The Cargo Letter
THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
17 March 1998
Good St. Patrick's Day from our Observation Deck...... overlooking the
officially designated "Cargo City" area and....... Runway 25-Right, at
Los Angeles International Airport ........ where we handle about US$3.1 billion
worth of imports from South Korea each year.
Contribute your knowledge, stories & company information ........ by e-
mail to The Cargo Letter. We strive to
bring you useful information which is timely & topical. Be sure to visit our
web site .......... http://www.cargolaw.com
Michael S. McDaniel, Editor & Publisher, Countryman & McDaniel,
forwarder/broker attorneys at LAX.
INDEX to The Cargo Letter:
OUR Top Stories
1. Live ! "TRANS-CAMS" Premiere On The Internet
* 1st In The World
* Where Will You Go Today?
2. Indonesia's New Cabinet Picked Amid Protests
* China's National People's Congress
Names Legislative Heads
OUR "A" Section: Trade, Financial & Inland News
3. Freight Forwarder Trade Briefs
4. The Cargo Letter Financial Page
OUR "B" Section: FF World Air News
5. Freight Forwarder World Air Briefs
OUR "C" Section: FF World Ocean News
6. FF World Ocean Briefs
7. The Cargo Letter Cargo Damage Dispatches
OUR "D" Section: FF in Cyberspace
8. The Cargo Letter "Cyber Ports Of Call"
OUR "E" Section: The Forwarder/Broker World
9. Revisions To U.S. Drawback Regulations
10. Industry Trends Announced By A.T. Kearney
11. WISTA Wants You
- 1st In The World
- Where Will You Go Today?
LAX--17 Mar- You can now forget age old considerations of time and space. The
LAX forwarder/broker attorneys at Countryman & McDaniel have announced
launch of their "TRANS-CAMS" service to our transport industry.
Internet users are now able to instantly see live color views of current
conditions at dozens of Int'l air & ocean ports, harbors, border crossings
& rail operations via over 70 LIVE! cameras which keep vigil 24 hours a day.
These LIVE! Cameras span the globe.
"We're very excited", said web site designer Michael S. McDaniel.
"One of the toughest parts of this industry is educating customers &
associates as to how the international freight system works. Now we can just
show them!. Indeed, a picture is worth a thousand words."
"TRANS-CAMS" is the first site of it's kind on the Internet, but
Countryman & McDaniel point out that there is one serious deficiency. While
these cameras now cover the world from Istanbul, to Port of New York, to Geneva
Int'l Airport, to Ballard Locks at Port of Seattle, to Brussels Int'l Airport,
to the Port of Halifax, to the Port of Yokohama, to Abu Dhabi Harbor, to cargo
reception stations at the South Pole .......... there are no cameras currently
being operated by either carriers or forwarders. It is understood that The
Journal of Commerce will soon use the "TRANS-CAMS" concept to propose
live company cameras as representing the "next wave" in customer
service & public relations. While freight forwarders & custodial
carriers have made considerable investments in creation of company web sites,
this most basic concept of actually "showing" company operations,
locations & features has been overlooked. Imagine your next cyber visit to
the Fritz station at Qingdao, or to the Circle International station at
Heathrow, or to the Expeditors station at Sydney ....... all LIVE!. This is a
feature that will grab attention and compel customers to return to your web site
day after day.
The set-up cost of a live web camera is less than US$200 for a full color
link through existing company desktop computers at the desired site. This low
cost, when combined with currently operating company communications systems
should allow us to soon view a "Mast-Cam" from a Sea-Land container
ship at sea or an "Engine-Cam" from a speeding UPRR locomotive on the
plains of Texas. Because freight forwarders & custodial carriers operate
from the most diverse locations in our world, the possibilities are endless.
Details for setting up YOUR camera can be found at the"TRANS-CAMS"
The "TRANS-CAMS" web site is committed to add the cameras of ALL
freight forwarders & custodial carriers to it's site. Credit will be given
to the sponsoring company of each camera, along with all details of the
operation depicted. Links to "TRANS-CAMS" are currently being added to
many major business, travel & research sites on the world wide web. Visitor
traffic to "TRANS-CAMS" is very high.
Where will YOU go today? Visit "TRANS-CAMS" at the Countryman &
McDaniel web site and select "TRANS-CAMS", under "The
Manifest" menu. The address is: http://www.cargolaw.com
--- by Warren S. Levine, for The Cargo Letter
Seattle, WA. (Mar. 16) -- Indonesian President Suharto won a seventh term in
office last week, but faced vocal charges of cronyism when he appointed his new
Cabinet. The controversial appointments included Mohammad Hasan as Trade
Minister. Hasan, known popularly as Bob, is a Chinese Muslim who owns a large
timber cartel and is a golf buddy of the president.
Over the past two years, and during their current period of economic
instability in Indonesia, ethnic Chinese have been the subjects of considerable
social violence in that country. Last year a large Buddhist shrine was destroyed
by a mob. Construction is still going on to restore the temple.
Hasan will be the first ethnic Chinese to serve at the ministerial level in
the 32 years since Suharto first took office.
Suharto named his daughter, Siti Hardiyanti Rukmana, known as "Tutut,"
the new Social Affairs Minister. A millionaire in her own right, "Tutut"
has been mentioned as a possible successor to her father.
Suharto also appointed close aides and friends to positions as Ministers of
Finance and Defense.
Thousands of students protested at a college campus in Surabaya, where extra
police were called in, and smaller demonstrations have taken place throughout
In Beijing, the National People's Congress re-elected President Jiang Zemin.
Premier Li Peng, an unpopular yet still-powerful figure, was elected to chair
the Legislature, but there were a high number of dissenting votes.
The National People's Congress also elected Zhu Rongji, current Vice-
Premier, to replace Li Peng as Premier, by a 98% - 2% margin, a solid vote in
favor of the 69-year-old.
Of 2942 votes, Li only received 2616, or 88.92%. There were 200 votes cast
against him, and 126 abstentions. Li's vote count was second-lowest. Dissidents
inside and outside China were vocal in their opposition of Li when plans to
install him were announced.
Li is term-limited and must soon leave the Premiership, after having served
the maximum two five-year terms. He is widely disliked for having declared
martial law in 1989, which led to the killing of hundreds, possibly thousands,
of students in Tiananmen Square.
In Hong Kong, nominations were opened for posts on an 800--member election
committee which will appoint ten of Hong Kong's 60 legislative seats in May. The
first elections in Hong Kong since Chinese reassumed sovereignty over the
territory are due to be held on May 24.
- NCBFAA Convention Begins ............ as the National
Customs Brokers & Forwarders Association of America began it's annual
convention at San Antonio, TX this week. Are you there yet? The NCBFAA says
forwarders & other intermediaries are trying to win changes in the
latest U.S. ocean shipping reform bill. Senate Majority Leader Trent Lott
(R) and key U.S. Senators have endorsed a compromise plan that would end
requirements for public filing of tariffs and allow key parts of
shipper-carrier service contracts to remain confidential. The compromise is
supported by shipper groups, carriers, ports & labor. Lott has said it
could come to a Senate vote within a couple of weeks. The NCBFAA says it
does not oppose the principle of Shipping Act reform, but wants restrictions
on discriminatory practices. The NCBFAA also wants language guaranteeing
forwarder compensation & granting non-vessel- operating common carriers
the right to offer service contracts to shippers. [for add'l info see our
story in the Ocean News section, including a full text of the new law] Visit
the NCBFAA web site: http://www.tradecompass.com/ncbfaa/
- Happy 100th Birthday For Circle .......... as Circle
International, one of the world's leading providers of multi-modal
transport, customs brokerage & logistics services, is celebrating its
100th anniversary this year. In conjunction with Circle's centenary
celebrations, chairman & CEO Peter Gibert will tour Asia where he will
be spending time with customers, partners & associates. According to
Gibert, "The mandate for this trip is to highlight initiatives recently
introduced within the Company that are particularly relevant to Asia &
the South Pacific. This dynamic region plays a major role in Circle's
operations. We want to strengthen and advance this role with additional
investments and joint ventures. Our aim is to increase existing business in
the region considerably in the next twelve months." Asian exports
currently account for over 30% of the world's trade. 24% of Circle's
revenues are derived from its Asia/South Pacific operations. Circle has a
40-year history in Asia. From the establishment of its first Asian operation
in the Philippines, Circle has grown to 39 offices in 18 countries around
the region. In related news, Circle Fretes Internacionais do Brasil, Ltda.,
a subsidiary of Circle Int'l Group, Inc., has signed a letter of intent to
form a joint venture with Sonave Logistica, Ltda., a freight
forwarder-broker based in Belo Horizonte, Brazil. The new company will be
called Circle Sonave Logistica Internacional, Ltda.. Circle is the No.1
airfreight exporter in Brazil. Headquartered in San Francisco, Circle Int'l
has more than 300 offices in 104 countries around the world. http://www.circleintl.com
- It All Becomes "GeoLogistics" .......... as
corporate parent Int'l Logistics Ltd. has announced that over the next 18
months, its operating companies -- LEP Int'l, LEP Profit Int'l, Bekins
Logistics Div. & Matrix Int'l -- will transition to a new single global
brand: GeoLogistics. Bekins Household Goods Division will continue to use
its existing name. The corporate & North American operations will begin
using the GeoLogistics brand and identity on June 1, 1998. Europe & Asia
operations will introduce the new brand during the last half of 1998. With
annual revenues of US$1.6B, GeoLogistics Corp., formerly International
Logistics Ltd., is the largest non-asset based global logistics provider
headquartered in North America, with approximately 1,000 service centers in
75 countries. The company's site is: www.real-logistics.com
- Vindication For Fritz ........... as three Federal
"Green Mail" lawsuits have been dismissed with prejudice by the
U.S. District Court in San Francisco. The shareholder suits, brought by 3
individuals, claimed that Fritz Companies, Inc. officials issued false &
misleading statements in violation of federal securities laws. The court
found that the plaintiffs had no evidence to support their claims. The
lawsuits were dismissed as groundless. When Fritz stock dipped in 1996 after
the company reported losses in connection with its purchase of Intertrans,
the lawsuits followed. Also this month, Brooks Sports, Inc., manufacturer of
athletic footwear, has selected Fritz Companies to manage its off-site
warehousing & distribution center. Over one million pairs of Brooks'
shoes will pass through the Fritz Seattle logistics center annually.
- BAX Could Get Cocky .......... as BAX Global India has
won the country's prestigious "Golden Peacock" National Quality
Award in the service sector. The National Quality awards are given annually
by the country's Institute of Directors, a non-profit body designed to
promote the practice of continuous quality improvement. The award is based
on nine specific areas of quality achievement through the year. The award
criteria are similar to the Malcolm Baldridge Quality Awards in the United
- Danzas Gets Class "A" ......... as it becomes
the 1st global logistics company to obtain a class "A" forwarder
full-scope operating license from China's Ministry of Foreign Trade &
Economic Co-Operation. At an official ceremony at Shanghai it was said that
the new license enables Danzas to operate Int'l airfreight, ocean freight,
container loading & unloading, customs clearing & other logistics
services. Danzas is establishing a new company, Danzas Z.F., at Shanghai and
intends to focus even more on China in the future.
- New Schenker Air Boss ......... as global forwarder
Schenker Int'l has appointed Eckhard Volckert as head of its airfreight
operations. He previously worked for the TNT group-owned Red Star Express,
AEI & Kuhne and Nagel.
- Happy 50th For Coppersmith ......... as LAX was the site
of last month's gala event to celebrate the 50th anniversary of pioneering
California customs broker Coppersmith, Inc. (formerly L.E. Coppersmith).
Begun by Adrienne E. Coppersmith in 1948, she was only the 7th woman in the
U.S. to obtain a customs brokers license. Lew E. Coppersmith, a director of
the World Trade Center Assn. of Los Angeles/Long Beach, became president in
1957, and is now being followed by a 3rd generation of the Coppersmith
Family in operating the nationwide network of company offices. Happy
Birthday To One Of The Greats !
- New Brass At Intercargo Insurance Co. .............. with
the appointment of Robert M. Lynyak to Sr. V.P. , to be responsible for all
of Intercargo's non-U.S. operations, including Intercargo Insurance
Company's U.K. Branch office in London and Intercargo Insurance Company H.K.
Ltd. in Hong Kong. In addition, Lynyak will be responsible for new product
development. The move follows Lynyak's 33 year career at The Chubb Group of
Insurance Companies, most recently as Deputy Chief Underwriting Officer
& Managing Director of Chubb & Son, Inc. Meanwhile, the Trade
Insurance Services, Inc. (TIS), subsidiary of Intercargo has announced
appointment of Desiree Mizerek as Dir. of National Accounts to the TIS
management team. During Desiree's 6 year tenure with TIS, she was
instrumental in establishing a TIS branch office in Hong Kong & a joint
venture operation in Singapore. She founded the Int'l Dept. for TIS, and was
also chief architect of the FIATA NVOCC Group Bond Program, which was, and
remains as, the 1st and only group NVOCC bond on file with the Federal
- Mexico Finds New Border Crossing "Route"
.......... as the Journal of Commerce reports that Mexican motor carriers,
tired of waiting for the cross- border provisions of NAFTA to take effect,
have found another way to enter the U.S. market. Mexican carriers are
leasing their trucks & drivers to U.S. motor carriers, in effect
securing operating rights that allow them to carry cargo far beyond the
border zones. The arrangement is claimed legal, as long as the U.S. company
maintains full control over the Mexican equipment & drivers. The article
states, government officials report no widespread safety problems with the
Mexican trucks on U.S. highways. However, at least one Dept. of
Transportation official stated that the leasing practice is illegal. Stand
- UPS Becomes Electric ............ as "UPS Document
Exchange" will expand the company's core business to include secure
electronic delivery over the Internet with a suite of document delivery
& management services, available to the public in the 2nd quarter at
www.exchange.ups.com. It provides state-of-the-art technology to alleviate
customer anxiety over performing critical business practices over the
Internet by providing maximum encryption levels, as well as user
authentication, proof of delivery & archiving. Customers will have a
choice of two Internet delivery services, UPS OnLine Dossier &UPS OnLine
Courier, each with distinct features and levels of security. UPS OnLine
Dossier, for very critical and confidential documents, offers industry
leading security that utilizes a double encryption method and identity
validation via digital certificates. It also features document delivery
confirmation, tracking, user insurance and a 3rd party validation by
Deloitte & Touche LLP, a professional services firm. UPS OnLine Courier
is for customers who require universal solutions for exchanging documents
over the Internet, allowing customers to send documents to anyone,
regardless of the e-mail software, operating system or hardware being used
by either sender or receiver. Customers will have several security options,
including password protection & encryption, as well as tracking and
receipt confirmation. The technology was developed through strategic
alliances with NetDox, Inc. (OnLine Dossier) & Tumbleweed Software
(OnLine Courier). The UPS Document Exchange service currently is being
tested by select UPS customers. In related news, IBM has signed a long-term
contract with UPS for domestic air express service valued at more than
US$22M a year. UPS already provides international air express service to
- E-Commerce Tax Held Off ......... as 100 European
companies last month pledged to remove obstacles to trading over the
Internet & other electronic networks. The move comes as a debate over
whether to regulate electronic commerce gains momentum. The memorandum of
understanding (MOU) signed by the European companies looks to ensure that
self-regulation prevails. Said the chairman of the group of 100; "The
general impression is that [businesses] don't want legislation. They want
cross-border, cross-national commerce to take place and are fairly committed
to discussing self-regulation that stimulates confidence." The group of
100 said that governments could play an important role in electronic
commerce through global agreements on telecommunications standards. The U.S.
is urging self-regulation and recently suggested that the WTO should agree
on rules for Internet trade, including an agreement on duties. The Clinton
Administration supports duty-free Internet trade, saying the global
potential for prosperity is enormous and should be left unhindered.
Governors of U.S. states disagree with the Clinton Administration, arguing
that the loss of tax revenue would be damaging to state economies. Instead,
the governors propose a flat tax on Internet commerce. Industry observers
warn the era of Internet commerce could mean the erosion of important tax
revenue bases for governments. Whether or not Internet commerce is
duty-free, it would force governments to at least lower taxes to become
attractive to companies looking to minimize transaction costs. One to watch.
- Sun Shines On Forwarders .......... as a software package
for forwarders & logistics companies has been unveiled in Hong Kong by
Sun Microsystems, Int'l Transport Information Systems (ITIS) &
Innovative Information Systems Ltd. The new system combines the ITIS Freight
Operation & Management System together with the Ultra Enterprise 450
server. The package is said to handle all aspects of export & import
documentation operations, and can be sent via the Internet or by EDI
- Euro Bar Code Standard? ........... as the forwarders
group "FreightForward Europe", including Danzas, Kuehne &
Nagel, Lep & Panalpina, have chosen the EAN/UCC 128 bar code as a
standard for handling logistics information. The group said that while
implementing the bar code standard would be a top priority, members would
still use existing identification standards with their clients.
- U.S. Rail Rates Continue Slide .......... as the Surface
Transportation Board has announced today that its Office of Economics,
Environmental Analysis & Administration has issued a study concluding
that the average, inflation- adjusted railroad rate declined by 46.4% from
1982 through 1996, and fell in each year during that period. Even without
any adjustment for inflation, the (nominal) rail rate declined by 15.6%.
- Sino-Russian Rails .......... with agreement to start
int'l transport on their new joint railway project this July 1st. The
Sino-Russian border railway forms part of the N.E. Asian trunk transport
line backed by the United Nations Development Program and connects Hunchun
in China's N.E. province of Jilin with the Russian city of Mahalino. The
network will link China, North Korea & Russia, helping to create what
project backers hope will be a more favorable investment climate in the
- USFreightways Claims Drop .......... as it delivered
99.75% of the shipments handled in 1997 free of loss or damage claims,
surpassing the company's previous best mark set in 1993. Shipment volume15%
increase over 1996, but loss & damage claims increased by only 2%. The
carrier's claim ratio for 1997 was 0.37%. "Claim ratio" is a
standard industry measurement that represents the total dollar amount of a
carrier's claims paid for the year as a percentage of its total revenue. USF
Holland's claim ratio for the past five years is 0.43%, well below the
industry average reported by the American Trucking Associations Freight
Claims Council for the same period.
- "E" Entry For Emery ......... as Emery
Worldwide's customs brokerage unit has introduced a new electronic customs
clearance technology that expedites processing for Int'l cargo, reducing
clearance times by approximately 6 hours. The new system can transmit &
merge documentation instantaneously and review critical documentation up to
30 hours prior to shipment arrival to prepare error-free entries for
submission to Customs. In addition, the system creates electronic archives
for even more efficient retrieval by customers, Emery personnel and customs.
Emery's brokerage unit handles more than 500,000 transactions on behalf of
more than 25,000 customers annually.
- Aegis Approved As New Bond Surety ......... as Gary C.
Bhojwani & Deborah A. Briner, Attorneys-in-Fact, of Aegis Security
Insurance Company. have been approved effective 19 Feb. 1998. It is
understood that the new Customs Bonds will be marketed by Avalon Risk
- U.S. Customs Penalized For Attempted "Movement"
........... as a woman held for 22 hours, strip searched & forced to
take powerful laxatives by customs agents during a futile search for drugs
has been awarded US$450,000 by a federal jury. Lawyers for Amanda Buritica
of Port Chester, N.Y., argued that agents at San Francisco Int'l Airport had
no reason to suspect her of being a drug courier, intensified their search
when they found no evidence and ignored the fact she was already suffering
from diarrhea. Agents found anti- diarrhea medicine in their initial search.
A government lawyer countered that agents had several reasons for suspicion.
They described Ms. Buritica as a woman in her 50s traveling alone on a
Singapore Airlines flight from Hong Kong - a ``high-risk flight'' from a
city that is a common source of drugs, wearing loose clothing, carrying no
mementos and unresponsive to questions. Ms. Buritica, then 50, a
Colombian-born U.S. citizen, was returning from a round- the-world trip in
September 1994 when she was detained.
- New 19 CFR Part 111......... as it is understood that a
notice of proposed rulemaking for a new 19 CFR Part 111 on Customs Brokers
has been drafted and is expected to be reviewed by U.S. Customs beginning
this month. How long this internal review process could take is unknown.
- New AES Hotline .......... as U.S. Customs has announced
that the Automated Export System (AES) now features a new toll-free hotline
to answer non-technical questions about AES. Dial 1-800-549-0595, Monday
through Friday, from 9:00 a.m. to 6:00 p.m.
- Int'L Mail: No Right Of Privacy ............ as the U.S.
Ninth Circuit Court of Appeals held last week that a border search of
international mail is not subject to a U.S. constitutional right to privacy,
and Congress intended the reasonable cause requirement of 19 C.F.R. 145.3 to
broaden U.S. Customs inspectors' discretion. The court found that searches
of Int'l mail are held to the same standards as border searches, which are
reasonable by "virtue of the fact that they occur at the border."
The court further found that Congress' intent to increase the discretion
with which customs inspectors can search mail was evidenced by the
reasonable cause requirement subsequently added to 19 C.F.R. 145.3.
- Air Freight Worker Blows Up Boat & Cops, Kills Self
......... as 10 police officers were injured last week when Richard
Hellenschmidt of Suffolk County, NY, plunged a knife into his chest and then
blew up his 35-foot cabin cruiser by igniting gas fumes. The 45-year-old air
freight worker was on bail for a drunk-driving charge and apparently snapped
when a bail bondsman dropped by his boat around 11:45 p.m. to discuss his
case. Hellenschmidt tossed the bail bondsman out, threatening to light the
propane tanks on his boat. Police negotiators were called in but
Hellenschmidt refused to talk. The force of the gas explosion blew some
officers into the bay. Most suffered cuts & bruises, and 8 were treated
& released from local hospitals. Two remain hospitalized with multiple
fractures. Strangely, to date officials find no record that Hellenschmidt
had applied for employment with the Post Office.
- Quote Of The Month .......... from the Journal of
"We’re guilty of almost everything."
-- Dick Davidson, chairman of Union Pacific, on his railroad’s continuing
plague of service problems.
Union Pacific Railroad announced on 11 March that it may stop taking new
shipments if it doesn't unsnarl more of the congestion on its rail network
in the next 30 days. In its weekly report to federal regulators UPRR said
its efforts to clear up the 9 month-old traffic jam have been ``inadequate''
and ``unacceptable.'' To ease the tie-ups, the railroad set a 30-day
deadline for making ``very substantial improvement'' or it may halt taking
any new shipments to allow the rail lines to clear. UPRR will redeploy about
300 locomotives in Texas this month, believing this a key move for the cure.
Thousands of rail cars waiting to cross into Mexico are backing up in south
Texas, further slowing Union Pacific's attempts to clear a backlog across
the nation's biggest rail freight network. ............ On the other hand,
proving it can be done right, Canadian National has been selected as Quality
Carrier of the Year for 1997 by Sea-Land Service, Inc.
- Airborne Freight Corp, UP with revenues of $2.9B for 1997, a 17%
increase over 1996 revenues. Year-end shipments for 1997 totaled
302,731,000, up 17.5% over 1996. Company officials attributed the increase,
in part, to the UPS strike which "significantly added" to
- Air Express Int'l (AEI) UP with 4th quarter 1997 net income of
US$14.5M, up 21%. Gross revenues for the Connecticut-based company grew 9%
to US$142.6M. Net income for year 1997 jumped 28% to $49.5M with gross
revenues up16% to $1.546B and net revenues up13% to $448.2M.
- Air France. UP and is expected to post 1997 profit of 1.7 billion
French francs. Air France & Indian Airlines are jointly studying the
idea of setting up a global express cargo product. Such a combination is
seen as a worthy competitor for other players in the cargo market from
India, such as British Air & KLM.
- Atlas Air, Inc. DOWN with 4th-quarter net profit fell 32% to
US$9.1M, or 41 cents per share. Operating income for the quarter dropped 7%
to $27.8M, while operating revenues grew 15% to US$120.9M for the freight
airline. 1997 net profit declined 38% to US$23.4M, partially due to
extraordinary charges. Stephen C. Nevin has been appointed to the position
of V.P. & CFO. He was previously CFO at AirTran Holdings, Inc.
- Circle International Group (NASDAQ NM: CRCL). UP with reported
record earnings for the 4th quarter and year ended December 31, 1997. Net
income for the quarter increased 16% to US$7.6M. Basic earnings per share
increased 15% to $0.47 per share. For 1997 1997, net income increased 20% to
- Eva Airways (Taiwan subsidiary of Evergreen Marine). UP with an
expected a 70% increase in pre-tax profits for 1997 to US$24M, over 1996's
- Interpool Corp.(NYSE: IPX) UP with 4th quarter of 1997 revenues of
$42,503,000, up 12%.
- Knighthawk Airlines (Canadian all-cargo carrier) UP with 1997
revenues of US$9.2M, a 31% increase over1996. This, despite a 13% drop in
3rd quarter revenues, which occurred after Air Georgian Ltd. ended its
relationship with the carrier in August and TNT Express Worldwide ended its
contract in October, which accounted for 35% of Knighthawk's revenues. The
company next signed a contract with Airborne Express, which more than
replaced the lost TNT revenues.
- LanChile S.A. UP with net income 1997 of US$64.1M, 68% higher than
the US$38M in 1996. This result includes non-recurring charges of
approximately US$3.3MM relating to aircraft returns & technical stock.
- Thai Airways. DOWN with a huge US$576M loss for the 1st quarter of
the current financial year. These heavy losses, coupled with the resultant
negative equity, are expected to hamper the Thai government's plan to sell a
large portion of its 93% stake in the airline.
- The Freight Connection, Inc. UP with record revenues in 1997 of
US$26,330,000, a 19% increase over the prior year revenues of $22,170,000.
Net income for 1997 rose 72% to a record $465,000, or $0.10 per share. The
company has opened a new sales office in San Francisco complementing the
existing west coast office in Los Angeles. The parent company is Vitran
- UPS. UP with total revenues 1997 of US$22.46B and net income of
US$909M. By contrast, 1996 revenues totaled $22.37B and net income totaled
US$1.15B. Int'l operations played a significant role in 1997's results,
closing the year with a loss totaling just US$6M compared to a loss of
US$201Min 1996. Overall, the company posted fourth quarter revenues of
US$6.14B and net income of US$351M, exceeding fourth quarter 1996 revenues
of US$5.94B and net income of US$247M Package delivery volume for 1997
totaled 3.04 billion pieces, or an average of 12 million a day. Within that
total, average daily U.S. domestic ground volume declined 4.9% compared to
1996, while average daily U.S. air express volume increased 4.6%. Average
daily int'l export volume grew 11.9% compared to 1996. .
- Wilson UTC. UP as profits for the forwarder jumped 72% in 1997.
However, although Wilson's companies in Hong Kong, Australia, Sweden,
Finland & Denmark enjoyed strong operating profits, its U.S. operations
are still losing money. Global operating profits rose to US$9M over 1996
figure. Revenues increased to US$500M.
- Internet Cargo Conf To Kick Off .......... as the 2nd Annual Air
Cargo Internet Symposium will be held in Oakland California March 29-31,
marking the 2nd gathering of of air cargo professionals to discuss new
Internet technology as well as EDI, electronic funds transfer, & bar
coding. Hundreds of air cargo professionals will meet with the web masters
& technical officers of the biggest 30 airlines, forwarders, and
shippers using Internet technology today. Workshops in Internet Basics &
Web Design will accent the conference and help to bring even new users of
the Internet up to speed with terms and innovative techniques in web design.
An impressive roster of speakers includes Jim Hartigan, Vice President of
Cargo, United Airlines, Ken Lyon, VP Information Services, UPS Worldwide and
Michael S. McDaniel, Esq. of the Countryman & McDaniel forwarder/broker
law firm. Details and schedules can be found on the ACIS2 web site at: http://www.coastalair.com/acis2-98/
- "E" Will Do It By E-Mail ............ as Emery
Worldwide becomes the 1st major carrier to offer an e-mail tracking feature,
called EMCON 2000. Customers initiate e-mail tracking by sending a message
to TrackIt@emeryworld.com, which
links directly to Emery's global EMCON shipment information system.
Customers then enter their shipment numbers (SN), shipper's reference
numbers (SR) or consignees' reference (CO) numbers to track as many as 30
shipments at a time. In the body of the message, customers request shipment
status by using the above keywords in combination with the actual tracking
number; for example SR-1234567890. Separate shipments are defined by a comma
or a carriage return. Customers then receive a return e-mail message,
automatically generated by Emery's EMCON system, that gives them a status
update on each of the listed shipments. For more info: http://www.emeryworld.com
- UPS Announces "Hub 2000" ............. as
Louisville, Ky. has been selected for the company's new US$860M
cutting-edge, automated sorting facility. Dubbed "Hub 2000", it
will require a 2.7 million- square-foot building and will be built at
Louisville Int'l Airport to replace UPS's main express hub. The new center
will nearly double UPS's current hub capability in Louisville and ultimately
will create up to 6,000 new full-and part-time jobs. UPS currently employs
more than 15,000 in Louisville. Sorting automation, which drastically
reduces the lifting and lowering of packages, combined with improved
facility design in general, will improve safety and working conditions for
all UPS employees in the hub. High-speed conveyors and "smart
labels", read by overhead scanners, will enable the facility to process
300,000 packages and documents per hour when it is completed in 2001. The
hub can be expanded to process as many as 500,000 packages per hour.
Currently, the Louisville Hub processes about 165,000 packages per hour.
"Smart packages", bearing machine-readable labels, are the key to
Hub 2000 automation. Many UPS customers already have, or soon will have, the
ability to produce the labels using special software provided by UPS, but
hub employees will apply "smart labels" to packages that arrive
without them. Construction of the facility is planned to begin this year and
is scheduled to be completed in 2001. Some sections of the hub will be
completed early so that additional capacity can be brought on-line,
beginning in 2000.
- Changing European Skies .......... as The Air Bulletin
reports that unprofitable European airlines may be forced to merge with
another carrier rather than rely on state aid, according to a European Union
official. "Now that state aid is coming to an end I don't see that all
airlines will be able to manage without economic difficulties," said
Frederik Sorensen, head of the European Commission's air transport policy
division. The EU has been phasing out state support to airlines in the past
few months, agreeing to massive cash injections by their respective
governments into troubled carriers like Air France or Alitalia only under
strict conditions to lead them back to profitability and with the
understanding that no further state interventionism would be allowed. Thus
far, the Belgian government sold a 49% stake into national airline Sabena to
Swissair because it didn't have the cash to help debt ridden carrier.
Similarly, British Airways is offering to buy a stake in Spanish state owned
Iberia Airlines. The French government says it will reduce its stake in Air
France to 66% and allow 20% to be sold to private investors and a further
12% to be made available to senior staff. The Polish treasury ministry is
considering selling more than 49% of its national line LOT during its
privatization later this year Most recently, the Greek government has
instructed management of Olympic Airways to find strategic partners to keep
it afloat and will enforce rescue legislation in 2 months time unless the
airline has made significant steps to ensure its survival. Indeed, European
lines are up in the air over this.
- So. Asia Air Routes Shorten ............. as North Korea
has opened its airspace to overflying aircraft on a trial basis before the
country officially opens its air routes to Int'l flights on April 23, the
result of an agreement reached with the Int'l Air Transport Association
(IATA). A Cathay Pacific freighter was the 1st flight to benefit from the
new route when it crossed North Korean airspace en route to Hong Kong from
Anchorage, Alaska. Flying over North Korea can reduce flight time up to 50
minutes on flights between the U.S. & So. Asia and will allow freighters
to operate at maximum payload capacity, suppressing the need to balance
range against load. As part of the trial, A KAL freighter to Seoul from New
York has also used North Korean airspace even though North & South Korea
remain technically at war. It was freighters which led the way in opening
the new route. However, the move could disadvantage U.S. carriers as the FAA
considers ordering all U.S. registered aircraft to keep off most of North
- U.S.-Canada Skies Now Fully Open ........ as the 3 year
process of deregulating the trans-border aviation market has been finalized.
Under the original 1995 agreement, Canadian lines had the right to fly
anywhere in the U.S., but U.S. lines could not to Vancouver, Montreal or
Toronto. While the restriction on U.S. flights to Montreal & Vancouver
expired 12 months ago, the Toronto ban has just been lifted.
- An American In Tokyo ............ as American Airlines is
cleared by the DOT to fly from Chicago to Tokyo. Japan Air Lines also
announced that its long-awaited alliance with American may be sealed very
soon. American's main competition comes from United, which will soon upgrade
its daily Chicago-Tokyo service to twice daily. United has unlimited rights
to Japan, and also operates considerably larger capacity aircraft on the
route. American will use MD-11s while United is flying B747-400s. However,
American is in the process of selling its MD-11 fleet to the giant express
carrier FedEx, which will convert the aircraft to dedicated freighter
- Delta Expands .......... as it moves to become a more
competitive force in the U.S. - Latin America market, expanding service from
its Atlanta Worldport on April 5, 1998 to Guatemala City, Guatemala; Panama
City, Panama; San Jose, Costa Rica; and San Salvador with B757 aircraft; and
on April 1 to Caracas, Venezuela; and on 1 July to Lima, Peru. On the other
side, the U.S. Dept. of Transportation has approved Delta's application to
operate daily nonstop service connecting Atlanta & Tokyo, beginning June
3, 1998. Delta still has applications pending to provide daily nonstop
flights between Portland, Osaka & Fukuoka and to increase its current
LAX to Tokyo flights from 6 a week to daily service.
- Good Bye - Again........ as despite last minute efforts
to increase cash flow, Pan Am requested its two units, Pan American World
Airways & Pan American Airways be placed under bankruptcy protection by
the courts in Miami, FL. As a consequence, the airline halted all flights
effective February 27. This is the 2nd bankruptcy for Pan Am, which shut
down in 1991 following the 1988 Lockerbie bombing. Pan Am took to the skies
again in 1996, however, there were no similarities between the two
operations, save for the common name & distinctive logo. The original
Pan Am was well known for its pioneering Int'l flights reaching to all
corners of the world while the "New Pan Am" is a low cost carrier
competing in the crowded New York to Florida market. In March 1997, it
bought a controlling stake in another low cost carrier, Carnival, but both
airlines were already heavily indebted. The name has always deserved better.
- Mexican Carrier Sales ............ as the Mexican
government plans to sell its 50% stake in Cintra, the holding company that
has the nation's 2 leading airlines, Aeromexico & Mexicana de Aviacion,
plus several regional lines. The plan is for government to stop being a
partner in the airlines and concentrate on its role as a regulatory agency.
This divestment could take place either by putting the government shares on
sale in the stock market or through a buy-back of stock by the airlines
- No Rest For FedEx .............. as it began Sunday
package deliveries this month, reflecting a trend toward seven-day-a-week
work weeks in America. Sunday deliveries began in 50 of the largest U.S.
cities with an eye toward expansion. Meanwhile, FedEx pilots worried that
work-rule changes could mean more work for little or no additional pay have
rejected a proposed labor contract with the cargo airline by a margin of
1,322 to 1,023. The union's board of directors and negotiating committee had
recommended approval. No immediate effect on operations is expected.
Salaries currently range from $45,000 a year to $200,000.
- Cargo Latte Anyone? ......... as the owner of a
Beaverton, OR. espresso cart has announced settlement in a lawsuit filed
against him by FedEx. The lawsuit, filed in federal court in Portland on
June 12, 1997, accused Greg Judish of violating FedEx' trademark by using
the name "Federal Espresso" to identify his coffee business. The
business will be renamed "Custom Coffee", but what about U.S.
- Instant Market Domination ............ as Sinotrans
Northern Airfreight Forwarding Corp. has opened in northern China, instantly
becoming the largest air cargo agent in the region, with the full backing of
Sinotrans Pekair and 3 other air cargo companies. The company will act as an
agent and as well as handling Int'l air cargo transport & Int'l express
mail. It pays to have friends.
- DHL Will Stay ......... as a 24 month study to choose the
location of its new central hub for the U.S. has concluded with a decision
to remain at its present location in Cincinnati, Ohio ......... and build a
new US$170M cargo center at the site.
- The New Nest Is Well Feathered ......... as Eagle USA
Airfreight, Inc. (Nasdaq: EUSA) has completed construction of its new
corporate HQ building & Houston operations center, near the Houston
Intercontinental Airport. It is situated on over 23 acres of land, which
affords opportunity for expansion to accommodate future growth. More than
400 employees have been moved to the new building which also features
several amenities such as a landscaped jogging trail surrounding the site
& a health & fitness room featuring the latest in personal wellness
& exercise equipment. No word on whether Federal Expresso will be
served. Total square footage of the new facilities is 135,279, which
includes 46,275 square feet of warehouse space. In related news, The Cargo
Letter has learned that Eagle USA Airfreight, Inc. applied for an ocean
forwarders license last month.
- New Airport Will Bubble ........ as a major all-cargo
port is due to be built at a former NATO air force base in the Champagne
region of France, at Europort Vatry, N.E. of Paris. It will be the focus of
a US$200M multimodal distribution center, currently being called the largest
in Europe. The port includes a 12,000 foot runway capable of handling the
largest wide-bodied freighters and is slated to be operational by the end of
next year. Get your office space scouts busy now. The company is a comer.
- Crash May Kill Sungshan .......... as the busy airport in
downtown Taipei may be closed in the wake of the China Airlines crash that
killed more than 200 people last month. Officials are calling for the
removal of Sungshan Airport which handles more than 170,000 takeoffs and
landings annually. Critics want the airport moved to a sparsely populated
area, not only because of the safety risk but due to noise pollution caused
for the area.
- Korean Air Hub May Close ............ as the financial
crisis deepens, and both KAL & Asiana cancel more flights, the Chongju
Int'l Airport may close its doors, following cancellation of all its Int'l
routes. The 75.1 billion- won airport was opened just last April, to be the
transport hub for the nation's central region.
- AFI Will Change Hub ........ as Ft. Wayne Int'l Airport,
Indiana, was able to persuade American Int'l Freight to switch its hub and
is poised for a major expansion of cargo operations. The US$33.5M hub would
be built on 75 acres of the airport's Int'l air trade center.
- UPS Catches Asian "Economic Flu" ......... as
United Parcel Service says Asia's economic turmoil has already lead to 1997
revenue losses of US$4M, and expects even bigger losses this year.
- UPS Says NO ........ as it will no longer accept Class 5
hazardous materials, or oxidizers, for shipment by air.
- UPS B767-300 Extended Range Freighter .......... debuts
on European routes this month and is able to carry 55 tons of cargo 3,000
nautical miles in 24 main-deck containers, plus 7 more in lower holds. Mr.
Boeing's new freighter replaces a current DC-8 aircraft
- New FedEx Aisa Chief ........ as Michael Ducker is named
president of the Asia Pacific Division, after 2 decades of service, 1st
joining the company in the U.S. in 1975, two years after the company was
- FAA HAZ MAT Hit .......... as it will propose a $90,000
fine against Southwest Airlines for violating several hazardous materials
regulations by accepting hazardous materials on a passenger flight from LAX
to Albuquerque, N.M., last May. FAA says the shipment was clearly labeled as
ammonium hydroxide, although the air waybill from Graph Air Freight
described the shipment as machine parts. Ammonia hydroxide is corrosive, is
considered extremely poisonous and can be fatal if inhaled or absorbed
through the skin. We hope that the Graph Air Freight paperwork is in order.
- Volumes ............ as Air Canada reported cargo traffic
for Jan. 1997 rose 7.9% to 68 million revenue ton miles. Air France (now 3rd
in world air cargo) has boosted air cargo handling to 18.2% of its total
turnover during the 1996/97 financial year, also posting a 4.4% rise in
capacity over 1996 (dedicated freighters provided 54% of cargo capacity).
Lufthansa Cargo carried 1,690 million tons of cargo, an all-time high up by
0.3% on 1996, with freight-ton kilometers was up by 2.8% to 9.58 million
tons, and sale up by 1.7%. United Air Cargo's 1997 cargo ton miles were
223,586,000, up 14.7% over 1996. Hawaiian Air cargo Ton Miles flown in
February 1998 were 4,082,000, up 1.5%. LAX 1997 cargo tonnage totaled
2,064,897 tons, up 8.9% over 1996's final amount of 1,895,754 tons. Total
air cargo traffic at Hong Kong's Kai Tak Airport 1998, was 118,165 tons of
airfreight, down by some 2.6% over same period 1997. Beijing's Capital
Airport grew almost 25% for 1997 to 327,000 tons, a record. Korea's Asiana
saw air freight carried between Manila & Seoul rise 30% in 1997, despite
the Asian "economic flu". China's air freight in 1997 exceeded all
other forms of freight transport, including passenger transport, as 1.24
million tons of freight were carried by air, 7.5% higher than 1996.
Singapore Airport Terminal Services (Sats) is set to increase its annual
cargo capacity to over 2 million tons and is planning a 6th air freight
terminal at Changi Airport, costing US$300M. Amsterdam Airport Schiphol
again stood out as the fastest-growing airport in Europe last year with
cargo volume increasing by 7% to 1.159 million tons.
- Don't Close The Door! ........ as Continental Airlines
has announced that effective immediately, customers will be able to use
their cellular phone on board aircraft while the main cabin door is open.
This allows passengers to use their phones during the boarding &
- I SAID, DON'T CLOSE THE DOOR !!!!! ..........as a FedEx
ground crew worker got locked accidentally in the unheated belly of a cargo
jet and wound up taking a freezing 90-minute flight from Indianapolis to
Richmond, Va. earlier this month. ``A young man, a new employee, was inside
the plane securing a cargo net when someone outside lowered the door,''
Kathleen Bergen, an FAA spokeswoman, said.
- Circling The NVOCC Wagons .......... as a group called
the American Consolidators Assn. has been formed by Brennan Int'l Transport,
Direct Container Line, Roadway Express & Yellow Freight to increase
their bargaining muscle with TACA, the Transatlantic Conf. Agreement. The
new group formed in the wake of the National Customs Brokers and Forwarders
Association of America move last autumn to raise the profile of its
- FMC Announces Proposed Reform Details ............ as
Chairman Creel of the U.S. Federal Maritime Commission, stated the latest
reform to the 1984 Shipping Act would affect the way non-vessel-operating
common carriers compete against ocean carriers. The most recent draft
legislation would allow NVOs to offer service contracts in their capacity as
common carriers, Creel told the Containerization Int'l Liner Shipping Conf.
in London. He said the legislation “would create some interesting
competitive situations in all U.S. trades, as NVOs would be positioned to
further encroach on vessel-operating carriers' market shares." Under
the proposal being discussed, “very limited essential terms” of all
contracts would have to be published. Judging from previous Senate
proposals, the essential terms would not include the freight rates & the
name of the shipper, Creel said. Creel said, however, that all service
contracts would be filed with the FMC confidentially, so that the commission
could police unfair practices. American Shipper has posted the text of the
Shipping Act of 1984 as it would be modified by the Ocean Shipping Reform
Act of 1998 on the Internet. Go to http://www.shippers.com
- Alameda Corridor Marches Forward ......... as one
thousand residents of communities along the Alameda Corridor will receive
job training under a sweeping program now approved by the Corridor's
governing board. The Alameda Corridor is a 20-mile railroad freight express
line linking the ports of Long Beach & Los Angeles to the
transcontinental rail yards just east of downtown Los Angeles. It is
America's largest current transport project. The Corridor will speed the
flow of cargo by consolidating rail lines and straightening portions of the
tracks. It will also improve the flow of vehicle traffic in the area by
widening roadways and separating them from railroad tracks. Construction of
the US$2B project began last year and is scheduled for completion in 2001.
- A Second Alameda Corridor? ......... as The Journal of
Commerce reports that officials are looking to extend the Alameda Corridor
another 55 miles to the east to speed int'l cargo from the port complex to
intermodal yards in San Bernardino County and keep it off our area's
notoriously crowded freeways.
- Inchcape Quits The Trade ........... as one of the
world's biggest independent shipping agency networks is pulling out to
concentrate on its automotive activities, following a drop in profits for
it's shipping services division, due to the effect of currency translations.
The British company's shipping arm deals with liner agency services, ship
husbandry, marine parts supply and protection and indemnity
correspondent/claims handling services in Asia, Europe, North America &
other parts of the the world. The agency network operates in 44 countries,
handling 2 million containers annually, as well as offering support services
for more than 30,000 ships. Good bye to a proud industry member!
- Changes At NOL ........ as Singapore's Neptune Orient
Lines has formally resigned from the Trans-Atlantic Conference Agreement.
NOL will stop operating Atlantic services late this month, when its newly
purchased APL is due to start its own service, with Mitsui OSK & Lykes
Lines as its partners. The new service is estimated to be capable of adding
about 5% to capacity.
- More Hanjin Capacity ........ as the carrier is
introducing 2 new ships of 5,300 TEUs and two 4,000-TEU vessels as well as
two 17,500-dwt tankers. One of the new 4,000-TEU ships has already been
deployed on the Europe/Asia/US west coast tri-continent container service.
Hanjin aims to have 35 box ships by the turn of the century, including a
dozen with 5,300-TEU capacity. A further 8 will have room for 4,500-TEUs,
and the remainder 4,000 TEUs. Watch the capacity.
- There Will Be Empties Headed Out Of U.S. ......... as a
potentially serious shortage of containers in Asia could hit the peak season
for trans- Pacific shipping operations this year. Record imports from Asia
have led to a glut of containers in the U.S., while a decline in exports is
causing difficulty for carriers wishing to send containers back to Asia for
reloading operations. The trade gap is so acute that the region is already
seeing a shortage of equipment, the worst seen in the Pacific for a decade.
Cargo chiefs are worried that the trade imbalance will get worse as the
Christmas shipping season draws near. Carriers that are used to having 3
containers U.S. inbound for every 2 outbound are now seeing four or 5
inbound for every 1 outbound.
- Ancient Rivalry: New Warning .......... as the Japanese
Shipowners' Assn. has warned its members to be on their guard against
increased competition from South Korean shipping companies. Chmn. Kentaro
Kawamura said the depreciation of the Korean Won would put Korean shipping
companies in a favorable position while Japanese lines, on the other hand,
are hit by the strong Yen & high cost of labor.
- Kintetsu Will Double ......... as Kintetsu World Express
plans to double its west Japan monthly ocean cargo volume by the end of
1998, currently at more than 500 TEUs a month, making the company one of the
foremost cargo firms in the country. Most of the outbound cargo moves from
Kobe Port, with about 45% bound for Asian destinations, 40% to the U.S., and
the remaining 15% Europe-bound.
- NVOCC Collides With FMC ........ as a U.S. Admin. Law
Judge has issued an initial decision finding that Shipman Int'l (Taiwan)
Ltd., a non-vessel- operating carrier (NVOCC), has violated the Shipping Act
of 1984 & 46 CFR Part 514 on numerous occasions during 1995 & 1996
in a scheme of misdescribing commodities transported U.S. inbound in the Far
East - U.S. trades, primarily from Taiwan to Los Angeles. Shipman is said to
have charged rates not filed in any tariff on file with the FMC. Shipment
has been ordered to pay a civil penalty of US$1,425,000. This initial
decision will become the decision of the FMC in the absence of review by the
FMC. PLEASE TAKE NOTE. Watch that "K.D. Furniture" stuff!
- Further COSCO Adventures At Long Beach? ......... as the
South China Morning Post reported last week that China Ocean Shipping
(Group) Co. has signed a letter of intent to operate the Pier 400 container
terminal at the Port of Los Angeles. The deal is said to be worth US$300M
and the concession will start in 2001. An even larger deal L.A. was made by
Evergreen Marine Corp. (Taiwan) Ltd. when it signed a 32 year, US$1B renewal
lease last week with the Port of Los Angeles. Evergreen Marine's operations
at Los Angeles last year totaled 640,000 TEUs, some 21% of the port's
volume. [Remember, Long Beach & Los Angeles are neighboring ports]
Meanwhile, Port of Long Beach has made an agreement that will allow it to
proceed with construction of a new (non COSCO) container terminal on the
former U.S. Naval Base. The port will give US$4.5M to a fund that aids
preservation & restoration of historic structures in the area. One point
of contention has been the requirement for the port to demolish historically
significant buildings in order to build the terminal. As a result of the
agreement, a lawsuit filed by preservationists will be dropped. It will
measure 145 acres.
- More For Portland ........ as FESCO Line has added a
direct port of call to its Australia & New Zealand service. The call at
Portland will be introduced as a service arriving on an every-other-vessel
rotation, once every 18 days.
- South Sea Goes South .......... as South Sea Shipping
went into receivership on 19 Feb. Two ships are under arrest in New Zealand
while M/V Rangitata was arrested the afternoon of 19 Feb. in Melbourne,
Australia. A total of 8 ships, chartered from German interests, are said to
be involved and the owners reclaimed the ships forcing the company into
- Meet Sally ......... as latest container vessel for
Maersk has recently been named M/V Sally Maersk. She has a capacity of 6,600
TEUs and can travel at a speed of 25 knots, with a length of 1041 feet &
beam of 129 feet. Together with her 2 sisters, Sovereign Maersk & Susan
Maersk, she is one of the 3 largest container vessels in the world.
Propulsion is delivered by a MAN B&W 12-cylinder diesel engine, with
74,640 BHP. A bow thruster of 30 tons transverse thrust & stern
thrusters each with 15 tons transverse thrust are fitted. The highly
automated container vessel has a crew of just 15. After a series of sea
trials M/V Sally Maersk will enter Maersk service between Europe & the
Far East with Gothenburg as the 1st port of call.
- "End Of The World" Shines Again ........ as
French navigator Andre Bronner and 7 others have completed 2 months of work
building a lighthouse on Isla de los Estados, Argentina, a desolate island
between Argentina & Antarctica with weather that is often less than
ideal. The original wooden structure, built in 1884, was the inspiration for
"The Lighthouse at the End of the World," the last novel of Jules
Verne which was published in 1905 after his death. The lighthouse
illuminated Tierra del Fuego and served as an eastern sentinel to ships
starting the passage of South America. The newly completed wooden replica is
26 feet in diameter & 23 feet tall and is built of with solar panels to
provide power for the light, which is on a timing system.
- Volumes ........ as experts say about 13% of the world’s
trade volume is shipped in containers, compared to about 9% in 1990,
according to Port Import/Export Reporting Service. The Port of Tianjin, N.
China's biggest, saw exports passing through its facilities rise 7% to reach
US$13.1B, while imports dropped by about 10% from 1996's figure to US$8.4B
There is little growth for India's Cochin Port Trust which handled 8.79
million tons of cargo in the period from April through December, compared
with 8.63 million tons for same period 1996. Throughput at Hong Kong's
container port is forecast to grow by an average of 5.8% a year over the
next decade. Despite an earlier slide, strong volumes in 4th quarter 1997
pushed the Port of Oakland's loaded container volume up by 2.3% overall for
the year with a throughput of 1,264,200 TEU. The Chinese Port of Tianjin
increased its cargo volume 16.8% last year and handled 828,200 TEUs.
Recent Pirate Incidents ........ as Bulgarian owners of M/V
Alfa BG (Belize-formerly the Mona C.) have agreed to pay ransom for the 11 crew
as well as the 22 crew of a Syrian-affiliated vessel. Both were seized by
pirates off Somalia on 13 Jan. by about 25 armed men. Reportedly, the Syrian
vessel was towing the Alfa BG when it lost power.
On 27 Jan., it was reported that the M/T Clipper Sea (Norwegian) was boarded
by two men approaching Dakar, Senegal, at 2355 hrs. 19 Dec. They jumped onto the
stern by using grappling hooks and climbing over the transom. One then jumped
overboard with the end of the mooring line coiled on the deck. The second, who
held crewmembers at knife point, cut the line & leaped overboard as well.
M/V Meridian Spica (Malaysian.) was boarded by pirates, 28 Jan. while at
Cigading, Indonesia. They stole parts from an engine room storage area.
Washington State Ferries Crewmember Missing ........... as a
crewmember of M/V Tacoma (1,400-dwt ferry built in 1997, operated by Washington
State Ferries) fell overboard the night of 18 Feb. in Puget Sound as the vessel
sailed to Winslow on Bainbridge Island, Wash. Steven Brown, 41, of Redmond, was
reported overboard about 2000 hrs, 2 miles from Seattle off Alki Point. The
Tacoma turned around to search for the man until U.S. Coast Guard air & sea
units arrived along with vessels & aircraft of the Bainbridge Island Police
Dept. & the Seattle Fire Dept.. Three passengers reported hearing someone in
the water and one saw a light. The man had worked for Washington State Ferries
since May as an "on-call" able bodied seaman. Brown was last seen near
the 2nd mate's office on the main passenger deck. Washington State Ferries has
moved to formally convene a board of investigation to probe the circumstances
surrounding the apparent drowning death of this crew member of the ferry M/V
Ocean CARGO disasters this month include the following ..........
1.] 7 Feb. M/V Fei Cui Hai (Chinese COSCO Bulk Carrier Co. Ltd.) sank off
southern Vietnam with 34 dead & 2 missing;
2.] 10 Feb. the tug Aiu (Canadian-registry) sank 10 off Comox Bar, British
3.] 13 Feb. M/V Leona I (Liberian) sank at a pier in Dakar, Senegal, after a
collision with the M/V Caro;
4.] 1 Feb. M/V Agan (Russian) sank 40 miles north of Ullung-do Island, South
Korea, carrying scrap from Nakhodka, Russia, to Masan, South Korea. Four Russian
crew were killed, 11 others were rescued. The Agan sent a distress message
stating it was flooding in a cargo hold and 4 vessels responded. An icebreaker
took the survivors and the 4 bodies to Vladivostok, Russia;
5.] 14 Feb. M/V Begi (Belize) broke its moorings in Poti, Georgia, and drifted
into the Black Sea during a storm. It later sank and the 5 crew are missing;
6.] 15 Feb. the tug Elizabeth S. (133-gt tug built in 1944) sank on 15 Feb. near
New Orleans during a storm. The Samson (115.2-foot tug operated by Crowley
Marine Services Inc.) ran aground near New Orleans at East Bell Pass the same
7.] 15 Feb. M/V Manzur, carrying calcium oxide & other chemicals, caught
fire in the Gulf of Mexico. The ship reached the S.W. Pass of the Mississippi
River the next day, by which time the fire was contained;
8.] 16 Feb. the barge Cherokee hit the offshore petroleum platform West Delta
106 in the Gulf of Mexico at 1345 and both caught fire 8.] 17 Feb. M/V Green
Wave (U.S.-registry 507.12-foot dry cargo ship) had a crankcase explosion 256
miles off New Zealand. The ship was sailing from McMurdo Station, Antarctica, to
Christchurch, New Zealand. The U.S. Coast Guard's lead ship of the U.S.C.G.C.
Polar Star (WAGB 10)-class icebreaker, which was sailing to Melbourne,
Australia, after 3 months operating around Antarctica, responded & took
Green Wave in tow. The Green Wave is chartered by the U.S. Military Sealift
Command from Central Gulf Lines Inc.;
9.] 17 Feb. M/V Marie Bouanga (Congolese, operated by Europea rvices Agency)
collided with M/T Zircone (Italian) off the Netherlands. The Marie Bouanga was
sailing from St. Petersburg, Russia, to Rotterdam, the Netherlands. The Zircone
was sailing to Rotterdam with caustic soda, gasoline, kerosene and methlyine
chloride. The Marie Bouanga was towed by Eemshaven, the Netherlands. One of its
crew is missing and the ship has severe damage;
10.] 17 Feb. M/V Shine (Honduran) sank in rough seas, about 16 miles
east-northeast of Iki, Japan. Four crew were rescued and 1 was killed. A fishing
vessel rescued the 4 South Korean citizens but the 5th, Engineer Kim Chong Kun,
62, of South Korea, was found dead. The Shine was sailing from South Lorea to
11.] 18 Feb. M/T Conquestventure L (Liberian-registry tanker) hit a submerged
object near Robben Island in South Africa's Table Bay. Liquid caustic soda
spilled into the water from 2 cargo tanks for 2 hours. The tanker was sailing
from the United States to Cape Town, South Africa;
12.] 21 Feb. M/V Scot Trader (Bahamian dry cargo ship.) ran aground in the
Humber River off Brough, England, on 21 Feb. and developed a 50-degree list. The
crew evacuated and the cargo of timber was lightered to barges to enable
refloating of the ship the next day.
13.] 22 Feb. M/T Hekabe (Bermudan tanker), carrying ammonia, lost power 101
miles south of Amchitka, Alaska. Two of the 35 crew were injured when a cylinder
head exploded, disabling propulsion. Weather conditions included winds of 50
knots gusting to 75 & 40-foot seas. Repairs were made and the ship sailed to
Dutch Harbor, Alaska. The injured crew were airlifted to Anchorage, Alaska, by
U.S. Coast Guard;
14.] 22 Feb. M/V Adria (Romanian motor dry cargo ship) caught fire 50 miles of
Casablanca, Morocco, sailing from Abidjan, Cote d'Ivoire, to Ravenna, Italy,
with general cargo including baled cotton. The fire followed an explosion in the
engine room. Three crew were killed and 13 were rescued. The ship was last
reported adrift & still on fire;
15.] 25 Feb. is (Malaysian 53,483-gt, motor tanker) and M/T Oriental Violet
(Panamanian-motor tanker) collided 20 miles northwest of the U.K.'s Guernsey
Island in the English Channel. The Eagle Memphis was in ballast and sustained a
holed port ballast tank;
16.] 25 Feb. M/V Laura (Noumea motor general cargo ship) sank in the Arafura
Sea, N.E. of Darwin, Australia. All 11 crewmembers were rescued by the Royal
Australian Navy's Fremantle-class Patrol Boat H.M.A.S. Wollongong;
17.] 26 Feb. the tug Florida Seashore sank in 38 feet of water, three miles
south of the channel in Houma, LA;
18.] 27 Feb. M/V Ulsund (Norwegian motor general cargo ship) sank 16 miles off
Lista, Norway. Of the 7 crew, 2 were killed & 5 are missing. Weather
conditions included gale force winds. Two empty lifeboats and other debris was
found. A distress call made at 2030 said the ship was flooding with a list to
19.] 1 Mar. M/V Algosoo (Canadian) as fire damaged the ship's self-unloading
equipment beneath its cargo holds. The ship was moored at Welland, Ontario;
20.] 3 Mar. the tug Seagull sank 53 miles east of Assateague, Va. The tug Caicos
Sound rescued the 2 crew, but that tug, with a crew of 5, suffered a propulsion
failure. The two were sailing to Jacksonville, FL. Weather included seas up to 6
feet & winds of up to 30 knots;
21.] 6 Mar. M/V Canopus I (Cypriot general cargo ship) ran aground off Longstone
Island, England. Cargo containers were undamaged;
22.] 8 Mar yacht Yuyu sank at 0330 8 March off Kushimoto, Japan, after it was in
a collision with M/T Koshin Maru (chemical tanker). The 3 crew, including a
British citizen who was the master, were rescued in the 40 minutes after the
23] 8 Mar. M/T Regents Park (Liberian.) dragged anchor in high winds &
collided with the anchored M/T Yan Shui Hu (Liberian operated by COSCO Dalian
Ocean Shipping Co.) off Galveston, Texas.;
24.] 10 Mar. M/V Golden Union (Maltese, motor dry cargo ship) lost power after
its engine room flooded and the ship began sinking 4 miles S. South Africa. It
was sailing from Karachi, Pakistan, to western Africa with rice. The 33
crewmembers were rescued by 2 So. African Air Force helicopters. On 11 March,
the John Ross (St. Vincent) towed the ship further from shore to prevent it from
running aground. Heavy weather was in the area but at last report, a decision
had not been made on the ship's fate. The Golden Union was last reported 20
miles south of Umzimbuvu;
25.] 10 Mar. M/T Nadym (Cypriot), sailing from Pusan, South Korea, to Magadan,
Russia, with 15,000 tons of fuel, was driven aground by ice at Cape Alevia,
Russia. The ship grounded on rocks and has a holed ballast tank.
NOTE: Due to seasonal weather there were many, many more groundings, barge
losses, fires & other disasters we had no room to report. Large loss of life
was reported in the fishing fleets and on ferries. It was a BAD month at sea. We
mourn the many vessels lost.
The historic dangers of carriage by sea continue to be quite real. Shippers
must be encouraged to purchase high quality marine cargo insurance from their
freight forwarder or customs broker.
Here are our suggested world wide web sites of the week for your business,
your information and your amusement ...............
Connecticut Maritime Association '98. Includes recent CMA
Virtual Conference .......... ISM Code discussion & "electronic
Hamburg Sud and subsidiaries, Columbus Line and Deutshe
Nah-Ost Linien launch a site.
Lynden Air Freight. Now upgraded
Austrian Airlines. Good freight tracking for this small
Amsterdam Airport. Holland's airport.
American Track Systems. The latest in rail technology.
Daily Freight News Of Spain
World Animal Transport
MALE. Hungarian air cargo carrier.
-- by Dave Jordan CHB for The Cargo Letter
LAX -- 16 Mar. - "Drawback" is a refund or remission, in whole or
in part, of a Customs duty, internal revenue tax, or fee. Drawback may be
claimed, under qualifying circumstances, when imported merchandise or articles
have been exported or completely destroyed to the extent that they have no
The functioning of the drawback process has implications for many types of
businesses. Under varying circumstances, exporters, importers, manufacturers,
and others may file a claim for drawback of ordinary customs duties, marking
duties, and Internal Revenue Taxes. (Certain other duties and fees are not
eligible for drawback.)
The U.S. Customs Service has published extensive revisions to the Customs
Regulations (19 C.F.R.) regarding drawback. These revisions, taking effect on
4/6, implement changes to the drawback law contained in the Customs
Modernization portion of the North American Free Trade Agreement Implementation
Act. Additionally, certain other changes are intended to expedite the filing
& processing of drawback claims and/or generally simplify and improve the
editorial clarity of the Regulations. In the process of formulating the new
rules, Customs consulted extensively with the drawback trade community.
The complete 104 page Final Rule is published as Part II of the March 5
Federal Register (Volume 63, Number 43, Pages 10969-11072). It can also be
downloaded from the GPO Website (http://www.access.gpo.gov/su_docs/dbsearch.html)
or from the University of California’s GPO Gate (http://www.gpo.ucop.edu/search/fedfld.html).
However, take care to be sure to download the entire notice. Both the text-only
and portable document file (PDF) versions have been split into three documents
due to the length of the notice.
DAVID F. JORDAN CONSULTING SERVICES, INC.
A.T. Kearney, Inc., a leading management consulting firm, has now published
it's Transport Outlook which includes the following:
- Airline industry alliances will move far beyond traditional code- sharing
arrangements to include a broad range of shared services over the next
- The European airline industry will undergo dramatic change as deregulation
accelerates and more low-cost carriers expand throughout Europe. Some
national flag carriers are particularly vulnerable and will be forced to
launch major initiatives aimed at becoming more competitive.
- There will be continued emphasis on railroad cost reduction, but attention
will focus on "second-tier" opportunities. Most railroads have
already tackled the big issues of employee numbers and assets, and they will
attack this next wave of cost reduction through purchasing, procurement and
facilities management. Merged railroads are working to find the most
efficient processes to put into place, and these types of areas hold the
most promise for quick returns to the bottom line.
- Smoother seas are ahead for the containers-shipping industry. Intense
competition and overcapacity have driven freight rates downward in real
terms by as much as 30 to 40% on some major trade routes over the last
decade, while shippers' expectations for service have increased. The result
is an increasingly streamlined industry with a few leading carriers that are
well- positioned to benefit from any improvement in market conditions. Look
for significant earnings improvement for the new breed of lean,
- Global shippers are demanding more than just plain transportation. As
shippers' global sourcing patterns shift on an increasingly rapid basis,
they will need carriers and intermediaries that can combine flexible global
coverage with a high level of delivery, powerful information technology, and
telecommunications as the backbone.
- Leading trucking companies will implement marketing programs to more
effectively target customers whose shipping requirements "fit the
network" and that offer opportunities for profitable growth. Motor
carriers are enjoying newground profitability as a result of a strong
economy, a more stable pricing environment and implementation of major cost
reduction strategies. Specifically, network rationalization and a slowdown
in new-equipment orders have reduced the over capacity that resulted from a
decade of geographic expansion, allowing carriers to be more selective in
their mix of freight.
- Demand for time-definite, nonmode-specific service will continue to
accelerate as customers streamline their supply chains. This trend will fuel
a new round of industry consolidation, as carriers pursue
acquisitions/alliances to round out their service portfolios.
- The ability to provide end-to-end information services will become
increasingly important in carrier selection, as more shippers gain access to
low-cost IT. Carriers who lack these capabilities (that is, processing a
pickup request; providing ETAs and advance shipment notification, invoicing
and freight payment; as well as POD-Payment on Demand) will face both
marketing and cost disadvantages.
- Core-carrier consolidation and acceleration in private-fleet conversion
will spur growth in the truckload sector. Large, well capitalized players
will be the primary beneficiaries as barrier to entry rise. IT investment
and dedicated fleets/drivers necessary to support JIT (just-in-time)
requirements are very expensive, and only the largest companies will have
the scale required to obtain preferential intermodal rates.
The Women's Int'l Shipping & Trading Association, "WISTA" began
in 1974 as an organization for women involved in shipping-related businesses
throughout the world. It started as an informal gathering of women brokers in
the U.K. and has expanded to include women from all over the world in all areas
of shipping & trading, including operations, finance, brokerage, chartering,
freight-forwarding, agency, consulting, management, law and insurance. Today,
WISTA provides its members with the opportunity to develop professionally,
network & make contacts, share experiences, and generally facilitate the
free flow of information.
WISTA organizes annual conferences which generally run 3 days and include
workshops, lectures, specialized courses, tours of the port & terminals,
company visits, professional discussions & various social events culminating
in a gala dinner. This year's conference will be held in New York City from
September 16-18 and promises to be an informative & exciting event.
The goal is to establish an active U.S. chapter of WISTA and, with YOUR
support, to make the annual conference a success. An annual membership fee of
$60.00 provides membership in WISTA USA, WISTA Int'l, mailings from the WISTA
Int'l Committee, a subscription to "The Watch", a listing on the WISTA
Int'l membership directory & discounts for WISTA USA activities.
For information, contact Marieann Rigos, Membership Commitee For WISTA USA,
[an error occurred while processing this directive]
E-mail - Marianna@Rigos.com