The Cargo Letter
THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
19 July 1999
Good Monday 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''. Yes, we have much PIRATE news 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
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Board or try our new News Server.
The Freight Detective ........ http://www.cargolaw.com/detective.html
Michael S. McDaniel, Editor & Publisher, Countryman & McDaniel,
logistics/customs attorneys at LAX.
INDEX to The Cargo Letter:
OUR "A" Section: Trade, Financial & Inland News
1. Freight Forwarder Trade Briefs
2. The Cargo Letter Financial Page
OUR "B" Section: FF World Air News
3. Freight Forwarder World Air Briefs
OUR "C" Section: FF World Ocean News
4. FF World Ocean Briefs
OUR "D" Section: FF in Cyberspace
5. The Cargo Letter "Cyber Ports Of Call"
OUR "E" Section: The Forwarder/Broker World
6. Tensions High Across Strait As
Taiwan President Lee Utters Controversial Words
7. Aged Mir To Be Abandoned
Aluminum Rain In The Forecast
- The Magnificent Seven ........... as our last issue of
The Cargo Letter featured history breaking news that Princess Cruise Lines
had launched the world's first live, 24 Hr. camera from a vessel at sea.
Days after our announcement Princess took another leap forward by expanding
the service to seven vessels, deployed throughout the world. In the past
several weeks we've toured Glacier Bay, watched the Arctic sun, entered St.
Thomas, studied Istanbul, cruised Fjords, and much more. Because the sun is
now always shining on one or more vessels, take a look now.
- The Cargo Letter On-Line Face Lift ........... as the
often confusing index at our web site has now been replaced with a user
friendly interface which provides instant access to our hundreds of
transportation features. Your "Portal To International
Transportation", offers 24 hour shipping news, over 185 live airport
& ocean port cameras, banking & financial resources, free language
text translators, currency convertors, World Customs information, vessel
& cargo tracking, medical database, legal database, investigative
resources, world shipping schedules, Air & Ocean Cargo Centers, Haz Mat
Center, Corporate Sleuth, Cargo Claims Data Center, Cargo Loss Prevention
Center, U.S. Export Center, Motor Truck Cargo Center, Travel Planning &
Discount Reservations Center, Transport Tutorial For Int'l Transportation,
Int'l Weather Center, Historic Bills of Lading, Intelligence Center
............ and much more. Our General Reference Desk is used by major
universities. The Transport Law Navigator is the most complete guide to
Int'l industry laws available anywhere. Join our 1200 daily visitors and
take a look today!
- "Asian Flu" May Now Be Only A Sniffle
............ as trade figures show Taiwan's trade surplus for January to
June 1999 ballooning five-fold compared with the same period in 1998, from
US$1.22B to US$6.23B. The export-driven growth is due chiefly to increasing
demand from reinvigorated Asian economies. January-June exports were boosted
5.5% year on year, to US$57.42B. Exports to Korea rose a healthy 58.4%, to
US$1.15B, with those to Japan went up 19% to US$5.5B. Shipments to Asia were
up 13% to US$5.88B, with exports to the U.S. inching up 6.7% to US$14.85B.
The trend indicates that exports for the whole of 1999 will rise 7%, well
above the 4.7% forecast for the year. Imports for the 1st six months of this
year were US$51.19B, dropping 3.8% from the 1998 level.
- TT Club Warns On Cargo Crime ............ as cargo crime
costs the industry US$30-50B every year. Addressing the club's "Insight
into Loss Prevention Conference" at Antwerp, Mike Hawkins of the club's
claims investigation branch said that cargo was most likely to be stolen at
ports & terminals. He went on to say that most major thefts are the work
of organized crime syndicates using contacts 'on the inside' and warned
terminal operators of the need for continuous checking of security
arrangements. "Always remember," he said, "the criminal is
one step ahead." Hawkins said that large-scale thefts are "almost
invariably the work of criminal organizations which usually plan their
crimes based on information supplied by individuals working on the
inside." Generally, buyers for stolen cargo are arranged prior to the
actual thefts, he added. Case histories indicate that the most likely places
where cargo consignments are stolen are at ports or terminals, followed by
freight depots & road transportation -- generally when parked overnight.
- Cargo "Laundering" Warning .......... as U.S.
Customs has warned of a crackdown on a widespread drug money-laundering
scheme involving purchases of American products for export to Colombia.
"If there are those that are out there willingly facilitating this
criminal system, they should know that we will be vigilant," said
Treasury Under Secretary for Enforcement James E. Johnson. The
"black-market peso exchange system'' launders an estimated US$5B a year
in drug profits, Johnson told members of the Senate's informal Caucus on
Int'l Narcotics Control. Lawmakers have been told how brokers in the
black-market exchange helped launder drug money through purchases of
products from major corporations, including Sony, Whirlpool, Kodak & G.E.
"Everyone in this black market business knows that the U.S. dollars
they are dealing in are from drug sales in the USA,'' said an anonymous
witness. Johnson said household appliances and cigarettes are among the
products most commonly involved in the illegal trade schemes, and that U.S.
companies, which often export indirectly through distributors, may be
unwitting participants. Colombian peso brokers, who act as middlemen in the
money-laundering scheme, give Colombian importers IOUs in exchange for
pesos. The pesos are then used to buy U.S. dollars from drug cartels,
providing the cartels with clean, usable currency. Then, the brokers use the
dollars to purchase goods and smuggle them into Colombia on behalf of the
importers, who thereby avoid high government tariffs and taxes on foreign
currency exchanges. Cooperative efforts by U.S. & Colombian law
enforcement agencies over the past eight years have resulted in the seizure
of more than US$800M in assets and 2,100 arrests related to the black-market
peso exchange. Some American companies, including Whirlpool and General
Electric, already are taking steps to help combat the problem, such as
cutting off sales through independent distributors in Colombia, said Bonni
G. Tischler, assistant commissioner of U.S. Customs. "It's existence,
however, has not been highly publicized or well understood," Tischler
said. To try to raise awareness, Customs is launching a campaign to educate
exporters, including using pamphlets describing ``red flags'' to watch for.
Among telltale signs that money launderers may be at work is when payments
for goods are made with checks, money orders or bank drafts not drawn on the
account of the purchaser, but of a third, apparently unrelated party.
- U.S. Ponders New Cuba Rules ............. as the U.S.
Export Administration met with shippers last week in Washington to discuss
the requirements for shipping certain types of goods to Cuba. In March 1998
& Jan., President Clinton announced 2 initiatives to provide aid to
Cuban people. For the 1st initiative, Commerce has streamlined its process
for reviewing license applications for sale of medicine & medical
supplies. Commerce has seen a substantial increase in license applications
since last year. The license ensures Commerce that medical goods are being
used for civilian purposes. Under the 2nd initiative, Commerce revised its
Cuba regulations to provide for a case-by-case review of applications to
sell food and certain agricultural products to Cuba. Treasury has also
revised its Cuba regulations to provide specific licensing of travel to Cuba
to explore sales opportunities in these commodity areas.
- New "Exporter" Definition ............. as the
U.S. Census Bureau & the Export Administration have announced their
proposed definitions of "exporter." Under the new proposed rules,
the exporter or seller of cargo will be defined as the "U.S. principal
party in interest." This entity will provide the agencies with all the
necessary shipment information. The forwarder must provide the
transportation data. The forwarder may fill out the entire export
declaration if it has written permission from the exporter. Both agencies'
proposed rules are expected to be published together in the Federal Register
within the next 2 weeks. If the new rules are accepted by industry, they
could be implemented as early as Sept.
- Danzas Is No Frosted Flake .......... as cereal giant
Kellogg Co. has reduced the number of forwarders it works with worldwide
from 40 to one by appointing Danzas as its single provider. The Battle
Creek, Mich.-based multinational has signed an agreement with the Swiss
forwarding & logistics group. Under the agreement, Danzas handles all
freight originating from Kellogg's production facilities throughout the
world, with warehousing, distribution, air, ocean, customs, transborder
& domestic services. Danzas has set up "implants" in Kellogg's
offices in Battle Creek & Mexico.
- CN Rail Now Spans Continent .......... as on 1 July,
Canadian National Railway Co. took control of Illinois Central Corp., parent
of Illinois Central Railroad Company and launched a step-by-step integration
of CN & IC operations. CN now spans Canada and mid-America, from the
Atlantic & Pacific oceans to the Gulf of Mexico.
- New EU Rail Giant ........... as on 1 Jan. 2000, DB Cargo
AG & NS Cargo NV, the cargo arms of the German & Dutch railroad,
will merge into "Rail Cargo Europe." In June 1998, these parties
signed their Memorandum of Understanding for this merger. So far the
European Commission has not yet given its approval of this expansion of
- Our Journal Goes Daily On Industry Stock ...........as
The Journal of Commerce, our beloved daily paper covering Int'l trade &
transport, announced that its "Bridge Transportation & Logistics
Stock Index" is now being updated & published daily on its website.
The index is a "for pay" composite of 90 U.S. & foreign-based
companies in transportation & logistics, including: container & bulk
shipping, air & rail cargo, trucking & equipment leasing, and
3rd-party logistics and freight forwarding. The index will continue to
appear weekly in print editions on Tuesday. This service joins our 24 Hour
air, ocean & cargo insurance news feature at the top of The Cargo Letter
Int'l Transportation Portal web page.
- Venezuela Says "Mind Your Own Business".............
as the Venezuelan trade minister says that Colombia's trade minister should
have minded her own business when she criticized Venezuelan trade policy
last week. The Colombian minister, Martha Lucia Ramirez, criticized a
Venezuelan law requiring Colombian truck drivers to hand their cargo over
Venezuelan drivers at the border. In an interview with the Caracas daily El
Nacional, she said Venezuelan President Hugo Chavez ``talks about
integration, but the measures applied by some of his officials are just the
opposite.'' Ramirez's comments were an ``undue interference in the internal
affairs of the country,'' Venezuelan Trade Minister Gustavo Marquez said in
response. Venezuela said the law was necessary because its drivers were at a
disadvantage. Few Venezuelan drivers venture into Colombia because of the
presence of leftist rebels & paramilitary squads. Venezuela's president
says he is recalling the country's ambassador.
- Fear Fuels China Tariff Harvest .......... as China's
smuggling crackdown is responsible for soaring tariff income, according to
new statistics by the PRC's General Administration of Customs. The figures
show that 994 smuggling cases were prosecuted in 1st quarter 1999, involving
goods valued at US$176M. Alarmed smugglers, fearful of the stiff penalties
meted out by Chinese courts for customs duty evasion, are now believed to be
moving goods through legal channels. Duty income for the 1st half of this
year was more than double that for the same period last year. Customs
revenues amounted to US$9.46B for the end of the 1998/99 fiscal year.
- They'll Double The Tunnel ............ as Eurotunnel's
Board has approved a plan to increase freight shuttle capacity by 2003.
Freight traffic between the UK & Europe has grown by an average of 23%
each year between 1993 & 1998. The growth is expected to continue at a
rate of at least 5% each year over the coming years. A further 4 shuttles
will be ordered, in addition to the 3 shuttles which are already on order.
This will bring Eurotunnel's fleet from nine shuttles today to 16 shuttles
in year 2003.
- DFDS Will Get Dan .......... as the Danish ocean shipping
line has announced acquisition of the Danish freight forwarder Dan
Transport. Comments are invited to be submitted to the EC's competition
directorate by July 2.
- Fritz Goes Bigger In Southern China ........... as the
intermodal giant has opened a warehouse in the southern Chinese port of
Yantian. The 400,000-square-foot facility will offer a variety of logistics
services, such as consolidation, onsite customs supervision & racking
for inbound shipments. Fritz says that the emerging Yantian port has several
advantages over neighboring Hong Kong. Containers stuffing charges are 25%
in Yantian as opposed to Hong Kong, where the terminal handling charge is
about US$200 more than Yantian. Labor & land costs are also on the rise
for warehouse operators at HKG.
- Deutsche Post Goes Spanish .......... as it has agreed to
buy a 49% stake in Spanish parcel carrier Guipuzcoana, with an option to
purchase an additional 2% of the company (controlling interest) in 3 years.
Guipuzcoana, with nearly US$200M in annual revenue, offers parcels &
palletized freight transportation services through a network of more than 60
offices in Spain & Portugal.
- AEI Heads To China ......... as it opens a new operation
at Shanghai. The new company, AEI Logistics (Shanghai) Co., Ltd., will
operate AEI's 1st full service distribution center on the Chinese mainland,
in the Pudong Waigaoquao Free Trade Zone, located about 40 miles from
Shanghai. The 3rd party logistics provider is based at Darien, Connecticut.
- C.H. Robinson Takes The "Country"
.............. as it has signed an Asset Purchase Agreement with Country
Wide Transport Services, Inc. for the purpose of acquiring substantially all
of the operating assets of Country Wide's operating subsidiary Vertex
Transportation Inc. ("Vertex"). Vertex is a freight forwarder
based in East Rochester, New York. Vertex provides 3rd-party transportation
logistics services throughout the U.S., Canada & Mexico. Vertex had
gross revenues of approximately US$34M in fiscal 1998. The acquisition is
expected to close by the end of July 1999; C.H. Robinson will pay between
US$6.5 & US$7.0M above the net book value of the assets being acquired
and liabilities assumed.
- L.A. Re-Welcomes Expeditors To The City ............ as
Mayor Riordan's L.A. Business Team, a pro-business task force, has
facilitated a favorable tax classification for Expeditors, saving the firm
over US$350,000 in business taxes as an incentive for its move into the LAX
Commercial Corridor. There will be a new 64,000 square foot facility, under
a 5 year lease. "This is great news for Los Angeles and will provide a
big boost to the Gateway to LA business improvement district," said
Mayor Richard J. Riordan. "Expeditors Int'l is a quality company
bringing hundreds of quality jobs to our city. Los Angeles Int'l Airport,
the Port of Los Angeles & the Alameda Corridor will continue to be key
economic engines to ensure Los Angeles' place as the Capital City of the
- "Print Logistics" Sale .......... as R.R.
Donnelley & Sons Co., the leading commercial printer in North America,
has acquired Freight Systems, Inc. (FSI), a privately held print logistics
company headquartered near Los Angeles. FSI provides services in mail &
newsstand distribution since 1975 to large magazine publishers such as Time,
Newsweek, Hearst & TV Guide. Since 1996, FSI has been a partner of R.R.
Donnelley Logistics Services (DLS), and the 2 companies have worked to
expand delivery options for their customers on the West Coast.
- Consolidated Adds Swiss Forwarder ............ as
Consolidated Freightways, the U.S. LTL motor carrier, has formed an alliance
with Swiss-based Fracht AG that increases CF's coverage of the EU.
Headquartered in Basel, Fracht AG is a forwarder specializing in air, ocean
& ground transport & logistic serves in Switzerland, Germany,
Austria & Sweden. CF is also certified as an Int'l Air Transport Assn.
- Consolidated Wants You Out of The House .......... as the
U.S. national LTL carrier is using the Internet to market &sell
"CFMovesU.com", a self-load household goods moving service that
offers the convenience of a full service moving company with the low cost of
a self-serve truck rental. Consumers have a 2 day window to pack & load
household goods into a trailer that Consolidated brings to the origin
residence. Once the freight is packed & loaded, the trailer is picked up
by a professional CF driver, and transported through CF's nationwide
network. Consumers unload their household effects over the 2 days following
the delivery of the trailer. CF picks up the empty trailer. Given the
various problems associated with HHG moves these days, we find this new
program to be innovative. The problem will be with liability exclusions for
improper packing. Still, Bekins beware!
- Con-Way Says It Will Cut One Full Day To Coast ..........
as Con-Way Transportation Services, a national network of regional trucking
companies, announced today 3-day coast-to-coast service for businesses
moving freight from western New York & Pennsylvania to California. The
premium service, which covers almost 3,000 miles, extends Con-Way's
coast-to-coast service capabilities and compares with typical
less-than-truckload (LTL) times of 5 days or more to cross the country.
- Animal Pals Torch Dutch Trucks .......as the Animal
Liberation Front (ALF) has claimed responsibility for the gutting of 5
trucks brimful of beef as well as a container with detergents in The
Netherlands in late June. ALF proceeds to violence because it feels that the
politicos 'listen too little to animal friends'. After the fire the police
found empty jerry cans in a parking site close to a slaughterhouse.
- Bolero Cost A Bundle .......... as the TT Club disclosed
for the 1st time that it has invested US$1.5M in development costs in
Bolero, the electronic data interchange venture. Bolero, the joint venture
between the TT Club & the Society for Worldwide Interbank Financial
Telecommunication, plans this fall to launch a secure trade documentation
delivery system that will enable paperless negotiable bills of lading.
Bolero started "beta testing" the system with selected carriers
& shippers in April.
- "eCom"? .............. as U.S. Secretary of
Commerce William M. Daley promised that the Commerce Dept. would be fully
automated by 2002. "(We are) using the web to entirely change the way
we deliver information," Daley said at the "E-GOV '99"
Conference in Washington last month. "What eBay has done for auctions,
we are trying to do for government." In addition, Commerce's Export
Administration has announced the full rollout of its new Internet export
license application system, the Simplified Network Application Process, or
SNAP. The Export Administration began testing the system in February. There
are now over 300 users with access to SNAP free of charge. The SNAP system
is expected to save as many as ten days on processing of license
- New U.S. Export Act? .......... as the U.S. Senate
Committee on Banking, Housing & Urban Affairs held hearings last month
with the Administration & industry officials to reauthorize the Export
Administration Act. The legislation provides the legal framework for export
controls based on national security & foreign policy. The Export
Administration Act lapsed in 1994, and its provisions have since been
continued by executive order. The draft legislation would reauthorize the
Export Administration Act with new provisions that focus on technology
transfer overseas. The Senate also proposes stiffer penalties for violators.
- U.S. Customs Export Initiative .......... as the agency
has developed a program which it says will help ocean carriers improve their
timeliness when filing Shippers Export Declarations (SED). Development of
the "Export Sea Carrier Initiative Agreement" 3 years ago after it
found that carriers were only 70% compliant when filing SEDs, with their
outbound manifests. Customs collects SEDs for the Census Bureau's trade
statistics and also for its own enforcement purposes. Customs encourages
exporters to use the Automated Export System to file their SEDs. But in
cases when the exporter is not on AES, the carrier is responsible for
submitting the paper SEDs to Custom on behalf of the exporter. The new
agreement allows carriers to file paper SEDs for an entire manifest within
10 days after departure from the final port of export to a local Customs
office where the carrier's centralized documentation center is located. The
filings must be accompanied by a specified cover sheet & export
declarations must be separated by vessel and port of loading. In return for
participating in the agreement, however, carriers will be able to receive a
penalty/liquidated damage mitigation option when mistakes occur. Thus far,
Crowley, Sea-Land, APL, OOCL & Maersk, say they support the program. To
participate, a carrier must submit a letter of intent to participate in AES.
Once the carrier is active in the system, Customs will then measure the
carrier's outbound manifest compliance rate to make sure that it exceeds
- New "Flagship" Operation ............. as
Flagship Customs Services of Silver Springs, MD. has been awarded a contract
to develop an Internet link to the Automated Export System (AES) for the
U.S. Census Bureau. See previous story.
- May IHOP Still Serve Belgian Waffles? ............ as the
U.S. Food & Drug Administration has expanded the list of imported foods
from Belgium that U.S. Customs will seize at the border. No milk-containing
foods, from cheese to soups, can enter the country without special safety
testing. Belgian beef, poultry, pork and byproducts were banned by most
nations, including the U.S., in June, after it was discovered that large
quantities had been contaminated by cancer-causing dioxin. The contamination
apparently was caused by dioxin-laced animal feed. The FDA also ordered
detention of egg-containing products from Belgium, France & the
Netherlands, as well as animal feed, pet food and animal feed ingredients
from anywhere in Europe because of the contamination. The FDA termed the
move precautionary, calling it unlikely that U.S. consumers were exposed to
harmful chemical levels.
- Customs Factoid ........... as there are about 400,000
importers in the U.S., with about 1,000 of them controlling 60% of imported
- Harbor Maintenance Refunds Done............. as U.S.
Customs Service reports it has processed 99% of the Harbor Maintenance Tax
claims received and has issued more than US$600M in refunds. The tax had
been levied on imports and exports since enacted as part of a 1986
water-resources law. It was ruled unconstitutional, as applied to exports,
by the U.S. Supreme Court on 31 March 1998 Customs has received 3,423 tax
refund claims and has processed 3,385 claims totaling about US$740M.
Plaintiffs have disputed 171 claims & Customs has processed 80% of these
claims. The remaining 1% of claims received are awaiting problem resolution
by the U.S. Dept. of Justice.
- Wooden Pallets: U.S. Is Bugged About China & Others
.......... as the U.S. Animal & Plant Health Inspection Service (APHIS)
has issued public notice that it will prepare an environmental impact
statement regarding the importation of solid wood packing material a.k.a.
"wood packing materials other than loose wood packing materials, used
or for use with cargo to prevent damage, including but not limited to
dunnage, crating, pallets, packing blocks, drums, cases, and skids."
APHIS is hoping to achieve a consensus on regulatory alternatives that it
plans to consider for environmental review and impact. If the agency was to
take no action, China and Hong Kong will still be subject to additional
treatment and documentation requirements in order to control the risk that
it could introduce the Asian longhorned beetle into the U.S. APHIS is also
considering additional treatments for pallets from other countries, based on
the risk of infestation. Other APHIS alternatives are a complete ban of
wooden packing material, except those that are designed of long term
repeated use and completely "bark free." Drafts on regulations
expected after November 1999. Sources added that after a comment period
APHIS would then publish a final EIS and final rule, likely in or after
- US Customs' New Web Feature ........ as posted to its Web
site is "Customs Valuation Encyclopedia 1980-1998" in 3 formats:
WordPerfect 6/7/8/9 format in a self-extracting zip file, Rich Text Format
in a self-extracting zip file, and Adobe Acrobat format. According to
Customs, this publication includes every valuation decision (rulings,
notices, and court cases) issued in 1998. The feature replaces the prior
"Customs Valuation Encyclopedia 1980-1997." Customs adds that this
publication is comprised of relevant valuation statutory provisions, Customs
regulations implementing the statute, portions of the Customs Valuation
Code, judicial precedent, and Customs Headquarters rulings and notices
issued by the Office of Regulations & Rulings.
- New "Draft" Responsibilities For Exporters
............... as the Bureau of Export Administration (BXA) has posted a
notice to its Web site announcing a "draft" rule and supplementary
proposed rule from the Census Bureau, regarding the responsibilities of
parties to an export transaction, including filling out the Shipper's Export
Declaration (SED). The drafts are intended to clarify the responsibilities
of exporters and forwarding agents in completing SEDs and to clarify
provisions for authorizing forwarding agents to prepare and file SEDs or
file export information electronically using the Automated Export System
- Fresh Beagles To The Border ................ as the U.S.
Dept. of Agriculture graduated the 1st Border Beagle Brigade class today at
the Port of Pharr, TX, U.S. Customs facility. USDA's Border Beagle Brigade
is an extension of its existing Beagle Brigade program, which was started in
1984 by the Animal & Plant Health Inspection Service. The Beagle
Brigade, which partners beagles with APHIS' plant protection and quarantine
officers, works at 21 Int'l airports & select U.S. mail facilities,
detecting prohibited agricultural items such as fruits, plants, and meats.
The beagles locate thousands of pounds of contraband every year. Building on
the success of the Beagle Brigade, USDA decided to try the same concept in a
different environment. Beagles in the Border Beagle Brigade also sniff out
prohibited agricultural goods. However, they will be working on the
U.S.-Mexico border, checking vehicles &baggage. The Border Beagle
Brigade began in 1997 as a pilot project and successfully showed that a
detector dog team, working in conjunction with other plant protection and
quarantine officers & x-ray machines, would save time clearing buses and
vehicles through U.S.-Mexico border ports-of-entry. With these results, USDA
decided to place canine teams at Hidalgo, El Paso & Laredo.
- Smugglers To Be Blasted With Gamma-Ray Machines!
............ as in an effort to curb the illegal export of stolen cars, the
Florida insurance department is paying US$994,000 for 10 machines that scan
cargo containers at Florida ports. The rest of the money needed for the
machines is coming from the Florida Seaport Transportation & Economic
Development Council, along with funds from each participating port. The Port
of Miami was the 1st to receive a demonstration unit. In just one week in
February of last year, the machine processed 2,247 cargo containers, found
121 with cars inside and recovered 3 stolen vehicles & a backhoe -- all
worth US$117,000. It's expected that by the middle of next year all 10
scanners will be installed in the 6 ports. Miami will have 3; Port
Everglades, 2; Port of Palm Beach, 2; &, the ports of Canaveral,
Jacksonville & Tampa one each.
- Customs Helps Enforce Vow of Poverty ........... as a
Catholic priest was charged late last month with trying to smuggle into the
country US$2.4B in fake Treasury notes. The Rev. Mario Beato-Prieto, 35, a
Spanish citizen running a parochial school in the Philippines, was arrested
at JFK after U.S. Customs agents discovered he was carrying the fake
currency in his luggage. Prosecutors said the priest tried to sell 24 phony
US$100M notes through a broker. He also had US$2,000 in cash, plus a
document indicating he had access to another US$65B in fake currency. But
the notes looked more like US$100 million bills adorned with a likeness of
Grover Cleveland, marred by typos and runny ink. They were confiscated after
the priest arrived on a flight from South Korea. The church could not raise
bail because Augustinians take a vow of poverty.
- Customs Puts Squeeze On Juicers ........... as workers at
Mid-Florida Freezer Warehouses Co. of Port Canaveral, FL are accused of
refilling leaking juice storage drums with contaminated juices to conceal
inventory damage, a federal indictment alleged last week. Thousands of
gallons of fruit juice sold nationwide from 1981 to 1995 may have been
contaminated, federal authorities said after a grand jury issued the 2 count
indictment. Mid-Florida Freezer Warehouses allegedly acted to avoid paying
for damaged inventory. The indictment says the company kept a secret
inventory of contaminated juice, used the juice to ``top off'' damaged
drums, repaired the drums & shipped them. The company & its
president, Patrick T. Lee, are charged with conspiracy & making false
statements to U.S. Customs. If convicted, Lee faces a maximum sentence of 10
years in prison & a US$500,000 fine. Most of the juice is alleged to
have been shipped to Coca-Cola for its Minute Maid brand product.
- Japan Customs Goes Ape ............. as police have
arrested a man on suspicion of illegally importing Indonesian orangutans
into Japan. Kenichiro Fukuura, 44, allegedly hid two orangutans in a bag
(big bag?) before boarding a flight from Indonesia to Japan in December
1998, a police spokesman said last week on condition of anonymity. Fukuura
allegedly sold the animals upon arrival for US$6,900 to a pet shop owner in
the city of Osaka and now faces up to one year in prison or a fine for
violating the animal protection law, and 3 years in prison or an equal fine
for bringing the animals to Japan without permission. A recent survey by
Japan's Environment Agency showed that 1 in 5 Japanese traveling abroad say
they have bought traditional medicines made from endangered species.
- Airbore Express. DOWN as net earnings for the 2nd quarter ended June 30,
1999 will fall short of expectations. The consensus estimate of analysts who
follow the company was for earnings per share of US$63 and the company
believes actual results will be in the US$45 to US$55 range. Airborne stock
was down 2 at 25 3/16 on 8 July.
- Bureau Veritas, the Int'l classification company. UP 12.2% with 1998
revenue of US$716M, of which US$123M is from its marine & offshore
division. Last year the group classified 6.432 vessels totaling 34.8M tons.
- Emirates Group. UP with profits for the Emirates group in the financial
year April 1998 to March 31, 1999 of US$117M, up 15.6% year on year.
Emirates SkyCargo contributed 15.2% of total airline revenues & ended
the year with profits 3.17% up on the prior year. Carried were 214,215 tons,
an increase of 7%.
- Evergreen Marine. DOWN with a 2% fall in net after-tax profit for 1998, to
US$33M. Revenue dropped by 4% US$842M.
- FDX Corp. (FedEx). UP as 4th-quarter earnings rose 30% on strong gains in
its flagship Federal Express business. Net income was US$221M, or 74 cents
per share, in the quarter ended May 31. That compared to US$171M, or 58
cents per share in the same period a year ago. Revenue rose to US$4.38B from
US$4.08B. FDX also owns RPS Inc., Viking Freight Inc., Roberts Express Inc.
& FDX Global Logistics Inc.
- Finnair. DOWN as profit for the fiscal year ending March 31 fell to
US$61M, a 33% fall from the previous year. The line, in which the Finnish
government has a majority stake, was hit during the year with a strike by
air traffic controllers.
- J.B. Hunt (U.S. LTL carrier). UP as total revenue increased 8% to $497.6M
in the 2nd quarter of 1999, over the comparable period of 1998.
- P&O Nedlloyd Container Line. DOWN with an after-tax loss of US$14M in
1998. P&O Nedlloyd had already reported a 1998 operating profit of
US$81M on revenue of US$3.94B, with a pretax deficit of US$1M. In 1997, its
1st year of operations since the merger of P&O Containers & Nedlloyd
Lines, P&O Nedlloyd had a net deficit after tax of US$83M.
- Roadway Express. UP with net income of US$7,624,000 or US$0.40 per share
(diluted), for its 2nd quarter which ended June 19, 1999, an increase of 44%
over net income of US$5,307,000, or US$0.27 per share (diluted), in same
period 1998. Revenues for 2nd quarter 1999 were US$621,122,000, up 1.9%.
- TT Club (intermodal insurance) UP with a jump in its annual surplus &
in the club's net worth for 1998. The surplus for the year was US$11M,
compared to US$7M in 1997. Net premium income rose to US$98M, from US$85M,
despite a soft market & fierce competition, TT Club said. Claims
increased to US$82M last year, from US$58M in 1997, but the club reported a
higher investment income of US$27M for 1998, compared to US$15M in the
previous year. Net worth -- the value of the club's assets to its members --
increased to US$101M, from US$90M in 1997.
- Wallenius Lines. UP with a 40% jump in annual net profit for 1998, to
- Yellow Corp. (U.S. LTL carrier). UP as 1999 2nd quarter net income was
US$13.0M or US$.52 per share, a 16% improvement over earnings per share in
the 1998 2nd quarter.
- In Memorial ........... as a DHL twin-jet Hawker Siddley
125 clipped a fence 1,000 feet from a runway at Toluca's Int'l airport early
9 July & crashed in flames, killing all 4 people aboard. Two crew
members as well as two teen-age boys coming to Toluca for vacation were on
the plane. Officials report that the freighter was approaching the runway at
4:40 a.m. when it hit the 6-foot-high fence. The bulk of the plane crashed
500 feet closer to the runway. It was not immediately clear why the plane
was flying so low, but there was fog at the time. The airport, which handles
most of the cargo flights for the Mexico City area, has modern navigation
equipment. The DHL package service craft had taken off from Los Mochis, 750
miles N.W. of Mexico City. On 7 July, a B-727F freighter operated by
Lufthansa's Indian subsidiary for Hinduja Cargo crashed in Nepal, killing
all 5 crew, hitting a mountain shortly after takeoff from Katmandu. In still
other bad news, a B-727F freighter owned by Brazilian airline Varig caught
fire in an airport hanger, injuring seven workers, on 9 July.
- When Safety Becomes A Crime ............ as the now
defunct SabreTech Inc., was charged by the State of Florida last week with
murder & manslaughter in connection with the tragic Valujet crash of
1996. The company and 3 of its employees were later indicted by a federal
grand jury on separate charges of conspiracy, making false statements and,
in the case of the company, mislabeling & mishandling hazardous
material. The company also was accused of failing to properly train its
personnel to handle hazardous waste. This is believed to be the 1st time in
U.S. aviation history that criminal charges have been filed against a
company & maintenance workers after an airplane accident. Some relatives
of the 110 victims have been pushing for the tough charges against SabreTech
& ValuJet executives, but a government sources continued to speculate
that an indictment was expected only to charge a few line workers with
knowingly falsifying documents. More serious charges such as negligent
homicide had not been expected because there was no evidence that someone
intentionally placed flammable oxygen canisters on the plane knowing they
would explode. All aboard died when the DC-9 nose-dived into the murky
Everglades swamp minutes after takeoff from MIA on a flight to Atlanta.
Flames from a cargo fire had torn through the floor of the passenger cabin.
Crash investigators concluded SabreTech employees improperly labeled the
oxygen canisters, which had been placed in the cargo hold by ValuJet
workers. SabreTech was assessed a record US$2.25M fine by the FAA for
improperly handling the canisters. SabreTech Inc. mechanics Eugene Florence
& Mauro Valenzuela and Daniel Gonzalez, SabreTech's former V.P. of
maintenance, surrendered to the FBI & appeared in federal court on 15
July. The men were released on US$50,000 bond. Each could be sentenced to up
to 55 years in prison & fined US$2.7M if convicted. There may be more
soon .............. as a federal grand jury is now investigating the August
1997 crash of a Fine Air cargo plane for possible criminal activity,
according to the Miami Herald. Fine Air Flight 101, packed with cotton
fabric destined for the Dominican Republic, crashed Aug. 7, 1997, after
takeoff from MIA, killing all 4 people aboard the DC-8 & a motorist on
the ground. The National Transportation Safety Board found the plane's cargo
was improperly loaded & secured.
- FIATA Fights Discrimination .............. as the Int'l
Federation of Freight Forwarders' Associations says customs authorities
around the world don't treat traditional air cargo & express cargo
equally. This bias favoring express cargo should be eliminated, the
forwarders' body said. "In fact, most national customs authorities give
express cargo preference, without reason, even though air cargo fulfills the
same requirements in regard to customs clearance," a spokesman for
FIATA said. In many countries, express cargo can be cleared at airports 24
hours a day at the passenger customs entry, whereas air cargo is subject to
restrictions on customs opening hours at the air cargo warehouses, FIATA
said. FIATA is working with the Int'l Air Transport Association on
guidelines for airlines and forwarders to harmonize and speed up clearance
for air cargo worldwide.
- Private Ports The Way Ahead? .............. as the U.S.
House Aviation Subcommittee recently reviewed the status of U.S. airport
privatization initiatives since the enactment of the FAA Airport
Privatization Pilot Program which enables airports to sell or lease their
facilities to the private sector. Rep. Duncan, subcommittee chair & a
cosponsor of the Pilot Program legislation, invited airport officials, the
FAA & private operators to report recent developments, discuss why U.S.
airports have been slow to participate in the program and consider ways to
remove obstacles that may be discouraging airports from seizing the
opportunity. In the last two years, some 66 airports have been privatized
worldwide. In the U.S., Stewart Int'l Airport in New York & San Diego's
Brown Field, have applied for privatization under the Pilot Program. Los
Angeles recently rejected such a plan for LAX.
- HKG Sees Red - May Go Cheap ............ as to combat
mounting losses a year after its problem-plagued opening, Hong Kong's
airport is seeking to boost revenues by increasing cargo volume &
possibly cutting its notoriously high aircraft parking fees. The measures
are aimed at bringing Chek Lap Kok airport, which posted a US$51M deficit in
the past 12 months, out of the red, the Hong Kong Standard reported. The
airport's opening July 6 was marred by an historic & costly series of
failures that severely disrupted operations. But after the airport began
normal operations, airlines complained of exorbitant aircraft parking
charges, which are as much as a third higher than those at Hong Kong's
former airport. They said high fees contributed to the cancellation of 82
weekly flights that were not profitable. The charges also are about double
those of Singapore's Changi Airport, Chek Lap Kok's main competitor as
Asia's aviation hub. Singapore slashed its charges by 10% last year. Airport
officials have previously said they have to charge higher fees because they
need to repay their debts in four years. The airport and related
infrastructure cost US$20B. The charges will be reviewed this month or next,
said Billy Lam, chief executive of the Airport Authority, which runs the
airport and sets its fees. The airport will also concentrate on building new
duty free shops & resort hotels on its property.
- Could FedEx Embassies Be Next? ............. as Florida's
trade mission to Mexico, which started on July 12, is being cosponsored by
FedEx. FedEx considers the 3 day conference a strategic opportunity to
explore bilateral investment & trade opportunities. Florida Governor Jeb
Bush joined more than 300 business professionals from Florida & Mexico
attending the conference held in Mexico City.
- U.S. Says O.K. To More China Flights ............ as the
U.S. government has given tentative approval for 3 American lines to make 17
more round-trip flights each week to China. Northwest & FedEx will get 6
flights and United 5, according to a statement quoting U.S. Transportation
Secretary Rodney E. Slater. The U.S. won agreement from China in April to
double the number of flights between the countries as part of Chinese
efforts to join the World Trade Organization. The plan includes new direct
flights by United from San Francisco to Shanghai and by Northwest from
Detroit to Beijing & Shanghai. Airlines expect U.S. government
confirmation of the flights this month.
- "Express" Pressure On Argentina ............ as
UPS, DHL, FedEx, World Courier & TNT have joined forces to open up the
Argentina market. Capsia, a lobby group formed by the companies, wants an
end to government-imposed limits of 50 kg weight & 3,000 pesos value for
door-to-door courier services. The Argentine courier services market, which
has been growing at around 15% annually, is currently estimated to be worth
US$50M. Most of its activity is tied to exporting.
- Air France & Delta Tie Knot .......... as they have
signed an exclusive long-term strategic agreement that lays the foundations
for a major global alliance, to be announced by the end of the year. This
alliance will be set up with other airlines from among Air France's and
Delta Air Lines' existing partners and other carriers interested in this
project. The is based on the clear legal framework of the French-US aviation
agreement signed on 8 April 1998, which has boosted air services between
France & the U.S.. Perviously, Air France was in talks with both Delta
& Continental for the alliance, but chose Delta because it has a
stronger presence in the eastern U.S. The Air France-Delta alliance comes as
competition mounts on U.S.-European routes. Continental announced in May
that it plans to expand operations in Europe and eventually join Northwest's
alliance with KLM & Alitalia.
- In The Wake of Air France Deal ............ Swissair
& Belgian airline partner Sabena said they plan to form a code-sharing
agreement with American on routes between Europe & the U.S., after their
U.S. partner Delta announced its alliance with Air France. Swissair &
Sabena said their agreement with Delta, including Austrian Airlines, named
the "Atlantic Excellence Alliance," will remain in tact for now
despite Delta's ties to the Air France, a key competitor to Swissair in
Europe. In related news, Swissair & Sabena also said that they will
merge operations under a joint management company in June next year.
SAirGroup, Swissair's parent owns a sizable portion of Sabena.
- AA - BA Talks Suspend .............. as government level
discussions designed to approve an alliance between British Airways &
American Airlines have been suspended after BA refused to yield ground on
the number of takeoff & landing slots it is willing to give up. British
Cargo Airline Alliance, a British lobbying group, has criticized this
deadlock between the U.S. and British governments on a new bilateral
agreement. The British lobby group said that "there is no point in the
two sides meeting unless the U.S. government has a genuine reciprocal agenda
to put forward." The airlines group wants the U.S. government to open
the wet-leasing market to British airlines.
- UPS Takes Up The Challenge ............ as it is
positioning itself to become the dominant cargo carrier in Latin America
with the impending purchase of selected assets of Challenge Air Cargo, that
region's largest dedicated cargo line. The companies have signed a letter of
intent & expect to reach a final agreement this month. The acquisition
will be completed in January 2000, given the Department of Transportation's
approval. UPS must also secure the transfer of takeoff & landing rights
within Latin America. Challenge Air has 1,200 employees and annual revenue
- Swissair Heads South ............ as it buys 20% of South
African Airways at a cost of nearly US$300M for its stake.
- LanChile Strengthens On The Pampas ............ as it has
just announced an agreement to market and sell the cargo business on all of
Aerolineas Argentinas' domestic & Int'l flights. For this purpose,
LanChile & Aerolineas Argentinas have agreed to incorporate a new
company, which will be jointly owned by both parties.
- Danish Post Quits TNT ............ as through its courier
company Jetpost, Danish state-owned postal company "Post Danmark"
will enter into a merger with DHL and will terminate its co-operation with
TNT Post. The Danes opt for the alliance between DHL & Deutsche Post,
the other sister concern. TNT will continue to cooperate with the Swedish
& Norwegian postal companies. DHL expects that, with the Danish postal
company, it will also start competing in other Scandinavian countries.
- The Swiss Practice Their Portuguese ............. as
Swissair is to acquire a 42% equity stake in Portugalia, the privately held
Portuguese regional airline.
- Employees Buy Gemini Air Cargo ........... as the Carlyle
Group has signed a purchase agreement to acquire Gemini Air Cargo, Inc. in
partnership with Gemini's management & employees. Gemini has US$250M in
assets that specializes in providing Aircraft, Crew, Maintenance &
Insurance (ACMI) contract cargo services for other airlines. It is the
largest ACMI operator of DC-10-30F aircraft worldwide. Gemini's customers
include Swisscargo, Air France, Emery, FedEx, European Air Transport (a
subsidiary of DHL), Asiana & China Eastern, among others. Gemini owns
& operates eight DC-10-30F aircraft, with a fleet size second only to
FedEx. Two additional DC-10-30F aircraft are scheduled for delivery this
year along with additional aircraft next year. Gemini is based at Washington
Dulles Int'l Airport. Founded in May 1987, Carlyle is a Washington D.C.
based global investment firm that structures & leads equity investments
in management led buyouts transactions.
- Next You'll Have To Buy Two Tickets For Each Passenger
.............. as in another desperate move to save "our PAL," the
Philippines government has ordered state employees and workers to fly
Philippine Airlines when traveling overseas. The order is the latest move by
Philippine authorities to reduce competition for the ailing national
airline. PAL, while restructuring its operations, owes some US$2.3B to
creditors. In May, Philippine regulators rescinded the right of Emirates
airline to serve Manila from Hong Kong, and said it was reconsidering an
open-skies policy adopted by the Philippine government earlier this decade.
There is a rumor that Lufthansa Technik, a unit of German carrier Lufthansa,
has negotiated to acquire PAL's maintenance and engineering operations.
- American Not Bugged By Millennium Bug .............. as
it is the only airline in the Fortune 100 to receive the top rating for its
Year 2000 computer preparedness by Weiss Ratings, a consulting group that
measures companies' Y2K progress. The airline was one of only three top 100
non-financial companies to receive the high rating. Only 51 companies out of
the largest 837 non-financial companies - 6% - received the rating. A A also
has met its own self-imposed June 30 deadline for its Y2K work and is
planning to conduct business as usual on January 1, 2000. Not without cost,
however, AMR Corp, American's parent, is expected to spend US$250M to make
the airline & its sister, Sabre Inc. Y2K ready.
- But North American Industry Not Far Behind .......... as
IATA's Aviation Millennium Project has announced that U.S. & Canadian
airlines are 95% finished with Y2K correction efforts. The announcement
formed part of a status report to the President's Council on Year 2000
Conversion & to the Dept. of Transportation. 'The airline industry is in
great shape and we will be ready for the new millennium', said Carol
Hallett, president and CEO of the Air Transport Association (IATA). Airlines
have spent over US$750M on solving the Y2K problem, with over 4,400 people
working on Y2K throughout the industry at any given time. Boeing &
Airbus have completed their Y2K flight testing demonstrating that there are
no safety of flight issues related to Y2K.
- But ........... Polish flag carrier LOT has cancelled all
its flights scheduled to depart or land on January 1, 2000, citing concerns
over the millennium bug.
- China Merger Talk .............. as the Chinese
government is said to be weighing the complexities of a merger between China
Southern Airlines & flag carrier Air China. Regulators are understood to
be studying merger formulas and their implications. One proposal would
include injecting Air China's assets into China Southern Airlines, the
country's largest carrier, in exchange for shares that would be held by the
state. A merger between the 2 carriers would produce considerable cost
savings with little overlap. China Southern Airlines is strongest around its
base in the Southern city of Guangzhou and has limited international service
while Air China's presence is the most prominent around Beijing and in Int'l
flights. Both airlines mostly rely on Boeing aircraft for their fleet needs,
each operating a large number of 737-300s. All but 7 of Air China's 59
aircraft in its fleet come from Boeing & China Southern Airlines
operates 61 Boeing planes out of a 76 aircraft strong fleet. The fleet
commonality between the two carriers will allow for cost savings in
maintenance and purchases. Further cost cuttings are likely once the two
carriers fully integrate all their operations. There are a few obstacles
ahead of a merger, however. As a state-owned carrier, Air China is the
"official" airline of China, carrying government officials free on
state visits and often disrupting its schedule to accommodate them, a role
that China Southern Airlines is not keen to embrace. China Southern would
also like to complement the injection of Air China operations with a
disposal of some non-core assets, and that could also complicate gaining the
government's approval for the merger, industry officials said. If the merger
goes ahead, it will pose a major challenge to Shanghai-based China Eastern
Airlines and will further disadvantage the many smaller carriers in China.
China Eastern is likely to look for linkup opportunities with China
Northern. As with the proposed merger, a union of China Eastern & China
Northern would benefit both airlines as they fly mainly in different regions
of the country and operate mostly Airbus aircraft.
- Mexicana To Become A Star ........... as it is to join
the Star Alliance in 2000, according to Lufthansa. Mexicana, which serves
destinations in Central, North & South America, will be the 10th airline
to join the alliance to date. The other members are Air Canada, Air New
Zealand, All Nippon, Ansett Australia, Lufthansa, Scandinavian Air, Thai
Airways, United & Varig Brazilian.
- Goelogistics & Kitty Hawk Pair For Puerto Rico
.......... as last month they began a new overnight cargo service between
Miami & San Juan, Puerto Rico. Kitty Hawk Int'l is providing ACMI lift
for the Miami-San Juan route with a DC-8F. The route operates Monday -
Friday, departing Miami at 1 a.m., arriving in San Juan at 3:30 a.m., then
departing San Juan at 5 a.m., arriving in Miami at 7:30 a.m. GeoLogistics
Air Services is a niche freight forwarder and is the largest air cargo
provider between Puerto Rico & the mainland U.S., with a market share of
40% of the heavy air cargo flown.
- Emery Now Guarantees Japan ............ as it has
introduced Gold Priority Express from Japan to North America. This newest
offering provides shippers with a 2-day service from Japan to the U.S.,
Puerto Rico & Canada. The service also offers a same-calendar-day
delivery for shipments picked up in the morning in Japan for Los Angeles,
Ontario & San Diego. Keep those engines running!
- Atlas Air Stock Jump .......... as the company was up a
stunning 2 5/16 at 32 1/4 on 30 June. The news was that Atlas agreed to
lease its 747 cargo aircraft to Air France. Atlas Air operates a fleet of
B-747F freighters under long-term contracts with airlines including Alitalia
& British Airways.
- Cargo Industry Helps FAA To Future ................ as on
10 July the future of air traffic control got a flight test when more than a
dozen planes with satellite-positioning systems flew over Ohio &
Kentucky while monitors tracked the exact location of each aircraft. While
clouds obscured the planes from the eye, an airborne monitor clearly
displayed the test aircraft, cargo planes owned by UPS, FedEx &
Airborne. More accurate than radar and with a longer range than existing
collision-avoidance systems, the ``ADS-B'' system simultaneously gave air
traffic controllers & pilots an instant look at where the airplanes were
& whether any were on conflicting courses. ``The present system requires
everyone to go down the same tubes,'' said aviation analyst John Nance, a
veteran airline pilot. ``That limits the number of planes you can put in the
sky.'' The Aircraft Owners & Pilots Association says,``It's about the
most exciting thing and the only exciting thing in general aviation in the
last 10 years.'' Since cargo airlines are leading the developing of ADS-B,
it also may address a lingering safety problem: the lack of
collision-avoidance systems in the nation's growing cargo fleet. Such
equipment has been required in all but the smallest passenger planes since
1995, but cargo aircraft have been exempt. The government & private
industry view this so called "Free Flight" as a way to address the
issue. But before it can take effect, a variety of technology must be
developed or perfected. One element already in place is the Global
Positioning System, which features a constellation of satellites circling
the globe. The system gives pinpoint position information to everything from
nuclear missiles to wilderness campers. A 2nd critical part is a secure data
link between the cockpit and the control tower. That will allow controllers
and pilots to exchange messages via a type of e-mail, ensuring accurate
transmissions and eliminating any language problems. A limited system will
be deployed in Miami in 2002. A 3rd element is the system that allows
pilots, controllers and crews in other aircraft to know instantly the
position of all airplanes in their area. The Cargo Airline Assn. has been
working with the FAA & UPS Aviation Technologies on ADS-B, or Automatic
Dependent Surveillance-Broadcast. ADS-B uses GPS signals to determine an
airplane's speed, altitude & direction of travel. The information is
updated several times a second, unlike the slower sweep of a radar scope.
The information is supplied to any other airplane or ground station in a
200-mile radius that has a similar unit, providing all with the same eye in
the sky. ADS-B units also can also be placed on runways, airport terminals
or airport vehicles, helping pilots avoid ground obstructions and
controllers prevent runway collisions.
- NW CFO Becomes Cargo Chief .............. as Mickey
Foret, Northwest Exec. V.P. & CFO, has assumed the additional duties of
president Northwest Cargo.
- Continental To Start Newark Int'l Gateway ........... as
it will start heavy construction on its long awaited US$1B Global Gateway
Program at Newark Int'l Airport next month; scheduled for completion in
2002. On the cargo side, Continental will build a 150,000 square foot cargo
building on the airport's north side. Additionally, plans are underway to
construct a second widebody hangar (adjacent to Hangar 56) and engine shop
to maintain large jets such as the Boeing 777.
- New "E"-MAWBs For Delta ........... as Anacomp
has announced a 5 year service agreement with Delta Air to provide online,
web-based storage & delivery of cargo air waybills for Delta's domestic
& Int'l flights. Anacomp will capture, index & transform the
original MAWBs and deliver the electronic images to Delta personnel
throughout the company via standard web browsers & a specialized web
site. The images will be available on line for an initial 180 days then
Anacomp will migrate the waybill images to CD for audit purposes and store
them on magnetic tape for disaster recovery & longer-term archive. The
system will be operational for Delta domestic cargo locations by i Sept.
- FedEx Gets Some G-Log ............ as its has made an
equity investment in G-Log which is developing an Internet based command
& control system for the global supply chain.
- Another Virus Wobbles In ......... as "WOBBLER"
is said arrive on E-mail titled "CALIFORNIA." IBM & AOL have
announced that the virus is very powerful, more so than Melissa, there is no
remedy. It will erase all information on the hard drive & also destroys
Netscape Navigator & Microsoft Internet Explorer.
- Air Cargo Newsgroup Back On Line ............. as
moderator Michal Douglas has announced that the Albion Group has decided to
become the new sponsor for misc.transport.air-industry.cargo - the Air Cargo
Newsgroup. This means that the 3000+ member E-mail gateway to the newsgroup
will be reinstated. The AIRCARGO mailing list allows readers to interact
with mta-ic by E-mail. The list was discontinued earlier this year but
should now be back online. Welcome back, old friend!
- Volumes. Northwest Cargo ton miles (CTMs) systemwide were
up 16.1% in June from 1998's 167.6 million CTMs to 194.6 million CTMs in
June 1999. For United In June, CTMs were 213.8 million, up 3.9% from 205.8
million last year.
- FMC China Probe Could Have Teeth ............ as the
Federal Maritime Commission has ordered its chief attorney to prepare a
formal order to address China's alleged discrimination against U.S.-flag
& other non-Chinese ocean carriers. The order will be prepared under the
FMC's Section 19 sanction authority. Under Section 19 of the Merchant Marine
Act of 1920, China could face a number of sanctions, including limits on
U.S. port calls, suspension of tariffs, or vessel voyage fines of up to
US$1M per U.S. port call. The actions are a result of an investigation that
began in August 1998 in response to complaints from a number of sources,
including U.S. flag carriers, NVOCCs, the Dept. of State, the Dept. of
Transportation, the Dept. of Commerce & Sen. Ernest F. Hollings. Under
Chinese law, U.S. carriers must go through a cumbersome pre-clearance
process in order to call at many Chinese ports, and they have yet to win
China's approval to open more branch offices in China. Chinese law also
restricts non-Chinese forwarders from issuing bills of lading, arranging for
customs clearance or from opening new branch offices beyond the 6 originally
approved by Chinese officials. The FMC will also keep a close watch over
other developments, including proposals that could require ocean carriers to
disclose confidential service contract rates & terms.
- FMC Says "No" To NCBFAA ............ as the FMC
has turned down a proposal to enable forwarders to act as shippers, in
effect denying a request to allow forwarders to sign service contracts
directly with ocean carriers. The National Customs Brokers & Forwarders
Association of America had petitioned the FMC to change the legal definition
of the term forwarders. The forwarder group argued that a new classification
of the forwarder's status would remove years of ambiguity & provide
forwarders more flexibility business operations. The NCBFAA had sought
permission to allow forwarders to form shippers associations without being
classed as common carriers. The petition was opposed by the major
transatlantic & transpacific ocean carriers, as well as some EU &
Japanese ship owners.
- M/V Norasia Sheba Sets The Record .............. as the
1,400 TEU container ship set a new Pacific crossing record last week,
sailing from Hong Kong to Vancouver in a record 10 days, with two midcourse
port calls. She departed Hong Kong on July 5 and arrived in Vancouver 10
days, 4 hours and 25 minutes later on July 15. Sailing at an average 25
knots, the vessel took the port by surprise & wasn't able to berth
immediately. This sailing marks the fastest known crossing of the Pacific by
a container vessel. The voyage included calls at Keelung & Pusan. From
Keelung to Vancouver the transit time was 7 days and from Pusan just 7 days.
- 1998 World Fleet Report .............. as the global
merchant fleet is larger than ever according to Lloyd's Register, issued
this month. A total of 85,828 ships of 100+ gt with a combined tonnage of
531.9M gt are now registered worldwide. Panama continues to lead the way,
with an 8% increase to 98M gt, ahead of Liberia's 2nd place 60.5M gt.
Singapore's fleet continues to grow, recording an 8% increase over last
year. Hong Kong has shown signs of recovery after its steep drop following
the Chinese takeover in 1997, rising 7% to 6.2M gt, although this is still
1.5M gt short of its 1996 level.
- Sign of The Times .......... as the Japan/U.S. Eastbound
Freight Conference, the last transpacific conference still operational, will
be terminated on Aug. 1. A conference official in Tokyo said that the
agreement will be dissolved due to changes brought on by the U.S. Ocean
Shipping Reform Act. U.S. Reform has made conferences
"meaningless," an official said, as shippers are switching to
individual agreements with carriers. The 10 members of the Japan/U.S.
Eastbound Freight Conference are APL, Hapag-Lloyd, "K" Line,
Maersk, Mitsui O.S.K. Lines, NYK, OOCL, P&O Nedlloyd, Sea-Land &
Wilhelmsen. Termination of the Pacific conferences does not affect existing
non-binding discussion agreements in the trade, such as the Eastbound
Transpacific Stabilization Agreement & the Westbound Transpacific
- State of Washington Lobbies For China ........... as Sen.
Patty Murray, Rep. Norm Dicks & Rep. Jim McDermott, all Washington State
Democrats, have urged the FMC to approve a petition from China Ocean
Shipping Co., that would allow the Chinese government-owned carrier to match
competitors' shipping rates within 24 hours. Since May 1, when the new Ocean
Shipping Reform Act went into effect, COSCO must wait 30 days to match
competitors' shipping rates.
- "Spontaneous" Oakland Dock Strike Ends With New Contract
............. as Int'l Longshore & Warehouse Union workers returned to
their jobs on 8 July after shutting down the Oakland port for 2 days in the
middle of contract negotiations. The walkout by 1,400 workers forced cargo
laden vessels to slow down across the Pacific Ocean or wait at anchor in San
Francisco Bay just outside the port, which handles 12% of West Coast
shipping. Talks resumed in San Francisco with management's Pacific Maritime
Assn. over a new 3 year contract with the West Coast's 10,000 longshoremen
in California, Oregon & Washington and resulted in a tentative agreement
late on 15 July. Terms of the new contract have not been announced. The
parties had been working without a contract since July 1. The PMA had asked
the National Labor Relations Board to force the longshoremen back to the
docks. ILWU said the work stoppage was "spontaneous" and not
directed by union leaders. The latest reported management contract offer
included a 32% boost in pension benefits to future retirees and a 15% raise
for those currently retired. Pay in 1998 averaged US$99,000 for dock
workers, US$117,617 for clerks and US$156,251 for foremen, according to the
association. ILWU said these figures represent total employer costs,
including taxes & benefits. He said actual salaries are lower. OK, but
where do we sign up? Get the current details:
- Substantial Change In Chinese Maritime Justice Seen
............ as control of China's maritime courts has been wrestled from
the administration of local ports and placed under the direct control of the
Supreme People's Court administrative system. The Qingdao Maritime Court was
the last of China's 6 maritime courts to be placed directly under the
federal court system. Analysts say the changes are part of ongoing reforms
in the judiciary to improve efficiency in case processing and enhance
judiciary fairness. "The change will help maritime courts exercise
their duties independently," said Jiang Xingchang, Supreme People's
Court vice president at the transferring ceremony. The maritime courts had
been established by the Ministry of Communications in 1984 and are located
in Guangzhou, Wuhan, Shanghai, Dalian, Tianjin & Qingdao. The Cargo
Letter agrees with critics within the country who charged that the old
maritime court structure, operating under the local port authority, led to
conflicts of interest & abuse of judicial power. According to the Los
Angeles based law firm of Countryman & McDaniel, which coordinates
litigation in the PRC on behalf of NVOCCs & underwriters, the outcome of
cargo loss & damage cases could often be predicted by merely identifying
which party was local or tied to local administration interests. Over time,
the court's reputation became damaged as a growing body of people expressed
concerns about the fairness of the courts. The structural changes are also
an attempt to deal with a boom in the maritime case load, as the number of
litigants heading into the courtroom increases by 30% per year. By the end
of 1998, maritime courts in China had handled more than 26,000 trade cases,
concluding 25,000 cases with a commercial value of US$2.6B. Almost 300
maritime judges work amongst the 9 maritime courts. The remaining maritime
courts are located in Xiamen, Haikou & Ningbo.
- Oakland Gains Vision .......... as the former U.S. Naval
Fleet Industrial Supply Center (FISCO) was officially transferred to the
Port of Oakland in ceremonies on 8 July. The transfer of FISCO now allows
the Port to begin the construction of new marine terminals and a joint
intermodal terminal as part of its Vision 2000 Program. Some 10,000 new jobs
are expected to be created by the program over the next 10 years, including
6,600 direct jobs. These direct jobs encompass maritime-related businesses
such as terminal operators, shipping lines, freight forwarders, warehouses,
container repair, and others.
- Oakland Gains Hanjin ........... as Hanjin has signed a
letter of intent for a 25-year agreement with the port to build and operate
a 120-acre terminal, scheduled to open in December 2000, with 2 berths of
2,400 feet, 4 post-Panamax container cranes & an annual handling
capacity of over 450,000 TEUs. Hanjin already operates its own dedicated
terminals in Long Beach & Seattle.
- TACA Surcharge Jump .......... as the Trans-Atlantic
Conference Agreement is increasing its U.S. Pacific Northwest surcharges for
all westbound shipments moved to or via the ports of Seattle & Tacoma.
The surcharge will rise to US$440 per 1 x 20' container, from US$320,
effective Aug. 1. The charge per 1 x 40' will go up to US$550, from $450.
The increase applies to both direct & intermodal moves. The eastbound
Pacific Northwest surcharges remain unchanged.
- FEFC Increase Modest .......... as the Far Eastern
Freight Conference says that freight rates in the Asia/Europe trade will
still be low after the introduction of rate increases of US$300 per 1 x 20'
container & US$600 per 1 x 40' on July 1. Statistics compiled by the
FEFC show that westbound ocean rates from Asia to northern Europe dropped by
about 35% from 1991 to April 1999.
- DCL Gains Huge FMC Penalty ............. as it has agreed
to pay the Federal Maritime Commission US$800,000, plus interest, to settle
two complaints filed against the Carson, Calif.-based NVOCC in January. The
commission suspected the DCL of misdeclaring cargo weights &
measurements to get lower carrier rates, and whether the company charged
rates above those listed in its tariff. The investigation focused on
shipments DCL booked on transpacific ships of OOCL & Maersk. A 2nd
investigation, announced in April, explored whether DCL and company
president Owen Glenn, arranged receipt of rebates & other freight rate
concessions in the South American Trade. Glenn was later dropped as a party
in the complaint. Under the FMC-DCL deal, the commission agrees not to
pursue future civil penalty proceedings against DCL.
- New HKG Shipper Cooperative ............ as group
comprising 5 Hong Kong freight forwarders was formed on 1 July, by
Birkart-East West Freight Ltd., Flynt Int'l Forwarders Ltd., Geis JM Hong
Kong Ltd., Oriental Air Transport Service Ltd. & Zust Ambrosetti Far
East Ltd., has been operating a successful inbound service from Germany for
over a year. The group plans to extend this cooperation to other
destinations. With their combined volume & buying power the 5
medium-sized privately owned companies believe they will be a competitive
force in the forwarding industry.
- Giants Will Be Just Average.......... as Sea-Land &
Maersk have confirmed orders for vessels of 6,000 TEU range, and Hyundai has
signaled that it is considering ordering vessels of this capacity. P&O
Nedlloyd, Maersk & NYK Line are the only carriers currently using the
jumbo 6,000 TEU range ships. This capacity, unheard of until a few years
ago, is increasing coming into favor within our industry. Maersk Line
recently ordered four 6,600 TEU vessels from its Lindo shipyard. The
shipyard has built or is building a total of 19 `K' or `S' class vessels,
which are in the 6,000-plus TEU range. Sea-Land has also announced that it
will be leasing 5 Hyundai-built ships of a 6,200 TEU capacity.
- Largest U.S. Project Gets New Chair ............ as Long
Beach City Councilman Jeffrey A. Kellogg, is named chairman of the public
agency overseeing construction of the Alameda Corridor rail cargo project.
Kellogg has been a member of the board since its inception in 1989, and
served as chairman in 1997-98. "With construction under way at
locations and excavation of the Mid-Corridor Trench scheduled to begin this
summer, the Alameda Corridor is fast becoming a reality," said Kellogg.
ACTA, a joint-powers authority of the cities & Ports of Long Beach &
Los Angeles, is building a 20-mile railroad cargo expressway linking the
ports to transcontinental rail yards east of downtown Los Angeles. It will
speed the flow of cargo to and from the ports and ease traffic congestion by
eliminating more than 200 at-grade crossings.
- Gibraltar Promotes An Arresting Industry ................
as the famous "Rock" wants to promote itself as the ideal place to
arrest a ship. Gibraltar does just that, and with very good reason. At any
one time there could be, typically, 10 ships under arrest in Gibraltar,
usually either berthed at the Detached Mole or at anchor in the Eastern
Anchorage on the opposite side of the Rock to the harbor. Arrested ships
mean business for Gibraltar's numerous lawyers, for agents, tug companies,
even pest control services & sometimes for the dockyard too. And it
certainly means plenty of hard work for the Admiralty Marshal. Gibraltar
owes its popularity as a place to arrest ships to being a Common Law
jurisdiction and its ability to move relatively quickly. The Gibraltar
Supreme Court has a track record of hearing cases quickly and uncontested
ones are dealt with in a matter of weeks. As with the English courts, it
passes clean title to vessels sold by the admiralty marshal. For full
report, visit the Gibraltar Panorama website and select the 5 July 1999
- New Asia Anti-Pirate Center ............. as member
states have agreed a new set of measures to combat piracy at the Asia
Ministerial Meeting on Transnational Crime. The action plan includes
increasing cooperation both regionally & internationally and the setting
up of an "Asia Center for Combating Transnational Crime."
"The efforts and commitment of the Asia governments to combat piracy,
ship hijacks and other transnational crimes affecting the region are
commendable," said Daniel Tan, secretary general of FASA, the
Federation of Asia Shipping Assns. The agreement follows a string of
hijackings & attacks in the region, and an increase in related crimes
such as phantom ship fraud (see next story). Two cases have come to light in
recent weeks - the disappearance of the M/V Sam Xanxai off Malaysia &
discovery of the M/V Marine Master under a false name in a Chinese port.
Southern China, especially around the Gulf of Tongkin, has been the most
popular destination for cargoes stolen by pirates according to the IMB, but
it is now turning up in areas as far afield as East Africa & the Mid
- Beware The Phantom Ship! ......... as the Int'l Maritime
Bureau recommends cargo owners check with them before committing their cargo
to possible "phantom" vessels. The warning follows the recent
spate of cases such as M/V Marine Master, which was found in a Chinese port
under the name M/V Nuobo Pierra 3 months after its hijacking. Checking with
the IMB Information Dept. should only take a few hours according to the
Bureau, which advises cargo owners not to carry on with negotiations if the
ship or its owners match the profile of a phantom ship operation. Past cases
have led to cargo owners facing huge losses after ignoring the warning of
underwriters who have refused to cover cargo after checking the ship with
the IMB. The Bureau also reports that the syndicates responsible for phantom
ship fraud are moving further afield. Although traditionally based in China,
Indonesia & the Philippines some recent cases have involved operations
based in Mumbai, India & the UAE.
- Japan Holds Further Pirate Talks ............. as with
the wave of piracy in S.E. Asia, Japanese vessel owners held a meeting on 8
July with the Nippon Foundation, a charity with considerable experience in
issues of maritime safety. The Foundation & owners are working with the
Japanese government on ways of combating pirates, who attack an average of
13 Japanese ships every year. Despite this, the Nippon Foundation has found
that many ships are still totally unprepared for an attack. The meeting
follows a similar one on July 2 between owners & officials from the
Japanese Transport & Foreign Ministries.
- Pirate Death Claims Paid ........... as the London Club,
a mutual P&I underwriter, has settled the US$2.3M claim for compensation
for the deaths of the 23 Chinese crew of the Hong Kong owned bulk carrier
M/V Cheung Son, which was attacked by pirates some time after sailing from
Shanghai on November 13, 1998. A number of individuals have been arrested by
Chinese authorities on suspicion of murdering the crew, but the vessel has
never been traced. The attack came to light when fishermen discovered a
number of the crew's bodies, bound hand & foot and weighted down.
- Two W's, One Line ............ as the merger of Wallenius
Lines of Stockholm & Wilhelmsen Lines of Oslo took effect on 1 July. The
new company, Wallenius Wilhelmsen Lines (WWL), has a global market share of
23% for its oceangoing vehicle & ro-ro transport services, making it the
world's largest provider of such services. The merger is a response to a
globalization trend within the vehicle industry. Companies have become fewer
and larger, and demand a global service product and logistics management.
WWL will operate a combined fleet of 70 modern purpose-built vessels and
will carry around 1.5 million cars and 300,000 ro-ro units annually. A
further 8 new vessels are due to be delivered from Korean & European
yards by the end of the year.
- NOL Offers Stock ........... as Neptune Orient Lines has
approved a US$500M capital raising. It will seek to raise US$300M from an
Int'l share placement of ordinary shares & US$200M from an issue of
nonvoting redeemable non-convertible preference shares. The company will use
approximately 30% of the capital raised to fund profitable growth
opportunities in container transportation. The balance will be used to pay
- Hamburg Sud Line Goes Native ............ as it has
signed an agreement to purchase the assets of South Pacific Container Lines,
Inc. from Interorient Navigation Co. Ltd., of Limassol, Cyprus. South
Pacific Container Line, based in San Francisco, provides container service
between the North America west coast & Tahiti, Western Samoa &
American Samoa. ***CMA-CGM Delay Wedding, But Keep Church Reservation
............ as Compagnie Maritime d'Affretement & Compagnie Generale
Maritime, the 2 operating companies of the French group CMA-CGM, have missed
the 21 June target date for their merger. A spokesman for CGM said that the
merger with CMA hasn't been completed, but would not comment on the reasons
for the delay. The merger had already been postponed last year because of
court actions by Johnny Saade, a minority shareholder of CMA.
- Transroll Rolled ............ as Transroll de Navegacao's
Europe-South America carrier operation has been taken over by Hamburg-Sud's
Brazilian subsidiary, Alianca. Acquisition follows Transroll's withdrawal
last year from pan-America intercontinental east coast trade. Sale terms
have not been released, nor is it presently known whether Transroll's
vessels are part of the deal. The name "Transroll Int'l" is being
retained by Hamburg Sud/Alianca. Brazil-based Transroll will continue to
operate its Mercosur region cabotage shipping service.
- Sea-Land Offers E-Bills ............. as it is the latest
carrier to have introduced a system to enable shippers to print original
B/Ls through the Internet. Shippers can now print the B/Ls on-line using
Sea-Land's SEA-net interactive computer application. The system eliminates
the need to collect B/Ls from a Sea-Land office or to have hard copy B/Ls
sent by courier or post to shippers. OOCL & APL were the 1st carriers to
launch Internet B/L printing systems. A paper bill must still be handed
over, in order to meet legal requirements of such regimes as U.S. COGSA.
- All Hands On Deck! ........ as in preparation for
full-scale millennial port disasters, the U.S. Coast Guard is conducting
rigorous Y2K drills. Coast Guard officers are testing container vessels on
their ability to cope with a complete electronic-systems breakdown. With
officers watching, ships' captains are tested on their ability to manage
vessels the old-fashioned way - with hand-powered pulleys & levers, and
orders barked to the engine room via a voice-powered intercom.
- South Korea Terminal Handling Charges Up ................
as the S.E. Asia Liners' Council reports increases effective 1 Aug. '99.
(SELC). The rate hikes will affect high traffic routes between Korea-China,
Korea-Japan & Korea-Southeast Asia. Fees are expected to increase 22% to
101,000 won per 1 x 20' 137,000 won per 1 x 40'. SELC officials defended the
fee hikes saying that Korean THCs are much lower than at competing ports
such as Hong Kong. Korean rates now stand at US$67 per 1 x 20' while Hong
Kong weighs in at US$232. Indeed, Zim Israel says HKG must reduce its
container handling charges by at least 30% if it wishes to remain
competitive with neighboring Shenzhen terminals, according to a survey
carried out by Zim itself. The global survey, which compared port charge
increases over the last 15 years, found Hong Kong's charges to be
"very, very high."
- Hanjin Continues To Build ............ as it has
christened its container terminal in the Port of Kaohsiung, with a handling
capacity of 430,000 TEUs a year. There are 3 post-Panamax gantry cranes, a
berth measuring 960 feet and a depth of 15 meters. Hanjin says that the new
terminal is its gateway to East and South mainland China, including Ningbo,
Fuzhou and Xiamen. Hanjin already operates terminals in Kamcheon, Kamman and
Kwangyang in Korea; Osaka & Tokyo in Japan; Hamburg in Germany; and Long
Beach & Seattle in the U.S. The Korean carrier has reiterated its plans
to develop terminals in New York & Oakland.
- Russia Wants Your China Cargo .............. as the
growing container traffic on the China-US trade lanes has given rise to
suggestion that some shipments to go via the Russian-Japan Sea ports of
Vladivostok & Vostochniy. Authorities at the ports are seen increasingly
frustrated because their low cost facilities are claimed capable of reducing
shipment costs by as much as US$1,000 per 1 x 20', yet ignored. Years of
high-level talks with all parties have left the Russians claiming that China
is using projectionist tactics. It is understood that the Russian ports are
now trying to establish direct links with shipping lines and U.S. traders in
an attempt to attract business.
- NYK & MOL See Container Use Drop .............. as
the figures show a reduction in the number of containers in use during the
previous financial year. NYK said containers in operations reached 271,888
TEU in the year to March 31, a fall of about 6%. Mitsui OSK Lines, used
containers equal to 242,801 TEU in the same period, a drop of 1.6%.
- Seattle Grows Despite Loss of COSCO ............ as
container throughput grew 6% from January to May 1999. In year-on-year
figures container volume increased from 94,041 TEU in May 1998 to 99,777 TEU
this year. Full-year volume climbed from 593,203 TEU to 631,188 TEU.
- Port of Boston Smiling .......... as double-digit growth
in cargo volumes through the first 5 months of 1999 is announced. Total
volume was up 16.1% to 472,792 tons. Exports rose 21.6 percent to 146,089
tons while imports were up 13.8% to 326,703. Container throughout rose 8.4%
during the January-May period, to 35,698 TEUs. Autos rose 13.8% to 29,051
units. The port handled an addition 8,300 vehicles in June.
- Christmas In June For Port of L.A. ............ as May
import/export cargo volumes set records. A total of 335,960 TEUs were logged
through the port's 6 container terminals. The previous record had been
313,130 TEUs, set in August 1998. Export container traffic in May totaled
152,986 TEUs. Import containers numbered 182,974 TEUs, including 175,535
loaded TEUs, a port record. "The holiday shipping season has arrived
with resounding force," said Larry A. Keller, exec. director of the
port. The peak transpacific shipping season usually begins around June 1,
when goods begin to move into the U.S. for the holiday season. Many believe
that Y2K stocking explains the jump. L.A. handled 3.5 million TEUs in its
1999 fiscal year ending June 30, an 11.73% increase over fiscal 1998, an all
- Hay & Cotton No Longer "Dangerous"
.............. as the Int'l Maritime Dangerous Goods (IMDG) Code covering
hay & cotton carried in containers came into full force on July 1.
Compressed baled hay with a moisture content of less than 14% &
accompanied by a certificate confirming moisture content is no longer a
hazardous cargo. Similarly the IMDG Code no longer applies to dry, baled
cotton of a density of not less than 360 kg/m3. No certificate is required
or such cargo but Australian Chamber of Shipping, in its latest newsletter
recommends that a declaration that the consignment complies with the
conditions allowing exemption for the Code be carried.
- A New Cargo Income Opportunity At MIA .............. as
beginning this month the Florida Anti-Fraud Reward Program will pay tipsters
up to US$25,000 for information leading to the arrest & conviction of
organizers of insurance fraud and cargo & auto smuggling and theft
schemes. The program will pay rewards based on the amount of monetary losses
involved. The schedule is very liberal with, for example, a US$5,000 reward
for losses estimated between US$20,000 & US$100,000. The insurance
department's Division of Insurance Fraud will work jointly with insurers'
special investigative units. Citizens can report suspected insurance fraud,
which includes cargo theft & smuggling, by calling the state insurance
department's toll-free Fraud Hotline at 1-800-378-0445. Wow, even the call
is free, so pay attention to those other guys in your warehouse!
- M/V CMA Djakarta Ablaze ............. as 21 crew had to
be rescued by an Italian warship after containers on the 10 year old, 30,421
gt, 2,100 TEU container ship M/V CMA Djakarta caught fire near Crete in the
eastern Mediterranean. Within four hours the blaze, apparently fueled by
chemicals in containers stowed on deck, was out of control, threatening the
accommodation block. The vessel drifted for 2 days after the crew abandoned
the ship, still burning, before grounding on the Egyptian coast where fire
fighting & salvage operations could begin. The cause of the fire is
- Shipping Water By Water? ........... as Turkey could
solve Israel's chronic water shortage by hauling enormous water-filled
plastic bubbles by tugboat across the Mediterranean, Turkey's president said
last week. Such a project could eventually supply Israel with up to 140
billion cubic feet of water a year, Turkish President Suleyman Demirel said
after talks with Israeli President Ezer Weizman.
- Throughput. Le Havre reported that it handled 4% more
TEUs in January-May than in the same period of last year, to 564,000 TEUs
- This Month In U.S. Naval History......... as on July 4,
1776 the United Colonies declared their independence from the UK. The
Continental Navy had 18 ships.
Here are our suggested world wide web sites of the week for your business,
your information and your amusement
.......... the new site, with 3-D graphics.
Canadian National Rail
........ the new site. Tracking & estimated times of arrival .
Govt. of Hong Kong, Marine
......... claimed as the U.K.s 1st Internet air forwarder. On line quotes &
schedules, but booking is still done by phone. The site gives data on 900 Int'l
destinations from the U.K. & more than 2,000 service options. Quotations are
obtained on-line in 30 seconds or less after entering minimal details about the
S.S. United States
........... tour the tragic condition of America's once proud symbol of the
World Ship Owner.com
......... the site for vessel owners & operators.
.......... for the famous UK port, with a help & chat board for visitors to
ask and answer questions about the Clyde & its shipbuilding.
container terminal & scheduling software.
........... the company chosen by J.B. Hunt to track its 9,000 trucks, 35,000
trailers & containers with low earth orbit GPS satellites.
.......... will sell "wearable computers" to the State University of
New York Maritime College. The system is seen useful in the loading of cargo and
container ships for inventory and safety control right from the dock, making it
easier to scan & code hazardous materials which can not be stowed near each
other on a ship.
there are 4 modules at the new site: transportation companies can exchange
cargo, space, equipment and information at the Exchange Market; or send online
bid requests & receive quotations through the Freight Market; or shipments
to a chosen freight forwarder can be booked through On-Line Booking; or online
meetings can be conducted at Logistics Dialogue.
eFax.com ............ Lets
you receive all your faxes at your existing E-mail address. Get a Free Fax
Number without needing a Fax Machine! Every time you receive a fax, it is
forwarded to your E-mail address and viewed using the eFax Microviewer.
Doing Business Online Conference
..........will be held October 14 & 15, 1999 at the Meeting place at Pike
Place Market in Seattle, WA., featuring an exceptional faculty of lawyers &
corporate managers pioneering the new marketing and business opportunities
created by the Internet.
........... computer connected people & their non-connected associates can
communicate -- instantly. This is a new, Internet-based, communications service
that makes it possible for online users to easily contact unlimited numbers of
people in the way they prefer -- via E-mail, voice, pager, fax, postal mail or
overnight delivery -- and to track receipt of messages & receive recipient
feedback. There's no need to buy new equipment or software.
............. Free on-line anti-virus scanning service.
Gator.com ........ stores
your personal data for filing out net registration forms. Designed to overcome a
variety of daily obstacles using its "Gator Vault" as your online
Celarix ............ as
announces 2 revolutionary Internet-based global logistics applications: iSuite,
a global logistics management system and Global Logistics Exchange. iSuite is a
centralized repository for Int'l & domestic logistics information. It
combines purchase order information with in-transit shipping, freight payment
and customs clearance information for real-time visibility into an order from
the time it is created, through its shipping process, until it reaches its final
destination. Global Logistics Exchange is a vendor-neutral forum for trading
& purchasing logistics products and services over the Internet, functioning
as an on-line marketplace.
.............Large variety of high quality shareware, freeware & commercial
......... listen to your favorite radios stations from anywhere in the
..............Mind-it Free Service! Sign up for web pages you want to monitor
& be notified via E-mail when they are updated.
Net Pirates Casino
.......... now loose your money in Mandarin Chinese.
-- by Warren S. Levine, for The Cargo Letter
SEATTLE, July 17, 1999 - Tensions between China and Taiwan are intensifying
as the result of an interview with Taiwan President Lee Teng-hui by a German
radio station earlier this month.
Lee said, "Since our constitutional reforms in 1991, we have redefined
cross-strait relations as nation-to-nation, or at least as special
state-to-state relations. Under such special state-to-state ties, there is no
longer any need to declare Taiwanese independence."
Chinese officials immediately countered by calling Lee a liar and a
splittist; a spokesman for the Beijing government said, "…the status of
Taiwan as a portion of China's territory has not changed."
China reiterated their claim to sovereignty over Taiwan, stating once again
that they would use force, if necessary, to reinforce that claim.
Chi Haotian, China's Defense Minister said, "The Chinese People's
Liberation Army is ready at any time to safeguard the territorial integrity of
China and smash any attempts to separate the country." Chi is the first
general to address what has been mostly a war of words.
Taiwan's position on reunification with China has been to state that they
favor reunification, but that it would not happen until China becomes a
democracy. Quietly, however, the reasonable assumption is that China will never
become a democracy, and so the more economically advanced Taiwanese are
comfortable with their current status.
Hong Kong newspapers reported stepped-up Chinese military exercises and, as
in 1996, when China staged war games in the Taiwan Strait in the weeks
surrounding the Taiwan presidential election, tensions in the region are at a
US Navy officials noted that the aircraft carrier USS Constellation is
already stationed off Korea for regularly scheduled exercises. In 1996, the US
sent two carriers to the region in order to ensure stability during Beijing's
war games and Taiwan's elections.
The Singapore newspaper The Straits Times carried an op-ed which contained a
detailed list of escalating Chinese military responses to Lee's statement.
China also announced last week that they had created their own neutron bomb,
but they maintained that the announcement was a coincidence. Response on that
was divided, as many considered the remark to be more sabre-rattling by Beijing.
In response to the uproar, many Taiwanese groups have repeated that they are
in favor of a one-China policy, and that nothing has materially changed.
The US-ROC (Taiwan) Business Council repeated its recommendation that the
U.S. renew NTR/MFN status for China and reminding us that they've supported MFN
for China every year since 1996.
Taiwan is heavily invested in factories in China, and could be dealt a major
economic blow if China nationalized their joint ventures.
The Cargo Letter recommends updating your Political Risk Insurance if your
company has interests in the region.
Taiwan's stock index took a 6.4% loss Friday as rumors continued to circulate
about Beijing's possible reaction to Lee's comments. In the days since Lee's
remarks, the index has dropped 12.4% -- the equivalent of almost 1400 points on
-- by Warren S. Levine, for The Cargo Letter
SEATTLE, July 15, 1999 -- The Russian Space Agency is planning to recall the
last 3 cosmonauts from the aging space station Mir, and disable it on August 23.
A milestone in transportation history is at hand. Mir has traveled more miles
than any other manned vehicle in history, having orbited the earth since 1986.
Orbiting at 250 miles above the earth, at one orbit every 90 minutes for 13
years, Mir has clocked nearly 4 billion miles in its lifetime. At light speed,
it would have taken less than 6 minutes to cover the same distance. Our nearest
neighbor star is over 4 light years away.
Still aboard are cosmonauts Viktor Afanasyev, Sergei Avdeyev & French
astronaut Jean-Pierre Heignere.
Facing a launch ban in Kazakstan because of an accident and some US$115M in
unpaid bills, a short-term food shortage for the crew and chronic mechanical
problems aboard Mir, Russia is simply unable to shoulder the estimated US$250M
annual cost of its upkeep.
Kazakstan gained control of the launch site in central Asia when the Soviet
Union broke up. Launches from the site were banned last week, when a Russian
military satellite exploded shortly after takeoff and scattered its remains
throughout the area.
In addition, there was that small matter of the unpaid bills.
A cargo ship (The Morflot Chernobyl?) is due to lift off with supplies this
week, which should last Mir's final 3 occupants a few more weeks. If the launch
doesn't take place on time, they would have to leave Mir virtually immediately.
Russia has tried to raise capital to keep Mir flying, but efforts to obtain
private funding have failed.
With over 1,500 breakdowns in its 13-year life, Mir has been on artificial
respiration for a number of years, almost colliding with a supply ship in 1997.
Home Depot reports that parts sales to the Russian Space Agency had increased by
over 30% in each of the past three years.
After Mir is abandoned, it will be kept in orbit for a short while before
being brought down slowly to burn most of it up in the atmosphere. Russia plans
to guide the parts that don't burn up into the ocean, but people living near the
intended re-entry window are warned to watch for aluminum rain. Up-to-date
forecasts and a very cool website can be found at :
http://sn-callisto.jsc.nasa.gov/ [an error occurred while processing this directive]