The Cargo Letter
THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
29 July 1998
Good Wednesday Morning from our Observation Deck...... overlooking the
officially designated "Cargo City" area and....... Runway 25-Right, at
Los Angeles International Airport, voted ``Best Cargo Airport in North
America''. For your company travel this summer, or any time, the world's best
discounts, information, selection & real deals can only be found at our http://www.cargolaw.com/d.traveler.html
The thousands of Forwarders & Brokers who read this publication around
the world need to learn of YOUR experiences and what YOU learned today.
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://cargolaw.com
For late breaking news or to post comments about The Cargo Letter or discuss
articles, go to ....... http://www.interpool.com/tcl/disc1_frm.htm
Michael S. McDaniel, Editor & Publisher, Countryman & McDaniel,
forwarder/broker attorneys at LAX.
INDEX to The Cargo Letter:
OUR Top Story
1. Chaos Central: The Opening Of CMK
* Most Expensive Cargo Disaster In
OUR "A" Section: Trade, Financial & Inland News
2. Freight Forwarder Trade Briefs
3. The Cargo Letter Financial Page
OUR "B" Section: FF World Air News
4. Freight Forwarder World Air Briefs
OUR "C" Section: FF World Ocean News
5. FF World Ocean Briefs
6. The Cargo Letter Cargo Damage Dispatches
OUR "D" Section: FF in Cyberspace
7. The Cargo Letter "Cyber Ports Of Call"
OUR "E" Section: The Forwarder/Broker World
8. Asian News Briefs
* Our Warren Levine Feature
9. Overweight Containers Bite Brokers
* You Were Previously Warned
10. New U.S. Int'l Transport Legal Cases
11. What's Your U.S. Customs Filer Code Number?
12. HHG Moving Tips
* Word From The Experts
13. New HKG Airport Stats
- Most Expensive Cargo Disaster In Aviation History
-- by Cameron W. Roberts with Michael S. McDaniel for The Cargo
Los Angeles - 28 July - Is it human error or corruption which plagues Hong
Kong's (HKG) new US$20B Chek Lap Kok Int'l Airport?
On 6 July HKG's Chek Lap Kok (CLK) Airport opened. Thus began one of the most
complicated cargo disasters of the 20th Century. After 3 weeks, mechanical &
computer systems are still down amidst a sea of idle ULDs, soaring delay claims
and missing freight in epic proportions. According to Hong Kong's Airport
Authority a "bug" in CLK's master computer triggered a domino effect
that instantly sent the new facility into utter chaos; erasing inventory,
changing flight schedules; mis-routing cargo & baggage ....... and causing
the biggest ever global snag.
In an attempt to gain control, Hong Kong officials enforced an air cargo
embargo, hoping that the suspension would allow sufficient time to fix the
computer & mechanical problems. At the time of the embargo Hong Kong Air
Cargo Terminals Ltd. announced that to relieve pressures at so-called
"Super Terminal 1", all import cargo processing - with the exception
of perishables, strong room cargo, reefer freight, lifesaving materials, news
material &statutorily controlled items would revert to the old HKG.
venerable Kai Tak Int'l Airport.
Human Error, Hi Tech Stumble or Corruption? In the days immediately following
the cargo embargo, it was widely reported that human error had caused the many
computer problems. Other recent airport openings at Denver (US$4.9B), Kuala
Lumpur, Kansai all had difficulty with computer systems intended to integrate
various operating systems, but only CLK had sought to orchestrate all it's
systems, from passengers & baggage to cargo & jet fueling via a single,
central computer system designed in part by Oracle Corp. of Calif., &
Electronic Data Systems Co. (EDS) and linked by over 400 miles of fiber optic
cable. Contractors, computer experts & airline authorities all indicated
that the individual systems would function separately in the event of a central
computer failure. That was the plan. However, according to the Airport Authority
& EDS somewhere in the system incorrect data was entered into the central
database. In turn, central system instantly spread this erroneous information to
all the connected systems with catastrophic results. Cleaning crews, passengers,
baggage & cargo were directed to the wrong gates. Problems were exacerbated
by a general breakdown in the telecommunications system, forcing ground crews to
rely on cellular phones to coordinate with gate arrivals.
Thus far it is unclear if the computer system failed or if human error caused
the problem; but it does seem clear that old fashion corruption has a role to
play in the disaster. On 15 July four airport workers were charged with bribery
& corruption for covering up shoddy construction of facilities connected
with the rail link to the airport. Two engineers allegedly falsifying building
requirements & delivery statements. HKG's Chief executive, Tung Chee-hwa,
has appointed a judge to head an independent commission that will investigate
and issue a full report within 6 months. [see our story in FF Air Briefs]
Opening Day - Peak Season? Clearly, the lessons of history are lost on CLK's
Authority. HKG's traditional peak traffic volumes start in July and continue
through October. Backlogs & lift are always an issue in these hectic months.
Wearing apparel & other seasonal importers, busy building back to school
& Christmas inventories rely on HKG as a primary logistics hub. Seasoned
logistics experts question the wisdom of switching to CLK at a time when space
& time were at a premium. "Just in time" inventory systems rely on
reliable transit times that are measured in hours, not days. Delays of 2 to 3
days have caused major U.S. importers, such as LL Bean & The Gap to
reconsider the importance of Hong Kong in their logistics planning. Many believe
that local economics & politics, not logistics planning, were the driving
force of a July opening day.
The Unexpected Problem - "Documents". Integrators, carriers,
consolidators & shippers alike were scrambling to track & trace
documents for inbound/out bound freight from HKG on 7 July 1998 . Courier
services responsible for forwarding documents were temporarily unable to locate
pouches containing original bills of lading, invoices & textile visas. These
essential documents are often sent to foreign ports "just in time" to
clear Customs. As a result, Hong Kong's embargo has sent a ripple through the
logistics chain with global implications. In an effort to prevent further
disruption, Cathay Pacific agreed to carry all express shipments on its
passenger aircraft despite the cargo embargo. DHL & other courier services
were exempt from the HACTL cargo embargo since courier shipments are classified
under the same category as postal & perishables, not cargo. Several courier
services are able to handle shipments direct from commercial airlines utilizing
their own airport employees & systems based at the Express Cargo Terminal (ECT)
facility, thus by passing the cargo handling problems at so called "Super
The Future. On 21 July 1998, The Hong Kong Association of Freight Forwarding
Agents (HAFFA) responded to HACTL's plan for an air cargo recovery program with
concern. HACTL announced that it has "achieved substantial increases in the
amount of cargo being processed". Out of a predicted load of 4,000 tons at
the start of each day, HACTL is currently processing only 1,900 tons. The
company is expressing confidence in its recovery schedule which it says is
realistic. HACTL has announced a 4-phase recovery program for air cargo - the
1st of which was executed on Saturday, 18 July. For the operation, both the old
airport & the new will be used - "Super Terminal" at Chek Lap Kok
& Terminal 2 at Kai Tak Int'l Airport HACTL'S objective is to finally shift
all operations to "Super Terminal 1". Here are the details:
PHASE 1: From 18 July HACTL will start processing 50% of
the projected daily tonnage of imports & exports. Cargo to be managed will
be confined to pre-packed cargo on freighters only, but import perishable will
still be processed at Check Lap Kok to ensure fast release.
PHASE 2: By the end of July, export pre-packed cargo on
freighters &passenger aircraft will be dealt with, as will import cargo on
freighters &passenger aircraft, representing 75% of daily tonnage.
PHASE 3: Mid-August will see services fully operational.
HACTL will process 100% of projected tonnage of imports & exports using
PHASE 4: By the end of August, all import operations will
be transferred to "Super Terminal 1". HAFFA has called HACTL's
handling of the situation so far "an embarrassment" and "a
disappointment" to the industry. It's now calling on the government to
assist HACTL. saying the SAR's economy &reputation are at stake, and the
"huge loss of revenue sustained by the industry & its customers"
must be curtailed before further damage is done. The damage remains to be
......see our other CLK stories throughout The Cargo Letter
- UPRR Begins Pay Back, But So. Calif. Still Taking Hits
.............. as this month Du Pont Corp. settled for an undisclosed amount
its damage suit with Union Pacific over the epic shipping delays of 1997.
Many other shippers are known to have filed damage suits against UPRR after
experiencing delays in some areas of the operator's network. The railroad
has acknowledged there are some critical problems regarding service, but
said its 1996 merger with Southern Pacific RR is solving, rather than
contributing to these problems. However, many experts point to this merger
as the very cause of the historic debacle. The U.S. Surface Transportation
Board is studying whether or not to call for further restrictions on UPRR as
a result of service problems over the past 2 years. During the 1st 3 months
of 1998, the Port of Seattle's market share of Asian container imports with
the West Coast rose nearly one percentage point to 11.4% during the same
period last year, and said, in part, due to the Union Pacific delays caused
in Southern California. By contrast, Southern California ports' market share
of Asian imports fell 1.6 percentage points during the period. More bad news
for LBG/LAX, the New World Alliance of APL, Hyundai Merchant Marine &
Mitsui OSK Line announced last month it will shift its express rotation
servicing Hong Kong, Taiwan & Southeast Asia from Southern California to
Seattle. While congestion has eased on UP's western U.S. system, delays are
continuing in other areas ........... and the Christmas shipping season is
close at hand. Pray.
- Integration Is Future For Carriers ............. as
Lufthansa Cargo says that, as far as it's concerned, the only way for air
freight companies to fend off future competition is through the
establishment of integrated systems. The statement came following
Lufthansa's decision to collaborate with a forwarders Jet Speed Air Cargo
Forwarders, Hellmann, AEI & Expeditors Int'l to advance various
time-definite services. Panalpina, Kuehne & Nagel, Danzas and Schenker
are also to join the new operation. The project will integrate the services
offered by both the airlines and the forwarders, transforming them into
complete logistics solutions. Lufthansa says the outcome of the co-
operation will be a "virtual integrator" for shippers and will
"dramatically improve the efficiency of the transport chain."
Industry rules continue to change.
- U.S. Department of Commerce - Bureau of Export
Administration U.S. Sanctions on the Export of Dual-Use Goods to India &
Pakistan. Read the report
- Deal For Automated Export Filings Struck ..............
as The Journal of Commerce report that after 3 years of sometimes bitter
quarreling, the trade community has reached an historic agreement with the
U.S. Customs Service & the U.S. Census Bureau on a system to automate
the filing of export documentation. The proposal to restructure Customs'
Automated Export System satisfies the needs of exporters and freight
forwarders by limiting the amount of pre-departure information that must be
filed for routine export shipments. Many exporters have long complained that
it is impossible to submit every piece of information about a shipment prior
to departure, as Customs was demanding. But in a major concession by
Customs, the restructured AES will actually allow pre-qualified, low-risk
exporters to ship their products without having to file any information
prior to departure. Other exporters can export with only a portion of the
required information submitted to Customs. The Census Bureau also wins
because it will obtain information it needs to provide accurate records on
U.S. exports. Top Census officials have said that because of the haphazard
way in which export information is submitted, exports are under counted by
billions of dollars a year, significantly inflating the trade deficit. The
proposed restructuring of AES will probably be published in the Federal
Register and go through the normal public comment period and rule-making
procedures before it is formally adopted. It is estimated that as much as
US$70B of exports go unreported each year, meaning that last year's reported
trade deficit of US$181B might have been overstated by as much as 63%.
- China Growth Slowed ......... as export growth rate
during the January- June period dropped almost 14% compared with the same
period last year, reports in the Chinese press.
- Norton Lilly Int'l Expands China ........... as it has
become the first U.S. based operator to be granted a Class A forwarding
license in China, following final approval in early July for a joint venture
with Sinotrans Shanghai. The 50/50 joint venture involves Norton Lilly
attaining half of the Shanghai-based forwarding operations of Hua Hang Int'l
including warehousing, trucks & chassis. The U.S. forwarder will also
take over 5 local joint ventures & 6 offices.
- Circle Int'l Gets More China ............ as the U.S.
forwarding giant has merged with Concord Express-Singapore & CE
Logistics-Asia (collectively Concord). Circle's worldwide network will allow
Concord, which concentrates on integrated transportation logistics &
supply chain management, to magnify the size and range of its services as
well as branching out, geographically. The merger was designed to make
Circle's standing in Asia even more deep- rooted. A successful investment in
Thailand 1.5 years ago, served to improve the company's standards as a
logistics provider throughout the Asia Pacific region. The hope is that the
combination will improve Circle's air & ocean logistics products and
increase its critical mass in integrated logistics capacities within
Southeast Asia. Circle Int'l is based in San Francisco and Concord Express
- Circle Int'l Gets Alrod ............ as it has agreed to
acquire Alrod International, Inc., a privately owned corporation, through an
exchange of common stock. The transaction will be accounted for on a
"pooling of interests"/merger basis & will be non-dilutive.
Founded in 1978, Alrod is a leading Int'l forwarder-broker, the top
Hispanic-owned transport company in the U.S., and a founding member of the
"Hi-Tech Forwarder Network". Alrod is based on the U.S. West Coast
with 250 employees, offices & bonded facilities in San Francisco, Los
Angeles, Dallas, Houston, San Diego, Guadalajara &Tijuana, Mexico.
- Sole Ownership For Castelletti ............. as the
Swedish forwarding group, BTL, is now the sole owner of Swiss-Italian
forwarder Castelletti. The Swiss railway SBB & French transport company
Fatton sold BTL the 51% share of Castelletti it did not already own.
Castelletti has 25 branches in Italy and subsidiaries in Switzerland,
Germany & the U.S., employs more than 800 staff and has annual sales of
- C.H. Robinson Worldwide Gets LTL .............. as it has
acquired Preferred Translocation Systems, Inc. ("PTS"), a
less-than-truckload, or LTL, 3rd-party transportation company, &
Controlled Visions Corporation ("CVC"), an information systems
company affiliated with PTS. PTS-CVC, headquartered in Eden Prairie, Minn.,
had combined revenues of US$9.4M in the first 5 months of 1998. Terms of the
acquisitions were not disclosed. C.H. Robinson Worldwide, Inc., has gross
revenues approaching US$2B and is a global provider of multimodal
transportation services through a network of 120 offices in 38 states,
Canada, Mexico, Belgium, the United Kingdom, France, Italy, Poland, Brazil,
Venezuela and South Africa.
- Buddy, Can You Spare A Euro? ............ as
Intercontainer -Interfrigois set to become the first European intermodal
operator to adopt the Euro as its unit of currency. At present
Intercontainer uses the European Currency Unit for certain customer
contracts as well as in accounting transactions, but present contracts which
are in ECUs will be changed in Euros. This will apply to all European
Monetary Union member countries as well as Switzerland. All tariff, supply,
service, accounting & finance business transactions will be converted to
the new currency by the start of next year.
- Can You Euro-Speak? .......... as a Cargo-L article
reports that the European Commission has announced an agreement whereby
English will be the official language of the European Union (EU), rather
than German, which was the other possibility.
- Joining U.S. & Canadian Rails ............. as
Canadian National Railway Company (CN) & Illinois Central Railroad
(Illinois Central Corporation) (IC) have filed a formal application with the
U.S. Surface Transportation Board seeking regulatory approval of CN's
acquisition of IC and integration of the companies' rail operations. The
result will be a Canadian owned, 18,670 route-mile CN/IC network with 26,000
employees and operations in 16 U.S. states and 8 Canadian provinces.
- Panalpina Austria Grounded On Land .......... as it has
withdrawn from the overland transport business following the breakdown of
sales negotiations conducted for the past year with domestic & foreign
companies. The withdrawal affects Panalpina Landtransport, Vienna, and its
subsidiaries in Graz, St Michael, Linz, Wels, Salzburg & Innsbruck. The
570 people employed in overland feeder services, warehousing &
distribution have not been given notice. Management is attempting to find
interested parties to take over these employees, together with the traffic
affected by the withdrawal, in the framework of a voluntary social plan.
- Saying Sankyu To China ............. as the Japanese
forwarder &logistics company, Sankyu Inc., is launching a north-south
network between Guangzhou & Beijing through Tianjin & Shanghai. It
will achieve this by extending the present Guangzhou-Shanghai service to
Beijing. In early June, Sankyu created its 9th subsidiary in Beijing. The
network now encompasses sea, air & land services in the north, east
& south of mainland China. The supporting companies are in Tianjin,
Dalian, Qingdao, Hong Kong, Shenzhen, Shanghai, Nanjing & Guangzhou. The
Beijing subsidiary, capitalized at US$1.2M, is owned 80% by Sankyu; the
remainder belonging to Beijing Marine Shipping Co.
- Take A Wireless Bite Out Of Crime ............as cargo
theft has nearly tripled to an estimated US$10B a year in the U.S., as
opposed to bank robberies which equal about US$80M a year. Indeed, who would
ever want to rob a bank when it's been so easy to get a container? Weak
penalties & high financial return on stolen goods for the criminals add
to the increasing trend of stealing cargo. Because of the recent rise, law
enforcement and the U.S. Congress are quickly devoting more time &
resources to passing laws that would stiffen penalties. Looking for
assistance in fighting cargo theft, trucking and other fleet management
companies are turning to state of the art wireless tracking systems to help
keep their vehicles and cargo "in sight." Automatic Vehicle
Location (AVL) is poised to become the first "killer app" for both
wireless location & mobile data services, according to a new study. AVL
revenues for commercial vehicle fleets & trailer tracking are expected
to grow from US$367M in 1998 to over US$1B by 2003. One such system is
General Motors' OnStar product. Another is produced by a company called
Teletrac, Inc. With an estimated 90% success rate in locating stolen
vehicles & cargo equipped within 2 hours or less, Teletrac may be worth
study. Using Teletrac's wireless tracking technology, Crescent Truck Lines
of Hayward, Calif., recently recovered 5 stolen trailer, saving nearly
US$220,000 and helped apprehend the suspect who was on parole for auto theft
and under investigation in connection with 17 other stolen vehicles. In
Miami, Tiffany Transport Co., Inc. recovered a stolen vehicle in less than
30 minutes and saved nearly US$150,000 in vehicle and cargo value. In both
incidents, the companies were able to provide the exact location of the
stolen vehicles to their local police department. Teletrac's has two-way
messaging so fleet operators can also communicate with drivers.
TSchad@teletrac-online.com The similar Qualcom system, adopted by Covenant
Transport for it's 3,400 trailers, can be seen at
- Chunnel Hope Still Alive .......... as the highly
troubled Channel Tunnel from Britain to France carried 1.3 million tons of
cargo in the first five months of this year, a rise of 18% over the same
period in 1997.
- WDM Forms Perishable Network ........... as
Brisbane-based freight forwarder, WDM Int'l is taking steps to establish a
worldwide perishable logistics service, called the Global Perishable
Logistics Group. The organization hopes to join specialists together to
offer an integrated, worldwide service.
- Another "E" Step For UPS .............. as
Encanto Networks, a provider of electronic commerce solutions for small
business, has announced an agreement with UPS to bundle UPS OnLine Office
software with Encanto's e.go Commerce webstation. e.go Commerce will now
deliver a complete, end-to-end online Internet business transaction. When a
customer order is received from e.go Commerce's online storefront, the
merchant, using UPS OnLine Office, will be able to immediately fulfill the
order and ship it via UPS -- saving time, reducing paperwork, and
- Making U.S. Export A "SNAP" .............. as
the Bureau of Export Administration will be bringing a new system online by
end of summer which will allow companies to apply for an export license via
the Internet. The Simplified Network Application Processing System (SNAP)
will reduce paperwork & improve accuracy ...... and will be free. To
access SNAP, users will need a pin number which they can get by writing the
bureau. When operational, companies will be able to download the forms,
complete them and post them to the website. Users will have a choice of:
license applications, commodity classification requests, re-export license
applications & multipurpose forms. Forwarders take note.
- New Solutions Software ........ as Pfastship Logistics
Int'l has announced its powerful, object-oriented application, Pfastship
Windows NT, which supports carriers, including but not limited to UPS, RPS,
FedEx, Airborne, BAX Global, USPS as well as LTL carriers. In addition to
carrier support, Pfastship Windows NT can process an unlimited number of
transactions per day at multiple locations, while interfacing with a variety
of peripheral devices such as address-label printers, barcode printers, COD
tag printers, scales, scanners & meters. Pfastship Windows NT can
generate nearly any report that can be defined and will allow customers to
custom design specific documents as well as query by customer name &
number, order number, trace number and bill of lading, to name a few.
Pfastship Windows NT also has the ability to interface with all custom and
major order entry systems.
- Import Export Fundamentals OP 113 ........... as Prof.
Emilio Milian of Golden Gate University at San Francisco will launch his new
course for our industry this fall OP 113 emphasizes the practical aspects of
import - export operations. You will study the start-up and operation of an
export dept., the administration of Int'l transactions, letters of credit
& other forms of payment, collection methods, and shipping procedures.
Documentation, export regulations, import customs clearance & other
government requirements will also be examined. A 3 unit course.
- Amway Back In China ............ as Chinese customers
will be able shop at special Amway retail stores, which are currently used
as distribution centers. They will also be able to buy products from their
distributors. In April, the Chinese government banned Amway Asia Pacific
Ltd. & other direct marketers from door-to-door sales. Authorities were
concerned such sales would promote illegal activity, including smuggling,
the state-run news agency said at the time.
- Stiff Penalties Seen For Smuggler ........... as on 20
July, U.S. Border Patrol agents at San Diego seized 1,046 tablets of Viagra
that authorities say a Japanese tourist bought in Mexico and intended to
smuggle back to Japan for resale. The tourist, a 41-year-old man from Tokyo,
planned to resell the wildly popular impotence drug in Japan. After paying
US$11.00 per tablet in Mexico, the tourist planned to receive US$300.00 per
dose in Japan.
- Splats In His Face, Not In Your Hand ............ as R.P.
Scherer North America, a maker of gelatin medicinal capsules &
paintballs, has announced that it will operate a fleet of 8 climate
controlled trucks to ensure product quality to the point of use. The eight
40' trailers are close kin to the well known reefers used to move perishable
commodities throughout the world. The new units will be used ensure constant
temp & humidity conditions in transit for "paintballs" as they
are moved to various PMI (Pursuit Marketing, Inc.) distributions centers
across North America. Paintballs (.68 caliber liquid paint filled gelatin
balls) are highly susceptible to changes in temp &humidity resulting in
deformed or damaged paintballs that "unshootable". This is welcome
news to recreational paintball players as well as professional &seasoned
tournament players. Indeed, a melted paintball does little to brighten the
pocket of its owner. R.P. Scherer says that the new delivery units will be
positioned at multiple day national tournaments for storage of paintballs by
tournament players, such as the upcoming 1998 World Paintball Championship
Tournament scheduled for Fall of this year. A. Blaine Prentiss, or The Cargo
Letter The trucks can be seen at
- Aer Lingus Group. UP with a profit before interest, tax
and exceptional items of US$65.5M for 1997, an increase of 10% on the
US$59.4M made in 1996. This was achieved on a turnover of US$1139M, up 15%
on comparable 1996 levels.
- AirTran Holdings, Inc. (former ValuJet) UP with net
income for the 2nd quarter of 1998 of US$8.6M, or US$.13 per share on a
fully diluted basis, compared to a net loss of US$9.2M, or $.17 per share,
for 1997. Net income for the 6 months ended June 30, 1998, was US$700,000
compared to a net loss of US$27.7M for same period 1997. Total operating
revenues for the 2nd quarter were US$124M compared to US$47.8M for the
previous year, an increase of 160%. AirTran ended the quarter with a
continued strong cash position of US$66M.
- Alaska Air. UP with record 2nd quarter net income of
US$38.9M, or $1.51 per share (diluted), compared with net income of
US$20.8M, or $1.01 per share, for last year's 2nd quarter.
- America West Holdings, parent of America West Airlines, Inc.
UP with the best quarterly earnings in its history. The record 2nd quarter
1998 net income of US$41.4M was up 80% and included an after-tax charge of
US$2.5M related to a recent settlement by America West Airlines with the FAA
(see Air Forwarder News Briefs, below). Excluding that charge, diluted
earnings per share (EPS) for the 1998 2nd quarter were US$0.90, compared
with US$0.50 in last year's quarter. Including the charge, reported EPS was
$0.86. Year-to- date performance also set records for the best half year in
America West's history including record operating revenues of US$1.0B and
record net income of US$66.6M
- AMR Corp., parent of American Airlines Inc. UP with
reported record 2nd quarter net earnings of US$409M, or US$2.30 per common
share diluted, a 35% improvement over net earnings of US$302M, or US$1.63
per common share diluted, during same period 1997. These are the highest
quarterly earnings in the company's history. However, the division's cargo
revenue fell to US$169 million - a drop of 2.9%.
- Britsh Airways. UP with fiscal year revenue of US$955M,
4% up from 1996/97.
- Atlas Air, Inc. UP with net income for the quarter ended
June 30, 1998 of US$10.1M, or US$.45 per diluted share, a record for 2nd
quarter earnings and the 2nd best quarter in the Company's history.
- Circle Int'l. Up as income for the 2nd quarter increased
13% to US$7.5M compared to US$6.6M in the comparable period of 1997. Diluted
earnings per share increased 13% to $0.45 per share. Revenue for the quarter
was US$165.9 compared to US$166.9M for same period in 1997. Net revenue,
which represents revenue less freight consolidation costs, increased 5% to
US$69.0M. The effects of the stronger U.S. dollar when translating foreign
results into U.S. dollars for reporting purposes negatively impacted revenue
by 9% and net revenue by 7%.
- C.H. Robinson Worldwide, Inc. UP with 2nd quarter of
1998, gross revenues increased by 21.1% to US$546.7M from US$451.4M for the
2nd quarter of 1997. Net revenues increased 21.1% to US$63.3M in 1998 from
US$52.3M in the previous year.
- Cathay Pacific. EXPECTED DOWN as chief executive Peter
Sutch has warned the company may drop into the red in 1998, after a 55% drop
in profits last year when the company posted a profit of HK$1.694M. Reports
indicate Cathay is currently involved in talks with at least 3 lines looking
to forge links with the HKG based carrier. KLM/Northwest, British
Airways/American Airlines &the Star Alliance of United
Airlines/Lufthansa are reported to be competing to finalize a deal with the
- Delta Air Lines. UP with unaudited net income of
us$1.001B (US$12.68 diluted income per share) for fiscal 1998, a 13%
increase from the fiscal 1997 record net income of US$886M (US$11.44 diluted
income per share). Fiscal 1998 results represent the 3rd consecutive year of
record net income for Delta.
- FDX (FedEx, Viking & Caliber). UP with revenues for
the 4th quarter of US$4,078.0M (that's billion), 2.9% more than the fiscal
period's US$3,961.2M and 11.0% more than the calendar period's US$3,673.8M.
Net income for the quarter excluding merger expenses was US$170.7M or
US$1.14 per share. Net income was US$134.6M or US$0.91 per share in last
year's fiscal period and US$144.9M or US$0.98 per share in last year's
calendar period excluding non- recurring items.
- Fritz Companies, Inc. UP as the San Francisco based giant
has watched its revenue rise this fiscal year ending May 31, by 12% totaling
US$1.3 billion. Net revenue was also up for the forwarder-broker by nearly
10%. Both operating & net incomes were also substantially higher than in
the previous year. For the quarter, net income was at US$4.8M - up from
$93,000 a year earlier while revenue rose US$14M to US$323M and operating
income standing at US$6.9M - up from US$524,000.
- Interpool, Inc. UP as 1998 2nd quarter net income per
share (on a diluted basis) was a record 33 cents, as compared with 31 cents
for the same period in 1997. Revenues during 2nd quarter of 1998 were
US$44,506,000, up 12% from $39,784,000 in the 2nd quarter of 1997.
- J. B. Hunt Transport Services, Inc. UP with 2nd quarter
1998 net earnings of US$15.6M, or diluted earnings per share of 42 cents,
compared with 1997 2nd quarter net earnings of US$1.9M, or 5 cents per
diluted share. Basic earnings per share were 44 cents in 1998 and 5 cents in
1997. Total revenue increased 20% to US$461.0M in the 2nd quarter of 1998
from US$385.2M in 1997.
- Martinair. UP as the KLM-owned cargo & passenger
carrier posted net income of US$26M for the year ended December 1997, on
sales of US$715 million. This compares to last year's net income of US$2M on
a turnover of US$609M.
- TMM Line. UP with revenues were increased to US$670M from
a little US$470M in 1996. Gross profit for the year was reported to have
amounted to US$48.1M, an increase of 37% from US$35.1M in 1996. However, a
net loss of more than US$10M was reported for 1997, compared with a profit
of US$43M in 1996. The loss incorporated US$30.4M related to investment in
Transportacion Ferroviaria Mexicana.
- Tower Air Inc. UP with operating profits of US$3.9M for
the 3 months ended June 30, 1998 compared to operating profits of US$9.5M
for the 3 months ended June 30, 1997.
- IATA Looks Ahead ............ as the Int'l Air Transport
Assn. set a new agenda its 54th annual general meeting at Montreal last
month. The central goal is to reduce the number of accidents in the industry
by halving of the number of aircraft lost by 2004. According to IATA's
director-general Pierre Jeanniot other items on the agenda include problems
faced by privatizing air traffic control operations & with the
introduction of much needed new & more powerful navigation systems.
Members approved a project to make sure that service suppliers to the
industry such as air traffic controllers are Y2K compliant. In remarks to
the group, Mr Jeanniot also welcomed the dawn of electronic commerce, but
warned that adequate safeguards against fraud still need to be taken. Last,
Jeanniot warned that airlines need to make provisions in case the industry
should experience further effects of the Asian Flu.
- Big Boys Too Big? .............. as the question of
competition between airlines in the U.S. domestic market is to be explored
by the National Academy of Sciences. The study comes in response to
complaints that larger airlines are competing unfairly with smaller
carriers. The U.S. Congressional Transportation Committee decided in late
June that airlines must now gain prior Department of Transportation approval
for domestic alliances. In turn, competition guidelines, recently issued by
the U.S. Congress are being delayed while the study is carried out. The DOT
will now have about 6 months to review proposals involving code sharing. The
House action affects 3 announced alliances which involve the 6 largest U.S.
airlines: Continental &Northwest; American & US Airways; and Delta
- Some Advise From Singapore ............ as airlines need
to do more to understand the business of shippers & forwarders, Hwang
Teng Aun, Dir. of Cargo for Singapore Airlines, told the recent AirCargo
Forum. Hwang said airlines will never provide shippers with satisfactory
solutions if they &forwarders continue to manage air content &
ground content components separately. Cargo carriers need to vertically
integrate their IT &operational processes with major forwarders in order
to provide better solutions to customer problems, he told forum members.
Airlines should also learn more about their customer's products including
their production, delivery & harvest cycles as well as packaging
requirements. Following these guide lines is only way an airline can become
a value-added player in the logistics chain, Mr. Hwang said. We hope the
- Will There Be A BAXmobile? ........... as BAX Global has
enhanced its Emergency Response Service, or "ER," by adding 2 new
levels of service, including money back overnight guaranteed delivery &
direct airport-to- airport service. ER was developed by BAX Global to handle
shipments, regardless of weight or size constraints, that require demanding
time-specific guaranteed delivery. There are 3 distinct levels of service:
Guaranteed First Arrival; Guaranteed Overnight; & Guaranteed
Airport-to-Airport service. There is an automatic confirmation from BAX
customer service once the delivery is completed. http://www.baxglobal.com
- United Shoots Self In Paris Leg .......... as lack of
suitable aircraft has stymied UAL plans to run cargo services to Paris from
Chicago. Currently, the only U.S. firm running freight-only services to
France is FedEx, to its Paris hub. United had applied to operate 6 flights a
week from ORD via JFK to the French capital. While the application was to
operate the service with a DC-10, UAL has not been able to locate one not
already in use elsewhere. This difficulty for UAL opens the door for UPS to
be the next to take advantage of the recent open-skies accord agreed between
the US & France. UPS already has plans to run a Louisville-
Philadelphia- Paris route using its B-767F freighters.
- Polar Takes Better French Aim ............ as L.A.'s own
Polar Air Cargo, is currently finishing a feasibility study for freighter
flights into the French city of Marseille, expecting to begin the service by
the beginning of 1999. French & U.S. authorities are reported to have
replied positively to the line's proposal to serve Marseille 2 x weekly with
B-747F aircraft. Polar says it selected Marseille over Paris as FedEx &
UPS already have the route authority to fly into the French capital.
- Air France Aims At Self ........... as the French
government intends to proceed with plans to sell off 20% of the carrier in
Sept. The move startled many, considering the impact to both its reputation
& finances of a 10 day pilots' strike that crippled operations on the
eve of the World Cup Soccer Finals in early June. The strike happened only
days after the airline announced its 1st net profit this decade, US$313M,
compared with a loss last year.
- Diagnosis For Philippine Air Worsens ............. as its
pilot strike in June added damage even beyond the Asian flu. Sources in
Manila suggest PAL may end all intercontinental long-haul services except
for U.S. flights.
- AA - BA Deal Closer? ........... as the U.S. Dept. of
Justice has recommended that competitors of American & British Air
receive 336 slots at Heathrow as a condition of the pair’s receiving
antitrust immunity for their long-delayed alliance. Although the Dept. of
Justice does not have authority to block the code-sharing partnership, a
spokesman said, "The proposed alliance should not be approved unless it
is significantly restructured," with antitrust carve outs of hub-to-hub
routes Dallas-London & Chicago- London. Dept. of Justice added that
"a bilateral open-skies treaty , while essential, by itself would not
be sufficient to make the alliance acceptable, without substantial access to
Heathrow by competing airlines."
- Fed Ex Ready At CLK? ............ as the company says its
new facilities at Hong Kong Int'l Airport will save at least 2 hours of
processing time on inbound packages & documents. Located in the 2,500
square-meter Asia Airfreight Terminal (AAT) at Chek Lap Kok (CLK), FedEx
started operating along with the new airport on July 6. FedEx has 30 flights
arriving/departing CLK every week. Along with customs, FedEx has also
established an electronic data interchange (EDI) system at CLK.
- The People Who Brought You CLK: ARRESTED! ........... as
4 airport workers have been charged with bribery & corruption for
covering up shoddy construction of facilities connected to the rail link at
HKG's new airport, CLK. Two engineers & a project foreman allegedly
falsified measurements &fabricated delivery statements, and a 4th
suspect is charged with trying to bribe a building inspector with US$25,600
so he wouldn't look into the cover- up, the Independent Commission Against
Corruption said. The corruption case followed a string of problems since the
US$20B Chek Lap Kok airport opened July 6, and seemed certain to increase
growing criticism of the government &airport management. But what about
the guys who designed the cargo terminal?
- Fritz Keeps The Lift ............ as even though Chek Lap
Kok airport is now operating at only 30% of its normal capacity, Fritz
currently has no backlog of shipments from Hong Kong. Despite the problems
at the airport, Fritz has the capability to move shipments because of its
strategic alliances with many of the key airlines servicing Hong Kong. The
company predicts "normal" operations at the airport to resume by
the end of August, although many doubt the prediction. Fritz received its
ISO-9002 certification for air freight services in HKG in May 1997.
- From Chaos Comes DHL Profit ......... as continuing air
cargo glitches at Chek Lap Kok have resulted in a surge in DHL Worldwide
local business, as the int'l air express carrier adjusts operations to
accommodate the demand for air express services in Hong Kong. DHL customer
service operations in Hong Kong are experiencing a 50% increase in call
volumes from shippers seeking reliable shipping options. Additionally, over
the past 2 weeks, DHL has experienced a 20% increase in shipment volumes and
a 35% increase in shipment weights through its express terminal at the new
port. DHL continues to process shipments with its own employees &
systems based at its Express Cargo Terminal facility, thus bypassing the
problems & cargo embargo at the Hong Kong Air Cargo Terminal's Limited
(HACTL) now infamous & dreaded "Super Terminal One".
- Kuehne & Nagel Throws Its Hong Kong Airfreight In The Ocean
............. as it has instructed all its major overseas stations to accept
bookings to Hong Kong on a new Air-Sea service in order to deal with the
cargo problems at Chek Lap Kok. Under the Air-Sea service, airfreight
consignments are consolidated by the KN stations overseas and sent by air to
either Singapore or Korea where the cargo is loaded into ocean containers
and forwarded to Hong Kong on short-sea routes. As the long-haul sectors to
Singapore and Korea are still covered by air, the total transit time is only
extended by 4 to 5 days to allow for the sea-transport to Hong Kong. A
similar service for exports is offered by Kuehne & Nagel, whereby air
cargo consignments are sent by sea from Hong Kong to Singapore and Korea for
onward transportation to the oversea destinations by airfreight.
- KLM Under Fire ........... as there is serious criticism
stemming from its change to a new system whereby certain airport handling
facilities are off limits to forwarders, but accessible by KLM.
Schiphol-based forwarders say this allows the airline alone to control the
entire handling process, thereby giving KLM an unfair advantage in the
perishables market. The accusation is being processed by the Dutch
Competition authority, a division of the Hague's Ministry of Economic
- BA Gets Shanghai ........... as the British & Chinese
governments have reached an agreement on direct air services between the 2
countries with British Airways due to start flights to Shanghai using
- A Fine Result For Southern Air ......... as Fine Air
Services Corp. has announced that it has executed a letter of intent to
acquire Southern Air Transport, Inc., a privately owned cargo airline based
in Columbus, Ohio. The acquisition is expected to be completed within
approximately 90 days, subject to the satisfactory completion of due
diligence & receipt of all necessary regulatory approvals. It is Fine
Air's intent to continue to operate SAT as a separate line.
- MSAS Gets Laker Int'l ........... as French air freight
company Laker Int'l has been bought by MSAS Cargo Int'l. The Paris-based
company carries freight particularly for producers of high-tech equipment,
consumer goods &pharmaceuticals.
- Landair Splits .......... as Landair Services, Inc. has
announced it will divide into 2 publicly traded companies, one comprised of
its Truckload carrier business with operating revenues of approximately
US$96M & the other its Forward Air business with operating revenues of
approximately US$112M. Forward Air provides scheduled trucking services to
air freight forwarders, fully-integrated air cargo carriers and domestic
& Int'l airlines.
- UPS Euro Expansion .......... as UPS Worldwide Logistics
Europe has announced its new distribution center at Wakefield in Yorkshire
will be open by the end of Sept. at over 100,000 square feet. In Holland,
the company is adding almost 80,000 sq. ft. of warehouse space to its
existing distribution center at Roermond, due to be completed in early 1999.
- EU OK's DHL Deal .......... as DHL the European
Commission will allow Deutsche Post AG (the German post office) to complete
its purchase of 22.5% stake in DHL Int'l. From July 1, Deutsche Post is
offering its express document service, called "Express
International" co-branded with DHL and enable Deutsche Post customers
to send documents throughout DHL's network of 227 countries &
territories around the world. Deutsche Post joins Lufthansa Cargo, Japan
Airlines & Nissho Iwai as a major shareholder in the company.
- SwissCargo Consolidates ........ as it will move all
freighter aircraft operations to Basle, enabling it to offer services to
destinations such as Hong Kong & Mumbai. A company spokesperson said
focusing on a single point will lead to better aircraft utilization &
more viable fleet maintenance scheduling. At present services are scheduled
from both Basle & Geneva.
- GeoLogistics Renames Its Carib Purchase ............. as
completion of its acquisition of Caribbean Air Services, Inc. from AmerTranz
Worldwide Holding Corporation on July 15, 1998, will bring the new name
"GeoLogistics Air Services". The company provides air logistics
services between the U.S. mainland, Puerto Rico & the Dominican Republic
and was acquired for US$27M. GeoLogistics Corp. was formerly Int'l Logistics
- Not A Virgin In Airfreight ............ as Virgin
Atlantic Cargo has doubled the size of its LHR cargo facilities in
anticipation of expected growth in volumes. A new building, which is located
opposite the cargo terminals at London's Heathrow (LHR), will be known as
"Cargo Point" , to be managed by Plane Handling, Virgin's air
freight handling company. The new building, which houses 13,000 square
meters of warehousing & office accommodation, will be home for both
export/import operations as well as cargo sales & reservations.
- Boeing's Y2K Bug Is Dead? ........... as we repeat a
story from last month's edition  to remind
that the Boeing Group has announced that "no safety of flight
issues" have been identified with millennium computer bug. Speaking to
the IATA annual general meeting last month, Tim Fehr, V.P. of Airplane
Systems for Boeing, said flight safety will be maintained and no serious
problems are expected. The U.S. Federal Aviation Administration (FAA) told
the same conference that FAA views the millenium bug threat as an important
issue. However, FAA says it has a clear plan to combat the
issue&believes the national airspace system will be operating safely at
the appointed hour. To repeat, the issue is serious. For the past 2 years,
IATA airlines have been working together to ensure their own systems will be
year 2000 compliant, at an estimated cost of US$1.6 billion. What have YOU
done? Is your company ready for Y2K? Will your scheduling, payroll, and even
word processing still work at the stroke of midnight on 1 Jan. 2000? Don't
count on luck. Find out!
- Exactly Yellow .............. as Yellow Freight System
has entered into partnerships with several air carriers to service its
"Exact Express", a new system to offer same-day, next-day &
hour-specific deliveries to Canada, Puerto Rico and the entire U.S. Although
most shipments will be moved using Yellow Freight's own motor truck cargo
network, the company will also use air carriers when necessary to herald its
entry into the lucrative air freight industry. Yellow has guaranteed
customers that if stated delivery times are not met by the day or time
specified, service will be free.
- Maple Leaf & Mid East .......... as Air Canada &
Royal Jordanian are introducing a codeshare service between Canada &
Amman, Jordan via London (LHR).
- The Baron's Freight Focus .......... as Boeing has
delivered the first 2 of 8 MD-11F freighters to Germany's Lufthansa. It
expects to finish the order by year 2000. Meanwhile, Lufthansa &
Russia's Sibir Airlines have reached an agreement on cargo services to/from
their respective countries.
- Flying Movies ........... as Airborne Express delivers
about 75% of the movies you watch on the big screen. Entering the field in
1993, its entertainment division is now the fastest-growing unit in the
company. The lane is often hectic, as Airborne has to move additional
aircraft out of LAX to deliver the films, plus shift its other high-priority
freight around to make the movie studio deadlines.
- Slower Growth For Alaska Seen ........... as experts
predict air cargo traffic throughput Alaska will only grow by 8%over the
next five years. In the 12 months that ended June, '98 int'l air cargo
traffic through Anchorage, Alaska, grew by 17. Insiders are blame the Asian
Flu for the slowdown in growth, saying companies must keep in mind the fact
that air cargo traffic is still, in fact, growing, although not at such a
- Roehlig UK Chills Out In South Africa ...............
with the opening of new freight facilities by its sister company in the
southern hemisphere. Roehlig South Africa's new airfreight terminal in
Durban features cool-room facilities and is located adjacent to South
African Airline's cargo depot and 600 feet from customs, enabling
perishables to be placed directly into the cold room, eliminating long and
potentially damaging storage in the open. A second perishables &
airfreight terminal in Cape Town is similarly equipped and was built to
European Union standards for all kinds of perishable cargo, from fruit,
vegetables and flowers, to fish and even ostrich meat.
- Pedal To The Atlas Metal .......... as Atlas Air, Inc.
has reached an agreement with Boeing to accelerate into 1999 the scheduled
deliveries of 2 of the new B-747-400 freighters it currently has on order.
The revised schedule now calls for 5 firm deliveries in 1998, 4 firm
deliveries in 1999, 1 firm delivery & 4 options available in 2000, and 6
additional options available thereafter. "This agreement reflects the
confidence Atlas has in the market for this aircraft," said Michael A.
Chowdry, President of Atlas Air, Inc.
- America West Takes 2nd Biggest FAA Pounding..............
as the U.S.'s 9th-largest airline, was slapped with a US$5M fine after the
Federal Aviation Administration found the carrier had violated aircraft
maintenance & operating rules. The fine, believed to be the 2nd-largest
ever imposed on an airline, was based on a number of findings, including
cases in which 17 America West jets were flown after they were overdue for
structural tests. Among them were examinations of the skin around crew &
cargo doors on Airbus A-320 aircraft. In other cases, passenger & cargo
flights were flown aboard B-737 & B-757 airliners without protective
netting installed in aircraft cargo holds. Also, a B-757 was put back in the
air without necessary repairs to its elevator. US$2.5M will be forgiven if
the line complies with the terms of a settlement agreement which calls for
implement a series of new practices & procedures regarding certain
- What Was It About "DON"T" They Didn't Understand?
............... as ST Mobile Aerospace Engineering of Mobile, Ala shipped 3
boxes of oxygen generators as airfreight from Mobile to United Airlines in
Oakland, Calif., without properly labeling the cargo - an action similar to
that which led to the crash of a ValuJet airliner - faces a $100,000 fine
from the government. FAA cracked down on such shipments after the ValuJet
plane plunged in flames into the Florida Everglades in May 1996.
Investigators believe the fire was ignited or fueled by a shipment of oxygen
generators placed in the aircraft's cargo hold. The canisters can generate
heat up to 500 degrees when triggered. They are designed to provide oxygen
to passenger emergency masks. FedEx transported the shipment by air.
- OAG Goes "E" .......... as the world of air
transport analysis has taken a leap forward with OAG Worldwide's launch of
OAG MAX, an analysts decision support tool. Available on CD-ROM, it uses
32-bit technology on a Microsoft Windows 95 or NT platform, is designed --
principally -- for air transport analysts in the airline, air cargo,
airport, aerospace and Government department sectors. Updated monthly, OAG
MAX offers data usable in a matter of seconds, presented via an easy-to-use
series of drop-down menus from five main categories: flights, aircraft,
geography, airlines and time period. With its Internet style, OAG MAX is
also designed to help users who do not have specific database or IT
- Forwarder On A Wire .......... as Cargo Int'l Logistics
has faced some rather difficult challenges in keeping Vladimir Kekhaial, the
Ukrainian born trapeze artist "in the air". Billed as the World’s
Richest Trapeze artist, this former Moscow State Circus travels the globe
with special equipment which must not suffer shock damage of any kind. CIL
is keeping Vladimir show on the road all over the world.
- Volumes. UP for the world in March 1998, cargo volume
rose in Africa by 10%, in the Middle East by 9%, in Europe & No. America
by 5% each, and by 2% in Latin America & the Caribbean. UP for BA with
1997/98 fiscal year volume of 815,870 tons of freight & mail, a rise in
excess of 13% over the previous year. UP for Continental for the month of
June '98 with 67,811 cargo revenue ton miles, up18.8% over same period last
year. DOWN for Northwest, as Cargo ton miles (CTMs) systemwide were down
12.2% from 1997's 190.8 million CTMs to 167.6 CTMs in June 1998. WAY UP for
KLM's Martinair which saw its cargo operations grow 25%in 1997; 189,000 tons
last year compared to 152,000 in 1996. United's June cargo ton miles were
251,987,000, UP 4.9% from 240,127,000 a year ago. Emirates Skycargo carried
200,000 tons of freight, up 25%, and reduced its unit cost by almost 5% per
available ton kilos. Where the "Flu" is concerned, the number of
passengers using airports in Asia in March 1998 fell 10% from 1997 levels,
the 6th consecutive month of reduced traffic because of the region's
economic fallout; some 36.1 million air travelers used airports in the
Asia/Pacific region during the month, although cargo tonnage through the
region was down only 2%.
- IATA's Americas Air Transport Forecast 1985-2011.............
is now available. The report covers passenger traffic for all regions,
airline developments, route structures & profiles of airport activity.
It identifies areas of growth & decline in passenger traffic and ranks
countries & regions by order of importance in the Americas. For copies
contact IATA at 514/874-9659
- In Memorium ......... as a Ukrainian owned, Russian made
Ilyushin-76 cargo plane crashed into the sea on 14 July when its engine
caught fire shortly after takeoff from the Gulf emirate of Ras Al-Khaimah,
near Dubai. All 8 aboard were killed. The 4 engine freighter was owned by
Ukraine's Defense Ministry, on lease to a private Kiev-based cargo airline,
A.T.I. Aircompany, the Ukrainian Emergency Situations Ministry said. The
plane was carrying 40 tons of cargo when it took off, bound Mykolayiv in
southern Ukraine. Cargo included several automobiles & audio equipment,
the Ukrainian Embassy said. Mohammad Hussein, a businessman who was the
terrace of a beachfront hotel at the time, said he saw the plane catch fire
& explode before plunging into the sea 500 yards from shore. Hundreds of
watermelons were floating in the sea after the crash, he said.
QUESTION: How Do I Calculate Charable Weight For Airfreight Based On
Dimensions (DIM)? Domestic? Int'l? Metric?
ANSWER: Go to The Freight Dectective Transport Reference Desk
- Time Limit Defined For HMF Claims .............. as it is
reported that refunds for the Harbor Maintenance Fee, which was declared
unconstitutional in March 1998, are subject to a 2 year statute of
limitations. Still, attorneys for shipper interests have filed briefs with
the U.S. Court of International Trade at New York contending that the
statute of limitations should not apply and that there should be no time
limit on these claims.
- FMC To Change Fees ............ as U.S. Federal Maritime
Commission has announced that more than 35 will be increased, several will
be reduced and some eliminated. The changes are the 1st in 3 years.
Correcting clerical or other errors in submissions will now cost US$233. It
had cost nothing. Use of the Automated Tariff Filing & Information
System will decrease from US$0.46 to US$0.33 per minute. New agreements by
companies and others subject to the U.S. Shipping Acts of 1916 &1984
that need commission review will cost US$1,666, up from US$1,402. Agreement
amendments needing review will increase from US$695 to US$841. Ocean freight
forwarder license approvals will increase from US$687 to US$778. A US$84 fee
will be charged for a computer diskette of the Regulated Persons Index.
Comments on the changes are due 27 July.
- New "Shipping Act" Opinions Sought ...........
as the U.S. Federal Maritime Commission (FMC) wants YOU to contribute ideas
regarding proposed changes to the Shipping Act of 1984. If approved by the
U.S. Congress, the new law will come into effect on May 1, 1999. The FMC is
asking for comments on issues such as monitoring the private services
responsible for the publication of ocean carrier tariffs. Review The
Shipping Act at
- Long Beach Remains King ............... as it has
retained its title as busiest seaport in the U.S. by being the only
container port to exceed the 3 million TEU mark. For 1997, containerized
imports rose by over 16% to the equivalent of 1.8 million TEU, and exports
increased by 2.4% to 1.1 million TEU. With empty containers exceeding
590,000 TEU, the total volume of containerized trade jumped more than 3.5
million TEU - an overall increase of 14.3% from 1996. Trade with Japan
remained steady for most of 1997, worth US$22B. China is currently the
port's No. 1 overall trading partner. China &Hong Kong represent more
than US$20B in trade for Port of Long Beach. The port currently handles
almost a 3rd of all U.S.-Sino trade, more than any other seaport in the U.S.
Despite Korea's currency devaluation toward the end of 1997, trade between
Long Beach & Korea remained steady. Latin American trade has averaged an
annual growth rate of 52% since 1990, making it a major market in global
commerce. But remember, America's No. 2 busiest port is Port of Los Angeles
which is right next door! Los Angeles now has both the king & queen of
U.S. ocean cargo and LAX, the undisputed No.1 of U.S. air cargo. Indeed,
L.A.'s "THE PLACE!"
- Watch Out West Coast ............ as the Port of New York
and New Jersey cut a key charge on cargo of 60% effective 1 July.. The Int'l
Longshoremen's Assn., AFL-CIO & the New York Shipping Assn.,
representing employers, said the tonnage assessment on local cargo &
ocean containers destined for or moving from points within 260 miles of the
port will drop to US$1 from its present level of $2.50 per assessment ton.
The ILA & NYSA said the reduction reflects continued progress in their
joint efforts to increase productivity, improve their competitive position
and attract more cargo to the port. U.S. West Coast ports must continue to
monitor costs in order to remain competitive on imports destined for inland
- So Long El Nino: Panama Re Floated ........... as the
Panama Canal Commission has lifted draft restrictions in the waterway &
reinstated the normal maximum authorized transit draft of 39.5 feet. The
move follows 109 days of restrictions on vessel draft due to drought
conditions caused by the El Nino weather phenomenon. The restrictions lasted
for a shorter period than had been feared as experts initially expected the
dry conditions to last until September.
- Container Vessels Leave - Arrive In Record Number
......... as a study shows a record number of containerships are to be
pulled out of commission in 1998, exceeding even last year's record high.
Mitsui OSK says 19 vessels went to the junk yard last year, but by April
this year, an equal number had already been scrapped. NYK is now retiring
the 2,300 TEU M/V Aramac, constructed in 1972, while MOL is set to dismantle
the 1,800 TEU M/V Alligator Miracle, built in 1973. In spite of their ages,
the ships are still in demand for sale. The Aramac will by NYK's 3rd
retirement this year, & its 8th since 1996 while the Alligator Miracle
is the first full ship to be binned since containerization began in 1968.
Meanwhile, Maersk, Hapag-Lloyd, CGM & COSCO all ordered a series of
large ships this month, with Maersk making the biggest order for 4 2,200 TEU
vessels (large feeders). Hapag Lloyd has placed an order with Hyundai for
four 4,800 TEU Panamax containerships. Yang Ming has ordered five 5,200 TEU
ships OT Africa Line is negotiating for two 1,000 TEU vessels, while OOCL is
considering two to five 5,000 TEU newbuildings. While 55,588 TEU were
ordered between January& April, the pace is picking up, with 31 vessels,
and a total carrying capacity of 71,208 TEU ordered in May alone.
- LBG Approves New Terminal ........... as a plan to
redevelop more than 500 acres of the former Long Beach Naval Station for
cargo handling purposes has been approved by the Long Beach Board of Harbor
Commissioners. The board's action will allow the Port of Long Beach to
develop approximately 300 acres for one or more container terminals and
provides additional acreage for storage of petroleum and breakbulk cargo
such as lumber & steel. This is the same area for which a spirited legal
battle was fought on behalf of the China flag carrier COSCO. Space will be
set aside for a ship repair facility at the former U.S. Navy Shipyard (home
of the world's largest dry dock), but the exact size of the facility will
remain flexible until proposals are received from potential operators. The
board made its decision at a meeting held in June. The vote came on the
heels of the U.S. Navy's 26 May decision that deemed the City of Long Beach
reuse plan presented the best use for the former naval properties by
converting the land to cargo terminals.
- New Mexican HAZ MAT Rules ........... as the Mexican
Secretariat of Communications & Transport has published proposed rules
on hazardous cargo in the 30 June issue of Diario Oficial. The regulations
have been worked on since 1996. Vessels carrying hazardous cargo to Mexican
ports will have to inform the port of the cargo before arrival and ports
will verify the cargoes and can reject them. Trucks arriving at the ports
must give at least a day's notice. In addition, exclusive hazardous cargo
areas have to be formed at Mexican ports. A daily log will be kept of
cargoes but enforcement will ultimately reside with the federal government.
Hazardous cargoes are defined as those that in handling or transport,
present a higher risk to public health or the environment.
- Eritrea Seizes Cargo of Ethiopia ......... as the
Eritrean government has reportedly seized all cargo of Ethiopia at Assab,
Eritrea. It includes 80,000 tons of food aid, mostly wheat, 45,000 tons of
other cargo, 4,000 vehicles and thousands of tons of petroleum. A conflict
between the two countries began over border issues on 6 May.
- Who Wants Italia di Navegazione? ............ as Taiwan's
Evergreen has pulled out of bidding for Italy's state owned carrier.
France's CMA-CGM and Italy's D'Amico di Navigazione are the only 2 remaining
- COSCO Weds Sinotrans ............. as China's state owned
carrier, has agreed to merge with the forwarder. The decision to combine the
two transport giants is said made in keeping with the government's decision
to rationalize state companies and build up large conglomerates in China.
According to officials at Sinotrans and Penavico (the other state
forwarder), COSCO's agent, it is the intention of the government to separate
the newly merged entity from both the Ministry of Communications & the
Ministry of Foreign Trade and Economic Co-operation and create it a super
organization that will provide air services as well as sea transport.
Measures to aid state run companies include cutting interest rates about 5
times over the last two years. The cuts saved China's state companies a
total of 40 billion yuan, providing state banks with incentive to lend and
allowing companies to finance reforms.
- Hamburg Sud Gets South Seas Steam ................ as A/S
Thor Dahl Shipping, parent company of South Seas Steamship Co. Ltd. (SSS)
& Hamburg Sud have reached agreement in principle to sell the business
of SSS to Hamburg Sud - The Shipping Group. SSS is a container carrier
between the West Coast of North America and the Pacific Islands. Hamburg
Sud, through its Columbus Line operation, is a major container carrier
between North America & Australia/New Zealand.
- Flu Induced Increase? ............ as the 1st general
rate increase for 9 years has been implemented by the Korea Nearseas Freight
Conference. The whopping 15% increase, approved by the Korea Shippers'
Council, took effect on July 1. The Korea Nearseas Freight Conference is
made up of Korean liner operators serving Japan and Korea. Meanwhile,
Evergreen Line has dropped calls at Busan in favor of adding extra calls in
- Carriers Don't Think There Is Enough Capacity? ..........
as HKG based OOCL believes that it's 8 post-Panamax 5000 TEU boxships are
not enough. Reports say this Grand Alliance member will look to Japan's
Mitsubishi Heavy Industries & Korean Samsung Heavy Industries to build
the new vessels during the next 3 years. Meanwhile, Maersk Line continues
its expansion binge with an order for 6 new containerships to have
capacities of 3,700 TEU and to replace existing tonnage In early June,
Maersk placed orders for four 4,300 TEU newbuildings. Earlier, at the end of
May, the Danish carrier announced orders for four 2,200 TEU feeder ships.
Not to be out done, Hapag-Lloyd is finalizing discussions with several Asian
shipyards for 4 new 4,800 TEU vessels to be delivered by year 2000. The move
will increase the number of Hapag-Lloyd owned ships capable of loading more
than 4,000 TEU to 15. To fill its ships Hapag-Lloyd has also placed orders
for 38,000 TEU worth an estimated US$135.7M. Hapag-Lloyd has just taken
delivery of three 4,422/4,612 TEU ships, M/V Shanghai Express & M/V
Dusseldorf Express. M/V London Express is scheduled to enter the carrier's
Europe/Asia/Europe service before December. Now which way will those rates
- Hyundai Switches Sides .......... as it is reported to be
changing alliances from Zim to New World Alliance partners APL & Mitsui
OSK as of this month. The switch applies to the alliance's all-water route
between Asia &the US East Coast, via the Panama Canal. The port rotation
for the New World Alliance's Panama Canal route is: New York, Norfolk,
Charleston, Manzanillo, Panama City, Tokyo, Hong Kong, Kaohsiung, Busan,
Kobe, Nagoya, Tokyo, Panama, Manzanillo, Charleston & New York. Nine
2,880 TEU ships, from APL and Mitsui OSK, will be deployed on the route.
- Maersk Improves Caribbean Direct ............ with a new
direct service to the Caribbean as an extension of the carrier's north and
south American network. Countries covered by the new service are; Jamaica,
Haiti, Dominican Republic, Trinidad, Barbados, French Guiana, Guyana,
Surinam, Aruba and Curacao. Ports of call will be: Port au Prince, Haiti;
Kingston, Jamaica; Puerto Plata, Dominican Republic; Port of Spain,
Trinidad; Bridgetown, Barbados; Oranjestad, Aruba; Willemstad, Curacao;
Georgetown, Guyana; Cayenne, French Guiana; Paramaribo, Surinam and
Kingstown, St Vincent.
- To Russia: You Go West? ............. as there is now a
block-train service using the Trans-Siberian Railway (TSR) which could be a
competitive option to all-water carriers, the Trans-Siberian Intermodal
Operators Assn. of Japan (TSIOAJ) has said. Association members made the
statement after the successful April running of a demonstration block-train
between Pacific Russia (Nakhodka/Vostochniy) & Brest, on the western
border of Belarus. The train was made up of 45 freight cars loaded with
cargo from Japan, South Korea &other Asian destinations. In total, it
carried 90 TEU., and completed the 12,000 km journey in just 9 days. TSIOAJ
believes that with schedules in place, transit times to cities in eastern
Europe could be completed in less than 20 days, making it an effective
option on the Europe/Asia/Europe trade. Routes from Seattle & Alaska
might also come in the future.
- Maersk Wears The Stars & Stripes ............ as it
will contribute a crew to join 29 officers to work on the USNS Watson, the
U.S. Military Sealift Command's new large roll-on-roll-off ship. The Watson
is one of 14 new ro/ros being built for the US military by the National
Steel and Shipbuilding in San Diego and the Avondale Shipyards at New
- Interpool Gets XTRA ............ as the container &
chassis leasing giant continues growth. XTRA stockholders will receive US$65
per share and retain about 10% ownership when the company is sold to
Interpool. XTRA, is a lessor of US domestic and marine intermodal equipment.
According to US reports, the agreement will result in the recapitalisation
of XTRA. Interpool also recently gained a 50%interest in Container
Applications International, a manager of container assets. Interpool is
corporate sponsor of The Cargo Letter Library, Search Engine & Message
- Container Version Of "Pocket Fisherman"?
............. as a fold-down dry freight container which can be stacked
& locked together when empty is being marketed by its Australian
developers. Eubert Co. says its "Foltainer", folds down to 1/3 of
its normal size and can be erected in 5 minutes by 2 people, a forklift and
a hammer (and perhaps a small dog). The container is also watertight and
able to cope with the normal load & test conditions expected for a 20
foot, 30 ton ISO series 1 type CC container. When loaded, the containers
will be stackable to the same height as normal ISO units. Door seals are
standard, and the wall joints have double rubber/polymer seals. The new
containers are said to require fewer re positioning ships, fewer truck
trips, fewer acres of land for storing empty containers and fewer terminal
moves. The container has an 8 year service life.
- K Line Between The Sheets? .......... as a moisture
damage preventative sheet designed to protect rice from dew damage has been
developed by the Japanese carrier. Developed after years of intensive
research, the 2 types of dew proof sheets - "Dew Safe", suitable
for cargo loaded on pallets, and "Bulk Dew Safe" for bulk
commodities, have been patented in the U.S., Europe, Canada & Australia.
Using a system of waterproof sheets made of water-impermeable polyester
materials & a polymeric water absorbing material, the dew proof sheets
cover the ceiling and 4 sides of the ocean container. Air holes are provided
near the top of the sheet so that the moist air from the cargo is easily
discharged outside of the sheet. When the saturated air comes in contact
with the steel sides of the container, the air cools down and forms water
droplets which are in turn absorbed by the water absorbing sheets. The
system was developed after Japanese trading houses requested K Line develop
a new cost effective method of protecting rice from the damage caused by the
dew that forms inside dry containers. Rice imported into Japan from
Australia, Vietnam & Uruguay will have cargo hauled in "Bulk Dew
Safe" covered dry containers.
- One Way Containers? .......... as K Line, Mitsui OSK
Lines & NYK Lines have all purchased 18,000 FEUs, more than twice the
amount of containers purchased in the last year due to the container
shortage in Asia, where westbound cargo currently far outweighs eastbound.
These carriers have also orders a combined volume equivalent to 2,860 FEUs
in reefer containers, 240% more than last year.
- U.S.S. New Jersey Goes Home - Welcome "Harry"
............. as the U.S. Senate has approved moving the former U.S. Navy
Iowa Class Battleship New Jersey (BB 62) to its namesake state for mooring
as a museum in Bayonne. It is planned to open the ship in 2000 after U.S.$7M
in work. More than U.S.$3M has been raised so far. Meanwhile, President
Clinton commissioned the Nimitz class, nuclear-powered USS Harry S Truman
last Saturday with a celebration of the ``Give 'em hell'' president's
memory. The US$4.5 billion, 97,000-ton ship named for the former Democratic
president towers 20 stories above the waterline and has a crew of 6,000.. In
a compromise worked out in Congress, the next Nimitz Class carrier, due in
2002, is to be christened U.S.S. Ronald Reagan. We doubt any foe will dare
to mess with "Ronnie".
- Container Yard For Exclusive Malibu? ........... as
hundreds of FEUs (forty foot ocean containers) have stacked up in the land
of movie stars and the rich &famous. Good thinking on the part of Cal
Trans (California's transit authority) brought an ocean solution to a land
locked problem. FEUs weighted with sand have been stacked 3 & 4 high to
form a barrier for the protection famed Pacific Coast Highway through
southern Malibu as land slides recently pleagued the area in the wake of El
Nino. No word on a movie deal for Intertpool Corp.!
- Zen Continental Becomes Paramount ........ as the famed
China forwarder has moved to 15200 Downey Ave., Paramount, CA 90723 Tel#
- Throughput. As PSA Corp., the owner/operator of
cargo-handling facilities at Singapore, posted a record performance in March
with total traffic of 1.31 million TEU was 3.1% over the port's previous
record in October 1997, 10% higher than the corresponding month in 1997.
- Volumes. As TMM Line has reported increased volumes of
more than 30% to 482,000 TEU in 1997.
- In Memorium ...........as Richard G. Ashworth, Esq. dies
at 72. He was the lead counsel in the landmark Ronda v. Bloomfield case.
Ashworth, from Watertown, Conn., attended Princeton University & Yale
Law School before joining Haight, Gardner, Poor & Havens in 1950, where
he specialized in maritime law. He became a partner in 1963, the same year
as Ronda v. Bloomfield, which involved a vessel casualty off Le Havre,
France. The case established that a maritime court in one country cannot
halt legal proceedings outside that country.
As the world is now so taken by the movie "TITANIC", we seriously
question what the response might be if the public came to know just how
dangerous is the sea. Make certain your customers know the truth. Arrange
quality marine cargo insurance for all shippers and let them see the following
Ocean CARGO disasters this month include: ..........
1.] 16 June. M/V Aptmariner (Liberian- registry operated by COSCO (Hong Kong)
Shipping Co. Ltd.) ran aground off St. Nicholas Island in the St. Lawrence
Seaway near Montreal due to steering problems, while sailing from Klaipeda,
Lithuania, to Cleveland and Detroit with steel coils and was re floated 18 June
by the tugs Avantage, Andre H. &Jerry Newberry. The Aptmariner suffered
forepeak damage and will be repaired at a cost of U.S.$409,000, using 30 tons of
2.] 26 June. M/V Diana- Maria (Antigua & Barbuda-registry) ran aground near
La Marola Rock at Ria de Ares, Spain, while sailing from Blyth, England, to
Ferrol, Spain, with 2,000 tons of scrap metal. Flooding was reported in the
engine room and the 6 crew were rescued by a helicopter. On 29 June, work began
to lighter 20 tons of fuel as the Diana-Maria continued to flood;
3.] 26 June. M/T Astro Gamma (Greek-registry 268,310-dwt tanker) suffered an
engine room fire as it loaded fuel at Rotterdam, the Netherlands. The fire was
extinguished by local firefighters and no one was injured. The Astro Gamma has
42 crew; x.] 26 June. The Chilean Navy's lead ship of the Condell (PG 06)-class
frigate collided with the U.S. Military Sealift Command's Henry J. Kaiser-class
Replenishment Oiler U.S.N.S. Pecos (T-AO 197) while operating 70 miles off
California. No one was injured. The Condell was preparing to refuel from the
U.S.N.S. Pecos when it apparently had steering problems;
4.] 28 June. M/V World Peace (Cypriot-registry) was abandoned at 11 degrees 26.8
minutes north, 62 degrees 51 minutes east after its No. 4 cargo hold flooded.
The 21 crew abandoned ship & boarded M/T Maasstroom L (38,039-dwt motor
tanker). The World Peace was sailing from Chennai, India, to Rotterdam, with
marble and was last reportedly drifting at 2 knots west-southwest towards India;
5 .] 29 June. M/V Woo Yang Honey (South Korean-registry) was abandoned at 23
degrees 00 minutes north, 116 degrees 35 minutes east after it began flooding.
The 16 crew were rescued by another vessel and taken to Shantou, China, before
the Woo Yang Honey sank;
6.] 29 June. S/V Rita Allah (Syrian-registry wooden vessel) was towed to
Limassol, Cyprus, after drifting for days in the eastern Mediterranean Sea. Two
died of dehydration & were thrown overboard before the vessel was found.
Some 115 people were aboard when it docked;
7.] 29 June. M/V Magdelan Sea (Canadian-registry offshore supply vessel) rescued
3 crew from a 30-foot S/V Swamba that had spent 25 hours drifting in a storm off
Nova Scotia. The demasted Swamba was flooding in 16-foot seas;
8.] 29 June. M/T Katerina SG (Panamanian-registry) was disabled when the No. 5
piston in the main engine separated from the crankcase in an explosion. The
vessel was left drifting at 03 degrees 30 minutes north, 87 degrees 42 minutes
east. It had sailed from Port Klang, Malaysia, for Dar es Salaam, Tanzania,
& Nacala, Mozambique, with palm oil;
9.] 2 July. U.S. Coast Guard seized 41 pounds of cocaine from M/V Friendly
Express (Belize-registry). The vessel was sailing from Haiti to Miami when it
ran out of fuel on 30 June. It was towed to the Miami anchorage by the USCGC
Riga, where it was boarded by the Coast Guard and the U.S. Customs Service. The
cocaine was found in a concealed compartment under the deck of a cargo hold;
10.] 5 July. M/T Captain X. Kyrinkou (Cypriot-registry) was damaged in heavy
seas while sailing with diesel fuel from Jebel Ali, United Arab Emirates, to
South Africa. It called at Aden, Yemen, where damage was found to cable ducting
11.] 7 July. M/V Tiger Force (Maltese-registry 224 TEU ship of Bengal Tiger
Line) sank at 08 degrees 03 minutes north, 79 degrees 00 minutes east. It was
carrying containers from Colombo, Sri Lanka, to Tuticorin, India, and the crew
12.] 9 July. F/V Hosei Maru, an 11-ton fishing vessel, collided with a whale on
Tokyo Bay . Seven of 14 people aboard the vessel were injured including one who
had a broken jaw;
13.] 9 July. M/T Seasalvia (Maltese- registry 88,396-dwt motor tanker) ran
aground on sand near the Haydarpasa Breakwater in Turkey's Bosporus Strait. It
is carrying crude oil from Novorossiysk, Russia, to Italy;
14.] 10 July. M/T Tadoussac (Canadian- registry ) has run aground 2.2 miles east
of Peche Island near Windsor, Ontario. It is carrying coal;
15.] 13 July. M/V Rautz (Austrian-registry) sank at 35 degrees 05 minutes north,
09 degrees 31 minutes west, while sailing from Safi, Morocco, to Poland. Six
crew were rescued & 4 are missing;
16.] 15 July. M/V Aida (Swedish-registry 52,288-gt ro/ro operated by Wallenius
Lines) & M/T Golden Asia (Panamanian-registry.) collided east of Saeki,
Japan, at 32 degrees 58 minutes north, 132 degrees 09 minutes east. Each had
damage. The Aida was sailing from Mizushima, Japan, to Portugal, while the
Golden Asia was en route from Kaohsiung, Taiwan, to Oita, Japan, with alcohol;
17.] 15 July. M/V Docelirio (Liberian-registry) ran aground at Mile 85.7 in
Venezuela's Orinoco River. It was sailing to Trinidad with iron ore pellets;
18.] 15 July. M/V Nickerie (Dutch-registry motor refrigerated ship.) was taken
in tow following engine problems. The ship will be taken to its destination of
Vigo, Spain. It is carrying frozen fish;
19.] 27 July. M/V Lindarosa as flames raced through a cabin on a freighter in
Genoa's harbor, killing 5 illegal immigrants who had stowed away on the ship.
The ship had unloaded a shipment of cars from Tunisia. Frequent readers of this
feature will note that it was a very quiet month!
NOTE: Due to seasonal weather there were many, many more cargo vessel
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, but it
does not involve cargo and is nor reported. It was another BAD month at sea. We
mourn the many vessels lost.
NOTE: 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 ...............
The Freight Detective's Spyglass .... LIVE ! The Only
Gathering of 24 Hour Transport Cameras In The World - Where Will You Go Today?
Chek Lap Kok ............ Hong Kong's new, yet now infamous
USBTS - US Bureau of Transportation Statistics.
Broker Licensing & Compliance ........... U.S. Customs
Service. Soon to feature the National Broker Register.
Aviation Convention in Oshkosh, Wisconsin. July 29th August
4th. In addition to the seminars, we have 4 live video cameras set up for your
pleasure. We are looking forward to providing an exciting week of live coverage.
Air Cargo Calculator ............. figure out dim weight, by
CargoSoft, web site designs for transportation.
Transport Session of the European Parliament ............
set for 25 Sept. Italian Transport Minister Burlando will give the keynote
address. Topics will include "Raw Material Logistics",
"Logistics: What Future?", "International Port Networks",
"Industrial Logistics", Transports in Europe", "Financial
support of the transport infrastructures", "European Union Port Policy
after 2000". Info available only in Italian.
Hazmat Safety Homepage ..........of the U.S. Dept. of
Transportation. By October, this site will replace the Hazardous Materials
Information Exchange, an electronic bulletin board run by the Research and
Special Programs Administration. Eventually the site will offer online
registration for training courses and hazmat seminars for small businesses
conducted throughout the country by the HMS office and Transportation Safety
High-Tech Forwarders Network
CargoFinder ........... an open market exchange where
shippers' transport needs meets carriers' demand. See the online demo.
Reid's Consultancy Service ........... with online glossary
and industry info.
Maritime Signal Flags ......... meanings & uses. It
OceanWide .......... delivers sailing schedules via the
PointCast Network, using free software to deliver news & other information
to your PC or Mac. Users choose which sailing schedules they want to receive by
filling out a form at the site. Allows forwarders to get instantaneous quotes
and marine cargo insurance. The actual insurance certificates can then be
printed by forwarders directly from their computers.
Rating Your Frequent Flyer Miles .......... and
Transport R. Pynnonen Ltd .......... since 1948, the premier
transporter by road from the UK & Finland to Russia, Central Asia & the
Commonwealth of Independent States (Former Soviet Union). Now with a logistics
representative in the USA.
Trade Expert ............ a commercial product from IHS
TransPort Data Solutions contains rules & regulations necessary for
importing goods into the U.S. & Canada.
Material Safety Data Sheets (MSDSs) ............ for trade
& generic chemicals. Three CD-ROM set of more than 225,000 listings. NOT
Summer Diversions ................
The Freight Detective's Butler ............. the world's
greatest collection of resources for gourmet cooking recipes, travel, wine,
cigars and current event in YOUR own neighborhood! He's YOUR personal concierge!
Don't miss this important & fun resource!
Top Ten Vacation Planning Sites
Free Card & Classic Games
Play Fantasy Baseball
-- by Warren S. Levine, for The Cargo Letter
Albright Stands Firm At ASEAN Conference
U.S. Secretary of State Madeleine Albright, in Manila for the regional forum
of the Association of SouthEast Asian Nations, leveled heavy words at Burmese
Foreign Minister Ohn Gyaw for the political repression aimed at silencing
opposition leader and Nobel Laureate Suu Kyi.
Suu Kyi is reported stuck in a car on a rural road in Burma, surrounded by
military police. She has been there for the better part of a week as of this
writing. Albright was upset with Ohn Gyaw's support for the actions of his
government. She characterized the Burmese for having "...an authoritarian
government that just doesn't get it, that blames the victim for the
Albright had sharp words for Chinese Foreign Minister Tang Jiaxuan regarding
the rash of dissident arrests in China after President Clinton's June visit.
However, they also exchanged good words about liberalization of trade between
China and the United States.
Indonesian Military Accused of Mass Rapes, Murders
A number of Indonesian military officers and subordinates were arrested in
Jakarta, according to official Indonesian news reports. The arrests are in the
aftermath of the atrocities against and murders of ethnic Chinese citizens &
businesspeople, some of whose families had been in Indonesia for generations.
Over a thousand people were killed, over 100 women were raped and over 20
other women were raped and murdered in the violence which erupted in May and led
to the resignation of President Suharto after a reign of 32 years.
In one case, a nine-year-old girl was raped and tortured, and died a few days
later in a Singapore hospital.
Many crime scene photographs have been transmitted out of the country and
copied to news agencies and human rights organizations around the world via
email attachments. The Cargo Letter will make these resources available to
interested news or human rights organizations upon request with statement of
intended use. Warning: these are extremely graphic pictures.
The U.S. House International Relations subcommittee is keeping a close eye on
the situation in Indonesia. U.S. intelligence reports that the crimes may have
involved high-level members of the Indonesian military. Next step: a visit from
William Cohen, U.S. Secretary of Defense, in early August. It is hoped that
prosecutions by the Habibie government will proceed swiftly thereafter.
Jiang Zemin Orders PLA to Divest Itself and Stop Smuggling
PAP Also Smeared In Daring Speech by Chinese President
In a brave political maneuver and as a demonstration of just how great and
worthy a leader he is, Chinese President Jiang Zemin ordered the People's
Liberation Army (PLA) and the People's Armed Police (PAP) to divest itself of
lucrative real-estate, manufacturing, construction, importing and exporting
businesses and stick to their prime objective -- presumably hunting down
In an order issued last week, Jiang also instructed the militia to cease its
smuggling operations, although the production of pirated CDs and videos was not
Now that China's army has fortified its cash reserves, they will soon close
up shop and begin production of aircraft carriers and nuclear power plants, not
weapons factories or anything.
A factory which until recently was making fake Louis Vuitton sweats
&sneakers bearing a name similar to a Japanese stock index will be converted
to a plant which will produce knockoff radar-invisible sheeting for the People's
In news reports which raise further questions, Chinese Foreign Minister Tang,
at the ASEAN Forum in Manila, repeated China's promise to stop targeting 13
American cities with nuclear missiles, as agreed to during President Clinton's
visit in June.
But at the same time, in Beijing, the State Council released its first policy
statement in three years, indicating their displeasure with the strengthening of
relations between the United States and Japan.
In the July 27 statement, China once again refused to rule out the use of
force in their claim of sovereignty over Taiwan. It is, evidently, the heat of
the opera season in Beijing.
US Trade Rep Busted For Illegal Importation of Beanie Babies
U.S. Trade Representative Chalene Barshefsky, traveling with President
Clinton to China last month, was reported by The Washington Post to have bought
forty Beanie Babies in Beijing.
Customs Regulations allow the importation of one Beanie per family.
Additionally, Ty, the maker of the original Beanie Baby, has an agreement with
China that their product is not to be sold in China.
Barshefsky turned the Beanies over to Customs. Keep your eyes open for the
next auction of seized merchandise in the DC Customs District.
South Vietnamese "Head Shot" General Dies of Cancer at 67
Nguyen Ngoc Loan, the South Vietnamese General who marched a Viet Cong
prisoner into a Saigon street in 1968 and shot him in the head in front of
rolling news cameras died of cancer at his home in Virginia on July 15. He was
67. The man Loan executed was involved in the killing of a policeman and his
family during the Tet Offensive which led to the eventual collapse of South
- You Were Previously Warned
-- by Michael S. McDaniel for The Cargo Letter
As we warned in The Cargo Letter  of Oct.
1996, the Countryman & McDaniel law firm has begun to defend U.S. Customs
Brokers (CHB) and forwarders against both civil & criminal cases stemming
from a truckers so called "reliance" upon weight & dim information
stated on the Delivery Order (D.O.) form. Potential penalties can run well over
US$10,000, plus attorneys fees & costs. In these cases the motor carrier
presumed an ability to haul the load if the weight of a particular ocean
container was shown on the D.O. at less than 29,000 lbs. Then, when police
authorities stopped and cited the truckers load as "OVERWEIGHT"
.......... all fingers pointed at the Customs Broker for issuing a D.O. which
had set forth weight or height information which was within lawful limits.
The problem is that D.O. information is simply copy typed from the ocean bill
of lading under circumstances where the CHB never even sees the cargo.
Especially where the CHB does not provide a copy of the OB/L or HB/L to the
trucker along with the D.O., officials such as the Los Angeles City Attorney
have previously taken the position that the D.O. is a representation of weight.
While great strides have been taken at Ports such as Long Beach/Los Angeles
to educate officials as to the proper meaning & use of a D.O. form, our Oct.
1996 suggestion is still your best course. CHBs should reprint their D.O. form
to contain a prominent notice such as "THIS IS NOT A REPRESENTATION OF
WEIGHT OR HEIGHT", or "CUSTOMS BROKER DOES NOT WARRANT ACCURACY OF
WEIGHT &HEIGHT INFORMATION OBTAINED FROM OCEAN CARRIERS FOR THIS
It is good practice to supply a copy of the bill of lading to the delivering
trucker. Indeed, these same principles may apply to the "Arrival
Notice" forms issued by some NVOCC agents when providing cargo availability
information to CGNEEs.
- Transport Related Cases From Countryman & McDaniel
United States v. Marin-Cuevas
No. 96-50686 June 8, 1998 9th Circuit Court of Appeals Immigration Law:
Derivative Citizenship - Note This For Your Overseas Employees
Holding: Defendant's claim that he is a citizen of the United States by virtue
of "derivative citizenship" through his mother failed because his
mother did not spend enough time in the U.S. prior to his birth.
Defendant had claimed that as a legitimate child of a U.S. citizen, whose mother
was physically present in the U.S. prior to his birth for the statutorily
required period of time he is a U.S. citizen. Defendant, born in 1966, was
counting on a statute 8 USC sec. 1401 that was amended in 1986 and not meant to
operate retroactively. Hence his derivative citizenship claim failed.
Furthermore, there was no error when, although the jury was to make a
determination regarding citizenship, the district court instructed that the INS
has "exclusive authority under the law to issue a certificate of
citizenship." The jury instructions, taken as a whole were not found
Int'l Assoc. of Independent Tanker Owners (INTERTANKO) v. Locke
No. 97-35010 June 18, 1998 9th Circuit Court of Appeals
Constitutional Law: Federal preemption
Holding: Only one of Washington's Best Achievable Protection
Regulations, enacted to prevent oil spills, is impliedly preempted by Federal
law because the state requirement attempting to regulate vessel design
characteristics is preempted by the Ports & Waterways Safety Act (PWSA),
which places the design and operating characteristics of oil tankers under
In the aftermath of the M/T Exxon Valdez oil spill, Washington enacted
provisions more stringent than federal regulations in order to protect its
waters from pollution by oil tankers. Section 1018 of the Oil Pollution Act
(codified in 33 USC sec. 2701) demonstrates congressional intent not to preempt
"the authority of any state . . . from imposing additional liability or
requirements with respect to . . . pollution by oil." Regarding all
requirements but one, petitioners failed to demonstrate that Washington's
regulations were subject to conflict, field or express preemption. However, the
regulation requiring tankers to be equipped with global positioning system
receivers was impliedly preempted by PWSA. Affirmed in part, reversed in part
Enesco Corporation v. Price/Costco Inc.
No. 96-56571 June 22, 1998 9th Circuit Court of Appeals
Trademark Law: Liability for failure to disclose repackaging of product NOTE:
Holding: The district court improperly dismissed plaintiff's claims against
defendant for violations of sections 32 and 43(a) of the Lanham Act where,
although a trademark owner's right to control distribution is limited by the
"first sale" doctrine, plaintiff's product falls under the
"repackaging notice" exception articulated by the Supreme Court in
Prestonettes Inc. v. Coty (1924).
Plaintiff markets fragile porcelain figures which require careful packaging to
avoid damage. Plaintiff contends that its success is attributable in part to the
special cartons and inter packing it uses to protect its figurines. Without
plaintiff's permission, defendant began selling the figurines to its customers
in a kind of packaging that plaintiff alleges does not provide adequate
protection from damage. Since a damaged product may reflect badly on the
manufacturer, defendant may, if allegations by plaintiff are true, be required
to disclose to the public that it repackaged the merchandise. Since appellants
may be entitled to some relief, dismissal was improper. Reversed and remanded.
An Entry Filer Code is a unique three-character (alphabetic, numeric, or
alphanumeric) code assigned to Customs brokers & importers who file entry
documents for imported merchandise with the U.S. Customs Service. The code
constitutes the 1st three characters of the unique number assigned to each entry
filed with the Customs Service, and identifies the entity that prepared and
filed the entry. Entry Filer Codes may also be assigned to others who are not
entry filers, but who conduct business with U.S. Customs through the Automated
Broker Interface (ABI), for example, international carriers participating in the
Automated Manifest System (AMS).
Matt Zehner, V.P. for Customs Surety at Intercargo Insurance Co. has now
brought to our attention a new web site from U.S. Customs which features
downloadable, public notice of Filer Code files, including address & phone
number info for each user. This information has been added to our U.S. Customs
DID YOU KNOW? ............. Chicago's O'hare Int'l Airport
has the port code of "ORD" because its name used to be "Orchard
Field". Now you know.
Given that 45% household goods (HHG) moves occur during the summer months,
the American Moving & Storage Assn. has some helpful advice for your
- Label all boxes, assigning a room and box number to each.
- Pack one room at a time. This can help keep you organized, & save you
time when unpacking.
- Pack one or two "survival boxes." Your personal survival kit
should contain toilet paper, a telephone, toothpaste & brushes, snacks,
coffee and a coffee pot, soap, a flashlight, some kitchen utensils and
silverware & a can opener. Consider filling a second box with paper
towels, shelf paper, rags, sponges, window and floor cleaners and other
cleaning supplies. These survival boxes should be the very last boxes placed
in your car or truck to ensure easy access.
- When picking up heavy boxes, bend your knees to help prevent serious
injuries to your lower back and shoulders.
- To minimize the risk of damaging a lamp, wrap the base, harp & bulb
separately in newspaper. Never wrap lamp shades in newspaper, since ink can
stain them. Use tissue paper instead.
- To help prevent silverware from tarnishing, wrap each piece in cloth. Use
an old blanket or moving pad as a cover for your silver chest to help
- To help save time and prevent wrinkles or damage to clothing, keep
garments on hangers and use a wardrobe carton if possible. If you don't want
to use cartons, each item can be taken off the hanger, folded and placed in
a suitcase or box lined with paper.
- Make sure you use heavy-duty packaging tape to secure your boxes. To help
save time and avoid the aggravation of constantly searching for misplaced
scissors--or using a tape dispenser with a cutting blade--you may want to
use Scotch tear-by-hand packaging tape. This tape can be torn by hand in any
length, eliminating the need to use scissors, knives, keys--or even your
teeth--as cutting instruments. Scotch tear-by-hand packaging tape meets U.S.
Postal and UPS standards. It can be ideal for moving, mailing or other
package sealing needs. The tape costs about $2.49 and can be found at
leading drug, food, office supply and mass merchandise stores nationwide.
As the $20-billion Chek Lap Kok airport replaces Hong Kong's old &
overcrowded Kai Tak airport. Hong Kong is one of the world's biggest cargo hubs.
CARGO RANK (In millions of metric tones annually)
1. Memphis: 1.63 (due to FedEx)
2. Los Angeles: 1.37
3. Hong Kong: 1.30
4. Miami: 1.28
5. Tokyo: 1.27
PASSENGER RANK (In millions of people annually)
1. Chicago: 53
2. Atlanta: 50
3. Los Angeles: 45
4. London: 44
20. Hong Kong: 22
Note: 1997 figures. Source: L.A. Times
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