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Summary for December 1 - December 5, 2008:
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Monday, December 1, 2008

YRC and Teamsters make a new deal

YRC Worldwide Inc. and the International Brotherhood of Teamsters announced Nov. 28 that they have reached a tentative agreement to modify their current labor contract, which covers approximately 40,000 employees, including dock workers, drivers, and clerical workers.

“This agreement will help the company get through this deepening recession and protect the jobs and health, welfare, and pension benefits of our freight Teamsters,” said Tyson Johnson, director of the Teamsters National Freight Division.

Bill Zollars, YRC Worldwide chairman, president, and CEO, commented, “The modification to the agreement, which we expect to be ratified in December, will establish a more competitive cost structure allowing us to accelerate our market share recovery and capitalize on opportunities for future growth, while at the same time, defending the long-term prospects and job security of our employees.”

Neither YRC nor the Teamsters disclosed terms of the tentative agreement. YRC owns Yellow Transportation, Roadway, Holland, and New Penn.

Details surrounding the modification are expected to be available this week, following further discussions with labor leadership and the affected employees, YRC said.


YRC Worldwide Inc.



UPS survey finds businesses ignore risks

Nearly half of companies with global supply chains say they fear major disruptions in their ability to source, produce, and ship goods around the world — and they’re not doing much to prevent it, according to a new UPS-sponsored survey, “Supply Chain Resilience: How are global businesses doing?”

The global survey of nearly 350 senior executives by UPS and the Economist Intelligence Unit, released Dec. 1, was supplemented with interviews of academic experts and leading supply chain practitioners.

Forty-seven percent of companies say they need to pay more attention to risk mitigation compared to just 16% that believe they pay an adequate amount of attention, according to the survey.

As a result, only 38% of those surveyed rate the resilience of their supply chain above average, while a troubling 42% say the expansion of their global supply chains has outpaced their ability to manage risk.  

Among the findings, one of every 10 companies does not monitor suppliers for anything. About half of the remainder look only at immediate suppliers. Furthermore, in almost half the companies surveyed, formal risk assessment takes place only annually.


“Supply Chain Resilience PDF”


Keller honored by forwarders/brokers group

Peter I. Keller, president of NYK Line (North America) Inc., has been selected the 2009 Person of the Year by the New York/New Jersey Foreign Freight Forwarders and Brokers Association Inc., according to an announcement Nov. 26 by the group.

“Peter Keller has significantly impacted the global trade community and demonstrated great leadership in the international transport industry,” said Matthew Brauner, Association president.

Peter Keller was elected to the Governing Board of NYK in Tokyo in April 2007. He is only the second non-Japanese nominated to the Governing Board in the 120-year history of NYK and the first to be named president of NYK Line (North America), according to the announcement.

Prior to NYK, Mr. Keller spent 14 years with Sea-Land Service. Prior to Sea-Land, he served as president of CAST North America in Montreal, Canada, where he later became CEO of The CAST Group.

The award will be presented during the 92nd annual dinner at the Marriott Marquis Hotel in New York on Jan. 28, 2009.

Tickets and information about the award dinner are available online.


New York/New Jersey Foreign Freight Forwarders and Brokers Association Inc.


Tuesday, December 2, 2008

LA/LB ports’ cargo fee delayed

The Long Beach Board of Harbor Commissioners voted Dec. 1 to delay for at least six months the collection of a cargo-container fee intended to collect funds for road, rail, and bridge improvements in the harbor area.

Scheduled to begin Jan. 1, 2009, the “Infrastructure Cargo Fee” (IFC) of $15 per TEU shipping container ($30/FEU) was established in January 2008 by harbor commissioners of the ports of Long Beach and Los Angeles.

In the coming weeks, the Los Angeles Board of Harbor Commissioners is expected to approve a similar six-month delay.

The fees are expected to generate $1.4 billion over seven years for projects including upgrades to the ports’ rail network, replacement of the Gerald Desmond Bridge, and other improvements to facilitate traffic flow through the ports.

“Because of the extra time needed to complete the planning and approval process for these many projects, the ports felt it was sensible to delay the implementation of the fee,” said J. Christopher Lytle, deputy executive director, Port of Long Beach.

“We’ll reassess the situation in six months to see it if makes sense to start the fee then.”


Port of Long Beach


Luxury liner outruns Somali pirates

A U.S. luxury liner carrying more than a thousand people was chased and shot at by Somali pirates Nov. 30 while transiting through the Gulf of Aden within the maritime safety protection area.

Florida-based Oceania Cruises Inc. identified the ship as the 594-ft. M/S Nautica, which carries 684 passengers and 400 crew.

“All guests and crew onboard are safe, and there were no injuries,” according to a statement on the Oceania Cruises website. No damage to the vessel was sustained.

Two skiffs, approaching from a range of approximately 1,000 meters, attempted to intercept the vessel’s course, the company said, when Capt. Jurica Brajcic and his officers “immediately began evasive maneuvers and took all prescribed precautions.”

The Nautica was immediately brought to flank speed and was able to outrun the two skiffs, according to Oceania Cruises. One of the skiffs came within 300 yards and fired eight rifle shots in the direction of the vessel before trailing off.

The attack follows last month’s pirate capture of the Saudi tanker Sirius Star, carrying two million barrels of oil.


Oceania Cruises Inc.


WWL opens ro-ro terminal in S. Korea

Wallenius Wilhelmsen Logistics Nov. 28 announced that it has opened a new car and ro-ro terminal with capacity for up to 5,000 cars in Pyeongtaek, South Korea.

Jointly owned by Wallenius Wilhelmsen Logistics and EUKOR Car Carriers, the new International Ro-Ro Terminal (PIRT), Terminal No. 11, has been developed from the ground up.

The terminal covers an area of 166,000 sq. meters and has a wharf length of 290 meters, capable of berthing the largest generation of ro-ro vessels.

Because of the 9-meter-high tide levels in the port, PIRT incorporates a pontoon that can handle ro-ro units up to 100 tonnes in weight. In addition, the terminal has its own management and operations system and fully complies with the International Ship and Port Facility Security (ISPS), Wallenius Wilhelmsen said.

Pyeongtaek, 70 kms south of the capital, Seoul, “is at the heart of a new economic development zone which the South Korean government plans to transform into an international trade and logistics hub for North East Asia,” the company said.


Wallenius Wilhelmsen Logistics


Wednesday, December 3, 2008

CNG-fueled drayage trucks in SoCal test

The Southern California Gas Co., the ports of Los Angeles and Long Beach, and the South Coast Air Quality Management District Dec. 2 announced that they have launched a 12-month demonstration of the nation’s first clean-burning compressed natural gas–fueled drayage trucks to transport cargo containers.

The ports say that about two-thirds of the 15 million container units coming into the San Pedro Bay ports annually are moved by truck within a 25-mile radius of the docks.

In the study, four heavy-duty CNG trucks will move containers between the San Pedro Bay ports and nearby freight-consolidation yards. The CNG truck engines are certified to meet the U.S. Environmental Protection Agency’s stringent 2010 on-road emission standards.

The trucks are expected to reduce nitrogen-oxides (NOx) emissions — a precursor to smog — by 80% as compared with the cleanest diesel truck.

According to port officials, this is the most ambitious anti-pollution plan ever developed at a global seaport. The demonstration project’s overall cost is about $1.7 million. The ports each contributed about $112,000, with $1.1 million from Southern California Gas and $421,000 from the AQMD.


Port of Los Angeles

Port of Long Beach


Port of Tacoma tests GPS tracking system

The Port of Tacoma, in what is believed to be a first for tracking containers inland on rail from a U.S. port, is testing a GPS system that tracks intermodal containers from the time they leave waterfront terminals until they reach their destinations in the Midwest and Eastern United States.

The announcement by the port Dec. 2 said that the system allows Port of Tacoma intermodal planners “to better understand inland rail issues and, ultimately, work with railroads and shippers to improve the speed and reliability of freight.”

“We will be able to proactively work with our steamship and rail partners to plan for the future and make sure that Tacoma remains a high-velocity transit point in the global supply chain,” said Rob Collins, Port of Tacoma manager of transportation and supply chain planning.

Joining the port in the test project are BNSF Railway, ocean carrier Yang Ming Line, and Edmonton, Alberta–based Safefreight Technology, the developer of the technology.

The centerpiece of the Safefreight system is a very rugged, portable tracking device, originally designed for truck trailers and vehicle fleets. The system uses GPS, wireless, and internet technologies to provide actionable data related to location, speed, direction, starts, stops, and other metrics.


Port of Tacoma


New logistics IT system from K+N

Kuehne + Nagel, a leading logistics company, Dec. 2 announced that it has completed the global roll-out of the new version of its logistics information system — “KN Login.”

The high-speed technical platform delivers Internet-based premium supply chain visibility and reporting solutions while “substantially improving productivity, efficiency, and usability for customers,” the company said.

Covering all of the company’s business activities (sea, air, road, and rail logistics as well as contract logistics), the new KN Login features a simplified, more efficient, and unified look-and-feel, personalized for each user, the company said.

The system offers customized summary view screens, the customer’s own reference terminology, and an enhanced exception monitoring engine.

In addition, Kuehne + Nagel’s single-sign-on portal provides configurable access rights for each user across logistical activities.

Thorsten Meincke, head of customer solutions and global sales, commented, “Improving on KN Login gave us a unique opportunity to build a compelling set of logistics information network solutions on an already tried-and-tested system.”


Kuehne + Nagel


Thursday, December 4, 2008

Report discloses fraud at Port of Seattle

Port of Seattle officials Dec. 3 announced the results of a special investigation into the port’s contracting policies and practices. The report documented 10 instances of civil fraud by port employees.

Former U.S. Attorney Michael McKay led the 10-month investigation and authored the report.

Among the findings were that a port employee “provided a detailed internal port estimate to a potential bidder on a third runway contract [at SeaTac International Airport] prior to the bid submission date” and that port employees “falsely represented a $2 million cost reduction as a $9.4 million reduction in an attempt to avoid [Port] Commission scrutiny.”

The report also concluded that former Port of Seattle CEO Mic Dinsmore “violated the Port Ethics Policy when he used the services of a port consultant, McBee Strategic Consulting, to obtain a paid internship for his daughter.”

In a statement also issued Dec. 3, CEO Tay Yoshitani said, ”I stand by my word. Any staff member who has committed fraud will be appropriately disciplined and potentially terminated.”

A separate criminal investigation of the port by the U.S. Justice Department is still underway.


Port of Seattle


High risk bonus offered by CMA CGM

Citing an increase in piracy in the Gulf of Aden, and as a member of the International Maritime Employers’ Committee, CMA CGM Group Dec. 3 confirmed its decision to set up a high risk bonus for its officers and crew who transit through the Gulf of Aden

“When transiting through this dangerous region,” CMA CGM said, “seafarers will receive extra pay equal to 100% of their basic wage.”

The company said that 65 CMA CGM vessels transit each month through the Gulf of Aden, most of which are deployed between Asia and Europe. These large container vessels have a capacity from 4,000 to 11,000 TEUs and sail at an average speed of 24 knots.

Somali pirates have attacked more than 100 vessels and successfully hijacked 40 vessels in the gulf in the last year. Thirteen remain under Somali pirate control.

CMA CGM stated that they apply very strict safety and security regulations and have set up a number of measures to avoid potential attacks even though container vessels are less vulnerable than other ships due to their speed and high freeboard.




Congress on ITS hears ‘Interstate II’ proposal

Federal Railroad Administrator and Intermodal Transportation Institute founding chairman Gil Carmichael spoke at the 15th World Congress on Intelligent Transport Systems (ITS) recently about his “Interstate II” proposal.

The plan calls for building on the interstate highway system with intermodal freight transportation systems and a high-speed passenger-rail network.

Carmichael stressed that it is the freight railroad that offers the high-speed, long-distance, lowest-cost transportation artery on land. “Railroads are essential to the global business environment we live and work in and are vital to its future growth,” Carmichael said.

“Today, a doublestack container train can replace 280 trucks, run at speeds up to 90 miles an hour, and afford as much as nine times the fuel efficiency of container transport by highway,” Carmichael said.

“With advanced technologies and careful planning, it is reasonable to foresee a doubling or even tripling of capacity of the existing route structure without having to acquire additional land.”

Carmichael described Interstate II as 30,000 miles of truly high-speed, intercity/port travel that is based on the steel wheel on a steel rail, not pavement. “It would partner the superior safety and efficiency of rail transportation with the strengths of the existing intermodal system, enhanced with new Intelligent Transportation Systems.”


15th World Congress on Intelligent Transport Systems (ITS)


Friday, December 5, 2008

Maersk Line lays up eight box ships

Maersk Line Dec. 4 announced the lay up of eight 6,500-TEU containerships for six months.

The decision follows the recently announced changes to Maersk’s Asia-Europe, Asia–Central America, and Transpacific service networks.

“In view of the market conditions, we have reached the point where laying up the eight vessels makes better economical sense than redeploying them,” said Michel Deleuran, head of network and product in Maersk Line.

“Freight rates remain under severe pressure, and in several corridors the rates do not fully cover our variable costs. Rate improvements are imperative for the industry to create a sustainable environment.”

Maersk Line said it will continue to adjust capacity in light of market developments by optimizing their schedules, consolidating services, entering into vessel sharing agreements, enhancing port productivity, reducing speed, and — “unless current market conditions improve” —laying up of additional vessels.

The eight vessels that Maersk Line will lay up — from December 2008 to May/June 2009, predominantly in Asia — are of the CV 65 class, the company said.


Maersk Line


Hutchison in Yantian Port deal

Shenzhen Yantian Port Group and Hutchison Port Holdings Dec. 4 announced that they have signed a Heads of Agreement for the joint construction and development of the Shenzhen Yantian East Port Phase I Container Terminal Project at Yantian Port.

Hutchison will own 53% of the project, and state-owned port operator Yantian Port will own the remaining 47%. No financial terms were released.

The East Port Phase I project will cover a total area of 1.38 million sq. meters with a total quay length of 1,442 meters split between four deepwater berths — two 6,600-TEU berths and two 9,500-TEU berths, the statement said.

A joint team will soon be assembled to carry out preparation work for the construction of this phase, the statement said.

In order to optimize the use of resources and lower operational costs, Yantian International Container Terminals will manage East Port Phase I, along with existing facilities at West Port, Phases I, II, and III, and the Expansion Project of Yantian Port.


Hutchison Port Holdings


Baltimore port in 10-year deal with UPM

The Port of Baltimore Dec. 4 announced that it has signed a new, 10-year contract with Finland-based paper manufacturer UPM that guarantees the shipment of UPM paper products through the Port of Baltimore for the next decade.

The 10-year contract began Oct. 1 and marks the first time ever that the Port of Baltimore has signed a forest products customer to a 10-year contract, port authorities said.

As part of the agreement, UPM is required to ship a minimum of 3.2 million tons of cargo through the Port of Baltimore over the lifetime of the deal.

The port estimates that the new UPM contract will result in 120 direct jobs, $26 million in wages and salaries, and $2.7 million in state and local taxes.

“Long-term contracts with global companies like UPM are the key in helping to support the thousands of good-paying, family-supporting jobs at the Port of Baltimore,” said Maryland Governor Martin O’Malley.

UPM has production facilities in 15 countries and employs about 26,000 people worldwide. The group’s key mills are located in Finland, Germany, France, England, Austria, the United States, and China.


Port of Baltimore



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