Wednesday, November 25 ,2009

Cosco hikes Far East to South America rates
COSCO Container Lines has announced a general rate increase of US$200 per TEU and $400 per FEU for shipments from Far East to the South American east coast from December 1.

For cargo from the north west Europe and Mediterranean (Israel, Lebanon, Syria, North Africa and the Black Sea) to South China (which includes Guangdong, Guangxi, Yunnan and Hainan provinces) rates will increase $65.87 per TEU and $102.46 per FEU from January 1.

Hyundai Merchant Marine quarterly loss hits record US$307 million
SOUTH KOREA's Hyundai Merchant Marine (HMM) has announced its worse ever quarterly loss of KRW379 billion (US$307 million) as well as an operating loss of KRW170.5 billion in its container trade.

Hyundai's container trade declined as freight rates on transpacific trade, which accounts for 44 per cent of its trade, dropped 38 per cent over last year's third quarter and six per cent quarter to quarter. On a positive note, transpacific rates increased in September after falling to a record low in July, according to Paris based Alphaliner weekly newsletter.

Because of its big exposure to the transpacific trade, Hyundai failed to benefit from rate improvement on Asia-Europe and intra-Asia trade which only accounts for 25 per cent and 31 per cent of its volumes. Rates on the Middle East trade are still low due to over capacity.

Hyundai's net loss for the first nine months of this year reached KRW724.25 billion.

RCL suffers third quarter net loss of US$18 million
REGIONAL Container Lines (RCL) and its subsidiaries have recorded a consolidated net loss of THB589 million (US$17.74 million) for the third quarter of 2009 compared to a net loss of THB440.5 million for same quarter last year, on the back of falling volumes and lower freight rates.

For the first nine months of the year, the group suffered a net loss of THB1.58 billion, down from a net profit of THB772.4 million for the corresponding prior year period.

The group's Shipper Owned Container (SOC) liftings in the third quarter under review fell by 30 per cent year on year to 282,303 TEU. The company attributed this partially to lower east-west trade volumes and reduction in the tonnage deployed, as the group returned more time-chartered vessels.

It said in a statement to the Stock Exchange of Thailand that with stronger recovery in the intra-Asia trades, the group's Carrier Owned Container (COC) liftings declined 14 per cent to 312,248 TEU.

Overall, in the third quarter, total liftings of the group recorded a 22 per cent decrease compared to the same period last year at 594,551 TEU.

In comparison with the first nine months of 2008, SOC liftings dropped 30 per cent to 816,486 TEU, COC liftings fell 12 per cent to 923,790 TEU, and total liftings decreased 21 per cent to 1,740,276 TEU.

Total turnover for the third quarter before exchange difference, gain on sale of assets, and adjustment for unrealised loss on derivatives was down 33 per cent year on year at THB5,267 million. The decline in turnover was said to be mainly due to the 22 per cent decrease in liftings as well as lower freight rates in the third quarter compared to last year.

For the first nine months, total turnover fell by 28 per cent compared to the same period a year earlier to THB10.7 billion.

Commenting on the results, RCL managing director Sumate Tanthuwanit said: "The earlier anticipated recovery that started in the second quarter has kept its momentum in the third quarter. From the shipping perspective, though demand in the USA and Europe has not bounced back to levels enjoyed in 2008, volume did however improve and rates held at a better level than previous quarter," he said.

"The intra-Asia trade, with stronger consumer confidence, saw an improvement in the volume as compared to the first half of this year. Recently, there were some signs that both the freight rates and volume had bottomed due to the common approach by the industry to look for additional revenue in the light of rising cost such as bunkers and the continuous weakening of the US dollar. Shipping lines were rolling out rate recovery and implemented the peak season surcharge in certain areas as planned."

Owing to cost reduction measures and lower bunker fuel costs, the cost of freight and operations in the third quarter fell 26 per cent year on year to THB3.7 billion. For the first nine months, the cost of freight and operations decreased 18 per cent to THB11.4 billion, the company added.

Port tracker expects rise in US containers early next year
IMPORT container volume at major US ports could see the first year-on-year increase in 27 months in early 2010, according to the monthly Port Tracker report released by the National Retail Federation and IHS Global Insight.

"This could be the turnaround we've been waiting to see," said federation vice president Jonathan Gold. "There's not enough data yet to establish a clear trend, but we're hopeful."

US ports surveyed handled 1.14 million TEU in September, the most recent month for which actual numbers are available. That was down three per cent from August and 16 per cent from September 2008.

October, usually the best month of the year, was estimated at 1.17 million TEU, down 15 per cent from last year. November is forecast at 1.09 million TEU, down 11 per cent from last year, December at 1.06 million TEU, flat compared with last year, and January 2010 is forecast at 1.03 million TEU, down three per cent.

The January figure would mark the 31st month of year-on-year declines, but the trend is forecast to be broken in February, when cargo is expected to total 973,872 TEU. The figure is below the million mark because February is the slowest month of the year, but would be a 16 per cent increase over February 2009. March 2010 is forecast at 1.02 million, a five per cent increase over March 2009.

The report now expects 2009 to end with a total volume of 12.7 million TEU, a drop of 16.8 per cent from last year's 15.2 million TEU and the lowest since the 12.47 million TEU imported in 2003.

"The second half of 2009 has continued to see declines from 2008 levels, but not as large as we saw during the first half of this year," said IHS Global Insight economist Paul Bingham. "These 'less bad' numbers are evidence that the industry is seeing early signs of recovery."

All US ports covered by Port Tracker - Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the west coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the east coast, and Houston on the Gulf Coast- are rated "low" for congestion, the same as last month.

Former Thales Group CEO touted to take over CMA CGM
DENIS RANQUE, former Thales Group CEO, has reportedly been tapped to take over troubled French shipping giant CMA CGM, reports London's TradeWinds, citing WanSquare financial news service sources.

"Word of the management change comes nearly three weeks after CMA CGM founder Jacques Saade bristled at reports that creditors want to oust him as chief executive. In late October, he expressed astonishment at the news and said the French liner giant needs its management team intact," said the TradeWinds report.

Mr Ranque had been head of Thales Group, an arms manufacturer in suburban Paris, from 1998 until last May, though he still runs Thales Avionics as CEO, reported BusinessWeek.

There has been no comment from CMA CGM.

High winds topple stacks of boxes at HK's Felixstowe terminal
STRONG winds of up to 50 miles per hour have been blamed for blowing down container stacks inside quayside storage parks at Britain's largest container port of Felixstowe.

Hong Kong's Hutchison port officials told the Ipswich Evening Star that the adverse weather conditions over the weekend had affected rail and yard operations and that access was being restricted to operational areas to protect the safety of port users.

The forecast is for the unsettled weather to continue this week with more showers and strong winds expected.

Mystery HDS Lines takes over box business from banned IRISL
IRANIAN flag-carrier Islamic Republic of Iran Shipping Lines (IRISL), suffering bans from the US and Britain, has transferred its container operations to a new and hitherto unknown entity called HDS Lines without warning or announcement.

The move comes after United States ban was imposed last year after IRISL was reportedly caught transporting weapons for the Iranian military in violation of a UN arms embargo, reported Paris-based maritime consultancy AXS Alphaliner.

The British government also imposed a ban on financial services to IRISL in October after a consignment of ammunition was discovered on an IRISL operated vessel, said the Alphaliner newsletter.

HDS Lines is said to be a privately owned company registered in Iran and commenced operations from November 20, but there is little information about its ownership or corporate structure.

IRISL operated liner services in the Far East, Middle East and Europe. Its main linehaul services include its AMEL service (Asia Med Express Line), connecting the Far East, Indian subcontinent and Middle East with Malta; the AMCL service (Asia Middle-East Container Line) connecting the Far East to Middle East and ECL (Europe Container Line) connecting Europe and the Middle East,

IRISL operated 65 general cargo and container vessels ranging from 100-6,500 TEU. It is also involved in a dispute with Hanjin Heavy Industries over the delivery of three 6,500-TEUers it ordered in March 2005. The ships have been completed but IRISL has been unable to take delivery because of the sanctions imposed. The three ships are on the block but thus far no buyers have come forward.

Ports America to land 50-year lease at Port of Baltimore
PORTS America, the largest port operator in the US, will be awarded control of the state-owned portion of the east coast Port of Baltimore for the next 50 years in exchange for the company's pledge to invest hundreds of millions of dollars to expand and maintain the facility, according to Maryland Governor Martin O'Malley.

A report by the Washington Post said the deal is expected to create thousands of jobs, particularly over the next four years as Ports America commences construction on a berth big enough to accommodate some of the world's largest container ships that are anticipated to arrive from Asia after the expansion of the Panama Canal is completed in 2014.

It said that building of the berth and cargo cranes would likely create 1,000 jobs, while an extra 2,000 workers would be employed in coming years to fix roads, bridges and tunnels around the terminal.

Ports America would immediately pay the state US$100 million towards the improvement works if the state's General Assembly and Board of Public Works confirm the deal, the report said.

It added that in the long term, the state expects the expanded port to provide an additional 2,700 jobs a year and $15.7 million in annual tax revenue.

Furthermore, according to the terms of the deal, the state will receive a $15 fee for every container above 500,000 handled by the port annually. In 2008 more than 600,000 containers were offloaded or loaded at Seagirt.

Aries abandons box shipping to focus on bulk carriers
ARIES Maritime Transport is reported to be selling its last two container ships, the MSC Saronikos Bridge and MSC Seine, before year-end for an estimated US$11.4 million as part of a major restructuring drive.

Grandunion Incorporated, which acquired a controlling interest in Aries in September, plans to transfer the assets of Newlead Ship Management, namely four dry bulk carriers and two product tankers, to Aries, reports Handy Shipping Guide, which described the agreements as being currently non-binding.

A spokesman for Grandunion was cited as saying that they are pleased to be exiting the container shipping market and believed that the "influx of expertise and equipment from Newlead would bolster Aries' future performance and operating efficiency which had hitherto been poor," the report said.

This comes as Aries Maritime Transport posted a third quarter loss of more than US$111 million against a loss of $4.3 million a year ago.

Port of Houston to hike container, breakbulk fees
THE US Port of Houston plans to raise its port fees by three per cent for containers and two per cent for breakbulk and project cargo in spite of shipping lines and port stakeholders being opposed to the move.

Representatives from container carriers Mediterranean Shipping Company, Zim Lines and Hapag-Lloyd are reported to have requested that the port commission postpone the tariff increase as all of the shipping lines said they were struggling, according to a recording of the meeting made by and available online at Guidry News Service.

Salvatore Bruno, Hapag Lloyd's senior vice president for the Gulf Pacific region, said the carrier's losses over the last two years have been the highest in its 200-year history. To reduce operating expenses, John Edel, Gulf region vice president for Zim Lines, said that Zim has laid off staff, laid up vessels and has scrapped a direct call to Asia from the Gulf.

This comes amid projections by Port of Houston of operating costs growing by US$8 million during 2010, or more than eight per cent on container operations and 8.7 per cent on general cargo operations.

According to local news sources, the higher operating costs will be driven by increases in fuel, labour, security and infrastructure costs. The port's executive director Alec Dreyer was quoted as saying that despite the tariff increase, the port will be absorbing most of these new costs and Houston's tariff will be one of the lowest at a major US ports.

In the first half of 2009, Hapag-Lloyd posted losses of $662 million, while Zim suffered losses of $302 million.

Deutsche Bahn to help upgrade Qatar rail system
DEUTSCHE Bahn (DB) became the exclusive partner of Qatar Railways Company (RAIL) recently in the establishment of a rail-based transport system in the emirate after DB chief executive Ruediger Grube has signed an agreement to set up the Qatar Railways Development Company (QRDC) in the capital, Doha.

DB International will have a 49 per cent stake in the new company, while the remaining 51 per cent interest will be held by state-owned Qatari Diar, a statement issued by DB Schenker said.

As the planning and management company for the project, QRDC will be responsible for setting up a railway organisation and steering all planning and construction activities for the establishment of a modern metro and railway system. The project envisages a metro system for Doha, as well as long-distance and freight lines.

The investment amounts to EUR17 billion (US$25.46 billion). The cooperation will also include the provision of vocational training in the railway sector for young Qataris.

"We are proud and delighted that DB International has been chosen by the Qatari government as the partner for this ambitious infrastructure project," said Dr Grube.

The metro system planned for Doha will have four lines, 98 stations and an overall length of 300 kilometres. The plans also include a 180-kilometre long high-speed line to Bahrain, which is designed for a top speed of 350 kph. A 100-kph line to Saudi Arabia will be suitable for trains running at speeds of 200 kph. A total line network of 325 kilometres is planned for freight, most of which is expected to also be used for passenger service.

QRDC has a budget of EUR700 million. Under the deal, DB International will supply two of the four managing directors, including the chief executive officer (CEO) for the first four years. QRDC will be responsible for implementation of the entire project.

China Eastern looks to possible cooperation with Sinotrans
CHINA Eastern Airlines may in future cooperate with Sinotrans Ltd in the air cargo services sector, according to China Business News.

Its report cited an unidentified source as pointing out that in the absence of any "substantive cooperation" being established between the two companies so far, "both hope to do so in the air cargo businesses, " said a Xinhua report.

The Xinhua report said: "Sinotrans seeks to develop its air cargo businesses by making use of the air transportation capacity of China Eastern through the cooperation. It aims to put more capital and resource in building its ground transportation network in the future."

China Eastern is the controlling shareholder of China Cargo Airlines Limited, while Sinotrans has a stake in the joint venture Grandstar Cargo International Airlines Co Ltd that was co-founded by its listed subsidiary Sinotrans Air Transportation Development Co Ltd and Korean Air.

Sacramento pitches self to 11 Asian air carriers for cargo
OFFICIALS at California's Sacramento County Airport have been holding talks with representatives of 11 Asian air freight carriers hoping to bring international cargo carriers to the state capital, reports the Sacramento Business Journal.

In revealing this, Fred Davis, aviation economist and management consultant with Sabre Airline Solutions in Irvine, noted that Sacramento has the fastest-growing air cargo market in the state of California, rising to 150,000 tons in 2008 from 20,000 tons in 1990, while the airport's share of the air freight market in northern California has grown from 8.8 per cent in 2004 to 11.1 per cent in 2008.

"People don't think of cargo for Sacramento, and yet you do 11 per cent of total air cargo for northern California and you don't even do international," said Mr Davis.

Civil Aviation Authority of Singapore holds charity run
MORE than 4,000 runners from 116 organisations across the aviation community in Singapore participated in the Aviation Run organised by the Civil Aviation Authority of Singapore (CAAS) as part of its 25th anniversary celebrations.

"With the generous support of the organisations and individuals, the Aviation Run raised S$218,000 (US$156,000) for the Community Chest," said a CAAS press release.

The Aviation Run also sought to foster closer ties among members of the aviation community. The high turnout and benevolent contributions by the community exemplified the strong spirit of partnership and camaraderie within the community, said the release.

Leaders and senior executives from the aviation organisations ran alongside Tranport Minister Raymond Lim, who was the honoured guest at the event.

"The impressive turnout by the aviation community at today's Aviation Run and its contribution to the Community Chest reflects the commitment of the community to work together to help the less fortunate," said CAAS director general Yap Ong Heng.

"Today's event is also a celebration of the aviation industry in Singapore. Despite the economic downturn and the impact on the industry, the industry is a robust one and will grow even stronger in the years to come," he said.