=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+= Law Offices of Countryman & McDaniel THE CARGO LETTER 
Air & Ocean Logistics - Customs Broker News 31 May 2012 =+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=
Good Friday evening from our Observation Deck......overlooking the officially
designated"CargoCity"area and...... Runway 25-Right, atLos AngelesInternationalAirport, voted "Best Cargo Airport in North
The Cargo Letteris now perfectly designed to be
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is what happened in our industry during the Month of May 2012. With
apology, we're a day late due to court activity.
To help you find what you need --FAST-- there's now a transport search engine installed at our www.CargoLaw.com website!
Contribute your knowledge, stories & company
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Michael S.McDaniel, Editor, Countryman & McDaniel, forwarder/broker, hull
& machinery attorneys at LAX.
INDEX toThe Cargo Letter: OUR "A" Section: Trade, Financial & Inland News*** 1.Freight Forwarder Trade Briefs______________ 2.The Cargo LetterFinancial Page
______________ OUR "B" Section: FF World Air News*** 3.Freight Forwarder World Air Briefs____________ OUR "C" Section: FF World Ocean News*** 4.FF World Ocean Briefs_____________________ 5.The Cargo LetterCargo Damage Dispatches
**Back By Popular Demand** OUR "D" Section: FF in Cyberspace*** 6.The Cargo Letter"Cyber Ports of Call"
_________ OUR "E" Section: The Forwarder/Broker World*** 7.New U.S. Transport Related Legal Cases________ ========================================
***************************************************** OUR "A" Section: Trade, Financial & Inland News*** 1.Freight Forwarder
***All Time U.S. Trade Record.....as the GeorgiaCenter of
Innovation. reports the U.S. set all-time records for both import & export volumes,
increasing 5% and 3% respectively in March as the U.S. imported about US$238.6Bn of cargo, the highest on record. March
U.S. imports have increased 5.2% in terms of value over the previous month and
grew 8.4% year-over-year. In March, the U.S. exported more than US$186.8Bn of cargo, the highest on record.
March U.S. exports have increased 2.9% in terms of value over the previous
month and grew 7.3% year-over-year. **U.S. seaports set the all-time record for TEU imports in April (up
9.2% over March). This totaled 1.52 million TEUs
imported, and the second-largest number of shipments ever, with 756,000
processed. The active container ship fleet reached a record 15 million TEUs. This is driven by deliveries of new vessels and a
sharp reduction in the number of laid-up ships. Sixty-two new container ships
have been delivered since January, 23 of which exceeded 10,000 TEUs each. **Global air freight in March rose 0.3% from one year ago and was up 2.2%
from the previous month. North American air freight in March rose 2%
year-over-year. In March, average international air cargo prices rose 7.3% from
the previous month. Average air freight rates were up 2.8% year-over-year. **Road Shipments rose 0.1% in April following a 0.3% increase in March
and a 0.7% increase in February. Overall trucked shipments decreased 1.9% on a
year-over-year basis. **Intermodal rail traffic in April 2012 was
3.6% higher than April 2011 and 0.3% higher than March 2012 totals. Intermodal loadings have experienced year-over-year gains
for 29 straight months.
Trade Booms..... as surface trade value between North
American Free Trade Agreement (NAFTA) partners - the US, Canada and Mexico - increased 17.4% year on year to US$78.1Bn in February,
according to the U.S. Dept. of Transportation. The highest value cargo with Canada was automotive, valued at US$8.7Bn, while electrical machinery
headed the value list between the US and Mexico - US$6.6Bn. Eighty-seven per cent of U.S. trade by value with Canada and Mexico moved overland, 8.7% was waterborne and 3.9% moved by air.
U.S.-Canada trade value increased 13.7% to US$45.4Bn while trade with Mexico increased 23% to US$32.7Bn.
But Promising.....as a new report, Transport Outlook 2012, prepared for
the Organization for Economic Cooperation and Development's Int'l Transport
Forum in Leipzig this week, says that while the short-term outlook for trade and
freight is bleak, "the conditions for returning to growth do exist."
The report added that when compared to 2010, it expects freight
growth (as measured in ton-kilometers) to be anywhere from 2 to 3.8-times as
high in 2050. Read the re[port: www.internationaltransportforum.org/Pub/pdf/12Outlook.pdf
Downturn..... as the World
Bank has cut its forecast for China's 2012 growth to 8.2% from 8.4%, but said
the government still has plenty of power to avoid a "hard landing,"
reports the Financial Times. China itself announced output growth hit a three-year low in April,
adding to pressure on Beijing to ease monetary policy after weak trade data the previous day
fueled fears over the giant economy. Official data showed on May 11 that
industrial output in the workshop of the world rose 9.3% last month, the
slowest pace since May 2009 and below the 12.2% forecast in a poll of
economists by Dow Jones Newswires. Analysts said the data, combined with a fall
in investment growth to 20.2% in the first four months of this year, boosted
the case for allowing more credit to flow into the economy.
***Franco Carbon.....as in his first interview as France's Minister of Industrial Renewal, Arnaud Montebourg
announced that he would be reviving plans to apply a carbon tariff to imports
from countries with more lax emission regulations. The idea was first floated
by the administration of former President Nicolas Sarkozy
in 2009 ahead of UN climate talks in Copenhagen, but was
widely rejected as protectionist by fellow EU member states. The newly
appointed minister, who is well known for his distaste for globalisation,
says a carbon tariff will help level the playing field in int'l trade.
***American-Romanian Business Council.....as the group was officially launched this month as a
non-profit organization to promote commercial relations between the United States & Romania. Chevron will serve as the first chair of the council. The
council's other board members are ADM serving as vice chair, Raytheon as
treasurer, Smithfield Foods as secretary, Amgen, MetLife, and The Mega Company.
General members include Cargill, Eli Lilly, ExxonMobil,
PHRMA & Timken. www.amrobiz.org/
***A Thank You ToPakistan?..... as
the U.S. Trade and Development Agency has awarded a US$628,000 grant to
Premier Mercantile Services (PMS), a private sector port and freight logistics
operator in Pakistan, to help facilitate the acquisition and operation of a fleet of
locomotives on the existing Karachi-Lahore Railway. This initiative is central
to improving the capacity of one of Pakistan's most important trade corridors, and
promoting continued economic growth in northern Pakistan, USTDA said. www.ustda.gov/
***ChinaRetaliates.....as it has met a 31% American tariff for
the alleged dumping of solar panels by charging six U.S. eco-tech projects in five U.S. states are operating in violation of international trade law. The
Ministry of Commerce accused the U.S. of illegally helping its domestic solar industry, but did not
release details, saying the results were preliminary, reported the Wall Street
Journal. The U.S. has said it will impose tariffs on Chinese solar panels being
sold on the U.S. market below cost.
***Israel Exports Down.....as the Israel Export and Int'l
Cooperation Institute (IEI) reported in the 1st quarter of 2012, Israel's exports came to US$10.9Bn - a 6.5% drop from Q4-2011 and a 5%
drop compared to last year's 1st quarter. A16% drop was reported in exports to
the EU, while there was a 3% increase in U.S. exports. Exports to the U.S., which made up 21% of Israel's exports in the 1st quarter, added 3% and amounted to US$2.4Bn.
Still, U.S. exports dropped 23% compared to Q1-2011.
as the global supply chain management (SCM) software market increased by
12.3% to reach US$7.7Bn in 2011, according to new numbers from technology
research firm Gartner. This marks the 2nd year of double-digit growth for the
SCM software market and was driven by an increasing number of supply chain
investments. Gartner noted that these investments often came over objections or
caution from IT budget decision makers. The top 5 vendors — SAP, Oracle,
JDA Software, Ariba and Manhattan Associates —
jointly held 48.3% of the worldwide SCM software market based on total
software revenue for 2011. http://en.wikipedia.org/wiki/Gartner www.gartner.com/technology/home.jsp
***China Rail Increase....as it's Ministry of Railway and National
Development and Reform Commission have announced an increase of domestic railway
freight rate by US$0.0016 per ton per kilometer, namely an average growth of
9.5%, to CNY11.51, in order to relieve pressure from higher fuel and labour cost, Xinhua reports. The
increase this time covers coal, grain, fertilizer, iron ore and many other
kinds of cargo. Industry opinions pointed out the raise will pass the pressure
on to the industries that are heavily reliant on railway transportation, such
as steel plants.
***Singapore To China RoadTrip.....as the freight management subsidiary of
SNCF Geodis, Geodis Wilson,
is expanding its trucking operations to include China, an extension of its existing routes through Singapore, Malaysia, Thailand and the Indochina region. The full cross-border route between Singapore & China covers a total distance of 5,950 km and has a lead-time of 6-7
days. Customers can choose between full container load (FCL) services or less
than container load (LCL) services. FCL containers are sealed from
door-to-door, and opened only if required by border customs, while LCL
containers are consolidated at the company's facilities along the route, and
fed into the main road network by regional trucks. http://en.wikipedia.org/wiki/SNCF_Geodis
***Mexican Road Crack Down.....as the government will tighten
inspections and lower maximum allowed weights for freight trucks after protests
over a string of fatal accidents involving double-trailer trucks, the
Associated Press reported. Independent truckers partially blocked highways
leading into Mexico City late last month to protest rules allowing extremely
heavy and very long trucks, which they said displaces them from hauling jobs
and pressures them to overload their rigs, AP said. Mexico currently allows trucks on two-lane roads with loads of up to
176,000 pounds and lengths exceeding 100 feet, higher than the U.S. limit of 80,000 pounds on interstate highways. It will lower
maximum weights by 9,900 pounds and limit double trailers to 15.5-mile runs on
secondary roads, AP reported.
Truck Drivers?..... asNevada drivers could soon be sharing the road with vehicles that don't
need them. Dept. of Motor Vehicles officials said May 7 they've issued Google the nation's first license to test self-driving cars
on public streets, after conducting demonstrations on the Las Vegas Strip and
in Carson City that show the car is as safe - or perhaps safer - than a human.
Self-driving vehicle technology works like auto-pilot to guide a car - in this
case a modified Prius - with little or no
intervention from a human operator. Laser radar mounted on the roof and in the
grill detects pedestrians, cyclists and other vehicles, creating a virtual
buffer zone around the obstacles that the car then avoids. Nevada's
regulations require two people in the test cars at all times. One person is
behind the wheel, while the other person monitors a computer screen that shows
the car's planned route and keeps tabs on roadway hazards and traffic lights.
***Pensions Killing The Post Office....as
the U.S. Postal Service (USPS) ended its 2nd quarter (Jan. 1 – March 31, 2012) with a net loss of US$3.2Bn, compared to a net loss of US$2.2Bn
for the same period last year. What's more, the USPS says these types of losses
will continue until and unless key provisions of its five-year business plan
move forward. The losses are due primarily to legislative mandates such as the
mandated pre-funding of retiree health benefits, and prohibiting management
from making the needed operational and human resource changes required to
address these issues under current laws and contracts. "Without
legislative change, we will not have sufficient cash to pay the US$11.1Bn
required for retiree health prefunding and may be
forced to default on other payments due to the Federal Government," said
USPS CFO Joe Corbett.
Drops Its Forwarding Arm....as it has signed a deal to sell Platinum Equity a 65%
equity stake in Caterpillar Logistics Services LLC, the company's 3PL division
of subsidiary Caterpillar Logistics. The overall transaction is valued at
roughly US$750M, and Caterpillar will retain a 35% equity stake. Other terms of
the deal were not disclosed. http://logistics.cat.com/
***Fake Brown.....as U.S. Border Patrol agents on May 23 arrested a
21-year-old man for attempting to smuggle illegal aliens across the border near
Niland, Calif., using a replica UPS delivery van, Customs and Border Patrol announced.
Agents spotted the UPS van attempting to avoid a checkpoint on Highway 111 and
stopped the vehicle, which had 13 undocumented passengers from Mexico hiding inside. An investigation determined that the vehicle was
not a legitimate UPS van. The van was impounded and the illegal aliens were
***Handicapped Coke.....as Federal authorities say a Mexican man tried to
smuggle more than 7 pounds of cocaine into Arizona by hiding it
in his wheelchair's seat cushion. U.S. Customs and Border Protection says the
43-year-old was stopped for further inspection at the Nogales port on May 13
after an officer noticed something peculiar about the cushion. Officials say
that during the secondary inspection, they found the cocaine in 5 packages within
the seat cushion. CBP officials say the cocaine has an estimated street value
of more than US$65,000. The man was arrested and turned over to U.S.
Immigration and Customs Enforcement's Homeland Security Investigations. His
name hasn't been released. Agents didn't say whether the man was disabled or
was just using the wheelchair to smuggle drugs.
a tractor-trailer crash in upstate New York has sent 18
tons of Greek yogurt spilling alongside a highway. WBNG-TV reports a truck
hauling 36,000 pounds of Chobani yogurt was traveling
west on U.S. Interstate 88 when it crashed on a curve and overturned late
Monday night in the Broome County town of Chenango, just north of Binghamton.
The station reports the yogurt spilled on the highway's shoulder and down a
hillside. The sheriff's office says crews were still cleaning up the crash
scene May 15 morning. The 24-year-old Nebraska man who was
driving the truck wasn't seriously injured. He was ticketed for failure to
reduce speed and improper lane use. The westbound lanes of I-88 were closed for
a time after the crash.
Delivery - Guaranteed !.... as a postcard mailed from Chicago in 1958 has
finally reached its intended recipient, but not without a little help from Facebook. The Chicago Sun-Times reports that a postcard
depicting Shedd Aquarium recently arrived at Scott McMurry'sVirginia home, more
than 5 decades after his mom mailed it. The 71-year-old says he immediately
recognized his mother's handwriting. The postcard was addressed to Clairmont Lane in Decatur, Georgia, where McMurry grew up. But it recently
arrived in Elizabeth Fulcher's mailbox on Clairmont Lane in South Daytona, Florida. Fulcher posted a picture of the
postcard on Facebook and her friends helped track
down McMurry. The half-century mail delay remains a
mystery, except for USPS customers. In the meantime, the aquarium has offered
to give him a tour of the attraction that his late parents visited. ======================================== 2.The Cargo LetterFinancial Page
____________ **Air France-KLM.DOWNwith an operating
loss of US$783M for the first quarter of 2012, down 82% year on year. **APL.DOWNwith a loss of
US$246M from continuing operations in 1st quarter, a massive drop from the
US$8M it lost in the corresponding period in 2011. **Assn. of Asia Pacific Airlines(AAPA).DOWNwith combined profits of US$4.8Bn in 2011, down 47% year on year
because of the higher fuel costs and lower cargo revenue. **China Shipping Container Line(CSCL).DOWNwith a 1st quarter loss that widened
928% to US$229M year on year. **CSAV.DOWNas the world's 20th
largest, posted a widening first quarter net loss of US$202.9M against the
US$182M lost in Q1 last year. **Damco(unit of the A.P. Moller-Maersk).UPas 1st quarter 2012 profit was US$7M, the same amount recorded in
the corresponding prior year period. **Hapag-Lloyd.DOWNwith a 1st quarter net loss of US$171.8M year on year. **Hanjin Shipping.DOWNas it slumped to a
US$209M operating loss in the 1st quarter of 2012, a huge drop from the
US$28.3M it lost in the same quarter in 2011. **Horizon Lines.DOWNwith a a net loss from continuing
operations for the first quarter ending March 25 of US$26.8M, compared to
US$20.2M in the same 2011 period. **Maersk Line.DOWNas world's biggest carrier had a US$599M loss in yhe 1st quarter,against
a US$424M profit in Q1 last year. **Neptune Orient Lines(NOL).DOWNwith a 1st quarter net loss of US$254M against last year's US$10M
loss in same period, drawn on US$2Bn in revenue, a decline of 4%. **SAS.DOWNas it steeply
widened losses in the first quarter of the year, to US$108M. **U.S. Postal Service.DOWNwith a loss of US$3.2Bn during the quarter, following a US$3.3Bn
fiscal first quarter loss and a US$5.1Bn fiscal year 2012 loss. ========================================
***************************************************** OUR "B" Section: FF World Air News*** 3.Freight Forwarder World Air Briefs __________
***Risk Alert...... as air forwarders doing
business in Germany are strongly advised to check and revise their documents,
as German jurisprudence breaks the "unbreakable" liability limitation
of the Montreal Convention by using the terms and conditions of air forwarders
against them. While the Montreal Convention maintains a gross negligence
liability limitation exception for the carriage of persons and baggage, any
equivalent exception for the carriage of cargo has been long eliminated; the
Convention has been relied upon to provide an "unbreakable" liability
limitation of 19 SDR/KG of affected cargo. However, cargo interests have
successfully argued before the German Federal Court that the German Freight
Forwarders Standard Terms and Conditions (ADSp)
constitute a contractual waiver of the Montreal Convention protections.
The argument is based upon Article 25 of the Montreal Convention, which allows
for the carrier to assume greater liability than that set forth in the
Convention. As a result, air forwarders doing business in Germany are advised to alter their documents to specifically claim
Montreal Convention protections for international air carriage, notwithstanding
contrary ADSp terms. Please contact contributor
ChristophWahner ofCountryman &
McDanielfor more information.
***TSA And EU
Achieve Unprecedented Air Cargo Security through Agreement.....as on June 1, 2012 the U.S.
Transportation Security Administration (TSA) and the European Commission
of the European Union (EU) each issued a press release announcing an agreement
to recognize eachother's air cargo security
regimes. As detailed in the EU press release, once fully
implemented, "Air carriers transporting cargo from EU
airports to the U.S. therefore no longer need to apply different measures,
but need to implement in full the EU legal requirements which lay down
obligations on the screening of consignments and on a regulated secure supply
chain. The EU also recognises the U.S. cargo security regime as meeting the recently adopted EU
requirements for cargo being flown into the EU from third countries." www.tsa.gov/press/releases/2012/0601.shtm
Deadline Set..... as the Transportation
Security Administration (TSA) issued a press release announcing a deadline of
Dec. 3, 2012 for all passenger air carriers to conduct 100% cargo screening on
int'l inbound flights, as required by the Implementing Recommendations of the
9/11 Commission Act. All cargo on a passenger aircraft departing a U.S. airport already undergoes screening. Domestically the process is
handled by air carriers or parties voluntarily participating in the Certified
Cargo Screening Program under TSA oversight. Details: www.tsa.gov/press/releases/2012/0516.shtm
***Qantas To Be Restructured.....as its int'l domestic services is to be run as two
distinct businesses starting July 1. The Qantas Group also announced changes
are to be made to its executive team as it enters the next phase of the 5 year
transformation plan launched in August 2011. After being restructured over the
coming months, Qantas International and Qantas Domestic - currently combined as
'Qantas Airlines' - will be formally managed as two distinct businesses. Each
will have its own CEO and its own operational and commercial functions. Their
financial results will also be reported separately. This change will enable a
greater focus on the priorities of turning around the Qantas int'l business and
enhancing the strong Qantas Domestic business, as part of the overall group
***The Enemy Within.....
as AerLingus welcomed a
court victory May 22 that permits British authorities to keep investigating Ryanair over its ownership of a 30% stake in AerLingus, a sore point between
Ireland's two major carriers. Ryanair sought to block
the probe into whether its status as the No. 1 shareholder in AerLingus represents a threat to
competition on British-Irish air services. Ryanair
lawyers argued that Britain's Office of Fair Trading had no jurisdiction to investigate two
Dublin-based airlines, and that the probe launched in 2010 came too late. But
the Court of Appeal in London sided with the Office of Fair Trading and AerLingus, which wants Ryanair
to be forced to sell. Ryanair built its stake as part
of a hostile 2006 takeover bid that was blocked by European Union regulators
and Ireland's government, which retains a 25% stake. AerLingus accuses Ryanair of
being a disruptive presence inside the company since its surprise takeover bid
***Vietnamese Vacuum.....as the government has offered incentives to foreign
carriers after domestic airlines exited the field including Indochina Airlines
and TraiTien Air Cargo,
following licence revocations in the face of
financial difficulties. Air Mekong and Vietjet Air continue to struggle
while Vietnam Airlines looks to restructuring and privatisation,
along with its recent acquisition of 70% stake in Qantas low-fare carrier Jetstar Pacific. Japan's All Nippon Airways (ANA) is reportedly considering cargo
flights to Vietnam after a passenger launch of its transpacific joint venture with
United Airlines cooperating with airfares and networks on the U.S. to Vietnam route.
Itself Back...... as it
approved a US$5Bn share buyback program and boosted the amount of cash it plans
to use to buy Dutch package firm TNT Express NV. The repurchase plan has no
expiration date and replaces one announced in 2008, UPS said in a statement.
UPS, which announced in March it will buy Netherlands-based TNT Express for
US$6.8Bn, plans to finance the purchase with about US$5Bn in cash and US$1.8Bn
in debt — a US$2Bn increase in the cash portion compared with its original
guidance. TNT last week reported 1st-quarter operating income of about US$48M,
turning around a US$103M loss a year earlier, Reuters reported. Revenue rose
1.3% to about US$2.4Bn.
***PharmaSpecialist.....as UPS has shipped 375,000 doses of flu vaccines worth
US$9M half way around the world which involved complex, precise planning flying
temperature-sensitive pharmaceuticals on five flights from Louisville to Laos. The vaccines, donated by Walgreens,
were transported from the company's healthcare distribution centre in Louisville, Kentucky to Bangkok's SuvarnabhumiAirport, after routing through Anchorage, Alaska; Incheon, Seoul; and Shenzhen. They
then took 20 hours to get to Vientiane by truck.
The company opened five pharmaceutical facilities last year in the Americas, Europe and Asia, as well as acquiring Italian pharmaceutical logistics company Pieffe at the end of 2011.
Earlier...... as in a second
expansion in just nine months, UPS has extended its competitive advantage by
enhancing its coverage area for early morning deliveries. For the critical delivery option, the enhancement has allowed UPS to extend even
more its advantage of delivering to more ZIP codes and more businesses than
anyone. UPS also increased the number of ZIP codes it serves by with its regular express service, another arena in which UPS
already was serving more ZIP codes and businesses than any other carrier. The
latest U.S. coverage expansion involved more than 2,600 Early A.M. and Next
Day Air ZIP codes. More than 80% of all U.S. businesses now can receive guaranteed early morning UPS
deliveries. in the overseas market UPS has added Honduras and Nicaragua to its UPS Express Freight network, offering the two Central
American nations day-definite transportation services. This development follow
UPS' announcement that it more than doubled its freight capacity to Latin America during the first quarter
***New FedEx Hub...... as it has unveiled plans to
develop a new North Pacific (NPAC) regional hub at Kansai Int'l Airport (KIX)
in Osaka, Japan to serve as a consolidation point for shipments from North Asia to the United States. The new regional hub will also operate round the clock as an
international gateway for western Japan. The company said in a statement the expanded facility will
provide greater operational flexibility to meet its customers' needs. The
agreement with KansaiInternationalAirport for this new 25,000 square metre
facility includes customs clearance, ramp operations, sort
and transshipment operations. The facility is slated to begin operations in
spring, 2014. The role of the company's Asia Pacific hub in Guangzhou, China will remain unchanged.
***FedEx Expands BrazilFootprint..... as it announced May 30, it has signed an agreement to acquire the
Brazilian transportation and logistics company, RapidãoCometaLogística e Transportes S.A., the latest step in FedEx's strategy for
profitable growth in Latin America. The acquisition of RapidãoCometa, which has been one of FedEx's authorized
representatives in Brazil for the past 11 years, will supplement the FedEx Express service
portfolio in Brazil and continue its Latin America expansion through key strategic investments. The company has 45
operational branches and approximately 145 distribution points and some 9,000
employees across Brazil. FedEx also announced plans to procure French
business-to-business express company Tatex. The exact
terms of the deal haven't been disclosed, but the acquisition will give FedEx
Express access to a domestic ground network that handles 19 million shipments a
year and generates approximately €150M in annual revenue.
***Cathay Pacific Doubles
Down On Cargo....as it will retire three Boeing
747-400BCFs this year. Although the carrier will
still take delivery of three additional Boeing 747-8Fs in 2012, with two more
arriving in 2013, the retirements mean freighter capacity growth will be flat
this year. Earlier company projections pegged freighter growth for 2012 at 3%. www.cathaypacificcargo.com/usrapps/identity/home.aspx
***The Power of Winglets.....as
Boeing has developed a new advanced technology winglet for its 737 MAX
aircraft, combining rake tip technology with a dual feather winglet concept.
The new design will provide MAX customers with an additional 1.5% fuel burn
improvement over the 10-12% already offered on the 737 MAX – a number validated
by wind tunnel testing. The 737 MAX so far has over 1,000 orders and
commitments from 16 customers worldwide. www.newairplane.com/737max/ http://en.wikipedia.org/wiki/Boeing_737_Max
Conscience Or Country..... as a man who once used his
air cargo company in South Africa to spy on the military operations of nearby
countries that opposed the apartheid regime, and who later helped the U.S. Drug
Enforcement Agency to capture a Russian arms trafficker, was recently jailed
for 5 years in a New York court, according to a report in the New York Times.
Born in Britain in 1941, but raised in South Africa and served in its air force, Andrew Smulian
was caught in Bangkok in 2008, with Russian arms dealer Viktor Bout. The court heard
that it all started when MrSmulian's
business failed and then he became ensnared in a purported arms deal with
terrorists that turned out to be a sting operation by the American government;
he was used unwittingly to capture the Russian arms trafficker Bout. When he
was arrested MrSmulian
decided to switch sides and over the past 4 years, he has co-operated with the
authorities against Bout, meeting regularly with prosecutors and agents, and
pleading guilty to supporting terrorism, among other charges. Last fall, at age
70, he became the government's star witness at Bout's trial in Federal District Court in Manhattan; Bout was convicted and sentenced to 25 years. The Drug
Enforcement Administration approached MrSmulian as early as 2007, using one of his old friends who was secretly cooperating with the drug agency. MrSmulian was asked to convey a
potential arms deal to Bout and they both met in Moscow and later in Curacao and other places
with other informers who posed as representatives of a Colombian terrorist
group, the Revolutionary Armed Forces of Colombia, or FARC. Bout agreed to sell
100 surface-to-air missiles, machine guns, grenades and five tons of C-4
explosives, prosecutors said. He and MrSmulian knew that the weapons would be used to kill
American pilots stationed in Colombia, the evidence showed.
***Volumes>>>Hong Kong'sAsia Airfreight Terminal(AAT), the airport's 2nd ground
handler, posted a drop of 0.4% in cargo volume in April year on year to 58,041
tons.>>>Air China' latest operating results show the carrier handled 93,300 tons of
air freight in April, down 11.7% year on year and 4.1% month to month.>>>Air France-KLM's April freight volumes plunged 8.3%, year-over-year, on a capacity
decline of 3.3%; especially sluggish was the Americas area and in the Asia-Pacific, with volumes falling 10.6% &
8.9%, year-over-year, respectively.>>>China Southern Airlinesposted a year on year increase
of 7.2% in its cargo volume to 103,400 tons in April while passenger volume increased
5.6% to 7.14 million people.>>>SingaporeChangiAirporthandled 148,200 tons of cargo during April, 4.9% less cargo than
during the same month a year earlier, owing to a 9% decrease in exports.
Month In Aviation History
1904 - The Wright brothers begin flight-testing the Wright Flyer II.
1908 - Mechanic Charles Furnas becomes the world's first airplane passenger,
accompanying Wilbur Wright in a 2.5 mile flight.
1908 – LéonDelagrange
makes the first airplane flight in Italy.
1927 – Charles Lindbergh completes the first solo airplane flight across the Atlantic Ocean, in the Spirit of
1959 - Benjamin Davis, Jr. becomes the first African-American Major General in
the United States Air Force.
1982 - British Airways completes its last Boeing 707 service.
1992 - The 2,000th C-130 Hercules is produced.
1995 - Boeing delivers the first 777 to United Airlines.
***Was This Really So Hard?...... as
Virgin Atlantic says passengers on its new Airbus will soon be able to chat on
their cell phones. They'll be able to text as well. Each plane will have its
own cellular network that bounces signals to satellites. That in-house network
will prevent signals from interfering with air traffic control.
***Minor Terror.....as officials say an 18-month-old girl was mistakenly
pulled off a JetBlue flight before it left Fort Lauderdale because airline employees thought her name was on the U.S. no-fly list. An airline employee boarded the Newark, N.J.-bound
flight before it departed May 8 evening, telling the family their toddler was
on the federal list that includes thousands of known or suspected terrorists. JetBlue blamed the problem on a computer glitch, saying
employees were following proper protocol. The U.S. Transportation Security
Administration says the girl never was flagged by the agency. The child's
parents told ABC affiliate WPBF they believe they were targeted because they
are of Middle Eastern descent and the mother wears a hijab.
The family was cleared to re-board. But they declined, saying they were too
***Minor Terrorist....as a 3-year-old boy who refused to use his seatbelt
never got off the ground when he and his father boarded an Alaska Airlines
flight at SEA in Seattle. The pilot returned to the gate at Sea-TacAirport on May 26 and asked the father and the boy to get off. Alaska
Airlines says it was a matter of safety and the pilot would rather deal with it
on the ground than in mid-flight. The father, Mark Yanchak
of Everett, told KIRO-FM the crew overreacted. OK, as long as he did not sit
next to me.
***************************************************** OUR "C" Section: FF World Ocean News*** 4.FF World Ocean
***UPSWill Float The Olympics......as it will use two barges on a
route along the Thames as part of its logistics operations for the London 2012
Olympic Games The barges follow a route down the river from the largest UPS
London 2012 logistics facility, located at the Port of Tilbury,
to Northumberland Wharf, situated just a couple of miles from the Olympic
Village. This demonstration event is being undertaken by the London Organising Committee for the Olympic and Paralympic Games (LOCOG) in partnership with UPS and
Transport for London. Previous barge trips have been made to transport 38 containers
full of furniture and soft furnishings, used to kit out the Olympic and ParalympicVillage ahead of the athletes' arrival this summer. In the future, if
this initiative is upscaled, the use of barges can
help to alleviate capacity on London's road networks,
supporting LOCOG's broader sustainability efforts by
reducing traffic congestion and noise pollution.UPSis
responsible for virtually all the distribution and logistics services for the
London 2012 Olympic Games. Millions of items are being handled, including 1M
pieces of sporting equipment.
***Stopping The Pirates.....asU.S. flag vesselM/V MaerskTexasthwarted an attack by multiple pirate skiffs while transiting the Gulf of Oman, northeast
of Fujairah, after leaving the Strait of Hormuzaccprdomg
to 'The National'. The security team fired warning shots when, despite
cautionary signals, numerous skiffs with armed men in each boat quickly closed
onM/V Maersk Texas.When the skiffs
continued to directly approach the multipurpose vessel, the team fired shots at
the pirates. The pirates then fired at the ship, and the security team returned
fire. All sailors on board were safe, and the vessel has proceeded on its voyage
to the U.S., said Kevin Speers, a senior director of marketing for Maersk Line. No armed vessel has been taken by pirates in
Officers Sentenced...... as
both the captain & navigation officer of the container vesselM/V Renahave each been sentenced to 7 months in prison. Both pleaded
guilty to numerous charges, which included operating a ship in a manner likely
to cause danger or risk to persons or property.M/V Renagrounded on Astrolabe Reef on the Bay of Plenty Coast on October 5
of last year, which caused the ship to spill fuel, cargo and other debris into
the ocean; all of which resulted in environmental ruin to the coast. Mauro Balomaga, the captain, and LeonilRelon, also lost their name suppression when they
appeared for sentencing today in the Tauranga
District Court. The two appeared solemn during sentencing. Afterward, female
supporters were seen leaving court in tears. Salvors
are still cleaning up the remainder of the cargo and ship; the ship eventually
split in two and sank earlier this year. Crown prosecutor Rob Ronayne stated in court that the crew, under time pressure,
committed a number of faults while racing to the Port of Tauranga. Ronayne claimed the ship cut corners
and sailed perilously close to other landmarks and the captain and navigational
officer tried to conceal the errors. "Substantial deviations" were
made from the approved passage plan and without just cause. In an interview of
October 11, neither of the accused mentioned falsifying charts. Balomaga plead guilty to a charge under the Resource
Management Act of being the master of a ship from which harmful substances or
contaminants were discharged into the coastal marine area. He also plead guilty to four charges under the Crimes Act of
"willfully attempting to pervert the course of justice."The Cargo Letterhas followed the incident since Oct. 2011 with a continued photo
feature, available at: www.cargolaw.com/2011nightmare_mv_rena.html
Young...... as the number of
containerships sent for demolition is surging, with 69 vessels for 124,000 TEUs scrapped so far this year, according to Alphaliner records, compared to only 85,000 TEUs, scrapped in the whole of 2011. Scrapping activity is
expected to remain high for the rest of the year, with low earnings and a weak
outlook for older, less efficient ships driving more owners to send such ships
to the breakers. The total capacity scrapped this year is expected to exceed
200,000 TEUs, making this the second highest year of
scrapping behind the record-breaking 379,000 TEUs
scrapped in 2009, according to Alphaliner. Younger
vessels are also coming under consideration for scrapping. Alphaliner
said a 13-year-old ship (1,500-TEUM/V Ocean Producer) was scrapped last
month, making it the youngest container vessel ever demolished. The average age
of scrapped vessels has been 28 years over the past decade, but that has
dropped to 26 years more recently. High scrap prices are motivating lines to
consider scrapping vessels. On the other hand, 621,000 TEUs
have been delivered into the global fleet this year, far outpacing the level of
scrapped capacity, said Alphaliner. www.alphaliner.com/top100/index.php
***Big Ditch Tax
Jump...... as the Panama
Canal tolls are set to be increased by an unspecified amount from the start of
July, in a move designed to align Canal toll charges with the value the route
provides, the Panama Canal Authority (ACP) said in a statement.
***U.S. Throughput Grows.....as total traffic for all imports
entering all U.S. ports was up 9% in April 2012, compared to the same month in
2011, according to U.S. import market data compiled by Zepol
Corp. The biggest percentage gain in imports for the month came from autos
& parts imports, which were up 27% over the same month a year ago.
Furniture imports were up 16% in April 2012, and mineral and stone imports were
up more than 14% for the month. In fact, all categories of imports tracked by Zepol were up percentage-wise from April 2011. On a
regional basis, the busiest ports in April were on the East Coast, where import
traffic was up 10.4% over a year ago www.zepol.com/
***New Hub For Anti-Pirates...... as commercial maritime security
specialist, Neptune Maritime Security, which has its operations and support
center in Poole, Dorset, UK, has opened a new office in the United Arab
Emirates, close to the UK Maritime Trade Operations (UKMTO) headquarter in Dubai,
which is part of the contribution by the British Royal Navy to ensure safe
trade in the Red Sea and Gulf areas. The company guarantees British-trained,
experienced, professional operatives who understand shipping companies' needs,
and can confront any security situation. 'Neptune' uses careful
selection and training of operatives; top-class equipment; detailed operating
instructions; 24-hour operational management contact; and constant quality
monitoring, to ensure the safe passage of any vessel in its care, regardless of
type or size. The company was founded by experienced former members of the UK's Special Boat Service (SBS), and supported by a range of
Big Bid...... as it has
submitted a proposal to the Commonwealth of Virginia for a strategic
partnership with the Port of Virginia, which the terminal operator values at
between US$3Bn & US$4Bn. APM Terminals is offering to operate all the Port
of Virginia's facilities in Hampton Roads and related inland locations under a
long-term concession agreement with the Virginia Port Authority (VPA). Under
the terms of the proposal, APM Terminals will transfer ownership of its
facility in Portsmouth to the Commonwealth. APM Terminals will also pay concession fees,
make additional capital investments, and provide a share of the operations'
revenue to the VPA. http://en.wikipedia.org/wiki/APM_Terminals www.vappta.org/unsolicited_conceptual_ppta_proposal_brto_operate_port_of_virginia.asp
***False Survey....as the U.S. Justice Dept. announced a federal jury in Miami convicted a
Miami-based ship surveyor this month for lying to the Coast Guard and for
falsely certifying the safety of ships at sea. Alejandro Gonzalez, 60, was
convicted of 3 counts of making false statements to the Coast Guard and one
count of obstruction of an agency proceeding. He faces a maximum penalty of 5
years in prison on each count. The jury found Gonzalez guilty of lying to Coast
Guard inspectors and a criminal investigator during an interview in April 2009
about the dry-docking ofM/V CalaGaldana, a 68-meter cargo vessel, in San Juan, Puerto Rico. Gonzalez
repeatedly claimed the vessel was dry-docked in Cartagena, Colombia, in March 2006, while evidence at the trial proved conclusively
the vessel was never in Colombia during 2006. Coast Guard inspectors in San Juan discovered
the vessel taking on water in Aug. 2008 and requested information concerning
the last dry-docking of the vessel. The government said Gonzalez concocted a
false story about the vessel being dry-docked in Colombia in 2006 when he knew it was not. As the surveyor on behalf of Bolivia, Gonzalez certified the ship as safe for sea while the vessel was
docked in Fort Pierce, Fla., in November 2009. When the vessel shortly thereafter arrived in New York City harbor, Coast Guard inspectors discovered exhaust and fuel
pouring into the ship's engine room, endangering the crew and the ship.
***BouyantContraband.....as authorities say three and a half tons of marijuana
have been found floating in the ocean off Southern California. A boater
spotted 160 bales of pot around May 20 about 15 miles off the
coast of DanaPoint. OrangeCounty authorities and the U.S. Coast Guard sent boats to gather up the
pot and turn it over to the U.S. Border Patrol. They say it's unclear who
dumped the pot, which together weighs about 7,000 pounds and has an estimated
street value of US$3M. Authorities say there was no boat in sight and they didn't
get any distress calls from a vessel.
***Swatting Containers.....as dozens of fly swatters bearing logos of collegiate
and professional sports teams have been washing up on the beaches of an Alaska island. The
fly swatters found on Kodiak were believed to be debris from last year's
Japanese earthquake and tsunami. But the Kodiak Daily Mirror reports that they
are from a shipping container that went overboard almost 4 months ago. Team
Sports America received word the container ship carrying its products from China lost several shipping containers after a rogue wave hit the
vessel in a storm. A cable on the ship broke and an entire stack of containers
went overside in the Pacific Ocean. It is likely the
containers were onM/V Cosco Yokohama, a container vessel transiting from Asia to Prince Rupert, British Columbia.
***Throughput>>>Port of Charleston' container throughput increased by 7.7% in April compared to the
same month the previous year to 123,439 TEU.>>>Port of Hamburg, Europe's 2nd largest container port after Rotterdam, reported a
5.2% increase in first quarter volume to 2.2 million TEU, driven by improved
trade with the Baltic region and North America.>>>Port of Los Angeles' record-breaking 14.5% increase in container volume to 707,182
TEU in April.>>>Port of Long Beach' 14% slump in import laden boxes to 232,963 TEU.>>>Oman'sPort of Salalah, the second largest container terminal in the Middle East by volume, raised
its container throughput 3% to 922,000 TEU, drawn on a 5.1% revenue increase to
US$35.77M year on year.>>>Port of Savannah, long the U.S. east coast star for Asian imports, posted a 4.2% decline in
container volume in April year on year to 248,886 TEU, compared to 260,063 TEU
the same period last year and 259,796 TEU in March.>>>Port of Xiamen, in Fujian opposite Taiwan, lifted 2.06 million TEU from January to April this year, an
increase of 11.82% year on year.
***This Month InU.S. Navy History 1781 -Frigate AlliancecapturesHMS Atalantaand Trepassy
off Nova Scotia. 1850 - Navy sendsUSS AdvanceandUSS Rescueto attempt rescue of Sir John Franklin's expedition, lost in Arctic.
1917 - First U.S. convoy to cross North Atlantic during World War I leaves Hampton Roads, Va.
1918 -USS Olympiaanchors at Kola Inlet, Murmansk, Russia, to protect refugees during Russian Revolution.
1939 - First and only use of Vice Adm. Allan McCann's Rescue Chamber to rescue
33 men from sunkenUSS Squalus(SS 192).
1941 - Authorization of construction or acquisition of 550,000 tons of
auxiliary shipping for Navy, 6 months before Pearl Harbor attack.
1962 -USS Valcour(AVP 55) provides medical care to a merchant seaman from tankerSS Manhattanin the Persian Gulf.
1945 - Fast carrier task force aircraft attack airfields in southern Kyushu, Japan.
1945 - Nine U.S. ships damaged by concentrated kamikaze attack off Okinawa.
as awholly-owned subsidiary of SinOceanic
Shipping ASA, SinOceanic III AS (Sino III), has taken
delivery ofM/V MSC Reguluswith a capacity of 13,100 TEU and placed her on a 15-year bareboat
charter party with Mediterranean Shipping Company, Geneva, at a daily rate of
US$46,650. The vessel was purchased for US$156M. The oompany
now operates four container vessels with a total container carrying lifting
capacity of 44.000 (TEU) containers.
***M/V MaerskAlabama Crew Seeks Damages.....as the five-day saga off the coast of Somalia ended when Navy SEALs killed three
of the ship's masters' captors in a volley of rifle fire and a fourth
pirate had previously surrendered to the Navy. Though the master ofM/V Maersk Alabama,Captain Richard Phillips, was
hailed as a hero, 11 former crew members allege in lawsuits filed in Norfolk
Circuit Court and in Mobile, Ala., that his employers, through Phillips'
actions, put them in grave danger when the ship sailed within about 250 miles
of the Somalian coast despite warnings to stay at
least 600 miles out because of pirate activity, according to 'The Virginia
Pilot'. Together, the suits seek nearly US$50M in damages from Norfolk-based Maersk Line Ltd., the owner of the ship, and Alabama-based
Waterman Steamship Corp., which operated and crewed it
under a charter. Among other things, the lawsuits filed by the 11 mariners
claim bodily injuries and an array of damages. They accuse the two companies of
negligence, failing to provide safe working conditions, and failing to pay
injured crew members reasonable compensation for medical expenses and lost
wages. Both companies deal with U.S.-flag vessels, which
means crew members generally must be U.S. citizens.
======================================== 5.The Cargo
Dispatches **Back By Popular Demand**
We're sorry, but there were so many sinkings,
explosions, pirate attacks, fires, cargo mishaps, battles on the water &
other disasters at sea that we do not have room to print even the highlights
this month. Many people lost their lives at sea this month!!
But you can read all this month's disaster news at our special Internet web
feature which provides full details of each event -- ourVessel Casualties & Pirate
Activity Database. Bookmark the site and visit every day! Updated twice daily. www.cargolaw.com/presentations_casualties.html
Daily Vessel Casualties......
as we don't want you to miss the excitement of our 24 hour reports of the
dramatic events at sea each day -- stories of casualties & pirates ---
almost none of which are carried on your local news. Edited
daily byChristophWahner, Esq.ofCountryman & McDaniel. www.cargolaw.com/presentations_casualties.php
historic dangers of carriage by sea continue to be quite real. Shippers must be
encouragedto purchase high quality marine cargo insurance from theirfreight forwarder or
customs broker. It's dangerous out there. ========================================
***************************************************** OUR "D" Section: FF in Cyberspace*** 6.The Cargo Letter"Cyber Ports Of Call"
Here are our suggested world wide web sites of the
week for your business, your information and your amusement..............
San FranciscoBay Ferry http://eastbayferry.com/ ========================================
***************************************************** OUR "E" Section: The Forwarder/Broker World*** 7.New U.S.
Transport Related Legal Cases _______
United States v. Dire 4th Circuit U.S. Court of Appeals
No. 11-4310, No. 11-4311, No. 11-4312, No. 11-4313, No. 11-4317
2012 U.S. App. LEXIS 10371, September 20, 2011, Argued, May 23, 2012, Decided. Piracy Convictions Affirmed...as the U.S. Court of Appeals for the
Fourth Circuit affirmed the decision of the Federal District Court for the
Eastern District of Virginia convicting five Somali men of piracy, as
proscribed by 18 U.S.C. § 1651, plus a "myriad other criminal
offenses." The conviction arose from the April 2010 attack on theUSS Nicholason the high seas of the Indian Ocean between Somalia and the
Seychelles; the men having confused the vessel for a vulnerable merchant
ship. The men initiated fire on the vessel intending to attain its
surrender. The crew of theUSS Nicholasresponded in kind, resulting in
an exchange of fire that lasted less than 30 seconds without casualty. On
appeal, the mens' legal team argued the crime of
piracy has been narrowly defined as robbery at sea, whereas they boarded theUSS Nicholasonly as captives and
took no property. The Court of Appeals disagreed, holding that § 1651
incorporates a definition of piracy that changes with advancements in the law
of nations, and that piracy under the law of nations encompassed the mens' acts of violence directed against theUSS Nicholas. (Review byChristophWahner, Esq. ofCountryman & McDaniel)
Written from wire stories, the Associated Press, Reuters, Hong Kong Shipping
News Lloyds & other world sources. ****************************************************** The Cargo Letter Correspondents:
Michael S.McDaniel, Esq. Editor (Countryman &
McDaniel) Christoph M.Wahner, Esq. (Countryman & McDaniel)DailyVessel Casualties
Maria Payne (Countryman & McDaniel) =+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=+=
_The Cargo Letter_
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