels that the company said it would be taking delivery of in 2010 and 2011.

The tug Pride and barge 650-7 where christened at the Port of New Orleans.

Crowley Petroleum Services will charter the VT Halter Marine-built ATB from Crowley's vessel construction and naval architecture subsidiary, Vessel Management Services, and operate it for Marathon Petroleum under a time charter agreement, the company said.

Crowley said it already has six, 185,000-barrel and four 155,000-barrel ATBs in the U.S. Jones Act trade.


Wednesday, October 28, 2009

Top Story

Interview with Tacoma’s outgoing executive director

It was announced this past week that the Port of Tacoma’s executive director Tim Farrell would be vacating his post by year’s end in what the port commission there stated was “a transition in leadership.”

In an interview today with Cargo Business News, Farrell talked about his five-year tenure as the port’s chief executive, and what led up to what he said was his decision to leave the major Puget Sound seaport.

The centerpiece story in Tacoma surrounding the recent announcement of Farrell’s departure has had to do with the major Japanese shipping group, NYK, announcing they would forgo development of an $800 million, 168-acre marine terminal project that was to include a 25-year lease.

Cost estimates for the project reportedly swelled to $1.2 billion.

“We found it would be more expensive than we thought it would be,” Farrell told CBN, stressing the original development figures “were never anything more than cost estimates.”

Farrell said the primary cost the port and NYK ran into was that of utility infrastructure in an area that had once been home to chemical plants, an aluminum smelter, and a shipyard that all “drew a lot of electrical power.”

“What we didn’t have down that we should have is that the actual utility systems and the relocation would have been hugely expensive,” he said.

The decision to start looking at serious alternatives to the original NYK terminal project, first announced in 2007, started in earnest in February of this year, Farrell said.

Subsequently, NYK decided to move to the APM terminal at Tacoma since the operator there had lost the services of its parent company, Maersk, to nearby rival Seattle.

The collapse of the global shipping economy in 2009 was cited by NYK in its decision to suspend the Tacoma terminal development.
The shipping economy was quite a bit different when Farrell was promoted from deputy executive director to the top post in late 2004, when the specter of double-digit declines in U.S. port traffic didn’t seem possible.

“Peak Season was year-round,” he said of that period of record-breaking container-shipping volumes pouring the West Coast box ports.
Farrell said the port’s container marketing manager, Brendan Dugan, had been visiting all of the major shipping lines selling the merits of expansion on the port’s Blair Waterway and getting rebuffed with a general attitude that it wouldn’t work there.

However, in 2005, Taiwanese shipping giant, Evergreen, opened a terminal at the head of the Blair Waterway, and Farrell said suddenly shipping lines were knocking on Dugan’s door.

“That process led us to select NYK as a company we wanted to do business with,” he said.

Farrell also referred to Taiwan’s Yang Ming starting up a containerized service at the port in 2005, and another Japanese carrier, MOL, following suit in 2007.

Farrell said he leaves a port that is poised for containerized growth when the time comes.

“Now we’ve acquired most of the land and have a deep understanding on what’s there. When the shipping economy revives, we’ll be well positioned to move on it. Everything’s on the table at this point, we can build three or four major terminals.”

Farrell pointed to the UP Railroad recently starting up a domestic intermodal service for 53-foot boxes, where they are utilizing 15 trans-load facilities, which “gives us other inland options,” he said.

Farrell said the port’s Alaska shipping trade, which takes up a significant percentage of Tacoma’s business, is down, but more stable than the global containerized market. He also said the port has new ro-ro business with customers like Caterpillar and Wallenius Willhemson, the major carrier in that trade, bringing in a new inbound service in from Asia, with outbound to Panama.

“We have a diversified base. We’re building a foundation for when we do see a recovery, if there is an uneven recovery, and one area catches fire first, we’ll be there,” Farrell said.

As for Farrell’s next phase, he finishes out his role as executive at the port at year’s end, and will be on a 5-month consulting contract starting first of the New Year.

Beyond that, Farrell said: “I’m 43. My daughter is 18 months and I look forward to spending more time with her and my wife. We’re going to trade a little bit. My wife will try and take off in her career.”

Further off, Farrell said: “Over the course of my 20 years in the industry, a lot of opportunities have come up, and now I can go back and look at that list – some in the industry and some not – that part is exciting for me – there s lots of opportunity.”

Looking back, Farrell said he considers bringing NYK to Tacoma a significant milestone.

Farrell also repeated what then-departing executive director Andrea Riniker’s parting quote to him was as he stepped into the port’s top position five years ago: “This job knocks the sauce out of you.”

Baltimore seeks clean diesel technologies

The Port of Baltimore, MD announced it is accepting applications for a federally funded clean diesel technology program from operators of heavy port equipment such as dray trucks, harbor craft, locomotives and cargo-handling machinery.

In August, the U.S. Environmental Protection Agency (EPA) awarded the port $3.5 million under the Recovery Act and the National Clean Diesel campaign. The port said the purpose of the grant is “to promote early, voluntary actions to reduce emissions related to the movement of international goods and cargo handled at the Port of Baltimore.”

The Port of Baltimore said it was selected from a group of projects competing for a share of $16.1 million, and the EPA’s mid-Atlantic region received 40 grant applications. The Port of Baltimore said it was one of seven applicants awarded funding.

The Maryland Port Administration said it is partnering with the EPA, Maryland Department of the Environment, Maryland Environmental Services, the University of Maryland Environmental Finance Center, the Maryland Motor Truck Association, and the Baltimore Port Alliance to implement the clean diesel technology program.

Old Dominion CEO cites YRC situation for tough pricing environment

Cut-throat pricing in the trucking sector is being exacerbated by what appear to be efforts of some competitors to drive struggling YRC Worldwide Inc. (YRCW) out of business, an industry executive said Wednesday.

Earl Congdon, chief executive of Old Dominion Freight Line Inc. (ODFL), cited the economic downturn and trucking overcapacity as culprits behind "the worst pricing environment we've ever experienced."

But he also said in an interview that some of the pricing trends likely stem from deliberate moves to undercut YRC, a top but financially teetering player in the less-than-truckload, or LTL, shipping market.


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Japanese warship collides with South Korean containership

A Japanese warship collided with a cargo ship off southern Japan yesterday, injuring three crew members and starting fires on both vessels. The JS Kurama and the South Korean container vessel Carina Star collided in the Kanmon Strait, some 500 miles southwest of Tokyo. Last night, there was still smoke coming from the vessel, which has 360 crew members on board, though authorities said that fires were under control.

Defence officials said that the destroyer suffered a damaged bow, but was capable of returning to port unaided.

Toshimi Kitazawa, Japan’s Defence Minister told a press conference: “We deeply apologise to people for causing concern. We will quickly find out what caused the accident.”

-Times of London

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Pirate attacks on rise

The first nine months of this year has seen more pirate attacks than all of last year. And more than half of those attacks were carried out by suspected Somali pirates, an international maritime watchdog group said Wednesday.

"The increased activity in Somalia is the major reason for the spike," said Cyrus Mody, manager of the International Maritime Bureau, which monitors shipping crimes.

From January 1 until September 30, pirates worldwide mounted 306 attacks, compared with 293 in all of 2008, the Bureau said.
Of the incidents this year, Somali pirates accounted for 54 percent: they launched 168 attacks.

Most of them took place off the east coast of Somalia and in the Gulf of Aden, a major shipping route between Yemen and Somalia.


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Thursday, October 29, 2009

Breaking Story

Boeing picks North Charleston over Everett

By Peter Hull, CBN Southeast editor

CHARLESTON – Good news appears to have followed Jim Newsome to South Carolina.

Since the new South Carolina State Ports Authority chief executive took the helm last month, Maersk Line last week has announced it would stay in Charleston after threatening to pull out over costs.

Then on Tuesday, more good news for Newsome and those who serve Charleston’s port: Boeing Co. said it will build its second 787 jet assembly plant in North Charleston – at the expense of Everett, Wash.

The arrival of Boeing in the state is expected to generate thousands of jobs and create a new industry for South Carolina, with comparisons quickly made to the arrival of BMW’s first and only vehicle assembly plant in North America 15 years ago.

The arrival of the German auto manufacturer boosted port business through the shipment of parts and finished vehicles, and took truckers across the state from Charleston’s docks to BMW’s Upstate plant 4 hours away near Greenville.

Newsome’s reaction Tuesday to Boeing’s announcement was businesslike, but clearly pointed to the beginning of a new relationship.
“This is a tremendous day for the people and industries of South Carolina, and we look forward to serving Boeing’s seaport needs,” Newsome said.

Local logistics and trucking companies were equally optimistic.

“This is fantastic news,” said Pat Barber, owner of Superior Transportation, chairman of the Charleston Motor Carriers Association and vice president of the South Carolina Trucking Association. “It’s a shot in the arm this region needed.”

The Port of Charleston is widely credited with contributing to BMW’s success. A logistics network, similar to that developed to serve the auto plant, likely will be required to serve the Boeing plant.

Part of what attracted Boeing to South Carolina was the state’s union-free environment. That environment applies to truckers, and likely will appeal to Boeing in a similar way, said Bill Campbell of the independent Port Truckers Association in Charleston.

“Out here [Boeing] could rely on the independent trucker to stay away from the unions,” Campbell said. “Here, there isn’t going to be a union.”

Friday, October 30, 2009

Top Story

China to lift U.S. pork ban

China plans to lift a ban on imports of pork from the United States, ending a six-month prohibition that has cost the American hog industry millions of dollars a week, officials said Thursday. Agriculture Secretary Tom Vilsack said pork shipments may resume next month. China imposed the ban in May out of concern over the swine flu virus. Chinese officials, concluding trade talks in the coastal city of Hangzhou, noted that the United States had relaxed restrictions on imports of Chinese poultry products. But they said the Chinese government was investigating possible unfair trade practices involving imports from American car companies.

- NY Times

Story source:

COSCO quarterly losses narrow

China COSCO Holdings the country's largest shipping group, narrowed its quarterly losses as China demand drove a rise in bulk cargo volume and freight rates and the container shipping market improved.

China COSCO made a net loss of 690.7 million yuan ($101.2 million) in the quarter ended Sept. 30, cutting its quarterly deficit by nearly half from 1.27 billion yuan in the second quarter, based on Chinese accounting standards.

Its shares opened up 3 percent on Friday after the results, beating a 2.1 percent gain on the benchmark index .HSI.
The carrier, which operates container ships and commands the world's biggest bulk cargo fleet, earned 5.56 billion yuan in the same quarter last year.


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Shanghai port plummets 30 percent for Q3

Shanghai International Port (Group) Co, China's biggest port operator, posted a 30 percent fall in its third quarter earnings as global trade showed no clear signs of recovery.

The port operator, whose facilities sit at the mouth of China's busy Yangtze River, earned 1.02 billion yuan ($149.4 million) in the third quarter, down from 1.45 billion yuan a year earlier, it said in its quarterly financial report.

Net profit for the first nine months also fell 30 percent, to 2.73 billion yuan, because the port handled less containers as trade volume dropped amid the global financial crisis, it said in a statement.


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Target expands free-shipping online ahead of holidays

Target Corp is expanding the number of items that qualify for free shipping on its website and rolling out the shipping promotion two weeks earlier than last year as it looks to win holiday sales. said Friday it is offering free shipping on more than 100,000 items when consumers spend $50 or more on its site. The free shipping offer for qualifying purchases will begin on Nov. 1, two weeks earlier than a year ago.

The holiday shopping season could be a tough one for retailers, with the National Retail Federation predicting sales could fall 1 percent. But online shopping is expected to be a bright spot, and retailers are attempting to win sales by touting free shipping offers or cutting prices.


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Airbus to open first Asia logistics center in Tianjin

Airbus will open its first logistics center in Asia early next year in north China's Tianjin Municipality, after signing a Memorandum of Understanding (MOU) with the local government Thursday.

The center will begin operation at a temporary site in the Tianjin Port Bonded Area of the Binhai New Area in early 2010, before its permanent location is determined after next March, according to the MOU.

Airbus, one of the world's largest commercial plane makers, forecast its procurement of components and materials in China will rise to $200 million by 2010, and $450 million by 2015.

-China Daily

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