The Cargo Letter
THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
31 July 2000
Good Thursday 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
To help you find what you need -- FAST -- there's now a transport search
engine installed at our www.CargoLaw.com
Contribute your knowledge, stories & company information ........ by
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bring you useful information which is timely & topical. Be sure to visit our
Michael S. McDaniel, Editor & Publisher, Countryman & McDaniel,
forwarder/broker attorneys at LAX.
INDEX to The Cargo Letter:
OUR Top Story
1. Circle Int'l Group In Historic EGL Merger
* Mouse Buys Elephant?
OUR "A" Section: Trade, Financial & Inland News
2. Freight Forwarder Trade Briefs
3. The Cargo Letter Financial Page
OUR "B" Section: FF World Air News
4. Freight Forwarder World Air Briefs
OUR "C" Section: FF World Ocean News
5. FF World Ocean Briefs
6. The Cargo Letter Cargo Damage Dispatches
* Back By Popular Demand
OUR "D" Section: FF in Cyberspace
7. The Cargo Letter "Cyber Ports Of Call"
The San Francisco-based forwarder & logistics provider Circle
International Group, and EGL Inc., the Dallas-based forwarder formerly known as
Eagle USA Airfreight, will merge to form a US$1.4B global logistics company.
Circle will become a wholly owned subsidiary of EGL. The merger combines EGL's
very strong domestic U.S. air & ground forwarding network with Circle's
Int'l forwarding experience & customer base. It positions EGL to compete
against the world's largest 3rd party logistics companies for multinational
shipping accounts. The all-stock deal, in which Circle shareholders will receive
one share of EGL for each Circle share, is valued at US$543M, based on EGL's
closing stock price of US$30.75 on June 30. Following the merger, EGL
shareholders will own 63% of the merged company & Circle shareholders will
EGL & Circle expect to close the deal this fall following regulatory and
shareholder approvals. The combined company will have a market capitalization of
about US$1.5B & is targeting a 20% annual earnings growth rate. EGL, which
will change to a calendar-year fiscal cycle, expects the merger to add
immediately to its bottom line & cash flow.
James R. Crane, CEO & majority owner of EGL, will continue as head of the
new combined EGL. Peter Gilbert, Circle's chair & CEO, will join EGL's board
of directors. "This merger would enhance EGL's already solid market
position domestically & would present tremendous opportunities for
international growth," Crane said. "We have identified a number of
compelling opportunities as we seek to maximize shareholder value through this
merger," he said. "Upon closing, we will immediately begin leveraging
the economies of scale, benefiting from both the operating synergies &
cross-selling opportunities present within our combined base of over 10,000
Circle controls some 300 logistics centers in more than 100 countries with
4,900 employees. The company earned US$23.2M last year on US$814.1M in revenue.
The Circle story began over 100 years ago, in 1898, with the founding of FFG
Harper Company as a San Francisco customs broker, helping turn-of-the-century
importers bring their goods into California.
EGL operates 92 terminals in nine countries with 3,400 employees. Most of its
facilities are in North America. The company earned US$30.7M in 1999 on sales of
Both companies stock was about the same price, but EGL dropped to a 29 PE
ratio while Circle jumped to 21. EGL stock was as much as 60% higher in the past
year. Only CEO Peter Gilbert of Circle will have a seat on the new board, even
though his company is 35% of the company stock.
According to a confidential source close to Circle, this merger represents
"interesting synergy." He continued, "EGL lacks the Int'l
presence, as well as the ocean & brokerage capabilities that Circle brings
to the mix. EGL has loads of air freight, which Circle also does. Clearly,
management wise EGL wins, and probably also on the air side, but I think
Circle's ocean & brokerage staff should fare well. The Corporate HQ will
likely move to/stay in Houston."
After 102 years for Circle International -- what next? We wish the company
well in this new venture.
- Forwarders & Brokers Fight MPF .......... as a 300-member
coalition of shippers, customs brokers & freight forwarders has vowed to
defeat an action taken by the U.S. Senate Subcommittee on Labor, Education,
and Health & Human Services to extend the Merchandise Processing Fee for
7 years and to use the funds to pay for what the coalition calls
"unrelated social programs." The processing fee is scheduled to
sunset in the year 2003 and is "solely earmarked for Customs commercial
processing & modernization, period," said Robin Lanier, chair of
the Coalition for Customs Automation Funding. "It cannot be used for
funding completely unrelated social programs or anything else for that
matter." The MPF generates almost US$1B per year, and by 2001, the
trade community will have paid nearly US$7.2B, which is "enough to pay
for a new import/export system 6 times over," Lanier said.
"Nevertheless, a new system has yet to be built. The trade community is
outraged that the Senate is taking the merchandise processing tax &
misappropriating it to completely unrelated programs, while at the same time
providing zero funding for Customs modernization." Meanwhile, on July
14 the U.S. House Appropriations subcommittee on Treasury, Postal Service
& General Government has marked US$105M for development of Customs'
future computer system in fiscal 2001. Customs had requested US$210M for its
Automated Commercial Environment (ACE), but the US$105M will help the agency
get the long awaited system into development. The Senate Appropriations
Committee is expected to mark up its version for ACE funding by the end of
the month. Senate & House appropriators will go to conference on the
Customs automation funding issue by the end of Sept.
- Customs Declares War On Paper ......... as now that the Automated
Export System is up and running, U.S. Customs & the Census Bureau say
they're going to focus more of their attention on paper filings of shipper's
export declarations. "There's going to be a paper attack by Customs
& Census," said Peter J. Baish, director of Customs' outbound
programs. AES was developed several years ago to automate & improve the
collection of export commodity & transport data. Customs uses the data
to target illegal shipments, while Census compiles it for the country's
trade statistics. Over 740 companies currently use the system to file their
SEDs. Of those companies, 544 are freight forwarders, which represent about
178,000 exporters. Between Jan. & June 2000, over 7 million commodity
data lines were processed in AES. But the agencies still receive about
500,000 paper SEDs a month, of which half contain errors. Studies also show
that exporters spend between US$18 & US$75 to process these paper SEDs,
and 3 times that amount to correct them. AES promises to significantly
reduce the industry's processing costs and error rates. Customs & Census
want to place more emphasis on cleaning up lingering errors in both the
paper SED & AES environments. One those areas is entering the proper
port of exportation (Schedule D codes). "How many vessels have you seen
sailing out of Laredo?" said Gerard Horner, chief of the Automated
Export Systems Branch at Census' Foreign Trade Division. Customs &
Census would also like to see more responsibility placed on the exporters
and forwarders when it comes to filing their SEDs. Legally, carriers must
collect SEDs from shippers & forwarders to prepare & submit their
outbound manifests to Customs. However, exporters & forwarders aren't
always cooperative with supplying carriers their SEDs in a timely manner.
- U.S. Customs Animated Over Automated ......... as it says that a
recent test of its Automated Export System in the ocean carrier environment
was successful. The Vessel Transportation Certification Test, which took
place in Charleston, S.C., gave the agency a better idea of how AES could be
used by carriers to electronically transmit their export-related transport
data. AES was developed several years ago to collect export commodity &
transport data. Customs uses the data for targeting illegal shipments, while
Census compiles it for the country's trade statistics. Commodity data is
provided by exporters or forwarders, while the transportation data is
provided by the carriers. Transportation data is especially important to
Customs, because it lets the agency know when the freight is about to leave
the country. The test carriers, P&O Nedlloyd & Lykes Lines,
transmitted their outbound manifests electronically in AES, but they still
have to file paper manifests to Customs the interim. Customs plans to use
the rest of July & Aug. to analyze the results of the test. "There
may be some minor changes made to the program," said Adam J. Wysocki,
program officer for the outbound process at Customs' Office of Field
Operations in Washington. Customs plans to develop similar AES capabilities
for other transport providers, such as the NVOCCs & air carriers.
- Switzerland Customs For Kyoto ....... as it has become the 11th
country to sign the revised Kyoto Convention on the simplification &
harmonization of customs procedures. The Brussels-based World Customs
Organization adopted the new Kyoto Convention last June. The new procedures
are designed to maximize the use of information technology & modern
clearance techniques based on risk analysis. "By carrying forward these
new requirements into national legislation, nations will facilitate Int'l
trade, stimulate economic growth and provide targeted customs control at
their borders & frontiers," the WCO said. The revised Kyoto
Convention will come into force when 40 of the WCO's 151 members have
- Syntegra Neutral About New Product ........... as the systems
development unit of British Telecom, has launched a U.S. Customs-approved
pre-clearance system for air cargo shipments arriving in the U.S. MSAS
Global Logistics, the 1st customer to use the system, has reported savings
of up to 24 hours in transit times for air-cargo imports, Syntegra said.
Syntegra's "Neutral" system links into Customs' Automated Manifest
System, through which imports must be registered. With data from the master
& house waybills from forwarders & airlines, Syntegra builds &
reports those shipments for pre-clearance while in-flight. Shipper
information is also kept confidential between forwarders & Customs in
Syntegra's system, while airlines receive either the full or limited house
waybill details they require.
- NCBFAA Forms Air Group
.......... as the National Customs Brokers & Forwarders Association of
America (NCBFAA) has chosen Joel Ditkowsky to head its new Ad Hoc Airline
Import Committee. Mr. Ditkowsky, who is V.P. of Far Rockaway, aims to
improve efficiency in the air cargo business by streamlining cooperation
between customs & the airlines. The new committee will focus on issues
relating to its Customs Air Automated Manifest System as well as other
airline related service problems which include security, storage rates &
- Sweden - Denmark Linked .......... as a 10-mile bridge & tunnel
combination, which includes an artificial island, has made it possible again
to drive between Copenhagen & Malmo, Sweden, Sweden's 3rd largest city.
Queen Margrethe of Denmark & Sweden's King Carl XVI Gustaf oversaw a 3
hour ceremony officially opening the link to motorized traffic on July 1.
The US$3.7B project will carry vehicles & trains. http://www.oresundskonsortiet.com/
- No More Belarus GSP ......... as it has been suspended from the
list of countries enjoying duty-free access to the U.S. market under the
U.S. Generalized System of Preferences. President Clinton said the
suspension was triggered when it was determined that "Belarus has not
taken and is not taking steps to afford workers internationally recognized
- Got Israel? ........... as Houston-based freight forwarder Bailey
Int'l has agreed to pay a US$4,000 civil penalty to settle 4 alleged
violations of the U.S. Commerce Dept.'s antiboycott rules. Commerce alleged
that in 1992 Bailey violated antiboycott rules by furnishing a statement
that goods shipped to Kuwait did not contain materials from Israel. The
forwarder also allegedly failed to report its receipt of boycott requests as
required by Commerce on 3 occasions. Commerce's antiboycott regulations,
which are spelled out in its Export Administration Regulations, prohibit
companies & individuals from complying with certain aspects of
unsanctioned foreign boycotts maintained against any country friendly to the
- Big Rail Wedding Off ........... as Canadian National Railway Co.
& Burlington Northern Santa Fe. said July 20 that their boards of
directors voted to terminate plans to merge, which would have created the
largest railroad in North America. CN & BNSF originally notified the
U.S. Surface Transportation Board Dec. 20 of their intentions to seek STB
permission to merge & create North American Railways Inc. The STB on
March 17 imposed a 15-month moratorium on rail mergers in order to create
& implement new merger rules. The STB's moratorium was in response to
concerns that competing railroads had yet to recover from their own attempts
at mergers. These railroads complained that CN & BNSF's planned merger
-- an end-to-end consolidation that would have created a 50,000-mile rail
network -- would have force railroads to throw together in an effort to
remain competitive. An attempt by CN & BNSF to challenge the moratorium
failed when the U.S. Court of Appeals for the District of Columbia ruling on
July 14 upheld the STB's action. With the 15-month moratorium rolling on, CN
& BNSF would not be able to apply with the STB until at least mid-June
2001, and with no regulatory decision from the STB before late 2002.
- These Two Will Just Live Together ......... as Canadian Pacific
Railway & Canadian National Railway have signed
"co-production" agreements to share track in Ontario and the
Midwest and Northeast U.S. CN & CPR signed a 5 year agreement providing
CN with access to CPR's Northeastern U.S. network in New York, New Jersey
& Pennsylvania. CPR will move CN forest product traffic to distribution
centers in New York and Albany, N.Y.; and Philadelphia & Scranton, Pa.
CPR will interchange CN traffic with major U.S. railroads in Albany and
Pennsylvania and with the New York & Atlantic Railroad at Long Island,
N.Y. A second, 3 year agreement provides CP with access to CN's
Toronto/Chicago main line, where CP will route at least 14 merchandise
and/or intermodal trains per week over CN's line between Canpa Junction in
West Toronto or near London, Ontario & Chicago. CN runs about 175
freight trains per week over its Toronto/Chicago main line.
- TNT Post Group Buying & Buying Again ......... as it has
acquired a 51% stake in Barlatier S.A., a French logistics company. TPG will
acquire the remaining 49% of Barlatier over the next few years. TNT Post
Group has also bought out German logistics provider, Schrader Group who's
main areas of business are in the consumer, retail & automotive sectors
are complementary to the TNT Post Group's existing operations in Germany. As
part of the arrangement, the Schrader Group will continue to trade under its
own name. Schrader has an annual turnover in the region of US$60-70M.
- Schenker's Indonesian Buy .......... as the German forwarding group
has acquired a company, PT Schenker Petrolog Utama, in Indonesia.
- ABX Logistics Buys More Portugal .......... as the transport &
logistics branch of the Belgian National Railway, has purchased the
Portuguese firm, Transpiedade Transitarios (TPT). TPT is the 2nd Portuguese
company to join ABX Logistics. The company acquired Eurofrete last Jan.
- TCT Logistics Makes Daily Purchase......... as the Canadian
transportation & logistics company has acquired Daily Transport Canada
Inc., the parent company of well-known central & eastern Canadian LTL
carrier Daily Motor Freight Ltd. TCT paid US$7.2M for Daily.
- Higgs Buys Newsround ......... as Ocean Group PLC's subsidiary
company, Higgs, the Int'l logistics publishing business of MSAS Global
Logistics, has acquired Newsround Int'l Airfreight Ltd. The terms of the
deal were not disclosed. Newsround's annual revenues are around US$6M with
assets of roughly US$1M. The buy consolidates Higgs' expertise in the Int'l
distribution of printed matter
- Phoenix Int'l Freight Services Pushes South ......... as it has
opened a new branch office in Miami. The company's new Miami office is the
24th U.S. branch for Phoenix -- a stunning 13th opening within the last
year. Phoenix says the new branch will give the Latin American sector of its
service a huge shot in the arm by benefiting U.S. & Latin American
importers & exporters. Congratulations!
- Transport To See An "E" Consolidation? ............. as
"the transportation industry is at a crossroads of transformational
change," says research company IDC. "The industry, characterized
by decades of relationship building & customized legacy transportation
management systems, is witnessing the birth and proliferation of
business-to-business transportation emarketplaces." In a new report
titled "Driver's Seat Still Open - A Closer Look at Logistics
eMarketplaces", IDC analyzes the developments in the B2B transportation
emarketplace & profiles the key service providers emerging in this
space. According to IDC, the service providers currently in the space
provide either contract management services or spot transaction services,
the latter being more prevalent. Most providers also focus on only one mode
of transport. Currently, service providers are racing to build up
transaction volumes at their respective sites & are trying to build
liquidity by focusing on point solutions. "In the scramble to build up
liquidity, important issues such as integration and execution have been put
on the back burner," IDC said. "Once customers are brought to the
site, the real challenge for service providers is to integrate legacy
systems and to ensure smooth execution of their applications under
battlefield conditions." While there is definitely room for multiple
players, IDC predicts the industry will witness a significant shake out over
the next 12 to 18 months. The survivors will be those who set themselves
apart from the busy crowd through effective & differentiated
- Forbes Names Transport B2B Favorites ......... as the magazine has
named 10 Internet companies in logistics & transport that are among the
"most promising" among more than 1,000 business-to-business sites
launched in the last year. They are:
- Yet Another One? .......... as Ryder System has funded a new
Internet-based freight marketplace - pFreight,
which brings together participating service providers for individual
drivers, small fleet owners & private fleets in the trucking &
transport industry. Driver services include everything from load matching to
assisting in filing all tax & regulatory reports required by
- And Another New One ........ as freightPro.com,
an online freight shipping & fulfillment company, says it will exceed
the US$1M revenue mark in July 2000. The company was launched in Dec.1999
& has realized an average revenue growth of approximately 50% per month
since that time.
- And A New B2B From The Airlines ....... as 13 carriers have joined
to launch "AeroXchange,"
as a marketplace of aviation supply chain solutions.
- Hey, Here's Another ........... as Transportation.com
is a new joint venture between Yellow Corp. & two venture capital firms.
The site offers transportation management & logistics consulting
- And Another New One .......... as FireSend.com
is a new venture which aggregates the offerings of a number of couriers in
the UK (e.g. Lynx Express, Interlink, Amtrak & Nightfreight) to amplify
the purchasing power of express delivery service buyers.
- And Another That's New........ as Transplace.com
commenced on July 1, 2000, as an Internet-based logistics business is
commonly owned by Covenant Transport; J. B. Hunt; M. S. Carriers; Swift
Transportation; U. S. Xpress, & Werner Enterprises, with a claim to have
signed up 217,300 trucks in the U.S. motor trade thus far.
- Here's Another New One ......... as oil companies & shipowners
joined forces to launch a chartering exchange for the US$30B a year tanker
market which should be operational in the fall. To be called SeaLogistics,
it will offer real-time information on ships, their locations, prices,
online negotiation & voyage tracking. It will compete with ShipDesk, a
London based online chartering exchange that plans to launch by year-end.
Texaco, Chevron, LG Caltex & Koch Industries are among the oil companies
backing SeaLogistics. (submitted by our good friend Capt. Onur Y. Uranli)
- And Another New One ........ as "Sameday"
a fulfillment & delivery company provides supply chain services to
eRetail & B2B clients and specializes in high-speed fulfillment &
delivery of eCommerce orders.
- And Another .......... as Transport
Shopping Network is an exchange for surplus transport equipment.
- "E" Consolidation Suggestion? ......... as FreightWise
& the National Transportation Exchange (NTE), two U.S. online exchanges
intend to integrate their web sites. Both NTE & FreightWise were
recently featured in Forbes Magazine as 2 of the Top 10 B2B e-commerce
transport & logistics companies. Sign of the times?
- CargoNow.com To Charge Fee ......... as the multimodal cargo
exchange based in Sweden, said it will charge transport service providers an
annual membership fee & "a small" transaction fee. For
transport users, the online exchange is free. The new charges for providers
will be introduced on Sept. 1, but will be free until then.
- Visit All The Transportation
Electronic Marketplaces .......... as The Cargo Letter has
established a single source for your review of the electronic marketplaces,
load matching services & transport B2B sites.
- What's Next For "E" Markets? .......... as while e-market
places have gained substantial press coverage, virtual supply chain
integration (V-SCI) may represent the next wave of evolution for
business-to-business e-commerce, or so says Cahners In-Stat Group, a
high-tech market research firm. The explosive growth of e-market places is
laying the foundation for businesses to move Internet-enabled supply chains
in-house. V-SCI networks will create a previously unattainable level of
dynamic communication and interaction among supply chain participants
capturing an even greater competitive advantage. According to Kirsten
Cloninger, industry analyst for In-Stat, "V-SCI networks will
eventually converge with today's electronic market place structure resulting
in an unprecedented level of connectivity among participants, optimizing
established relationships by streamlining the flow of information."
Connectivity will be crucial to the "extended virtual enterprise"
as critical business information must be available in real-time. In-Stat
believes that online supply chain participants will access V-SCI networks
through wireless technologies such as mobile phones & PDAs in addition
to laptops & desktop units. Widespread connectivity will result in a
transformation from a tactical pass-off to the strategic utilization of
knowledge across the business.
- CODEX Wants Your Processed Thoughts .......... as fruit &
vegetable shippers have been invited by the U.S. Dept. of Agriculture &
the Agricultural Marketing Service to comment on the agenda of the upcoming
meeting of the Codex Committee on Processed Fruits & Vegetables. The
public meeting will be on Aug. 10 in Washington. The U.N.s Food &
Agriculture Organization & the World Health Organization created Codex
in 1962. Its job is to protect the health & economic interests of
consumers and to encourage fair international trade of food. Shippers may
view related documents at: http://www.fao.org/waicent/faoinfo/economic/esn/codex/ccpfv20/pf00--01e.htm
- Is There Anyone Not Suing U.S. Tobacco? ........ as the European
Union's executive Commission said on July 20 it planned to sue a number of
U.S. tobacco companies in U.S. courts for alleged cigarette smuggling into
the EU. "We would like to confirm news reports concerning a decision in
principle by the Commission to launch a civil action in the U.S. against a
number of U.S. tobacco companies,'' the Commission said in a statement.
"The case concerns the alleged implication of these companies in
cigarette smuggling into the EU." It would not, in reply to reporters'
questions, say where or when the alleged smuggling had taken place or to
give brands, company names or figures. It said however that cigarette
smuggling was the biggest single fraud against the EU budget, worth billions
of dollars over years. "The aim is to achieve a degree of compensation
for the alleged loss of revenues," the Commission said. How about,
"WARNING: The Surgeon General Has Determined That Cigarettes Are
Dangerous To Customs Duties."
- New Silk Road Grows In Strength ........ as the "New Eurasian
Continental Bridge," an 11,000 kilometer railway line linking
Lianyungang in China's coastal Jiangsu province with Rotterdam in the
Netherlands, is fast becoming known as the new "Silk Road." Since
starting operations in 1992, the rail link is being seen by scholars &
officials as an increasingly important conduit for trade between China,
Central Asia & Europe. China's current "go west" policy has
identified the railway as an ideal means to enhance cooperation between
Central & East Asia while also bringing its western region more into
touch with the growing trend of globalization. This means that, for China,
the benefits are as much domestic as Int'l, with the railway promoting east
& west economic cooperation within the country while also enhancing
China's capital & foreign investment. The railway travels through the
Chinese coastal cities of Qinhuangdao in Hebei, Rizhao & Qingdao in
Shandong and the Tianjin Municipality. Also involved in the development of
the rail link is the U.N. Development Program which is seeking ways of
promoting the cooperation of the various nations crossed by the railway. In
a separate development, the city of Qinghuangdao is developing two water
& land links to the capitals of China, Japan, North Korea, Mongolia
- 6 More Months For Mont Blanc ......... as Italian motorway operator
Autostrade says it expects the Mont Blanc tunnel cargo link, closed since a
fire that killed 39 people last year, is to be reopened early next year. The
tunnel has been closed since March 24, 1999, when a fire that started in a
Belgian truck carrying flour & margarine engulfed another 20 trucks
- Rail Fleet Tracking .......... as GATX Rail Logistics, based in
Chicago, has implemented a new railcar management system that allows
shippers access to reporting on the current whereabouts of their rail car
fleets via the Internet. The new system, called Zephyr, is the 1st web-based
product that gives customers information on their fleets through a front-end
that is flexible enough to allow the creation of customized reports of fleet
status. GATX Rail Logistics leases more than 150,000 railcars worldwide,
& offers information-based and asset-based services.
- Bekins Online Tracking At Last
......... as the HHG mover, owned by GeoLogistics, now tracks customer
- New Drug Handling Rules .......... as the Justice Dept.'s Drug
Enforcement Administration has defined rules for establishing freight
forwarding facilities for DEA distributor registrants. The agency had
proposed the rules on Dec. 18, 1996, but has amended them based on comments
received. The new rules will take effect this August 18. Under the rules, a
distributor, manufacturer or importer may establish a freight forwarder
facility through which the distributing registrant may transfer controlled
substances in the course of delivery to customers. The distributing
registrant and freight forwarding facility must be part of the same
corporate entity. A distributor may have multiple registrations transferring
substances through the facility. The DEA registration requirement would be
waived for the freight forwarding facility upon proper notice of the
distributing registrant. Controlled substances transferred through the
facility may be stored in the facility for less than 24 hours. Containers
must be kept under continuous observation by designated individuals or a
lock-down facility with a monitored alarm system in place may be used.
Records must be maintained by the distributing registrant regarding the
transfer of controlled substances through the facility, reflecting date,
time of transfer, number of packages shipped, and authorized signatures for
each transfer. Documentation may be centrally provided. Each shipment must
contain all documentation usually required. Customer returns may be
transferred through the facility, provided the returns are pre-authorized
and the official transfer takes place at the customer's registered location
and the returns are treated in the same manner as distributions to customers
through the facility.
- Help With Harmonized System For Chemical Hazard.......... as the
Inter-Organizational Program for the Sound Management of Chemicals, will
meet August 10 to further develop a harmonized system of chemical hazard
classification & labeling. Agencies participating in the U.S. government
interagency group include the State Dept., Environmental Protection Agency,
Dept. of Transportation, Occupational Safety & Health Administration,
Consumer Product Safety Commission, Food & Drug Administration, Dept. of
Commerce, Dept. of Agriculture, Office of the U.S. Trade Representative,
& National Institute of Environmental Health Sciences. The meeting will
be held at 10 a.m. in Room C5521 at the U.S. Dept. of Labor, 200
Constitution Ave. N.W. Washington D.C. For information, contact Marie
Ricciardone, State Dept., (202) 647-9799.
- Alaska Airlines. UP as 2nd quarter operating revenues for the
quarter were US$553M, a 4.4% increase, while operating expenses were
US$540M, up 16.2%. Operating income for the quarter was US$13.1M, compared
with US$65.3M a year earlier.
- American Airlines, Inc. UP with 2nd-quarter net earnings of
US$285M, or $1.75 per common share diluted, before a special item. This
compares to net earnings from continuing operations of US$216M, or $1.36 per
common share diluted, in the same period in 1999. After accounting for the
special item, a US$36M after-tax gain from the sale of its warrants on
priceline.com stock, AMR reported net earnings of US$321 million, or $1.96
per common share diluted.
- Atlas Air. UP as its net income rose by 43% to a record US$19.0M or
$0.53 per fully diluted share for the quarter ended June 30, 2000, versus
US$13.3M or $0.38 per fully diluted share for the year-earlier period, on 4%
greater shares. Revenue for the quarter equaled US$191.8M, a 38% increase
over 2nd quarter 1999 revenue.
- Atlantic Container Line. UP with a recovery in its results for the
2nd quarter. Net profits reached US$7M, more than 3 times the net result a
year earlier. Operating revenue was US$80M, up 24%.
- BAX Global. DOWN with a US$13.5M operating loss in the 2nd quarter,
due mainly to softer demand and rising operating costs in the U.S.
Year-to-date, BAX recorded a US$16.4M operating loss on US$1.0B in sales.
BAX management, which recently was reshuffled, has initiated a cost-cutting
program that includes reductions in station operating expenses, sales costs
& corporate overhead.
- CNF. UP with 2nd-quarter net income for common shareholders of
US$43.9M, or 80 cents per diluted share, up 7% from net income for common
shareholders of US$41.0M.
- CP Ships. (ocean liner subsidiary of Canadian Pacific) UP with
2nd-quarter net income of US$37.6M, up 292%. Revenue was US$652.2M &
operating income was US$45.4M. Volume totaled 464,000 TEUs, compared to
352,000 for the year-earlier period.
- CSX Corp. DOWN as 2nd-quarter earnings fell 43%, reflecting higher
costs from CSX Transportation's absorption of Conrail, Inc. Net earnings
totaled US$55M, or 26 cents a share, down from US$114M, or 53 cents a share,
for 2nd quarter of 1999.
- Delta Airlines. UP as 4th quarter earnings rose to US$2.86 per
share, US$376M in total, from US$2.40, or US$364M, in the 2nd quarter 1999.
Revenue increased from US$3.96B to US$4.47B in the quarter.
- EGL Inc., (Houston-based forwarder which is purchasing Circle Int'l -
see "Our Top Story") UP as net income in its 3rd fiscal
quarter ending June 30 rose 16% to US$8.5M on a 43% jump in revenue to
US$213.7M EGL's domestic forwarding business provided the lift, increasing
39% year-over-year -- the highest growth rate in 9 quarters. Same terminal
revenue growth, a measure of existing business growth, hit 34%. EGL's Int'l
business also soared in the quarter, jumping 76%. Total net revenue, or
sales minus the direct cost of transportation, rose 38% to US$87.9M. For the
first 9 months, net income increased 15% to US$23.7M on a 38% increase in
revenue of US$589.9M.
- Forward Air Corp. UP with its eighth consecutive record quarter.
Operating revenue for the quarter ended June 30 increased to a record
US$54.1M, an increase of 32.6%, compared with US$40.8M for same quarter
1999. Operating income for the period was US$9.8M, an increase of 66.1%.
- Fritz Cos. Inc. UP with improved earnings for the 4th quarter and
fiscal year ended May 31. 4th-quarter net income was US$3.8M, compared to
US$1.2M for the year-earlier period. Revenues rose 19.3% to $412.5M. Net
revenues increased 10.6% to $159.5M. Net revenue growth was balanced across
the company's product lines. Regionally, Asia & Europe recorded Fritz's
strongest growth. The company incurred US$2.8M in pre-tax consolidation
costs related to the opening of Fritz's centralized customs brokerage
operation in Dallas. For the fiscal year, Fritz reported a 29.5% increase in
net income, to US$17.4M. Net revenues improved 7.2% to US$619.3M, while
operating expenses rose 6.1% to $586.8M. Fritz incurred $6.3M in pretax
consolidation costs for the Dallas customs brokerage operation. The costs
were in line with original estimates.
- Hanjin Shipping. UP as it expects revenues of US$3.45B, 5.6% more
than last year. Hanjin Shipping expects its container business division to
account for $2.3 billion of the company's total revenues. Bulk shipping is
expected to have revenues of $710 million and other activities revenues of
- The Hub Group Inc. (intermodal marketing) DOWN with a 2nd quarter
net income dip 11.5% to US$2.3M, despite a 7.8% increase in revenue, to
US$344.3M. Intermodal revenue improved 4% to US$247.7M, truckload brokerage
revenue rose 10.5% to US$53.4M &logistics revenue jumped 31.1% to
- KLM Royal Dutch Airlines Cargo. UP with a 17% rise in cargo revenue
to US$239M in the 3 months ending June 30. Otherwise, KLM reported a 33%
rise in first-quarter operating income.
- Matson Navigation Co.. Inc. UP with 2nd-quarter operating profit of
US$27.9M, up 10% over the year-earlier period. Revenue increased to
US$204.7M, from US$187.8M for the 2nd quarter of 1999.
- Norfolk Southern Corp. UP as 2nd-quarter profit rose 29% to US$99M,
or 26 cents a share, compared to US$77M. Sales climbed 32% to US$1.58B.
- Northwest Airlines. UP as 2nd quarter net profit still climbed 12%
to US$115M, or US$1.26 per share, while US$0.98 was predicted by Wall
- Old Dominion Freight Line. UP as revenue from operations for the
quarter ended June 30, 2000, rose 13.1% to US$120.14M from US$106.2M for 2nd
quarter of 1999. Net income was US$4,576,000, up 7.3%
- Overnite Transportation Co. (trucking subsidiary of the Union Pacific)
UP with net income of US$12.6M in the 2nd quarter, a 9.3% increase over same
period last year & the highest income for any quarter since 1994.
- Trailer Bridge Inc. (U.S. mainland/Puerto Rico shipping) UP with
net income of US$627,724 for the 3 months ended June 30, compared to a net
loss of US$399,377 for the 2nd quarter of 1999.
- Transportacion Maritima Mexicana (TMM) UP as the Mexican rail,
port, logistics & transport group reported improved financial results in
2nd quarter, with a net profit of US$9M. That compares to a net loss of
US$116m for 2nd quarter 1999, before TMM sold assets such as the group's
container shipping interests in the Americana Ships joint venture with CP
Ships. The US$116M loss in the 2nd quarter 1999 included US$84M of losses
from operations now discontinued.
- Union Pacific Corp. UP as net income in the 2nd quarter increased
26% to US$244M, or $.96 per diluted share.
- United Parcel Service. UP for the quarter ended June 30, 2000, as
revenues totaled US$7.3B, up 11% over same period a year earlier. Net income
rose 18.2% to US$695M, or US$0.60 per diluted share, excluding a
non-recurring item taken last year. Global package delivery volume averaged
13.2 million pieces a day in the 2nd quarter, a 6.7% gain. UPS will
implement a temporary 1.25% fuel surcharge, effective Aug. 7.
- Yellow Corp. UP as net income for the 2nd quarter ended June 30,
2000 was US$23.5M, or $.92 per share, compared with net income of $13.0
million, or $.52 per share in 1999. Net income grew 81% & earnings per
share were up 77% over the 1999 2nd quarter. NOTE: Yellow will implement a
general rate increase averaging 5.9% effective August 1 for customers not
currently on contract rates.
- Standard & Poor's ........has replaced Hannaford Brothers in
the S&P MidCap 400 Index with Atlas Air as of July 14, 2000.
- Changing Times ......... as Communist Vietnam took its most
symbolic step yet down the capitalist road on July 20, by opening a stock
market. The long-delayed opening of Ho Chi Minh City's Securities Trading
Center (STC) was Vietnam's 2nd dramatic boost for business confidence in a
week, following a landmark trade accord with the U.S. on July 13. As part of
the agreement, Vietnam agreed to lower import tariffs on a range of goods,
including agricultural & industrial goods. Vietnam also agreed to adopt
WTO standards on intellectual property rights and to allow increased market
access for U.S. services & investment. Four companies will be listed on
the new exchange at the start.
- "We Are Ready For Our Close-Up" ........ as Century
Blvd., "the doorway to LAX," will be ground zero for the thousands
of politicos, delegates & reporters coming to Los Angeles for the
Democratic National Convention in August. The area is getting a big boost in
its preparations from the LAX complex. LAWA Exec. Dir. Lydia Kennard &
Ted Tokio Tanaka Architects' team have installed a magnificent gateway for
the City of Los Angeles along Century Blvd. featuring a lushly landscaped
palm-lined drive & 26 monolithic, lighted architectural pylons which
will become an instant L.A. landmark. The Cargo Letter will join Major
Richard Riordan at a special gathering on Aug. 8 to celebrate the
"Grand Lighting" of the new gateway complex.
- Happy Birthday TWA ........ as July 13 made 75 years for Trans
- Deutsche Post Can't Be Stopped ......... as the chief of the German
postal service Deutsche Post said this month he did not expect an EU probe
to delay its planned initial public offering in Nov. -- set to be one of
Germany's biggest IPO's ever.
- ATA Says Growth Strong ......... as the Air Transport Association
(ATA) reports that cargo traffic increased 7.5% in May, over same period
1999. Int'l cargo grew 10% & domestic cargo increased 5.3%. Cargo
traffic includes mail, freight & express. Systemwide freight and express
cargo grew in May, increasing 8.1%. Domestic freight & express grew
5.7%, while Int'l continued to grow at a stronger pace, increasing 10.3%.
The amount of mail carried by the scheduled airlines increased 3.1% in May,
throughout the system. Domestic mail transported by the airlines rose 2.8%,
while Int'l mail grew 4.6%.
- BA & KLM - The EU Price of Merger? .......... as European
regulators are likely to force British Airways & KLM Royal Dutch to give
up slots at London & Amsterdam airports and sell their low-cost carriers
as a price for clearing their merger, competition lawyers said on July 13.
KLM earlier confirmed it & BA would file an official merger proposal
with the European Commission by the end of July or the 1st week of August, 5
weeks after announcing they were discussing a "combination of their
- U.S. Talks Tough On UK Open Skies ......... as the U.S. government
has warned that it will block any British Airways/KLM merger unless it
achieves a breakthrough in the open skies negotiations with the UK.
Washington made clear that KLM would jeopardize its own present unrestricted
access for flights into the U.S., if it passed into British ownership
without agreement on liberalized air services between the UK & the U.S.
- Merger Cloning? ........ as American Airlines, the partner of BA,
is busily organizing a takeover of Northwest, the partner of KLM. On July
13, The Washington Post reported that a takeover of Northwest by American
was only still 'a question of price'. At present, American offers US$44 per
share (which represents a total of US$ 3.7B), whereas Northwest demands over
US$100 per share.
- China Air Shuffle ............ as it will merge 10 carriers into 3
major airline groups, according to Chinese news agency Xinhua which reported
on July 21 that the new groups will be based on Air China, China Eastern
Airlines & China Southern Airlines. The other 7 airlines, China
Southwest Airlines, China Northwest Airlines, China Northern Airlines,
Xinjiang Airlines, Yunnan Airlines, Great Wall Airlines & Zhejiang
Airlines, are under direct control of China's airline regulatory body, the
Civil Aviation Administration. The 3 airlines' assets would each total about
US$6B. The companies will be free to pick which group to join. The move is
seen as a boost to China's aviation industry, as it prepares to enter into
the World Trade Organization. China Southern Airlines, the largest airline
in China, has celebrated its 3rd year of service to the U.S. & is
reporting a staggering 96% economy load (outbound) from LAX to China for the
month of June.
- EU Say OK To French Consolidation ......... as it's regulators gave
antitrust clearance July 28 to the acquisition by French airline AOM of 2
other French carriers Air Liberte & TAT European Airlines, through their
parent company Participations Aeronautics, or PAe. AOM is itself controlled
jointly by Switzerland's SAirGroup and French company Marine Wendel.
- Emirates & Air France Will Take A3XX .......... as have both
committed to buying Airbus Industrie's new A3XX super jumbo. A US$1.5B order
for seven A3XXs has come in from Emirates Airlines, while Air France has
signed a letter of intent to buy 10 of the yet to be produced aircraft. The
A3XX is Airbus' answer to a perceived need for super-sized passenger planes,
a strategy that the company hopes will propel it past Boeing as the world's
leading aircraft manufacturer. For Airbus, the Emirates & Air France
deals are a big boost to its minimum sales target in order to justify
putting the aircraft into production. Airbus is on record as saying it needs
at least 50 orders to move ahead. For other Airbus models, the company has
reported the sale of 239 aircraft this year with up to 500 more orders
expected before the year's end. Airbus is 80% owned by European Aeronautic
Defense and Space Co. & 20% by Britain's BAE Systems Plc.
- The New Giant ......... as the 1st Boeing 767-400ER (extended
range) is scheduled to be delivered to Delta Air Lines next month once
certification by the U.S. Federal Aviation Administration & Europe's
Joint Aviation-Authorities comes through, expected at the end of this month.
The 767-400ER fuselage adds 21 feet (6.4 meters) to the baseline 767-300
airframe, & provides approximately 15% more seats to accommodate 245
passengers in a 3 class configuration & 304 passengers in a two-class
configuration. Boeing claims its new 767-400ER is designed to be the most
efficient jetliner in its size category. It believes the aircraft will make
an ideal replacement for the L1011, DC10-30 & the A300. Its efficient
design is claimed to give the 767-400ER a range capability of approximately
5,650 nautical miles or 10,460 kilometers. Boeing also claims its 767-400ER
offers one of the lowest operating costs per seat in the category. Meanwhile
in Seattle, Boeing has also announced 2 big deals for its Next-Generation
737 & its 777 aircraft. GE Capital Services is buying 59 of the 737s and
fifteen 777s for US$5.5B while Int'l Lease Finance Corp. has committed to
buying thirty-three 777s & seven 737s.
- But The Bear Wants Biggest ......... as Antonov, the plane maker of
the Ukraine, wants to construct the largest freighter in the world: the
Antonov-225, which is capable of carrying 225 tons at a speed of about 800
kilometers per hour. At this moment, the Antonov-124 is the world's biggest
freighter, with a capacity of 120 tons. Antonov is to continue manufacture
of the An-225, of which one prototype was made in 1988 for the launching of
spacecraft. For a commercial program at least US$20M will be required. That
amount would have to be brought in by a partner.
- Best Managed Carriers Announced ......... as Aviation Week &
Space Technology has named SAirGroup, owner of Swissair, as the best managed
major airline in the world. In 2nd place came Cathay Pacific Airways, the
Hong Kong based carrier, which was also ranked as Asia's best managed major
airline. Third place went to Air Canada, & 4th to Delta Air Lines. The
2nd highest Asian carrier was Japan Air, ranked 14th in the world listings.
The rankings, based on a combination of asset utilization, productivity
& financial health, are part of the magazine's annual Best-Managed
Companies survey. The results were published on July 10.
- Clean Bill For Aeroflot ....... as the Russian flag carrier gets an
"OK" issued from UK-based auditor, AirClaims. Working under
contract for a number of European air transport insurance underwriters,
AirClaims carried out a comprehensive audit of the carrier's
mission-critical departments, including maintenance, passenger service,
staff training & cargo handling. After months of testing, AirClaims
concluded that all divisions from passenger safety to aircraft fueling
reached standards of Int'l compliance. Evaluation began last winter to
verify that standards are maintained across Russia's broad temperature
range. Regardless of the weather, Aeroflot's procedures were acknowledged to
be within Int'l aviation standards.
- FedEx Now Overnight From Latin America ............ as "FedEx
Int'l First" will be offered in Argentina, Brazil, Chile, Mexico,
Panama, & Uruguay, with launches expected in Venezuela, Costa Rica &
Guatemala by year-end. FedEx will guarantee 8 a.m. delivery for documents
& packages shipped from those countries to more than 5,000 zip codes in
the U.S., and to selected postal codes in London, Paris, Basel, Brussels,
Frankfurt, & Milan.
- Hong Kong Int'l Double Digit Jump ......... as record 2.14 million
tons of air cargo was handled between July 1999 & June 2000, with huge
growth recorded for all air traffic activities on a year-on-year basis.
Cargo grew 19.4% & aircraft movements were up 10% in the same period.
Growth in air cargo traffic remained strong after the beginning of the year,
with 1.04 million tons handled in the first 6 months of 2000. This indicates
a rise of 19.2% over the same period last year. Sustained recovery seems a
reality. Meanwhile, Dalian Int'l Airport recorded 33,800 tons of air cargo
was processed in the 1st half of this year, a 21.2% increase over same
- It Floats! ......... as Japan's Ministry of Transport has become a
major force in promoting the nation's 1st floating airport with recent
takeoff/landing tests successfully conducted on a floating airport off
Yokosuka in Tokyo Bay, a project set up by the Mega Float Technological
Research Assn. with support from the Ministry. The 1 kilometer prototype
airport will be enlarged up to 5 times to deal with commercial air traffic
- DHL Grows Something Special At Hong Kong ......... as it has
officially opened its US$2.6M Kowloon West Service Center, located in Tsuen
Wan, Hong Kong. The new center embodies DHL's "perfect shipment"
concept, which uses advanced technology & employs DHL's Transportation
Harmonized Procedure (THP), which standardizes and refines shipment process
flow with incorporation of state-of-the-art systems. One of the highlights
includes the "Cargo in the Air" (CIA) system which enables DHL to
utilize imaging technology to store digital images of air waybills, invoices
& other shipping documents needed for customs clearance. As DHL offices
at destinations can retrieve the necessary documents from the CIA System
before the physical arrival of the shipments, time for customs clearance is
reduced, & the entire process becomes easier. Another breakthrough is
the introduction of the automated "Re-Weigh Dimension & Label"
(RDL) system which enables faster & more precise shipment measurement.
RDL can process 500 packages per hour & accurately measure the
volumetric weight of each package. The center has the capacity to process up
to 12 tons of shipments per hour. In addition, more than 20 courier vehicles
can perform loading or unloading simultaneously.
- Alitalia Probe .......... as the Italian flag carrier, is
apparently under investigation for engaging in anticompetitive practices
& abusing its dominant position in the domestic Italian market. The
probe has been launched by the Italian Antitrust Authority and will examine
whether Alitalia`s practice of linking the size of its travel agents
commission to the number of tickets sold is anticompetitive.
- Lufthansa Dating In The U.S............. as the German airline will
choose between Denver & Phoenix to begin a direct transatlantic flight
next year. Lufthansa, which also considered San Diego, Seattle &
Portland, said it plans to launch daily nonstop service between Frankfurt
and the western U.S. in March using widebody A340 aircraft. The flight will
carry containerized belly cargo. Lufthansa said top officials will soon
visit both cities to receive proposals (and lots & lots of free stuff)
with a decision to follow within 2 months.
- Buy Olympic -- Please! ......... as last month we reported
government plans to sell 20% of the carrier. But now, a majority share in
the Greek flag-carrier Olympic Airways is to be sold by the Greek
government, more than the original 20% outlined earlier. Word of the change
in policy came from Finance Minister, Yannos Papantoniou, after he had
concluded a meeting with Greece's transport minister. Proposals for the
privatization of Olympic Airways will be forwarded before the end of the
month by Credit Suisse First Boston which is acting in an advisory role to
the airline. Order before August and receive a beautiful set of luggage.
Remember, the dolmas are still great.
- Also Czech Out This Sale ........ as the government decided July 26
to sell a 15% stake in the national airline CSA to Air France & Delta
Air Lines. The sale, scheduled for 2002, will give the 2 foreign airlines a
seat on the CSA board & some decision-making ability, while the state
should retain a majority share. Air France & Delta will gain their share
by increasing CSA's base capital by US$12.7M. The government also approved
CSA's entry into the SkyTeam consortium, a world alliance in which Air
France & Delta Air Lines play a dominant role.
- Getting A Little MAS ......... as Qantas has confirmed it is
interested in acquiring a stake in Malaysian Airlines System. The move comes
after Qantas saw its attempts to forge links with Air New Zealand fail.
However, speculation on whether Qantas has been in negotiations for a 25%
stake in MAS worth US$300M was not confirmed by the airline.
- Air France Gets A Brit ........ as it has agreed to acquire a
majority stake in regional French carrier Brit Air with a US$92M purchase of
stock. Brit Air has been flying under the Air France branding for 3 years in
a franchise arrangement, but rising profits have stymied Air France's
interests, prompting it to step in financially. Brit Air turned a profit of
US$7.8M from an income of $245M last year, it has a fleet of 38 jets of less
than 100 seats & offers 210 departures a day.
- New Alliance ........... as SkyTeam gives access to 98 countries
via Delta, Air France, Korean Air & AeroMexico in the newest alliance in
the air travel industry. SkyTeam is looking to improve upon its cargo
services. Current cargo customers can tap into the alliance's reserved cargo
space & marketing agreements which SkyTeam plans to enhance into a more
comprehensive program which it will introduce in phases.
- Congrats To BAX ........ as BAX Global has added a 1st DC10
aircraft to its proprietary cargo fleet, which will serve in the southern
Californian market. The DC10 came into service on July 10 and operates a
route between Los Angeles Int'l Airport & Toledo Express Airport which
is BAX Global's main hub facility. BAX Global's existing fleet consists of
DC-8s & B-727s.
- New UPS Tracking Standard .......... as it is soon to provide
companies with the option of verifying that a package was signed for, along
with the chance to view the handwritten signature. The new service follows
the introduction of track & trace, which lets shipping companies give
customers access to information about where packages are in the pipeline.
UPS' new Signature Tracking service takes advantage of the portable devices
used by UPS couriers to electronically store signatures. The service is on
limited trials now and will be rolled out broadly in Sept. An example of the
new service's use is how retailers could employ it to better track returns
for speedier credits from the product manufacturer. However, some analysts
have voiced concern over how such a service could limit confidentiality.
Where the shipment is delivered and who the suppliers & the end users
are constitute trade secrets in some circles, information that could be
given away when a signature is seen.
- ValuJet Settlements Told ........ as the families of 110 people
killed in the 1996 ValuJet crash in the Everglades have received at least
US$262 million in insurance settlements, court records show. The settlement
amounts, normally shielded by confidentiality agreements, became public when
prosecutors sought repayment from SabreTech, the jet repair company
convicted of mishandling hazardous cargo it delivered to the plane. The
illegal shipment of explosive-tipped oxygen generators caused the cargo fire
that brought down the Atlanta bound DC-9 shortly after takeoff from Miami
Int'l Airport on May 11, 1996. The court documents, filed earlier this
month, show that Lloyd's of London, which insured SabreTech, has paid
US$151M & United States Aviation Underwriters of New York, ValuJet's
insurer, has paid US$111M to settle all but 2 of the claims from relatives
of people killed in the DC-9 crash. Payments averaged US$2.4M.
- More Oxygen Generators ........... as the FAA has proposed to asses
a US$240,000 civil penalty against Mexicana Airlines for allegedly violating
the U.S. Dept. of Transportation hazardous materials regulations. FAA
alleges that Mexicana handled 6 separate shipments containing hazardous
materials aboard passenger aircraft. The shipments, all from Brownsville,
Texas, to Yorba Linda, Calif., comprises protective breathing equipment,
which contained oxygen generators. Shipping generators aboard passenger
aircraft is strictly prohibited. As stated in the article above, oxygen
generators were believed to have caused an explosion on a ValuJet passenger
aircraft which crashed into the Florida Everglades. Since then, the FAA has
stepped up regulation of hazardous materials aboard aircraft. The boxes
containing the shipments were not properly marked or labeled as hazardous
materials, no were they accompanied by shippers' certification or
declaration of hazardous goods. Mexicana has 30 days to reply to the agency.
- Massive Cargo Crash Award .......... as on July 19 a Dutch court
ordered Boeing to pay compensation to two victims of a 1992 air crash, when
a freighter owned by the Israeli airline El Al plunged into an apartment
building in the Bijlmer suburb here. The Boeing 747-200F cargo aircraft
killed 43 people after losing 2 of its engines on landing approach to
Amsterdam's Schipol airport. Eight years later, the Amsterdam court
announced a ruling that Boeing had ignored the claims of 2 people indirectly
affected by the crash and ordered the company to pay a total of 4,550 euros
(US$4,250) in compensation. Hardly seems to have been worth the effort. One
award was made to a woman who said she had suffered post-traumatic stress
after seeing the aircraft crash into apartments in the neighborhood where
she lived. The 2nd award was made to a man whose apartment was destroyed.
Even though the man did not see the crash, the court however found that he
had suffered psychological problems associated with discovering his
burned-out property. Boeing & El Al have already paid compensation to
the families of the deceased in the crash, and to those directly affected by
- Grab For Diamonds .......... as a cargo handler at MIA was accused
of stealing a US$60,000 shipment of white diamonds from a UPS plane he was
unloading on his 1st day on the job. Financial genius & master criminal
Nelson Rafael Gomez, 18, was charged on July 20 with grand theft &
dealing in stolen property. Police said he sold the gems to 3 pawn shops for
US$2,500. Police recovered the diamonds.
- Grab For Gold ........... as 15 heavily armed men stormed onto a
Brasilia Int'l Airport tarmac, opened fire on passengers & stole 134
pounds of gold from an airplane preparing for take off, police said. Using
automatic weapons & 3 cars, the robbers took less than 10 minutes to rob
the plane late on July 8. During the robbery, the gunmen fired on the parked
aircraft & an airport bus containing passengers before making off with
the gold, but no one was injured. The gold, worth US$607,000, belonged to
the Serra Grande mining company and was apparently headed to Sao Paulo.
During their escape, the robbers dropped a 55 pound bag of gold. Police
later found the cars abandoned outside the city, but have made no arrests.
- Eastbound Pacific Record ........ as vessel capacity in the
eastbound transpacific container trade broke the 10 million TEUs barrier for
the 1st time this month, according to "World Liner Supply," a new
quarterly report from the ComPairData shipping database. The 1st issue of
World Liner Supply shows that ocean carriers now deploy a one-way
transpacific capacity of 10,176,000 TEUs a year. This is a 10% increase
compared to January of this year. Shipping lines in this trade now offer
shippers 60 joint and/or individual liner services with a total of 456 liner
vessels. Both the number & size of ships continues to increase. The
eastbound Pacific trade is the 1st one-way route to hit a capacity of 10
million TEUs a year, research showed. The latest annual eastbound capacity
of 10 million TEUs a year represents the equivalent of 49 vessels of 4,000
TEUs sailing every week from Asia to North America.
- Westbound Transpacific Stabilization Agreement Also Up ..........
as it will raise rates for major commodities to Asian markets this fall.
Effective Sept. 1, wastepaper rates via U.S. West Coast ports will increase
US$100 per 40-foot container. Rates for soybeans will increase US$200 per
FEU & US$160 per TEU via all U.S. ports & by US$300 per FEU &
US$240 per TEU for inland locations. Metal scrap rates will increase $100
per FEU. Members of the discussion agreement are APL, COSCO, Evergreen,
Hanjin, Hyundai, "K" Line, Maersk Sealand, Mitsui O.S.K., P&O
Nedlloyd Ltd., NYK, OOCL & Yangming.
- Europe West Africa Trade Agreement Rate Pump .......... as it's
carriers plan to increase freight rates from northern Europe to West Africa
on Sept. 1. Southbound rates from northwest continental ports will go up by
US$272 per 20-foot container & US$489 per 40-foot box. Rates from
British ports will increase by US$153 per 20-footer & US$275 per 40-foot
box. The conference said that it is introducing a congestion surcharge of
US$217 per TEU on cargo transiting the port on Malabo, in Equatorial Guinea,
because of severe delays to vessels calling at that port. The members of the
Agreement are Maersk Sealand, Nile Dutch Africa Line, P&O Nedlloyd,
Safmarine & WAL-West Afrika Line.
- FEFC Follows Up .......... as the Far Eastern Freight Conference of
Asia/northern Europe shipping lines said carriers are implementing
previously announced rate increases in a continually strong market. Senior
executives met in London on July 28 to assess market conditions in the
eastbound & westbound Asia/northern Europe trades. Carriers are
"very confident" of securing the US$350-per-TEU rate increase in
the westbound direction on Aug. 1 The conference plans to raise eastbound
rates to Asia on Oct.1 by US$250 per container. The strength of the
Asia/Europe trade is expected to boost the profit result of shipping lines
on the trade route, thanks to larger volumes, higher freight rates and
better levels of ship utilization. Carriers of the FEFC are APL, CMA CGM,
Hapag-Lloyd, Hyundai, "K" Line, Maersk Sealand, Malaysia Int'l
Shipping Corp., Mitsui O.S.K., National Shipping Co. of Saudi Arabia, NYK,
OOCL, P&O Nedlloyd, Senator Lines & Yangming. The FEFC shipping
lines carry about 80% of the Asia/northern Europe container trade.
- Interpool Gets Transamerica ......... as the Princeton, N.J. based
container-leasing company will acquire the North American intermodal
division of Transamerica Leasing from Aegon NV and Transamerica Finance
Corp. According to Interpool, the purchase price is US$675M in cash. Aegon,
a Dutch insurer, bought Transamerica Corp. in 1999. Martin Tuchman, chairman
& CEO of Interpool, said that the company's acquisition will
"expand our chassis fleet & broaden our management & customer
service teams." Interpool will add 65,000 chassis to its present fleet
of 100,000, and will buy 23,000 trailers & 17,000 domestic containers
from Transamerica Leasing, substantially augmenting its current fleet of
8,000 units. In 1999, Interpool attempted without success to buy the Cronos
Group of New York, another container leasing company. Acquisition of the
Aegon-Transamerica unit "is a good move because it makes [Interpool] a
major player in the chassis business," said Burton Strauss, an industry
analyst. Interpool had 1999 sales of US$217.8M. Profit from operations last
year was US$28.7M, or US$1.01 a share. The company will finance part of its
container purchase through Salomon Smith Barney Inc. & Citicorp North
America. > Interpool, Inc. is corporate sponsor of The
Cargo Letter library & archive web feature
- Keeping The Fleet Afloat ........ as the Pentagon said in a report
to Congress that under President Clinton's current budget it cannot afford
to sustain the fleet of about 306 Navy ships that it deems a bare minimum.
The report released June 28 also said the Pentagon is considering an
accelerated shipbuilding plan that would cost US$4B to US$5B more per year
than is budgeted in the current Pentagon spending plan through 2005. After a
review of the nation's military needs in 1997, the Pentagon concluded that
the Navy should reduce its fleet to about 306 ships, including 12 aircraft
carriers. In the years since, that has proven problematic because it does
not allow for continual carrier presence in the Persian Gulf, the
Mediterranean & the Pacific. Sustaining a 306-ship fleet requires the
construction of 8.7 new vessels each year to replace decommissioned ships.
The report acknowledged that Clinton's budget for fiscal years 2001-2005
allows for a shipbuilding rate of only 7.8 per year. In its report to
Congress, the Pentagon said the next major review of U.S. defense needs,
scheduled to start in 2001, would consider as "one possible
option" building up the fleet to 360 ships, including 15 aircraft
carriers. "Building such a force would take a major commitment of
resources & require pacing over 15 to 20 years," the report said.
It would require building ships at an average rate of 11 per year, which
would cost an additional US$4B to US$5B.
- Korea Local Sea Trades Floating Well .......... as in 1999 both
South Korea-Japan trade & South Korea-China trade were up by almost a
third over 1998's figures. Korea-Japan trade, including feeder cargo, surged
30% in 1999 with 471,100 TEU being carried. Similarly, Korea-China trade was
up 27% over 1998 with 925,800 TEU changing hands. This has been attributed
mainly to the regained health of Asian economies. As a result of last year's
robust trade, industry insiders are expecting a restoration of freight
rates. Korea-China trade is operated by about 20 lines with the emphasis
being on exports from China. In 1999, China exported 524,800 TEU to Korea,
indicating a rise of 33.6 per cent over 1998's figures. Last year Korea
exported 401,000 TEU to China pushing the figure up 18.8% over the previous
year. Korea-Japan trade is plied by 13 carriers from the Korea Nearseas
Freight Conference. In 1999, these lines carried 36.5% more cargo
year-on-year from Japan to Korea, with 163,100 TEU being shifted in that
direction. And last year Korean exports to Japan leapt 32.3% over 1998's
figures to 308,000 TEU.
- Brazil Says "NO" To Pirates ......... as the government
has announced a new national security plan that addresses piracy against
cargo ships. Although the details have yet to be finalized, the plan is to
increase security at Rio de Janeiro, Sao Paulo, Pernambuco State (Recife)
& Brasilia State. Federal police will join local police in Rio de
Janeiro to begin surveillance and patrols of Guanabara Bay & other
harbors such as Sepetiba. The police will also add patrol boats & new
communication surveillance equipment. Access to ports will also be
tightened. The head of Customs at Santos issued instructions on June 2
outlining new procedures for access to the port. "Access will only be
granted after extensive documentary requirements have been fulfilled,"
said the Baltic & Int'l Maritime Council (BIMCO), a large carrier &
ship agent's group based in Denmark.
- Future of New U.S. COGSA Suggested By Critic .......... as a
possible new way forward was suggested by COGSA critic Prof. Bill Tetley in
his recent circular. While replacement for the 1936 "Carriage of Goods
By Sea Act" is currently stalled in the U.S. Senate, Teltley says that
if the proposed U.S. Senate COGSA is not pushed forward by Senator
Hutchison, or withdrawn from further consideration by the Maritime Law Assn.
of The United Stated, then the U.S. should just adopt Hague/Visby Rules and
some sort of amendment similar to the Canadian amendment to Canadian Visby
on jurisdiction & arbitration. While we disagree, see Appendix
"A" to the Commentary
on Prof. Tetley's website.
- CMA-CGM To The Atlantic ......... as France's largest ocean
carrier, will make its long-awaited entry onto the North & South
Atlantic trades by October through a slot-sharing agreement with Maersk
Sealand & the New World Alliance http://www.joc.com/enews/20000714/sections/ocean/w46875.shtml
- Maersk Sealand Online OB/L ............ as it now offers to its
customers means of verifying, online, proof copies of bills of lading or sea
waybills. Shippers using the service can view and print copies of the final
documents, such as issued Bills of Lading & sea waybills. These can be
used in connection with the customs clearance of the cargo. The new facility
is part of Maersk Sealand's Internet "business online module."
- Sea-Land Price Dispute ......... as AP Møller & CSX are still
locked in talks over the price paid for Sea-Land Service last year. Although
the two sides are playing down reports of a serious rift over the assets
acquired, negotiations continue about certain outstanding details of the
sale some 7 months after AP Møller bought CSX's Int'l shipping division for
- Sailing The Tundra To Down Under .......... as Hyundai is planning
to launch a service using the Trans-Siberian railway and to start services
in niche liner markets as part of an expansion of its container transport
business. Hyundai plans to commence a new service between the Far East &
Australia by the end of August. It also intends to initiate services in
niche markets such as East India, the Mideast Gulf, Southeast Asia &
Southwest Asia. "Plans are also underway to activate the cargo
transportation business in Russia ... through connections with the
Trans-Russia railway & the Busan-Vostochny service routes," a
spokesman for Hyundai said.
- Good Bye To A "Modern Marvel" ........... as Sea
Containers Ltd. confirms that its subsidiary Hoverspeed Ltd. will
reluctantly have to withdraw its two 32 year old hovercraft on the Dover to
Calais route & replace them with two SeaCats which have 50% more
capacity. The crossing times will not be significantly changed in that the
hovercraft take 35 minutes while the SeaCats take 45 minutes.
- Behold The "Ultra Large" Future ........ as London-based
Lloyd's Register & Ocean Shipping Consultants has predicted that the
size of the largest post-Panamax containerships will increase from the
current size of about 7,000 TEUs to an amazing 12,500 TEUs. A new study
concludes that 20 to 24 "ultra-large container ships" will be
built by 2008. The giant vessels will be 380 meters long, up to 60 meters
wide & will have a draft of 14.8 meters. They will carry 22 containers
abreast on deck & move up to 123,000 tons of cargo. The study predicts a
design speed of 23 to 25 knots, depending on whether the vessel has 1 or 2
engines. Lloyd's Register said that the vessel costs for a 12,500-TEU ship
operating on the Asia/Europe route would amount to about US$192 to US$198
per TEU, compared to US$253 per TEU for a 4,000-TEU ship & US$215 per
TEU for an 8,000-TEU ship. Indeed, the ultra-large vessel would save US$92M
a year on vessel costs when carrying 1.5 million TEUs on the Asia/Europe
trade, as compared to an Asia/Europe service using 4,000-TEU ships. However,
the study said that the large capital-intensive ships would require higher
port handling productivity in port to offset the disadvantage of slower port
turnaround. The advent of "ultra-large container ships" would
require a deeper draft & longer cranes to call at ports on major trades.
However, major ports are already ordering quay cranes with a long outreach
that are capable of handling very wide containerships.
- Greenpeace Arrested - Again ......... as 6 of its activists
prevented the Cyprus-registered M/V Aquitania from unloading Amazon rain
forest timber in the French port of Honfleur on July 29. The vessel was
forced to leave without unloading its cargo, but the 6 activists were
arrested. The activists, who had been occupying 3 deck cranes of Aquitania
in a protest against deforestation, were removed by French special police.
Greenpeace wants importers to stop buying timber from the Amazon forest.
Most of the Aquitania's cargo came from Brazil, home to the world's largest
rain forest. French building materials firm Lapeyre (LPEY.PA), one of the
companies accused by Greenpeace of importing timber on the Aquitania, said
it had held several meetings with representatives of the group. "For
timber supplies, Lapeyre has been conducting for several years a program of
using resources from controlled & well managed forests to substitute
timber from primary forests," it said in a reaction to Greenpeace's
- Back From The Grave ........... as Dutch salvage firm Smit has
successfully refloated the semi-submersible heavylift ship M/V Mighty
Servant II, which capsized & sank 7 miles south of Singkep Island in
Indonesia in February with the loss of 5 lives. The salvage team has been
able to recover the one remaining missing body, which will be flown back to
the Philippines for burial, & has revealed that the ship suffered a
massive 85-meter gash below the waterline as it hit an uncharted pinnacle of
rock. The Mighty Servant II is currently being stabilized on the surface,
and may be taken into Singaporean waters for a full inspection. Work is now
underway to recover the 8,800-ton offshore production module that the ship
had been carrying in when it sank. The module, which had been welded to the
deck of the ship for transport, was removed by salvors & is lying on the
seabed. It is likely to be cut into pieces & lifted out for disposal as
- M/T Erika Erupts Again ........... as French maritime experts said
on July 27 that oil was seeping from the sunken wreck of the tanker which
polluted large stretches of the western coast after it broke in two in
stormy seas last Dec. The local maritime agency in Brest, on the N.W. coast,
reported a persistent leakage from the stern section of the ship but said
that the oil tended to evaporate shortly after hitting the surface 120
meters above. The Maltese-registered Erika broke up on Dec. 12. About
two-thirds of its 25,000-ton cargo escaped, damaging islands, rocky
shorelines, oyster beds & popular sandy beaches as blobs of stodgy oil
hit land in waves of jellyfish-like invasions. Cleanup vessels began a
pumping operation about a month ago on the 2 sections of the sunken ship,
which lie about 6 miles apart & some 70 km (44 miles) offshore.
- Shocked, Shocked To See Ship Sunk In War ......... as relatives of
323 Argentine sailors who died when the British sank their ship during the
1982 Falklands Islands war will seek damages from England in an Int'l court.
Two lawyers representing the families of sailors aboard the warship Belgrano
say they would press their case next week before the Int'l Court of Human
Rights in Strasbourg, France. The sinking of the Belgrano marked the turning
point in the 10-week war. Battling in the So. Atlantic Ocean, the British
submarine HMS Conqueror torpedoed the Belgrano. The lawyers, Jorge Appiani
and Jorge Antonio Olivera, contend the sinking violated wartime conventions
set by the Hague in 1907 because it occurred beyond the 200-mile limit of
the theater of operations designated by Britain. There was no immediate
response to those claims. Argentina contends it inherited the islands, which
it calls the Malvinas & where about 2,200 people of mostly British
ancestry live, from the Spanish crown before they were occupied by Britain
in 1833. The Falklands war - won by Britain in 74 days - claimed at least
970 lives & helped hasten the departure of Argentina's military
government of the era. Argentina never sought damages against England after
the war. After nearly a decade of icy relations, the 2 countries restored
diplomatic relations in 1990, although Argentina still maintains its claim
to the islands.
- 2000 Ship Production Symposium & Expo ......... as this year's
event will be held August 23-25, 2000, in Williamsburg, VA The 2000
Symposium will present a full technical program of papers & panels
that will help American shipyards --large, medium & small--succeed. The
Expo will feature 75 top U.S. shipyards, marine manufactures & vendors
involved in all aspects of commercial and naval ship design &
construction. The symposium will be located in Colonial Williamsburg at the
famous Williamsburg Lodge in the in the heart of the restored colonial area.
The Williamsburg Lodge was the site of successful Symposia in 1986 &
1993. There are a limited number of booths available.
- Someone New Is Chasing Rotterdam ............ as the Port of
Antwerp, Belgium has become Europe's 2nd largest port instead of Hamburg,
after Port of Rotterdam. Freight traffic through Antwerp in the 1st half of
2000 grew by 14.1% to 63.5 million tons, from 55.6 million a year earlier.
Imports rose 12.4 % to 36.5 million tons, exports 16.5% to 27 million tons.
Container transhipment rose 19% to 22 million tons, taking market share from
Rotterdam as well as Felixstowe.
- Port of Long Beach Just Keeps Building ............ as it's board
voted unanimously to adopt a US$583.1M budget for the 2000-2001 fiscal year
beginning on Oct. 1. The spending plan is 9% more than last year's adopted
budget, largely because of major terminal expansion projects aimed at
keeping pace with cargo growth. The budget sets aside US$361M in capital
outlays including US$160.2M for the next phase of a 375-acre container
terminal project at the former Long Beach U.S. Naval complex on Terminal
Island. The port is also developing a 160-acre container terminal north of
the former naval complex. Due to be completed in 2003, this next phase of
the "Pier S" project is expected to come in at US$59M. Port
operating revenues are expected to increase about 8% to US$217.4M, with
projected revenues from shipping terminals climbing about 9% to US$201.3M.
Operating expenditures are expected to decline 2% to US$160.6M because of
lower debt payments. The port's net income is expected to increase to
US$70.8M. Last year, Long Beach led the nation in container cargo volume,
with its terminal handling the equivalent of 4.4 million TEU.
- Suez Canal Will Top Record .......... as "higher oil prices
& the recovery of Asian markets are expected to push up revenues of
Egypt's Suez Canal this year to well above 1999's US$1.86B record. Experts
see revenues to exceed US$2B during the current year," a United Arab
Emirates' spokesman said in Cairo. Higher prices of oil & liquefied
natural gas (LNG) have increased the canal's "competitiveness" to
alternative routes used by international shipping companies
- Shandong Takes Huge Jump .......... as the amount of foreign cargo
tonnage declared at the coastal ports of China's Shandong province was a
record from Jan. to May this year. More than 32 million tons in foreign
freight passed through the province's ports in the first 5 months of 2000
representing a 56% increase over the same period last year. Exports were up
47% with 14.25 million tons declared, while imports came in at 17.88 million
tons to record a 65% increase. Local ports handled a total of 907,000 TEU
during the period to record a 34% rise over 1999 figures. In the import
sector, it was grain which recorded the largest increase with 4 times as
much coming in compared with last year. Export figures showed the biggest
increase was in iron & steel with a total of 1.26 million tons
representing a whopping 210% surge.
- PMA: West Coast Must Modernize .......... as the Pacific Maritime
Assn. said longshore labor must embrace new technology to increase port
productivity in response to increased cargo volumes & just-in-time
shipper requirements. The PMA, which represents about 100 ocean carriers,
stevedores & terminal operators in negotiating and administering labor
contracts with the Int'l Longshore and Warehouse Union (ILWU), failed to get
the union to accept a technology & productivity agreement in the current
contract. "Despite generous pay & benefits, we have for the past
several years experienced stagnant productivity resulting from outdated,
inflexible work rules & a reluctance of our workforce to accept the
introduction of new technology," said Jack E. Suite, No. California
area manager for PMA. In last year's negotiations on a new master contract,
labor & management agreed to establish a Joint Technology Committee that
will serve as a forum for the parties to come to terms with technology
issues affecting the industry. "We are looking forward to working with
the Union to bring about technological improvements to the waterfront,"
Suite said. The last "landmark agreement" with the ILWU to
modernize the waterfront was the 1960 Mechanization & Modernization
Agreement, which paved the way to containerization on the West Coast.
- No More ECU Line Far East Ltd ......... as it will officially
change name to ECU-Line Hong Kong Ltd on Aug. 1 2000.
- Loss of The City of Adelaide? .......... as those interested in
transport history will be saddened to learn that, due to a lack of finance,
formal planning application has been made by the Scottish Maritime Museum in
Irvine to destroy the only class 'A' historic monument in Scotland - the
hull of the immigrant tall ship 'City of Adelaide' which dates from 1864.
The importance of the ship's role in the carriage of immigrants to Australia
and in returning wool from there to Europe is beyond question. She is the
very last surviving clipper ship that carried passengers to & from
Australia in the mid to late 1800s. Her present survival is astonishing, yet
now she faces the biggest threat to her existence. Please send your
objections to North
Ayrshire Council by E-mail - mark for the attention of Mr. T. Parish,
"City of Adelaide/Carrick", Legal & Regulatory Dept., North
Ayrshire County Council. Excellent articles with photos of the ship appears
on the web site of Traditional Boats
& Tall Ships
- First U.S. Cruise Ship in 40 Years........... as a patriotic crowd,
waving American flags & cheering, joined in a countdown this month as
"Uncle Sam" sat in as "guest operator" aboard a plasma
arc plate cutting machine to cut the initial steel plate for Project America
Hull #1, the 1st in a series of cruise ships being built by Litton Ingalls
Shipbuilding, a Litton Ship Systems company, for American Classic Voyages
- Handheld Stowaway Detector.......... as equipment used to measure
the amount of carbon dioxide in the air is being used at the Belgian seaport
of Zeebrugge to find stowaways hidden in containers & trailers. A recent
5 week test of the technology involved the inspection of 400 trailers for
roll-on/roll-off ocean transport. The equipment detected unusually high
amounts of carbon dioxide in 27 containers, of which 5 trailers held about
50 stowaways. The port authority at the French port of Calais acquired 2 of
the devices, which are about the size of a mobile phone & cost about
US$1,000 each. Inspecting a trailer or container takes about 3 minutes. The
Int'l Maritime Organization, the Baltic & Int'l Maritime Council &
the Int'l Chamber of Shipping are receiving reports of record numbers of
stowaways in European ports. The container involved in the death of 58
illegal immigrants last month originated at Zeebrugge.
- Coast Guard Chief Arrested .......... as a court in eastern China
has sentenced a corrupt Communist Party political commissar to 20 years in
prison for smuggling & other crimes. The Hangzhou Intermediate People's
Court sentenced Wei Baoguo, former political commissar of the Zhejiang
provincial Coast Guard, to the prison term for smuggling, embezzlement &
taking bribes. Wei helped a local firm import 21,000 tons of grapeseed oil
from Canada, causing a loss of US$4.28M in tariff revenue to the government.
He also embezzled US$5,100 with an accomplice & took bribes of 124,000
yuan between 1997 & 1998.
- Buried Naval Treasure Found! ....... as the placid waters of
Indonesia's Brantas River conceal an astonishing treasure-trove of aviation
history -- an entire squadron of Dutch naval warplanes scuttled by
retreating allied troops during the dark days of 1942. An ambitious plan to
recover the 8 Fokker T.IVs & 5 C.11s -- the only surviving examples of
either type will now go forward. The T.IV was a twin-engine torpedo bomber
of which only 33 were built. In contrast, the C.11s were elegant biplanes
that served as fleet artillery spotters & were typically based aboard
cruisers. But they were removed from Dutch warships in 1941 because of fears
fuel tanks could ignite the vessels if hit. That proved fatal for the Allies
in the pivotal Battle of the Java Sea, which sounded the death knell for
Dutch rule in the East Indies, today's Indonesia. Deprived of aerial
reconnaissance, a hapless Allied task force blundered into the Japanese
invasion fleet, whose patrol aircraft had shadowed it throughout. Caught
unaware, the task force was annihilated. Following that disaster, all Allied
forces were ordered to evacuate to Australia. Planes that did not have the
range to make the trip were ordered destroyed. Lacking demolition charges
& frantic to escape, Dutch airman at the Brantas base, 500 miles east of
Jakarta, simply punched holes in the Fokkers' floats & wings. The 13
aircraft sank into the river intact, settling in upright positions on the
bottom. A scan of the riverbed reveals the aircraft in remarkably good
condition with silt from a newly built dam protecting their aluminum skin.
Villagers remember that before the dam was constructed they were able to
glimpse the ghostly warplanes -- their machine guns still aimed at the sky
-- whenever dry seasons caused water levels to drop. Surprisingly,
scavengers never disturbed the site. WOW!
- Passing of Ben E. Nutter ......... as this maritime legend on the
West Coast, died July 15 at the age of 89. Nutter served as CEO of the Port
of Oakland, retiring in 1977. During his tenure, the port increased the
amount of cargo it handled from 2.5 million tons in 1957 to 8.5 million
tons. A resident of Santa Rosa, Calif., Nutter is survived by his wife,
- Current Size of The Panamax Vessel .....
||Approx. 50,000 to 80,000 dwt.
|| Bulk Carrier
||Approx. 100,000 to 170,000 dwt.
|| Bulk Carrier
|Ultra Large Crude Carrier (ULCC)
||350,000 & up dwt.
|Very Large Crude Carrier (VLCC)
||200,000 to 350,000 dwt.
||Approx. 120,000 to 160,000 dwt.
||Approx. 80,000 to 110,000 dwt.
- Throughtput. It was a great 1st 6 months as Port of Antwerp
registered a jump in the handling of container & ro-ro cargo with
figures showing 22,002,185 TEU and 2,933,401 TEU respectively, an increase
of 19% & 2% over the same period last year. Le Havre, France's largest
port, handled 5.5% more container traffic from Jan. to June than in the same
period of last year, as throughput was 717,695 TEU. A rebound in exports has
sparked an overall 6.5% growth in loaded containers at the Port of Long
Beach during the 1st 6 months of this year (Loaded outbound containers
increased to 1.68 million TEUs, from 1.58 million TEUs in the year-earlier
period, for an increase of 8.6% & loaded inbound containers rose 5.6%
for the period to 1.15 million TEUs). Total loaded container volume through
June at the Port of Los Angeles increased 28.9% over the same period in
1999, to 1.64 million TEUs. The Port of Montreal handled 500,055 TEUs
through the 1st 6 months of 2000, an increase of 4.4.% over the 1st half of
1999. Chile's Port of San Antonio, the country's largest, moved 4.372
million tons of cargo during the 1st half of 2000, up 7% from the 4.095
million tons moved during the same period year earlier, and container cargo
traffic accounted for 54% of goods moved through the port, up15% to 2.4
million tons during Jan-June. Shanghai Port has firmly established itself as
the Chinese mainland's No. 1 container handler, smashing its own throughput
record for 1st half of 2000, handling 2.56 million TEU during the 6 month
period, a 34% year-on-year rise. China's 2nd busiest Port of Shenzhen
expects to handle in excess of 4 million TEU this year, pushing it up into
the lofty company of the world's top 10 busiest ports, as during the 1st
half of the year, it recorded a throughput of 1.76 million TEU, growth of
37%. Port of Qingdao has lifted itself to mainland China's 3rd busiest port,
trailing Shanghai & Shenzhen, as it handled a total of 1 million TEU for
the year by June 28. The Canadian Port of Vancouver reported a 13% increase
in container throughput for the 1st 6 months of the year, driven largely by
rising import traffic from Asia, reached 595,549 TEUs.
- This Month In U.S. Naval History ........... as on July 27, 1953,
the United States, North Korea, South Korea & China signed the armistice
that ended the Korean War, but never brought a permanent peace. By war's end
the U.S. casualties included 33,651 service members. To date, the Republic
of Korea (South) & the Democratic People's Republic (North) have not
signed a peace treaty.
Visit our huge Vessel
Casualties & Pirate Activity Database ......... where daily updates of
this news are posted. Stay up to date!
This is only a partial list of casualties for the month in that most
dangerous place ....... out there. Full details are online!
The 3,797-ton passenger-cargo vessel M/V Trans Asia 1 inter-island ship
caught fire but all 520 passengers aboard were safe. The vessel was on its way
from southern Cagayan de Oro City to Cebu City in central Philippines on July 29
night when fire broke out in its engine room. A spokesman for the shipowners,
Trans Asia Shipping, said all passengers were unhurt & had been transferred
to a sister vessel to be brought to Cebu. The distressed ship was towed back to
port in Cagayan de Oro. (Sun. July 30 2000)
On 22. July 2000 at 0050 LT at position 13 06N 080 20E, Chennai Anchorage,
India, pirates boarded a tanker from forecastle. He tried to steal ship's
stores. Duty crew noticed him & alarm was raised. The pirate jumped over
board & escaped in a waiting motor boat taking with him 2 fire hoses. (Fri
July 28 2000)
On 20. July 2000 at 2245 LT at position 01 50.2N 102 22.5E, Malacca Straits,
6 pirates armed with long knives boarded an LPG vessel. They tied up the crew
& threatened to kill them if they did not cooperate. The pirates stole
ship's cash about US$10,000 & other valuables from the crew. (Fri July 28
On 22 July 2000 at 2200 LT at Mid Channel, Malacca Straits, 6 pirates in a
fast craft, white color, silent engine, approached a bulk carrier from port
quarter & tried to board using a bamboo hook. Attack was aborted due to the
presence of the crew on deck. (Fri July 28 2000)
A massive hydraulic door crushed a crewman to death aboard cruise ship M/V
Norwegian Sky near Alaska early July 26 morning. The death of Jai Ming Dai, 49,
of Shanghai, China, being investigated by the Coast Guard & the Alaska State
Police. Accident occurred in interior work area of the ship closed to
passengers. About 2,000 passengers & 750 crew members were aboard
approaching Haines, north of Juneau. The large hydraulic, watertight doors seal
off sections of the ship in the event of fire or flooding, & are designed to
close slowly to prevent people from being caught in them. (Thurs July 27 2000)
The bulk carrier M/V ELEVIT (16,683 gt, built 1977) grounded at Helen Mar
Reef, Indonesia, on Jul 24. Refloated the next day & shifted to a safe
anchorage, where patching work is now in progress. (Thurs July 27 2000)
A Viking crew which planned to mark the 1,000th anniversary of Leifur
Eiriksson's voyage to the New World have abandoned ship in the Shetlands after
engine trouble. Like many a Viking longboat before, the Skidbladner seemed
doomed from the start of its journey on Sweden's west coast in early June.
Swedish authorities first delayed issuing a seaworthiness certificate on safety
grounds, & then the Skidbladner's engine stopped in the Shetland Isles. The
skipper went off to get it repaired and we didn't hear a thing. After a week of
waiting the crew abandoned the Skidbladner, deciding they could not reach L'Anse
aux Meadows in Newfoundland in time for celebrations to mark Eiriksson's arrival
1,000 years ago. The Islendingur, another Viking vessel skippered by a
descendant of Eiriksson, has arrived from Iceland via Greenland. (Wed. July 26
M/V MEHMET SADIK (493 gt, built 1975) loaded with sand, sank as she waited
anchored at Gelibolu port July 24. The reason for her sinking is so far unknown.
All 7 crew managed to jump off the vessel. (Tues July 25 2000)
Indian bulk carrier M/V LOK PRAGATI (16,040 gt, built 1984), which left Port
Elizabeth for Quebec on Jul 19 with cargo of manganese ore, sent distress signal
on Jul 21 after reporting forecastle damage & water ingress. Tug John Ross
began proceeding to casualty but returned after master advised on Jul 22 that
pumps on board were coping with water in hull and that the vessel's position at
that time was lat 34 26S, long 23 41E, bound Cape Town. (Sun July 23 2000)
Somali pirates have hijacked French-registered cargo M/V Net Express in the
Gulf of Aden off the northeastern coast of Somalia. More than 15 gunmen in 3
speedboats boarded the vessel July 13 in full view of the village of Bargal, 19
miles east of the port of Bossaso, the witnesses said over VHF radio. The ship
had apparently been having engine problems because it had been moored in front
of the village for 2 days before the attack. (Sun July 23 2000)
On 19. July 2000 at 2350 UTC at Dar-es-Salaam Anchorage, Tanzania, 5 pirates
armed with knives boarded a tanker via anchor chain. They came aboard in an
eight meter long, unlit motor boat, manned by 3 accomplices. Duty crew raised
the alarm but the pirates broke the store & stole ship's stores. (Sun July
The Belize tanker M/T SUMMER STAR (1,271 gross). Kaohsiung for Zhanjiang with
diesel, had explosion & fire in No. 5 hold in Taiwan Strait, in lat 21 57N,
long 117 16E, Jul 20. Fire extinguished same day. 2 crew dead. 2 injured. 1
missing. Towage negotiations under way Jul 21. (Fri July 21 2000)
CARGO ALERT: The Panamanian container vessel M/V PRIME VALUE (5,938 gross),
Singapore for Calcutta, grounded on sand bank in bad weather at Lower Casper,
near Sand Heads, Calcutta, Jul 19. Refloated, grounded again, took water, listed
& sank. 7 crew rescued. 15 missing. Unconfirmed reports say 15 missing later
found safe. No word on number of containers aboard. (Fri July 21 2000)
The Indian M/V SULTENG I (2,641 gross), Christmas Island for Indonesia with
phosphate, took water in No.1 hold & sank off Christmas Island in about lat
09 17.5S, long 105 20.5E, Jul 18. 23 crew rescued. One missing. (Thurs July 20
On July 16 at 0100 LT in position: 13:04N - 080:22E at Chennai Anchorage,
India, pirates from a motorboat boarded a bulk carrier using a line with a hook
attached. They tried to steal ship's stores. The duty watchmen spotted them
& raised the alarm. Pirates jumped overboard & escaped in their
motorboat. (July 19 2000)
The Panamanian passenger vessel M/V PARADISE (70,390 gross) had problems with
1 engine at Miami Jul 17. Cruise terminated. Vessel requires dry-dock repairs.
(Wed. July 19 2000)
The Panamanian passenger vessel M/V FUNCHAL (9,563 gross) had electrical
fault in control panel while berthing at Gibraltar Jul 16. Assisted to berth by
tug. Repairs under way Jul 17. Cruise terminated. (Tues. July 18 2000)
Sri Lanka's army & navy attacked Tamil Tiger rebel bases & bombed a
supply ship, killing at least 18 guerrillas. The infantry attacked rebel
positions July 16 at 4 places in northern Sri Lanka, where most of the island
nation's 17-year-old Tamil separatist war is being fought. 14 rebels were killed
& 3 soldiers were wounded. In a separate assault, navy gunboats fired at
& destroyed a ship July 16 that was loaded with gasoline for the rebels. The
navy captured the ship's crew. (Tues. July 18 2000)
The Spanish ro-ro ferries M/V CIUDAD DE CEUTA (2,753 gross), Algeciras for
Tangier with passengers & vehicles, and M/V CIUDAD DE TANGER (9,481 gross),
Tangier for Algeciras with passengers & vehicles, were in collision in thick
fog in the Strait of Gibraltar Jul 16. 18 persons injured. 6 dead. Both vessels
berthed at Algeciras same day. Both sustained damages. (Mon. July 17 2000)
On July 15 at 0001 LT at Nouadhibou bay, Mauritania, Pirates from small speed
boats boarded a container vessel & stole ship's stores & equipment. Crew
mustered on deck & pirates escaped in their boats. The master reported that
he contacted Cigading authorities & Merak radio but there was no response.
(Thurs. July 15 2000)
M/V Don Martin Senior V, sank near Bantayan island, 490 km (300 miles) south
of Manila. Passing vessels and the coastguard rescued 92 passengers & crew
of the Philippine ship. Four people are missing, including a 5 year-old boy. The
vessel is owned by local firm Palacio Shipping Inc. The area has been lashed by
rain & strong winds from a tropical depression. Coastguard said the ship had
sent a distress signal early on July 14 because it was taking on water. (Fri
July 14 2000)
THE INCREDIBLE July 14 YUKON COINCIDENCE - Two fleet naval vessels named
"Yukon" - The San Diego Sea Gods? - Go Figure.
YUKON #1 -- Two U.S. naval vessels collided late July 13 while refueling 180
miles west of Oahu causing extreme structural damage to both ships but no
injuries to crew, said the U.S. Pacific Fleet. The fleet oiler of the military
Sea Lift Command's USNS Yukon, crew 100, was refueling the USS Denver , an
amphibious transport dock ship based in San Diego with crew 380, west of the
Hawaiian island of Oahu when the incident occurred at about 6:15 p.m. LT /12:15
a.m. EDT. (Fri. 14 July 2000)
All this over the sinking of a sister?
THREE HOURS LATER - YUKON #2 -- The 366-foot, 2,890-ton former Canadian
destroyer HMCS Yukon (not USNS Yukon, above) that was to be sunk on July 15 to
build an artificial reef, an event expected to draw thousands of spectators,
reached its undersea destination ahead of schedule July 14 after it took on
water. The former Canadian warship sank about 12:30 am Friday, about 1 1/2 hours
after she began taking on water off San Diego's Mission Beach. The U.S. Coast
Guard rescued 3 caretakers from the ship. One water pump aboard the vessel had
been unable to handle incoming water, which was pouring in at a rate of 500
gallons a minute. Caretakers were not injured. The cause of the sinking is under
investigation, but authorities noted that at least 50 holes had been cut into
the vessel to serve as passageways for divers. San Diego children were scheduled
to participate in a ceremony on July 15 whereby the game "Battleship"
would determine who would push "the button" to sink the ship. (Fri.
July 14 2000)
LESSON: Just try to repeat this "Yukon coincidence" again! The
historic Port of San Diego is well advised to treat it's ships well in the
future, but the meaning of all this will elude us. WOW! Don't mess with the San
Diego Sea Gods!
M/V BAUMWALL (3,999 gt, built 1998) drifted off her route & grounded off
Kotka on Jul 12. No leakage or oil spill was reported. The vessel was
subsequently towed into Kotka for inspection. (Fri July 14 2000)
The aluminum-alloy ro-ro cargo ferry M/V NGV ALISO sustained heavy weather
damage 7 miles out of Leghorn, Jul 8-9, while en route to Bastia, with 444
passengers. The vessel returned to the port where damages were found to several
portholes & to the roof of her upper deck. NGV Aliso was taken to Marseilles
on Jul 11 & is expected that she will be out of action for about 10 days.
(Thurs July 13 2000)
On July at 1500 LT in position 15:39.3N - 041:26.5E, Southern Red Sea, 2
speed boats with 5 pirates in each attempted to come alongside a bulk carrier.
Ship's crew mustered and turned on hoses. As a result the boats moved away.
(July 13 2000)
M/V ORIENT PEARL (2,495 gt, built 1981) sank near Umashima after a collision
with tanker M/T SHOWA MARU NO. 5 (2998 gt, built 1993) off Dokaiwan Lighthouse,
Fukunka Prefecture on Jun 25. P&I club currently arranging wreck removal.
(Wed July 12 2000)
On July 7 2000 at 0258 LT at Samarinda River Roads, Indonesia. Four pirates
armed with knives boarded a general cargo vessel from stern & stole a life
raft. The duty officer noticed them & raised the alarm. When the duty
policemen fired upon the pirates, they jumped overboard & escaped in a small
wooden boat. (Tues July 11 2000)
On July 7 2000 at 0515 LT at position 00 49N 103 35.5E, Durian straits,
Indonesia. Five pirates armed with long knives boarded a container vessel,
entered 2nd officer's cabin, tied him with plastic rope & stole all his
money, gold ring and personal effects and asked him to call the captain. The
chief officer saw the pirates & raised the alarm. The pirates jumped into
the sea & escaped in a speed boat. (Tues July 11 2000)
The United Arab Emirates passenger/general cargo M/V WURWOOD, ex AL JAZYA,
(5,426 gross) had engine trouble off Oman, in lat 17 30N, long 56 20E, Jul 9.
Still anchored in same position Jul 10. Tug Lulu proceeding. (Tues July 11 2000)
PIRATES shot & wounded a crewman on board the reefer M/V Minnesota after
it was boarded at anchor in Puerto Bolivar, Ecuador. Other ships are reported to
have anchored further out to sea after the incident. How badly injured the
crewmember is not known. (Sat. July 8 2000)
On 02.07.2000 at 2059 LT at berth no 9, port Conakry, Guinea. A general cargo
vessel was attacked by pirates. Further details are awaited. (Fri. July 7 2000)
0n 02.07.2000 at 0015 LT at Penang container terminal, Malaysia. A container
vessel at anchor was boarded by 2 pirates. The pirates were spotted by duty
seamen who informed bridge and subsequently alarm was raised. On hearing whistle
& fire alarm, pirates jumped overboard and escaped. (Fri. July 7 2000)
The Maltese M/V PIONEER SKY, 11,212 gt (built 1981), had main engine
breakdown June 25 and towed to an anchorage off Buenos Aires, where arrived July
2. Repairs completed & awaiting orders. (Fri. July 7 2000)
The Antigua & Barbuda general cargo vessel M/V SOUTHERN AMELIA II (4,410
gt), on her maiden voyage from Shanghai to Oregon, sustained severe structural
damage, with resulting ingress of water, due to "Typhoon Kirogi" in
lat 17 18.9N, long 132 55.17E, on Jul 4. Several vessels proceeding. (Thurs.
July 6 2000)
New York Harbor Pool Table -- as the ocean liner RMS Queen Elizabeth II got
into a fender-bender with 2 moored warships July 5, a day after all 3 vessels
took part in the 4th of July festivities. The QE2 was entering a Hudson River
slip when it bumped the Japanese warship Kashima, which in turned banged into
the British warship HMS Manchester. Damage was slight: scraped paint on both the
QE2 & the Kashima, scrapes & some bent metal on the Manchester. No
injuries. Thousands of tall ships & other vessels sailed through New York
Harbor on U.S. Independence Day. (Wed. July 5 2000)
A huge oil slick leaking from the Japanese M/T Takeo Maru that sank more than
20 years ago is lapping against a port on Russia's Sakhalin Island in the
Pacific. Winds 1st blew the 1.8-mile-long, 300 yard-wide slick out to sea, but
the gusts reversed course & sent the oil towards the piers of Shakhtyorsk.
Boats splashed absorbent chemicals on the spill & used booms to control its
flow. It is too early to assess ecological damage. The Japanese ship sank off
Sakhalin Island during a storm in 1979 with its fuel tanks full. The oil leaked
because a rusty tank had ruptured. Divers previously attempted to weld shut
small holes in the tanks. Work was slowed by a dispute over whether Russia or
Japan should pay for it. (Wed. July 5 2000)
Liberian oil/chemical tanker M/T TIMASHEVSK (26,218 tons gross, built 1996)
sustained a damaged propeller after striking navigation buoy while leaving New
York harbor on Jun 30. Coast Guard boarding party inspecting vessel discovered
125 kilos of cocaine on board. The drugs were confiscated but no crew members
were charged as the drugs were found in a compartment on an outer section of the
vessel's stern & it was unclear whether the crew knew of it's existence.
(Mon. July 3 2000)
A true vessel disaster -- as a Walnut Creek company failed to find an
investment angel June 30 to help it bring the SS Lurline -- the world's oldest
ocean liner -- back to San Francisco's waterfront. The Ocean Steamship Co. had
until Friday to raise at least US$750,000 to buy the vessel, which has been
berthed in Tampa, Fla., for the past five years. A year ago, the company
introduced its US$45M plan to refurbish the Lurline into a luxury floating hotel
and dock it by San Francisco's Pier 35 as a monument to the days when SFO was a
major port city. The Lurline, built 69 years ago for the Matson Navigation Co.,
carried thousands of travelers between San Francisco and Honolulu in its heyday.
It is still in good shape, said the ship's agent in Tampa. On Mon. morning July
3, a tugboat will tow the Lurline to a scrapyard in India. (Sat. July 1 2000)
Visit our huge Vessel
Casualties & Pirate Activity Database ......... where daily updates of
this news are posted. Stay up to date!
NOTE: The historic dangers of carriage by sea continue to be quite real.
Shippers must be encouraged to purchase high quality marine cargo insurance from
their freight forwarder or customs broker. It's dangerous out there.
Here are our suggested world wide web sites of the week for your business,
your information and your amusement ...............
IATA Annual Report 2000
.......is now online.
The Latin American View of
NAFTA ........ read the new article "A Latin American Perspective
On The NAFTA Model For Trade & Environment Issues In The FTTA Context,"
by Eduardo Gitli & Carlos Murillo, May 2000. The purpose of this article is
to express a Latin American viewpoint of the NAFTA model for Trade &
Environment issues in order to draw conceptual and operational conclusions for
the Free Trade Area of the Americas negotiation process. A Spanish version is
"United States: Import Measures on Certain Products from the European
Communities" ............ a new WTO
panel report is now available on the WTO website.
American Association of
Port Authorities ........... new companion site to Seaports of The
E-Freight World ..........
the annual meeting place for learning, networking & implementing e-business
in the European freight transportation industry. Conference & Workshops:
19th & 22nd September 2000, at the Cumberland Hotel, London
Port of Rotterdam
........ the new B2B effort.
Maritime & Port
Authority of Singapore (MPA) ......... has launched an Internet portal
with the goal of providing the maritime industry with a comprehensive range of
Odyssey Marine Explorations
............ current expedition is the "Cambridge," a code-name for a
large British war ship that sank in deep water over 300 years ago during a
severe storm. The company's management believes the "Cambridge" was
carrying a large cargo of coins with a potential numismatic value between
US$200M & US$500M or more.
1000th Anniversary of The Vikings 1st Discovering Newfoundland
............. as Viking ships from various places in Scandinavia are on their
way to Canada. Modern Vikings are not sailing themselves. They are sending their
ships on container ships. Pictures of the loading of the Viking ship Glad at the
Port of Gothenburg.
...... a tactical planning tool that helps achieve supply chain efficiency by
minimizing expenses, improving service levels & creating collaborative
reports that can be shared over the Internet.
..........a strategic network design tool that helps optimize the size &
location of your facilities to improve the overall functionality of your
E Big Mac? ......... a food
supply chain B2B.
Trailer For "The Perfect Storm"
Transportation .......... ride roller coasters in QuickTime.
It's Your Movie ........
world's 1st interactive film in which you participate.
Mummies of China
Written from wire stories, the Associated Press,
Reuters, Hong Kong Shipping News Lloyds & other world sources.
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