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Summary for October 28 through November 1, 2013:
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Tuesday, October 29, 2013 Top StoryLosing Hanjin will raise costs for exporters at Port of Portland
Hanjin handles 80 percent of the port's container business, averaging about 1,600 containers per week, according to The East Oregonian. The shipping line said it was leaving the Port of Portland due to high handling fees and low dockworker productivity. Port officials are having ongoing conversations with the shipper's decision-makers in efforts to convince Hanjin to stay. In a letter to customers, Hanjin said it will continue to review resuming the service "based on changing circumstances." If Hanjin leaves, Eastern Oregon exporters would have to pay more to truck containers to Seattle or Tacoma, which cost between $500 and $1,000 per container the last time ships were diverted in summer 2012. "It was unfortunate news and news we hoped not to hear," said port spokesman JoshThomas said. "Having weekly direct call service is a major selling point in this region. Without it, it creates a void." For more of The Columbian story: columbian.com China losing luster as global business hubChinese Communist Party officials are tussling over the scope of economic reforms, which means trouble for foreign businesses in the nation. Last week, the state-run media reportedly accused Starbucks of charging too much for coffee and said Samsung Electronics smartphones don't work properly. IBM's China Q3 revenue dropped 22 percent, contributing to the first-ever sales decline in the company's growth-markets division, as state-owned companies began delaying orders, including mainframes and servers. "The operating environment for foreign firms has deteriorated in the last year in a serious way," said Shaun Rein, managing director of China Market Research Group in Shanghai. "In my 16 years in China, it's some of the worst business sentiment among foreign executives. They don't feel as welcome as they used to." When the U.S.-China Business Council, a Washington-based trade group, surveyed U.S. executives this month, the chief complaints included rising costs and bureaucratic red tape. Almost 70 percent of the more than 100 U.S. firms polled said profit margin would be flat or narrow this year. Only 39 percent are optimistic about the next five years in China; 58 percent felt that way in 2011. For more of the Bloomberg story: businessweek.com JaxPort cargo volume flat for fiscal yearCargo volume was flat at JaxPort's terminals for the fiscal year, causing the Georgia Ports Authority to boost its sales and marketing to bring more business to Jacksonville's docks. Total cargo tonnage at JaxPort dropped by seven-tenths of 1 percent for the fiscal year ending Sept. 30, according to the GPA. In contrast, the Georgia Ports Authority posted a 2.4 percent tonnage gain for Savannah and Brunswick ports. JaxPort CEO Brian Taylor vowed to Jacksonville on track. "We have to grow our business," Taylor told the board. "The core business was flat. When we sit here at the end of the [fiscal] year next year, we'll have a different story to tell you." JaxPort's pursuit of deeper water for its ship channel has gained backing from Mayor Alvin Brown and JAX Chamber because the $723 million project would enable Jacksonville to accommodate mega-sized cargo ships after the Panama Canal expansion is complete in 2015. For more of The Florida Times-Union story: members.jacksonville.com Cosco Pacific net profit jumps on asset saleThe net profit of Cosco Pacific, a top global container leasing company, jumped 2.3 times year-over-year to $640.4 million in the first nine months on one-off disposal gains. Discounting the $393.4 million gained from selling China International Marine Containers in June, the underlying net profit dropped 0.8 per cent to $224 million. "During the first three quarters of 2013, the recovery of the world's major advanced economies was strengthening but the growth of major emerging economies became moderate," the company said in a statement. The currency crisis in emerging markets, including India, Brazil, Indonesia and Thailand, since August, combined with a strong yuan, have made Chinese products less attractive to these markets. The Ministry of Commerce said earlier this month that the slowdown in emerging markets was a concern for export growth. For more of the South China Morning Post story: scmp.com Iranian Navy rescues cargo ship from pirates"The Iranian Navy's 27th fleet of warships rescued an Iranian cargo ship which was surrounded by pirates' boats," said Admiral Siyavash Jarreh, Lieutenant Commander of the Iranian Navy for Operations on Monday. The five pirate boats attacked the Iranian cargo vessel in the entrance to the Gulf of Aden but fled the scene after a few hours of conflict with the Navy's special forces. Jarreh said the Navy's goal is providing a safe passage for Iranian and other countries' vessels through the Gulf of Aden without killing the pirates, "but if necessary, more crushing responses will be given to the pirates' attacks." For more of the Farsnews story: english.farsnews.com
Wednesday, October 30, 2013 Top StoryUPS forecasts record holiday season
UPS says it will handle 4 percent more U.S. packages over the holidays due to an expected 15 percent increase in online retail orders. "We expect this year's holiday season will be another for the record books, as we pick up more than 34 million packages on our peak day," said Alan Gershenhorn, chief sales, marketing and strategy officer for UPS. UPS said it now has 25 large retailers that schedule shipments each evening of merchandise they want to shift to other stores by the next day. UPS' profit more than doubled in the recent quarter to $1.1 billion, besting Wall Street estimates. Sales were up 3.4 percent to $13.5 billion, as the company handled almost 5 percent more packages year-over-year. For more of the SF Gate story: sfgate.com Goods clearance expedited between China Mainland and Hong KongThe Customs agencies of Hong Kong and Mainland China have made an agreement that will expedite goods clearance across the Mainland-Hong Kong boundary, helping to boost the trade competitiveness of local companies, according to a statement from the Hong Kong Economic and Trade Office. The Hong Kong commissioner of Customs and Excise, Clement Cheung, and the vice-minister of the General Administration of China Customs, Sun Yibiao, signed an mutual recognition arrangement in Beijing this week to mutually recognize the GACC's Measures on Classified Management of Enterprises and Hong Kong's Authorized Economic Operator Programme, the statement said. "The facilitative measures to be provided under the MRA will enable local companies to tap into the vast Mainland market, bringing more business opportunities to the import/export and logistics industries, thereby sustaining Hong Kong's long-term economic development," said Cheung. Under the arrangement, local Hong Kong companies accredited by the C&ED as authorized economic operators can enjoy clearance facilitation, such as reduced examination or prioritized clearance, for their goods imported from or exported to the Mainland. Mainland companies which have been certified by GACC as "AA" class will have their exports of goods cleared expeditiously upon arrival in Hong Kong. Crowley and Seaboard Marine to vessel share on Central America serviceCrowley Maritime's liner services group and Seaboard Marine announced a new vessel sharing agreement on a weekly service between South Fla., Costa Rica and Panama, according to a statement. By sharing vessel space, Crowley and Seaboard will increase total capacity in the trade by using two 2,500-TEU-capacity ships, which they say will result in a more efficient operation and reduced carbon emissions. Crowley said that when the service starts in late November, each ship will call weekly at Crowley's Port Everglades, Fla., terminal and Seaboard's Port Miami terminal before sailing to Puerto Limon, Costa Rica, and Colon and Manzanillo, Panama. Seaboard will be moving all of its vessels that serve Panama to Manzanillo International Terminals. "Our cooperation in this trade lane will allow us to continue to provide exceptional service to our customers while remaining competitive in the ever-changing market," said Steve Collar, Crowley senior vice president and general manager, Latin America services. "We are particularly pleased that our combined service will provide the fastest transits in the market to and from Costa Rica." A vessel will load in Miami and Port Everglades weekly for a Friday departure and then call in Puerto Limon on Tuesdays, Manzanillo on Wednesdays, and Colon on Thursdays before departing north on Saturdays from Puerto Limon, according to the statement. Each carrier will continue to provide its full complement of equipment types used in its Central America service. Port of Cleveland to start monthly container service to northern EuropeThe Port of Cleveland will offer direct, scheduled container service to ports in northern Europe starting in April in a move to provide more efficient shipping for manufacturers in the region. The Cleveland-Europe Express would provide the only scheduled international container service on the Great Lakes, allowing businesses to ship goods faster and cheaper by skipping East Coast stops, port officials said. The service, via the Saint Lawrence Seaway, would run monthly with the possibility of two trips a month between March and December. "It's cheaper, it's faster, it's greener and it's competitive," said Joe Roman, president of the Greater Cleveland Partnership economic development organization A deal is being negotiated for an Amsterdam-based company, the Spliethoff Group, to provide the ships. The Port of Cleveland would charter the ships, handle the cargo loading and make a profit by charging exports and importers, but it wouldn't subsidize the service or invest capital. For more of the Kansas City Star story: kansascity.com U.K. Navy uses Britney Spears music to ward off piratesUK commercial super tankers are blasting Britney Spears' songs such as "Hit Me Baby One More Time" and "Oops I Did it Again" to ward off approaching Somali Pirates off the east coast of Africa. "Her songs have been chosen by the security team accompanying our tankers because they thought the pirates would hate them most," Rachel Owens, a merchant navy officer, told Metro UK. "These guys can't stand Western culture or music, making Britney's hits perfect." "The speakers can be aimed solely at the pirates so as not to disturb the crew. They're so effective the ship's security rarely needs to resort to firing guns," added Owens. "As soon as the pirates get a blast of Britney they move on as quickly as they can." In 2011, there were 176 attacks on ships by pirates off the African coast, but only 25 were successful, reports The Mirror. In addition to using Britney's songs, the British Royal Navy has 14 warships patrolling the area. "I'd imagine using Justin Bieber would be against the Geneva Convention," joked Steven Jones, of the Security Association for the Maritime Industry. "Pirates will go to any lengths to avoid or try to overcome the music, even using earplugs." For more of the Huffington Post story: huffingtonpost.com
Thursday, October 31, 2013 Top StoryChina Cosco to sell assets to avoid third year of losses
China's largest shipping firm reported a net loss of $328 million for the first three quarters of the year, compared with a $162 million loss for first half, doubling its first-half losses in just three months. The company said it plans to sell three commercial properties, which could add $602 million of profit to its bottom line by the end of the year. China Cosco's container and dry-bulk business can't lose more than $274 million in the fourth quarter if the company is to turn a profit this year. Cosco handled increased 7.8 per cent more TEUs in the third quarter, but generated 7 per cent less in revenue year-over-year on lower freight rates. The volume of its dry-bulk business fell 9.5 percent over the same period. For more of the South China Morning Post story: scmp.com Port of Oakland truckers to work through talks with air boardAfter their protest forced a one-day shutdown of Port of Oakland terminals last week, independent truckers are hoping for talks with the California Air Resources Board, and have pledged to continue working through Monday, Nov. 4. The drivers, who were protesting upcoming regulation costs and long wait-times at the port, say Oakland Mayor Jean Quan agreed to arrange talks between them and the state air quality agency. Truckers have been trying to get an extension on the costly environmental regulations set to go into effect the first of the year, according to protest leaders. In 2014, trucks with engines that don't meet year 2007 emissions standards will be banned from the port under regulations from the California Air Resources Board. The drivers want the port and the city help them negotiate a one-year extension of the deadline and are asking for state funds to help them buy new trucks. "This is what forced us to go to this work stoppage," said Frank Adams, a driver at the port and a member of the Port of Oakland Truckers Association, a group of truckers behind the recent demonstrations. He said the truckers met with Mayor Quan on Oct. 24 and they are now asking the mayor for help to extend the deadline. For more of the Oakland North story: oaklandnorth.net Record U.S. corn crop drives up rail and barge costsHarvesting the largest U.S. corn crop on record and sending it on railroads and rivers to domestic and overseas markets is driving up costs for rail, barge and truck transport. After three years of crop shortfalls, the U.S. grain handling system now has to quickly absorbing a record corn crop, forecast at a record 13.8 billion bushels. About half of the crop is already harvested. "You have a record North American grain mass, and you went from zero to 100 miles an hour in two weeks," said Charlie Sernatinger, an analyst with ED&F Man Capital in Chicago. Costs for rail freight have surged this month, due in part to strong export demand for U.S. soybeans and hard red winter wheat. Grain traders say freight trains have been running slowly, especially in the western half of the U.S. "Normally they get 2.5 or 2.8 turns a month, sometimes 3. They're getting maybe 1.6 or 1.8 right now," said a grain trader who asked not to be named, referring to the number of trips rail cars were making each month. BNSF Railway service, a major hauler of grain from Midwest to Pacific Northwest export terminals, has slowed after recent infrastructure projects fell behind due to adverse weather, he said. BNSF said it was working with its customers to "address the challenging service issues the grain supply chain is experiencing during this record compressed harvest season." The surge of newly harvested crops has also raised costs for shipping grain on Midwest river barges to export terminals on the U.S. Gulf Coast, especially on the lower Ohio River, where a lock construction project has caused severe delays near its confluence with the Mississippi. Costs for southbound freight last week rose to an average of $28.04 per ton, up 23 percent from the three-year average, the U.S. Agriculture Department said. Mid-Mississippi River barge freight was $33.57 per ton, 11 percent above the average. Tampa Port Authority unveils new $56M petroleum terminalThis week the Tampa Port Authority celebrated a new $56 million petroleum terminal complex. "It is a one-of-a-kind facility," said Port of Tampa chief executive officer Paul Anderson. "It will bring sustainability to our state and our region for generations." The first phase of the project, the largest capital investment in port history, is competed. The port shared the cost with the state of Florida, which contributed $28 million. Department of Transportation Secretary Ananth Prasad said West and Central Florida would grind to a halt without it. "This project is kind of unique in the sense that this is our livelihood," he said. "This project basically supplies gasoline fuel and passenger (plane) fuel for state of Florida residents." The ribboncutting was held on a catamaran floating in the channel alongside the new complex. Anderson and Prasad were present, along with state Sen. Jeff Brandes, Rep. Dana Young, Rep. Mark Danish, D-Tampa, and Hillsborough County Commissioner Sandra Murman. For more of the Tampa Bay Times story: tampabay.com Seven missing after freighter collides with fishing shipAt least seven people are missing after a Chinese fishing vessel hit a Korean freighter near east China's Shandong Province, officials said today. The 3:40 am collision caused nine people from the fishing vessel to fall into the sea. Two were rescued by a passing boat, according to rescue officials. The search for the missing fishermen is ongoing.
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Hanjin Shipping's decision to withdraw from the Port of Portland in January will cost local exporters, who will face higher costs to move their products, which include processed foods and timber, overseas.
Shipping giant UPS predicts a record peak season, capitalizing on online shopping and bricks-and-mortar retailers that are shifting inventory around the country in an effort to compete with Amazon.com.
China Cosco, trying to circumvent a third straight year of losses in order to keep its place on the Shanghai Stock Exchange, posted bigger losses in the third quarter.