The Cargo Letter
THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
31 August 2000
Good Thursday evening from our Observation Deck...... overlooking the
officially designated "Cargo City" area and....... Runway 25-Right, at
Los Angeles International Airport, voted "Best Cargo Airport in North
America". ED NOTE: For the 1st time in years, there may be no The Cargo
Letter for Sept., as editor Michael S. McDaniel travels to address the FIATA
World Congress 2000 (Int'l Federation of Freight Forwarder Associations) at
Rotterdam this Sept. 2000.
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
e-mail to The Cargo Letter. We strive to
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. Forwarder Not Responsible As Agent
* Travel Agent Mode
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"
Los Angeles - 30 August -- A federal appeals court ruled last week that just
because a forwarder promises close door-to-door care & supervision of a
shipment doesn't mean it's liable when the cargo is damaged en route. The 2nd
U.S. Circuit Court of Appeals in New York reversed a lower-court ruling against
forwarder Panalpina, which arranged a shipment of an electrical transformer from
Italy to Iowa.
The transformer broke loose from the flat rack on which it was stowed, &
damaged other cargo belonging to Prima (U.S.A.) Inc. After Prima sued, the lower
court said Panalpina was liable because it had stated to Westinghouse:
"Rest assured your shipment will receive door to door our close care &
supervision." The appeals court quite properly said Panalpina was not
liable, because it acted as a forwarder instead of a carrier (NVOCC), &
because it exercised "reasonable care" in selection of the stevedore
As to Panalpina's promise to provide door-to-door care & supervision, the
appeals court said: "Because of the well-settled legal distinction between
for warders & carriers, that statement -- mere puffing -- cannot transform
Panalpina into a carrier, & bestow liability upon it."
The case was defended by leading Int'l transport underwriter XL Specialty
Insurance Company & argued to the high court by our dear friend -- the great
transport lawyer Andrew Spector, Esq. of the MIA firm of Hyman & Kaplan.
This case reconfirms a 1949 proposition of the U.S. Supreme Court that a
forwarder, not issuing a B/L, is just an agent, with no responsibility for the
physical state of the cargo. Bravo, Andy!
In it's opinion the high court quite properly defined a non-carrier freight
forwarder as a "travel agent" for freight.
The public commonly accepts the imperative that a "travel agent"
which books your passenger flight is not responsible for your lost luggage. The
federal court now restates the old, but sometimes forgotten, rule that this same
basic principle applies to cargo.
The entire text of this case will be available for your review at the
"Int'l Transport Law Navigator" section of The Cargo Letter website.
- New SBA Relief For Forwarders & Brokers ......... as the U.S.
Small Business Admin. said it will exclude "pass-through" funds in
the annual gross receipts of freight forwarders & customs brokers in its
determination of whether or not they qualify for small business status.
Pass-through funds include a variety of services provided, such as freight
payment to carriers & insurance. However, the gross receipts of
forwarders & brokers may not exceed US$5M. "These revisions better
define the size of business in this industry that SBA believes should be
eligible for federal small business assistance programs," the agency
said. It may also result in preferential state tax treatment for forwarders
& brokers, and exempt them from some regulations. The new size standard
becomes effective Sept. 8. "It's good news for us," said Jon A.
Kent, Washington rep. for the National Customs Brokers & Forwarders
Assn. of America (NCBFAA). "We've been after this change for several
years." However, the SBA has maintained the US$18.5M size standard for
NVOCCs & household goods forwarders, because these companies generally
have higher overhead costs than forwarders & brokers.
- Gore Wants Int'l Commission To Monitor Environmental Impact of Trade
........... as U.S. presidential candidate Al Gore's economic policy advisor
recently proposed creation of a global environmental organization to address
concerns about the impact of Int'l trade on natural resources. "If this
pattern of multilateral environmental agreements is going to continue, then
you are going to see a sensible development of an institution which allows
environmental negotiations to be done on more of a standing, regular
basis," argued Laura Tyson, who also serves as dean of the Univ. of
California-Berkeley's business school. "You wouldn't expect the WTO to
be the right forum." This move by the Gore campaign mirrors a recent
proposal made by French Prime Minister Lionel Jospin to create a World
Environment Organization. Next month, the Greenpeace environmental
organization will start looking for violations of environmental protection
regulations in the Port of Rotterdam. Beware.
- AES To Be Mandatory? ......... as in a report released to Congress
this month, the U.S. government recommended that filing export data
electronically should be made mandatory. Congress requested a study into
mandatory filing of shipper's export declarations (SED) in the Automated
Export System when it passed the Consolidated Appropriations Act last Nov.
The study called for the secretaries of Commerce, State, Defense, Energy
& Treasury, & the director of the CIA, to determine the advisability
& feasibility to process all SEDs in AES. AES was developed several
years ago by Customs & Census as a way to electronically receive export
commodity & transportation data. Customs uses the data in the system to
target illegal shipments, while Census uses it to compile the country's
trade statistics. Other agencies also have enforcement & statistical
needs for AES data. The agencies recommended that a mandatory AES program
should be rolled out in phases over 5 years, starting with filing export
data on the U.S. Munitions List & the Commerce Control List. During that
time, the cost of system enhancements to AES will be about US$19.7M for
Customs & US$6.7M for Census. U.S. Customs & the Census Bureau will
host a series of AES meetings in Los Angeles Sept. 13-14. Contact Leslie S.
Albertson of Customs, at (703) 921-7470.
- UN Commission Blasts WTO .......... as a commissioned study on
"globalization & its impact on the full enjoyment of all human
rights," released this month at the 52nd session of the UN
Sub-Commission on the Promotion & Protection of Human Rights, has
lambasted the WTO for its "grossly unfair" handling of the
multilateral trading system. The report, written by 2 special reporters
nominated by the UN Commission on Human Rights, describes the WTO as a
"veritable nightmare" for large parts of the world, particularly
citizens of developing countries. Citing an unbalanced & inequitable
approach to trade liberalization, nontransparent procedures &
inattention to human rights implications of trade policy, the report
concludes that "what is required is nothing less than a radical review
of the whole system of trade liberalization & a critical consideration
of the extent to which it is genuinely equitable & geared towards shared
benefits for rich a& poor countries alike." The report says that
despite the current environment supporting transparency at the Int'l level,
the WTO "has demonstrated a particular opacity" with respect to
the demand for openness. For an electronic copy of this document, visit: http://www.unhchr.ch/Huridocda/Huridoca.nsf/0811fcbd0b9f6bd58025667300306dea/2
- B2B Gets Circle Chief ........ as David I. Beatson, former
president & CEO of Circle Int'l, has been named Chairman & CEO of
SupplyLinks. The new company is an Internet-based B2B global supply chain
network that links customers to multiple transportation modes & service
providers. Its mission is to enable manufacturers, retailers, &
distributors to manage & bring innovation to their supply chain
processes by optimizing transportation routing, fulfillment and landed cost
of finished goods, parts & components. The SFO based forwarder &
logistics provider Circle Int'l & 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.
Meanwhile, Circle Int'l has formed an alliance with 2 Singapore-based supply
chain management companies to provide end-to-end logistics solutions for
high technology. Circle has teamed with a contract manufacturer, Omni
Industries, & a logistics management company, Mentor Media. The 3
companies, under the name COM, said they will offer "single-source,
turnkey manufacturing, assembly & delivery programs." COM will be
based in Singapore. Computer & electronics companies, led by Dell
Computer, Hewlett-Packard & Cisco Systems, are outsourcing more of their
manufacturing & supply chain management operations to 3rd parties. http://www.SupplyLinks.com/
- The Thieves Among Us ......... as a joint investigative effort has
snared a gang of 16 Pinkerton Security Services guards accused of stealing
more than $US1.5M worth of rail shipments that they were paid to protect.
The charges were the result of a task force comprising U.S. Customs, the
Union Pacific RR Police Dept., the U.S. Border Anti-Smuggling Unit, the U.S.
Attorney's Office, the FBI & the U.S. Postal Inspection Service. Customs
Service special agents also arrested a postal employee that allegedly
received & sold much of the merchandise stolen by the security guards.
The crime spree ran from 1993 until Sept. 1995, when Southern Pacific hired
the Pinkerton security guards to provide additional security in the El Paso,
TX area. While working for the SP, the security guards boarded trains
without authorization & broke or removed security seals, pilfered
containers and trailers & stole merchandise from shipments, including
bonded shipments. The guards transported the stolen merchandise in Pinkerton
trucks throughout El Paso & New Mexico. Many of the thieves left
Pinkerton to take other security positions -- including 2 who became U.S.
Border Patrol Agents. The thefts became known as the "steal rails"
- MPF Stopped ....... as a proposal by the Clinton Administration to
extend the U.S. government's fee to process imports until 2010 has been
stopped by Congress. The Merchandise Processing Fee (MPF), which is due to
expire in 2003, was implemented under the 1986 Omnibus Budget Reconciliation
Act. MPF imposes a tax based on the value of imported goods, ranging from
US$25 to US$485 per import entry. See full details in The Cargo Letter 
- Did The Mob Call This "Buying Protection"? ........... as
the U.S. Dept. of Justice has petitioned the Supreme Court to hear a case of
whether a USDA mushroom research & promotion program is
unconstitutional. The program, the "Mushroom Promotion, Research &
Consumer Information Act," requires mushroom importers to pay for
advertising & promotions. The 6th Circuit Court of Appeals on Nov. 23,
1999, ruled in USDA vs. United Foods that the USDA program violates the 1st
Amendment of the U.S. Constitution. The appeals court denied a rehearing 4
months later. The Supreme Court is expected to either accept or refuse to
hear the case shortly. If the court refuses & the appeals court ruling
becomes final, the mushroom importers could be due for a refund of the
promotion program fees. The USDA's research & promotion programs are
intended to expand, maintain & develop markets for agricultural
commodities in the U.S. & abroad. The agency has 13 programs similar to
the one for mushroom shippers, including cotton, beef, pork & honey.
There is no mention of "fish," as in sleeping with them, for
importers who do not pay.
- China-Japan Trade Surges .......... as during the 1st half of the
year volumes have rocketed 30% higher year-on-year. The US$38.8B total for
the 6 month period breezed past the previous record of US$29.9B, set in the
1st half of 1997. The much improved figures are indicative of China's
improving economy & Japan's accelerated recovery from its
"flu" & worst recession in decades.
- Iraq - Syria Rail Reopens ........... as the 1st Iraqi train to
Syria in 19 years arrived in the No. city of Aleppo on Aug. 12, marking the
resumption of a rail service between the countries. The train from northern
Iraqi city of Mosul, arrived after a 15-hour journey carrying freight &
passengers. The train will make the 520 km journey once a week. Relations
between Baghdad & Damascus have improved in recent months after 2
decades of tension. Syria, ruled by a rival branch of the Baath Party,
backed Tehran in the 1980-88 Iraq-Iran war & was a member of a U.S. led
30-state coalition that drove Iraqi forces from Kuwait in the 1991 Gulf War.
- Inter-Korea Line May Reopen ......... as talks in Seoul this month,
negotiators agreed to reconnect the 309 mile rail line from Seoul, South
Korea's capital, to Pyongyang, the North's capital, and on to Shinuiju on
the North's border with China. A South Korean official said he hoped the
railroad would be running by the fall of 2001. The last train to run this
stretch of rail linking Seoul & Pyongyang passed by in 1945. That was
the year American & Soviet forces divided the Korean peninsula at the
close of World War II.
- New Rail Links For China ......... as a giant US$2.8B new railway
project linking 4 interior provinces of the People's Republic of China was
given a boost with the approval this month of a US$300M loan by the Asian
Development Bank. The Hefei-Xi'an Rail Project involves constructing a
954-km single-track railway & 52 new stations linking the provinces of
Anhui, Henan, Hubei & Shaanxi, the ADB said. Nearly half the route will
be electrified, & modern technology will be used for signaling,
telecommunications, operations & mechanized maintenance. The project is
scheduled for completion by Dec. 2005.
- Burlington Northern Santa Fe Train Track .......... as it has
introduced a Web-based application that allows carload customers to access
estimated transit times between nearly 7,000 stations on the BNSF system.
Customers can determine scheduled carload transit time from the release or
interchange of the shipment to the placement of the shipment at destination,
BNSF said. Transit times are accessed through the railroad's Web site. From
the "Quick Links to BNSF Customer Tools," a customer clicks on
"select from list" & selects "carload transit
schedule" to access information. http://www.bnsf.com
- Intercontainer-Interfrigo Increase To Hungary ........ as traffic
of containers between German seaports & Hungary for the pan-European
intermodal operation in the 1st half of the year was up by 25% from last
year's level. Between Jan. & June, the operator carried 19,800 TEUs on
this route. The number of "block trains" rose by 23%, to 332 on
this route. Intercontainer-Interfrigo links the German seaports of Hamburg
& Bremerhaven with some 130 stations & terminals in Hungary.
- BAX Global Goes Big In Netherlands .......... as it has signed a
long-term lease with ProLogis for the use of a 269,000 square-foot
distribution facility in the Dutch town of Moerdijk. Picked by both BAX
Global & Prologis for its central location between Rotterdam &
Antwerp, both companies plan to use the facility to service the high-tech
and aerospace industries.
- TNT Said "Dreadful" In Netherlands ......... as the
quality of postal delivery by TNT Post inside its own country - The
Netherlands - gets worse & worse. However, the dispatch of ordinary mail
to the U.S. via U.S. Postal is so ghastly that it is better not to make use
of it. So says The Dutch Consumers' Assn. following an investigation.
Already for years PTT Post - the domestic leg of TNT Post - has neglected
the quality of both processing & delivery. Time & again the concerns
has promised to do better, but ever so often it appears that it just does
not honor such promises. Of the letters some 15% arrive too late. PTT Post
keeps a margin of 5%. PTT & disputes the method of the investigation,
although every customer of the company (i.e. everyone in The Netherlands,
for it has a monopoly) knows that the quality totally falls short. According
to The Consumer's Assn. the dispatch of standard mail to the U.S. is so
defective that it would be better for PTT to discontinue that service.
>> 20% of the letters get lost completely.
- Phoenix Int'l Freight Services Doesn't Stop ......... as it opened
its 25th US office on August 1 in Dallas/Fort Worth, marking the 14th
opening in the past year. With 17 years experience in the industry, Ken
Lopez will head up the latest branch. The DFW branch will also offer on-site
- UPS In The Chips ......... as its has signed a 5 year contract with
California-based National Semiconductor Corp. The deal is valued at US$150M
& includes the opening of a global distribution center in Singapore to
manage distribution of Southeast Asia-made microchips to consumers around
- Ford Motor Co., The Customs Broker ........ as Vastera, a trade
management concern & Ford Motor Co. have announced that Ford's U.S.
Customs Opns. will merge with Vastera in exchange for shares of common stock
in Vastera. Vastera & Ford also have entered into a 10-year agreement
under which Vastera will provide Ford with global trade managed services,
including managing Ford's import & export trade processes in the U.S.
Under the terms of the agreement, Ford's Customs Operations will be merged
into Vastera's Trade Management Services Operation. Completion of the merger
is subject to receipt of required regulatory approvals. Ford operates 112
plants in 25 countries making it one of the top importers/exporters in the
- U.S. Inland Rates Headed Higher? ........... as effective Sept. 1,
2000, LTL carrier American Freightways, Inc., will institute a general rate
increase of 5.5% with some additional adjustments in certain long haul
markets, imbalanced lanes & high cost service areas. Minimum charge
floors will increase by US$2.50.
- FedEx Gets A Passport ....... as it's "Custom Critical"
div. has acquired St. Louis-based Passport Transport on undisclosed terms A
leader in its market, Passport Transport moves antique cars, race cars &
other specialty autos, as well as cars owned by collectors, sports figures
& celebrities. The company transports cars throughout the contiguous
U.S. in custom-designed, enclosed trailers, operated by independent
contractors. Each trailer holds up to 6 vehicles, enabling customers to ship
several cars at one time. Founded in 1970, Passport will continue to operate
in its current location in St. Louis as a wholly owned subsidiary of FedEx
- South Korea Beef Appeal .......... as it will appeal a WTO ruling
against its restrictions on imported beef. The WTO Panel ruled that S.
Korean restrictions on the import, sale, & distribution of fresh,
chilled & frozen imported beef were inconsistent with Article III of
GATT (national treatment). The US & Australia brought the complaint to
the WTO, arguing that S. Korea's regulatory regime, or so-called "dual
retail" system limits market access for their beef products. The ruling
is available at: http://www.wto.org/english/tratop_e/dispu_e/distab_e.htm#ds166.
- Sneaking Butts ........... as a U.S. federal grand jury is
investigating export sales of the former Int'l division of R.J. Reynolds
Tobacco Co. The grand jury in Raleigh has issued subpoenas for documents,
R.J. Reynolds said in documents filed with the U.S. Securities &
Exchange Commission. Neither R.J. Reynolds or the U.S. attorney's office
would comment on the probe. Federal investigators already had been looking
into Int'l cigarette smuggling to avoid taxes involving a Reynolds
subsidiary, Northern Brands Int'l. That probe began more than 4 years ago
& has led to the conviction of one former executive, Les Thompson, who
managed Northern Brands from the company's Winston-Salem headquarters.
Thompson & Northern Brands pleaded guilty to charges related to
smuggling cigarettes into Canada. Justice Dept. officials said they would
continue investigating any possible role of RJR's leadership in
cigarette-smuggling operations. Governments in the U.S. & Canada, which
brought a US$1B suit against RJR that was dismissed last month, have been
unable to prove that any of RJR's senior managers engaged in illegal
conduct. RJR has suggested that Thompson acted alone in his smuggling
activity. The company's Int'l operations have been sold off to Japan Tobacco
- Gray Butts .......... as an administrative law judge for the U.S.
Int'l Trade Commission has determined that the importation of gray market
cigarettes violates U.S. laws. The case was brought before the Int'l Trade
Commission (ITC) by Brown & Williamson Tobacco Corp., which charged that
importers unlawfully & without its authorization imported & sold in
the U.S., Kool & Lucky Strike cigarettes manufactured by B&W for
sale outside the country. Agreeing with the company, ITC Admin. Law Judge
Debra Morriss recommended "that a general exclusion order be issued,
that a cease & desist order against (the importers) be issued, and that
a bond of US$7 per carton of repatriated Kool & Lucky Strike cigs
imported during the presidential review period be imposed." Should the
findings be adopted by the full Commission, U.S. Customs will stop the entry
of gray market Kool & Lucky Strike cigs into the U.S. The ITC's order
will be enforced at all ports of entry & against all importers of gray
market Kool & Lucky Strike brands, not just those involved in the ITC's
investigation. The ITC's final decision is expected in Oct. Judge Morriss
found that the gray market cigs differed materially in several respects from
those sold domestically, which leads to consumer confusion. Gray market cigs
are a problem not only for consumers & manufacturers, but also for state
governments, retailers & wholesalers, the company said. Gray market cigs
do not include the cost of the recent settlement between the states &
tobacco manufacturers, thus reducing the money the states are entitled to
under the agreement. This price advantage also hurts legitimate retailers
& wholesalers who lose sales to those who engage in the gray market.
- The Danger of Maps ......... as China has tightened control over
the production of maps, globes & audio visual (A/V) products. All
companies concerned, including foreign joint-venture companies based in
China, whose products are for export only, must obtain a production permit
for each contract. The new measures are already in place & will have
significant impact on imports & exports of such products. For companies
which have signed their contracts already, they can still continue with
their production. For new contracts, companies concerned must apply for a
permit before production. All companies producing maps, globes or products
with maps must submit samples of their merchandise to the State Bureau of
Surveying & Mapping for approval. For audiovisual products, approval
must 1st be obtained from the State Press & Publication Admin. Companies
concerned should then apply for an export processing permit from the
relevant trade authorities & customs. The reason for this action is not
immediately understood. What next?
- Panama Replacements .......... as the Honduran Congress has
ratified an anti-drug pact with Washington that will allow U.S. forces to
patrol Honduran waters & airspace. The convention will allow the U.S.
Coast Guard to board ships in Honduran waters suspected of smuggling drugs
or pirate activity. It also allows for joint air & land patrols, said
the head of Congress's Foreign Affairs Committee, Ramon Villeda. Since
losing Howard Air Force Base in Panama last year, Washington has been
seeking other regional solutions to monitoring & interdicting boat
shipments & planeloads of Colombian cocaine heading to U.S. consumers.
In what White House anti-drug czar Barry McCaffrey has described as plugging
the last hole in Central America, the U.S. in April signed an agreement with
El Salvador to use the Int'l airport of Comalapa as a forward operating base
for anti-drug agencies. It also has accords with the Caribbean islands of
Curacao and Aruba, & with the Andean country of Ecuador to use the naval
base of Manta. We want this to work, but it won't. Please recall Saigon.
- China Customs Chief Nabbed ......... as a former official is
accused of taking bribes to abet the smuggling of hundreds of millions
dollars worth of goods through its border with Hong Kong, Xinhua news agency
reported on Aug. 16. The official agency quoted the Communist Party as
saying former Shenzhen custom chief Zhao Yucun had been expelled from the
party & would be prosecuted for taking bribes to help a businessman
evade US$330M in duties. While heading up the Kowloon customs post on
China's border with Hong Kong from 1995-98, Zhao helped businessman Yang
Gaiqing use a bonded warehouse to smuggle 420 tons of vegetable oil &
2.1 billion yuan worth of other goods.
- U.S. Customs & Microsoft Strike ........ as recent criminal
actions were taken against 2 Georgia-based businesses for the alleged
distribution of counterfeit Microsoft software. After executing search
warrants at Compunet Systems, & Tierra Computer Inc., U.S. Customs
officials uncovered large quantities of counterfeit Microsoft software,
including Office 2000 Professional Edition & Windows 98, with a combined
total value of nearly US$1M. Both companies are subject to criminal
penalties for trafficking in counterfeit goods. Under federal trademark law,
criminal penalties include fines of up to US$2M &10 years in jail per
infringement; federal copyright laws include fines of up to US$250,000 &
5 years in jail per violation. The protection of intellectual property
rights is a top priority for U.S. Customs. Customs has seen a steady
increase in the seizure of counterfeit or pirated goods. In 1999 alone,
Customs seized more than US$98M in counterfeit merchandise. The theft of
intellectual property is not just a local problem -- it also hurts the world
- Fritz Companies Aids EU Customs........ as the SFO based forwarder
has won approval from the UK Customs & Excise Trade Policy Group to
participate in the "Single European Authorization" trade
facilitation project that seeks to simplify customs & duty requirements
in the European Union. SEA will create a mechanism that greatly simplifies
trade among European states, according to Fred Schardt, Fritz's managing
director of Europe. As an example, he explained, it will provide importers
in Europe with an opportunity to make duty payments & control licensing
& standards through one customs authority, regardless of the location in
the European Union where their goods are imported. Fritz operates a customs
processing office in London covering all of Europe.
- X-Rated X-Ray? ....... as the government calls it security. A
device called BodySearch is being used by U.S. Customs inspectors at 6 U.S.
airports to detect contraband. The low-power X-ray penetrates only a few
millimeters below the skin, seeing through clothing & eliminating the
need for strip or pat-down searches. BodySearch scans are so sharp that the
shape of a person's navel is visible, along with the shapes of other, more
private parts. This has raised the concern of groups who say it violates
privacy. U.S. Customs uses BodySearch at Int'l airports in Atlanta, Chicago,
Houston, Los Angeles, Miami & New York's JFK. It also is being used at 6
U.S. prisons & a gold mine in South Africa. And with a price tag of
roughly US$140,000, some private businesses could likely afford one. U.S.
Customs said BodySearch scans are strictly voluntary, & that people have
to sign a release form before the government can do the scan. There are no
plans for a centerfold in upcoming U.S. Customs Bulletins.
- It's Not Like Counterfeiting Music CDs........... as China executed
4 men on Aug. 9, including a Taiwanese man & a Hong Kong resident, for
counterfeiting & smuggling fake currency, Xinhua news agency reported.
Taiwan fishing boat Capt. Zhuang Tianhuo, of Kaohsiung, was put to death for
trying to smuggle $7.5M in fake Chinese currency in July 1998. Hong Kong
resident Cai Xiong & mainland accomplice Xie Zhuoxin were executed for
counterfeiting Taiwan & Hong Kong currency & possession of
counterfeiting equipment. Another mainlander, Zhuo Bing, was taken to the
killing grounds of his native Guangdong province for leading a ring of
counterfeiters which made bogus Chinese bank notes.
- Cathay Pacific Airways. UP with a record profit of US$280.6M during
the 1st half of the year, smashing the previous best interim profit of
US$211.7M in 1996. The prosperous figure dwarfs the profit of US$13.9M
recorded in the 1st half of 1999. Turnover was up a sharp 23.1% to US$2.075B
& passengers numbers also increased by 17% to 5.8 million.
- China Ministry of Railways. UP with earnings of US$1.14B for the
month of July, a year-on-year rise of 11.8%. Almost 59& of this figure
was accounted for by cargo which soared to over 78,000 cars per day, up 9.4%
on the figures for July last year.
- China Southern Airlines. UP with a 46.1% rise in first-half net
profit of US$42M.
- Circle Int'l. UP as net income in the 2nd quarter jumped 35% to
- Eimskip (Icelanid shipping) DOWN with net profit for 1st half of
2000 was US$6.6M, down from US$8.0M in the corresponding period in 1999.
- Expeditors Int'l. UP as 2nd-quarter net earnings improved 37% to
US$18.1M. Revenue increased 22% to US$404.5M while operating income rose 34%
- Far Eastern Shipping Co. (FESCO, the Russian shipping co.) DOWN
with reported a net deficit of US$82Mfor 1999, the 2nd year of heavy losses.
The carrier reported a net loss of US$128M in 1998. Revenue from hire &
freight income was US$331M in 1999, up 2% on the US$323M revenue in 1998.
Voyage & running costs increased 11%, to US$281M.
- Freight Connection, Inc. DOWN as revenues for the 2000 second
quarter were US$5.66M, compared to US$7.76M in the 1999 2nd quarter, a
decrease of 27%. Net revenues for the 3 months ended June 30, 2000 were
US$534,876 compared to US$767,566 for the prior year period. Net loss for
the 2nd quarter was US$11,185 or $.00 per share compared to net income of
US$73,125 or $.02 per share for the comparable 1999 period.
- GeoLogistics. DOWN, but with smaller losses for the quarter & 6
months ended June 30, partly because of the sale and restructuring of
activities. Net loss for the latest quarter was US$9M, compared to a net
deficit of US$12M in the 2nd quarter of 1999. Operating loss also decreased,
to US$3M, from US$7M in the same period last year. Revenue decreased 6% to
$373M in the latest quarter.
- Hanjin. UP with a record rise in 1st half profits to US$54.4M, more
than 5 times last year's figure, on the back of a stronger container market
in Asia & weakness of the won against the dollar. Hanjin is the world's
3rd largest operator, with a 4% share of the total global market.
- Interpool. UP with record net income for the 2nd quarter ended June
30 of $10,377,000, compared with net income of $5,726,000 for same period
1999. Revenues for 2nd quarter increased by 50% to US$66,093,000. Operating
income was $27,976,000 in the quarter versus $19,210,000 for same period
last year. Interpool is corporate sponsor of The Cargo Letter.
- Kühne & Nagel. UP with a record consolidated net profit of
US$33.3M in the 1st half of 2000, up 26.9% over same period last year.
- Novorossiysk Shipping Co. (Russian) UP as operating profit was
US$6.19M before extraordinary losses & tax, compared with a loss of
US$10M in 1998. Income rose slightly to US$311.35M, while costs fell nearly
US$14M to US$223M. The company has sold 33 older vessels reducing its fleet
to 78 ships.
- Orient Overseas Int'l. (OOCL). UP as its 1st half 2000 results saw
income increase by 20% to US$1,161M & operating profit before financing
of US$54.6M (US$28.3M last year). Operating profit before tax was US$33.6M
(US$5.7M last year). Profit after taxation of US$22.9M (loss of US$1.3M last
- P&O Nedlloyd Container Line. UP with 2nd quarter operating
profit of US$4M, compared to an operating loss of US$18M in the year-earlier
period & a loss of US$14M in the 1st quarter of 2000.
- Pacer Int'l. UP with 2nd-quarter net income of US$6.9M, compared to
US$4.3M for the year-earlier period. Consolidated gross revenues jumped
51.2% to US$294.9M for the 2nd quarter.
- Panalpina. UP with a record result for the 1st half as net revenues
rose 22.4% to CHF 2,427 million while gross profit advanced 26.1% to CHF
- Qantas. UP with another record profit before tax of US$447.7M for
the year ended June 30, 2000, an increase of 15.1% over last year. Net
profit after tax was US$304M, 23% higher than last year.
- SAirGroup (Swissair) DOWN 33% in the 1st 6 months of 2000, highly
due to fuel cost. Operating profit fell US$82M. Net profits went down by
US$2M. Revenues were up 34% to CHF 7.5 billion, boosted by the acquisition
of a catering company.
- BA & KLM Still Taking ........ as British Air & KLM Royal
Dutch Air said they have agreed to extend the exclusivity period for their
talks about a possible merger. The Aug. 10 announcement follows industry
speculation that the talks were close to collapsing. "Constructive
discussions have taken place & important progress has been made,"
the European lines said in a joint statement. Both parties said they
"recognize that a business rationale for a potential merger
exists." A combination of BA & KLM would be the most complex
transaction in the aviation industry, the lines said. BA & KLM have
agreed to allow for an additional several weeks to continue to discuss the
proposed deal. The BA/KLM merger discussions, seen as a takeover of KLM by
BA, started in June. But these are bleak times for BA as it faces a review
on its debts. The review has been initiated by Moody's Investors Service,
which had maintained a high rating on BA's debt throughout its travails. The
U.S. based rating agency thinks the review necessary, because of continued
weak earnings & the prospect for the continued high level of
competition. This month BA has reported a loss in the year to March, with
major losses on the European routes. The review has not been triggered by
BA's talks with KLM, a Moody's said, and would not take the possible merger
into account. One of the difficulties to overcome is the EU, which will have
competition concerns. The U.S. government was quick to warn that it will
block merger, if it cannot negotiate a new ‘open skies' agreement with the
UK. In related news, KLM Cargo said it will raise rates by 5 to 10% on most
European & Asia Pacific routes. The increases will take effect in Oct.,
expect in the Netherlands, where they will take effect Sept.1. KLM said
increased demand has spurred the rate hike, which means it's a seller's
market. In the carrier's 1st quarter, cargo traffic increased 4%.
- Swiss Airline Swissair's Demand ....... as it wants to take the
place of KLM in the merger with British Air. These plans would frustrate
merger discussions between KLM & BA. Swissair is said to be conducting a
study of the benefits of amalgamating with BA, according to British
newspaper The Mail. The conclusion apparently is that the Swiss are a
'stronger partner' for the British airline than the Dutch. A BA spokesman
only let out that BA 'always talks with all airlines'. This month KLM &
BA decided to continue their negotiations which must result in a merger. It
was said that important progress had been made, due to which a merger has
become a great deal more probable.
- Alitalia's Demand ........ as it will pursue a US$232M damage claim
against KLM Royal Dutch Air for breaking off alliance talks earlier this
year. The Dutch company's withdrawal April 28 from the partnership
negotiations was "illegitimate," & attempts at reconciliation
failed, an Alitalia statement said. Alitalia said that under the terms of
the alliance talks, it incurred losses of more than US$46M, and a damages
penalty of US$232M is applicable. The carrier had not yet decided where it
would file the claim.
- United Is Sorry ........ as it apologized on Aug. 18 to its top
shippers for the thousands of delays & cancellations this summer. UAL's
parent company, meanwhile, said its earnings for the current quarter would
fall short of what it had announced last month that Wall Street could
expect. It's at least the 5th time in the past 3 weeks the world's largest
airline _ plagued by stormy weather & acrimonious relations with its
pilots _ has thought it necessary to soothe angry shippers & travelers.
UAL stock, which was trading at US$79 in Jan, has slipped steadily to about
US$49.00, close to a 4 year low. But wait, UA reached an interim settlement
with it's pilots on Aug. 27. Perhaps we again may have "friendly
- Forwarders & TIACA Agree ........ as in an effort to improve
the shipping process, eliminate obstacles & focus attention on the air
transport issues involving world trade and the global marketplace, The Int'l
Air Cargo Association (TIACA) and the Airforwarders Assn. have signed an
agreement to share information, discuss issues & ideas and coordinate
action when required. Both associations recognize that government,
regulatory bodies & elements of the air cargo chain influence many of
the issues of common interest.
- Watch Your Head! ......... as In a travel season rife with late
arrivals & canceled flights, several lines have begun flying at lower
altitudes, trading fuel efficiency for on-time arrivals. The FAA more than a
year ago gave airlines approval to operate some short flights _ up to 500
miles _ at between 8,000 feet & 23,000 feet. But lines have resisted
until recently because flying through denser air at lower altitudes burns
more fuel. But with thousands of flight delays drawing the ire of shippers
& the eye of federal regulators, more airlines are turning to this quick
fix. After meeting with airline, union & airport executives Aug. 21,
Transportation Secretary Rodney Slater announced the formation of a task
force to monitor airline service.
- Deutsche Post Predatory? ......... as the EU Commission initiated
proceedings against Deutsche Post AG for abuse of its dominant position. The
Commission stated: "In response to a number of complaints, & a
judgment in the Court of First Instance finding that the Commission had
wrongly failed to act in the matter, the Commission has initiated formal
proceedings against the German postal operator Deutsche Post AG for abuse of
its dominant position. These proceedings are concerned in the 1st place with
Deutsche Post's pricing of parcel delivery services for mail-order
business." The Commission's preliminary inquiries suggest that Deutsche
Post allows large mail-order traders substantial discounts if they undertake
to send all their parcels through Deutsche Post. They also suggest that
Deutsche Post does not come anywhere near covering the costs of its
mail-order parcel services. This means that no private provider of parcel
services to mail-order firms has been able to achieve any firm foothold in
Germany. The proceedings likewise question the postage charged by Deutsche
Post for the letters it delivers under its monopoly rights. At this stage
the Commission is asking Deutsche Post to explain why it is that even taking
account of quality of service and density of population German customers pay
the highest postage in Europe.
- Deutsche Post Pricey ............ as the German post office turned
Int'l logistics giant, has set an initial public offering for Nov. 6 and
will list 25% to 33% of its shares on several stock markets in Europe.
Deutsche Post plans to list shares in Germany, Britain, Italy, Spain, the
Netherlands, Austria & Switzerland. The German post said it has not
finalized any plans. Since launching a US$3B global acquisition spree that
included the purchase of large forwarders Danzas & Air Express Int'l
& many European parcel delivery firms, Deutsche Post has become one of
the world's largest transportation companies. Analysts anticipate the $29B
company's IPO to be one of Europe's largest ever.
- U.S. - Nigeria Restart ........... as direct air links resumed with
a 1st flight on Aug. 16 after a 6 year gap, &10 days before the arrival
of Pres. Clinton. South Africa Airways (SAA) clinched the deal to operate
the lucrative Lagos-New York route earlier this month on behalf of Nigeria's
debt-ridden & near bankrupt national carrier Nigeria Airways. The U.S.
ended a ban on direct air links with Nigeria last Dec. after reporting
security improvements at Lagos airport. Analysts said the real reason was
the return to democracy after 15 years of military rule.
- Breaking Up Is Hard To Do ......... as Mexico's anti-monopolies
commission is expected next month to announce the breakup of the country's
main aviation holding company, as a step towards the sale of its 2 flagship
airlines - Aeromexico & Mexicana. The holding company, Cintra, was
created as a temporary measure after the 1994 peso devaluation left the
airlines on the brink of financial collapse.'
- Danzas AEI Makes On Line Deal ................ as the world's
largest air freight forwarder, & part of Deutsche Post, will make use of
the ClearCross Network for electronic transactions. Danzas AEI will use the
network to deliver specific global commerce services, including the
ClearCross Trade Engines for regulatory compliance, landed cost &
document generation, to speed fulfillment of Int'l orders. ClearCross
Network customers will also be able to access Danzas AEI's air & ocean
freight services, bookings, customs brokerage & warehousing. http://www.clearcross.com/
- At Least BA's Cargo Is Up .......... as British Airways World Cargo
said revenue during the carrier's 1st fiscal quarter ending June 30 rose 13%
to US$225M over last year's quarter. Cargo traffic also increased 13% in the
quarter to 232,000 metric tons, led by shipment growth in Australasia &
the Far East, particularly Japan. "The introduction of 2x weekly
747-400 freighter services between London & Osaka in May also enhanced
our bottom line," the company said. BA also credited the improvement to
the opening of its new World Cargo Center at London's Heathrow. Some 60%, or
all of the airline's containerized freight business, is now handled at the
center. Bulk shipments will be transferred into the facility this fall.
- Warehouse Space Available - Cheap ......... as after 10 years of a
U.N. ban on flights to Iraq, the Int'l airport in Baghdad has reopened for
business this month -- with no aircraft, passengers or cargo. Transport
& Communications Minister Ahmed Murtada Ahmed Khalil said the Saddam
Int'l Airport is "expecting the arrival of aircraft" from friendly
countries, but did not elaborate. Pres. Hugo Chavez of Venezuela received a
red-carpet welcome at the airport early this month when he was ferried there
from the Iranian border in Saddam Hussein's helicopter (Warning: Don't sit
by the window). Chavez was the 1st head of state to visit Iraq since the
1991 Gulf War. Pres. Abdurrhman Wahid of Indonesia has said he would visit
Baghdad in coming months. Iraq flew its fleet of 15 Boeing aircraft to
Jordan, Tunisia & Iran for safekeeping shortly before the war. Efforts
to bring the jets home have failed & the planes now may be too old to
fly. Iraqi Airways offices in Baghdad have turned into communications
centers & food stores.
- Japan Considers Possible New Submarine Base .......... as just 6
years after opening, the 2nd largest airport in Japan, & world's largest
man made island, is sinking. Authorities say there is nothing to worry
about. Built on reclaimed land off the city of Osaka, Kansai Int'l Airport
was designed to settle & sink by about 11.5 meters over a 50 year
period. However, fears that the airport's builders have miscalculated &
that the 505-hectare plot is sinking faster than expected are prompting
plans to spend US$248.6M in shoring up airport buildings against potential
ground flooding. There are even concerns that the rate of sinking is taking
place at an uneven pace & that this will lead to a buckling effect on
the airport's infrastructure. The airport's authorities & architects
disagree that there is any problem & say that, while sinking may be
taking place at a more accelerated rate than expected, it is still within
the airport's design specifications. Plans to reinforce the airport's
foundations are now underway with 2 strategically placed underground walls
installed as barriers against water seepage. Pumps will also be installed as
a backup should the walls be breached by an unusually high tide.
- Alitalia Picks Mercury At LAX ......... as it has signed a US$1.7M
contract with Mercury Air Cargo for cargo handling at Los Angeles Int'l
Airport. The deal, which covers services provided at Mercury's
180,000-square-foot LAX cargo facility, will take effect in Sept. & last
2 years. Alitalia joins Cathay Pacific, JAL, EVA Airways, LanChile &
China Southern as Mercury cargo clients in Los Angeles.
- New East EU Cargo Hub For Lufthansa? ........... as Lufthansa may
want to invest US$460M to turn a former military airport in Lithuania into a
cargo hub, a newspaper reported on Aug 21. The daily Lietuvos Rytas said the
group wants a 99 year lease in exchange for investment in the former Soviet
airport near the city of Siauliai, some 137 miles N.W. of the capital
Vilnius. The newspaper quoted Siauliai Mayor Vida Stasiunaite as saying
Lufthansa was one of the investors, who want to turn the facility into a
major cargo hub.
- Las Vegas No Gamble For Lufthansa ......... as a new US$400M
aircraft maintenance & cargo/logistics facility located on 105 acres at
McCarran Int'l Airport in Las Vegas (LAS) has selected Lufthansa Consulting
to provide tech support to the project. The planned 300,000 square foot
cargo/logistics facility will initially handle up to 200,000 tons of cargo
per year with growth anticipated to 500,000 tons over the next 10 years.
With both dry & cold storage available it should meet the growing high
demand for fresh products being driven by the city's hotel-casinos. McCarran
is the 10th busiest airport in the U.S. & the 17th busiest in the world.
Currently an average of 250,000 people occupy Las Vegas hotel rooms daily.
- Qantas On A Diet ........ as Australia's largest line has to
economize in order to be ready for a major competitive threat in the
domestic market. Australian owned line Impulse & UK-based Virgin aims at
breaking the market. Recently, Impulse made a serious attempt to do that,
when slashing fares on the Sydney – Melbourne route, which is the
country's busiest. Qantas' response to all this is to cut its annual
expenditures by more than AUD 85M, & to try to increase revenues by AUD
100M a year within 2 years.
- FedEx On A Tech Diet .......... as it is to cut the technology
staff & is considering eliminating about 200 info tech jobs, or about 5%
of the 5,000 employees in the corporate services division's information tech
- Uncle Sam's New Partner ......... as the U.S. Postal Service (USPS)
& Emery Worldwide will jointly work out a new 'Parcel@Home' logistics
program that will provide businesses with dock-to-residence delivery service
available in the USA. The service is targeted for shippers of high-value
computers & home electronics & it specializes in home delivery of
multiple-piece shipments, weighing up to 70 pounds.
- BAX Global Tracking Is At The Heart of It ......... as Ansett
Australia & Air New Zealand Engineering Services. (ANNZES) have opened
ground breaking Logistics Support Centers in Auckland & Melbourne, in
partnership with GE Engine Services & BAX Global. An airline 1st, this
initiative will provide the centers with an online link between ANNZES
inventory management system, live tracking data from BAX Global & GE
Engine Services, dramatically improving the time taken to source &
receive parts. The Logistics Support Centers (LSC's) are located within each
ANNZES engine overhaul facility, enabling ready-access to inventories of
almost 50,000 unique aircraft engine parts. This financial year the LSC's
expect to manage 60,000 engine components cycling in & out GE Engine
Services global repair facilities & 50,000 orders for new material
- Singapore Air - ANZ Done Deal ........ as it has completed of its
purchase of 16.7% of Air New Zealand (ANZ). The transaction, now approved by
the NZ government, is valued at US$139M. As a result of Air New Zealand's
100% ownership of Ansett, SIA now has a strategic stake in the Australian
carrier as well.
- CSA Joins The Team ........ as the government of the Czech
Republic, a 90% majority shareholder in the country's flag carrier CSA, has
decided to allow the airline to enter the SkyTeam alliance. CSA will become
the 6th member of the fledgling Int'l airline group which comprises Air
France, Delta, Korean Air, Aeroflot & Aeromexico. CSA's fortunes have
turned around substantially since last year, turning a profit of US$5.3M for
the 1st 6 months of this year compared with a loss of US$7.1M for same
period 1999. The carrier moved a total of 7,884 tons of freight during the
1st half, a year-on-year rise of 36.4%. The Czech government has stated that
it will allow either Air France or Delta to bid for a 15% stake in CSA when
it is offered in 2 years time.
- Other CSA Expands For Chicago .......... as China Southern (CSA),
is expanding its airfreight operations with the establishment of a 25,000
sq. meter cargo center at Shenzhen Int'l Airport. The center, expected to be
ready some time in 2001, will handle CSA's cargo operations to/from Chicago,
which are reaching load factors of almost 100% on outbound flights. Demand
for cargo services within China has been growing at a colossal rate as firms
jostle to position themselves for a larger slice of trade which is set to
boom if China's likely entry into the World Trade Organization (WTO) goes
ahead. Lower operating costs make Shenzhen an attractive alternative to HKG.
- FAA HazMat Fines ........ as it proposes fining FedEx US$165,000
for improperly shipping a chemical oxygen generator on a cargo flight from
LAX to the company's sorting facility in Memphis, where employees discovered
the shipment. The generator was packed in a fiberboard box & not
labeled, marked, classed, described, documented nor in condition for
shipment as required by regulations. The U.S. National Transportation Safety
Review Board ruled that an oxygen generator in the lower forward cargo hold
caused the crash of a ValuJet DC-9 in the Florida Everglades several years
ago. Since then, the FAA has aggressively pursued hazmat violations. Other
companies & fines proposed by the FAA this month are: Roy F. Weston
Inc., US$80,000 for shipping a portable generator aboard a FedEx flight;
Xerox, US$72,000 for shipping flammable liquid on a UPS cargo flight;
Midwest Sign & Screen Printing Supply Co. Inc., US$54,000 for shipping
flammable printer's ink aboard a UPS flight; & Heritage Environmental
Services LLC, US$52,500, for shipping mineral spirits.
- SabreTech Fined ....... as the defunct firm was ordered by a
federal judge to pay US$11M in fines for its part in the ValuJet crash that
killed 110 people in May 1996. ValuJet Flight 592 crashed into the Florida
Everglades shortly after takeoff from MIA. Federal investigators determined
the cause of the crash was improperly packaged & labeled oxygen
generating canisters in the DC-9's forward cargo hold. The National
Transportation Safety Board blamed SabreTech, ValuJet's maintenance
contractor & shipper of the oxygen generators, ValuJet & the FAA for
the accident. A jury found SabreTech guilty of violating hazardous material
shipping rules in Dec.
- Aeroflot No Longer "Int'l" .......... as it is moving
towards a full alliance with Air France & modifying its name. Aeroflot,
the largest commercial airline in the former Soviet Union, is busily working
with the French flag carrier on a number of issues, including cargo services
& the harmonizing of flight schedules. In addition, the Moscow-based
airline will now be known as "Aeroflot Russian Airlines," instead
of "Aeroflot Russian Inte rnational Airlines," a reflection of its
focus on expanding services within the Russian Federation & the CIS
countries during the past 2 years. Aeroflot intends to take advantage of the
recovery in the Russian economy to expand & aims to turn a profit of
US$4M for this year. Aeroflot's results for the 1st half of 2000 were a good
reflection of this economic improvement. The carrier uplifted 20% more cargo
than it did during the 1st half 1999.
- New Freighters Made At LAX ......... as L.A. World Airports has
announced the arrival of the 1st aircraft, a FedEx DC-10, to SR Technics
America, Inc. for aircraft conversion at the company's No. American
headquarter operations located at Palmdale Regional Airport, a satellite of
LAX. By Sept. 1, SR Technics will have hired 200 workers in preparation for
the conversion of the DC-10 passenger aircraft to a modern MD-10 freighter.
The company will be adding another line to operations after the 1st of the
year, & anticipates hiring an additional 150-200 workers. SR Technics' 5
year strategic plan calls for up to 5,000 skilled workers. Meanwhile, L.A.
World Airport's board of Airport Commissioners has sworn in 2 new board
members appointed by the L.A. City Council. Attorney Lee Alpert &
management consultant Mark Schaffer were confirmed as board members on Aug.
8, joining the enlarged 7 member board presided over by John Agoglia. L.A.
World Airports is a self-supporting dept. of the City of L.A., which owns
& operates LAX, Ontario Int'l, Palmdale Regional & Van Nuys
Airports. Combined operations cover 2.6 million tons of cargo annually.
- New TNT At JFK ......... as it opened its newest hub at JFK Int'l
Airport in New York on Aug. 7. The 25,000-square-foot space, 20% larger than
TNT's previous hub, is the company's main Int'l hub and allows TNT to
consolidate its import & export operations in one location.
- Make Your Moving Plans ......... as officials have disclosed that
Bangkok's Don Muang Airport will cease all operations in 5 years time with
all facilities moving to the 2nd Bangkok Int'l Airport at Nong Ngu Hao in
Samut Prakarn province. The move will coincide with the completion of the
new facility some time in 2004. The Airports Authority of Thailand has been
advised to draw up a transfer plan as well as inform & organize the
movement of affected airlines & freight transport companies in what will
be a huge logistical endeavor. Don't we all still remember all that
"fun" at Hong Kong?
- Diplomatic Cargo .......... as U.S. Navy divers have retrieved the
diplomatic pouches carried by a U.S. courier who was killed in the Gulf Air
crash. The divers began looking for the "diplomatic cargo" at dawn
Aug. 25 & found it in the shallow waters off Bahrain afternoon, said a
spokesman for the U.S. Navy's 5th Fleet, which is based in Bahrain. The
courier was the only American aboard Gulf Air flight 072 when it crashed
into the sea Aug. 23 evening. He was carrying classified information in
yellow pouches, the U.S. State Dept. said.
- Ornamental Boulder Shipments Decrease At AMS ........ as with the
arrest of 13 suspects this month, the Dutch equivalent of the F.B.I. has
solved thefts of computer equipment - to a total value of US$1.5M - at
Amsterdam Airport. Four of the 12 people arrested were employed by a
forwarder at the airport. During their work they regularly removed computer
components from boxes intended for export, & put bricks in their place.
The victims, who were based mainly in the Middle east, received bricks &
ornamenta l boulders for use in the garden, instead of the hard disks &
processors ordered in the Netherlands.
- Parguay Heist ......... as on Aug. 5 gunmen in military-style
uniforms stole a record US$11.1M as guards were about to load the money onto
a plane headed for New York in the South American country's biggest robbery
ever. Police said they had no immediate clues who was behind the robbery,
which went off without a shot being fired when heavily armed men overpowered
security guards at Asuncion's Int'l airport. The heist occurred on the
tarmac as the money was being moved from one of its trucks to the cargo hold
of the plane operated by Sao Paulo-based carrier Tam, or Transporte Aereo
del Mercosur. The money had been collected from several private banks. The
flight was scheduled to stop 1st in Buenos Aires, Argentina, then continue
on to New York with the money destined for a bank in that city.
- Hooray Henry Anhalt! ......... as he had never flown an airplane,
but his life & the lives of his wife & children depended on him when
their pilot passed out at the controls on Aug. 6. Anhalt safely landed the
single-engine plane with help from a flight instructor who told him how to
fly & guided him to an airport. The pilot, Kristopher Pearce, 36, was
pronounced dead, but the cause was not immediately known. Anhalt made a
mayday call, saying he needed help landing the 6 seat Piper aircraft. He
& his wife & 3 children were returning from a church retreat in the
Bahamas. The plane was spotted by Dan McCullough, a part-time flight
instructor who was flying in the area giving lessons. Anhalt didn't seem
frightened, McCullough said. Anhalt practiced controlling the aircraft with
McCullough's instructions. When Anhalt was ready & firefighters were in
place, they headed for Winter Haven Airport, Florida. "I just gave him
directions how to get it over the runway & then to cut the engine,''
McCullough said. ''I had to keep him level. If he came in too steep, he'd
dive into the ground. If he came in too far back, he'd stall." Thirty
minutes after taking controls of an airplane for the 1st time, Anhalt
landed. The plane struck a runway hard, bounced & touched down again,
then veered across a grassy median & came to a stop on an adjacent
- Sit Down & Shut Up! ......... as more than 300 passengers on
Air India Flight 308 took off for Japan after a 36-hour delay caused by a
mechanical problem but returned 6 hours later because the plane didn't have
permission to fly over China on Aug. 22. Outraged passengers complained no
one from Air India listened to their complaints over 2 days, & they
weren't even allowed access to their baggage to change clothing. Widespread
media coverage of the delay & turn-back in the midst of debate by a
Parliamentary subcommittee on whether to sell more than 25% of Air India to
a foreign carrier guaranteed continuing debate over whether the national
carrier is providing adequate service. Do they have dolmas?
- Volumes. Macau Int'l Airport grew strongly during the 1st six
months of 2000, especially in June when cargo traffic was up sharply to
5,941 tons, a massive 77% over the same time last year. There were 2,370
aircraft movements, up 25% compared with 1,890 in the same month last year.
- Pirate Attacks Rise ......... as latest 6 month figures released by
anti-piracy service the Int'l Maritime Bureau show that attacks have risen
for the 3rd year running in the 1st half of 2000, soaring 40% to 161 actual
& attempted attacks worldwide. Indonesia still hogs the lion's share of
incidents, with the Malacca Straits, accounts for 43% of the total. There
have been surges in the number of incidents, mostly robberies of stores
while at anchor, in Bangladesh & India, but much of the rest of the
world has seen numbers drop. The rise includes a more than doubling in the
number of attempted incidents, both boardings & ships being fired upon,
up from 22 in the 1st 6 months of last year to 46 in 2000. While this may
mean that crews are becoming more vigilant, the number of successful
boardings has also climbed, up 29% to 112. However, despite the rise in
attacks, the degree of violence crews are facing has slumped. There were 77
individual crew members involved in violent attacks, ranging from being
taken hostage or threatened to injured, killed or missing. This figure
represents a massive 80% drop from the 375 recorded in the first half of
1999. There were no confirmed deaths, although 5 seafarers are reported
missing, and the numbers injured or assaulted have both dropped. There were
also fewer incidents involving pirates armed with firearms, with the numbers
of knives on the increase.
- Arming Merchant Vessels .......... as the Guayaquil Port Authority
in Ecuador has started placing armed guards aboard all arriving ships as
they reach the Data-Pilot Station in port to counter the threat of pirate
attacks against cargo vessels. The announcement comes nearly a month after
the shooting of a seafarer by armed robbers in the port. The Baltic &
Int'l Maritime Council, a Denmark-based organization representing carriers
& ship agents operating in Guayaquil, has sent numerous appeals to port
officials since the event to increase security. The Ecuadorian Navy also may
become involved in the security effort. "BIMCO is pursuing the naval
officials in order to establish whether any such steps are under
consideration," said Thomas Timlen of BIMCO.
- When Does Peak Season Start? ........... as maritime people in Asia
say it already has. And that's beginning to cause a squeeze on containers,
well ahead of the normal boom time for Asian exports to No. America &
Europe. Some lessors in the region say they can't always meet demand from
carriers. Read more in the Journal of Commerce article: http://www.joc.com/enews/20000818/sections/ocean/w19069.shtml
- Expect More Feeders ......... as within 5 years the size of a
typical container ship on the Europe-Asia trade will be between 5,500 TEU
& 6,500 TEU, up about 1,000 TEU on current vessel sizes, according to
UK-based Ocean Shipping Consultants. The consultancy has just issued its
latest report, "No. European Containerization". This study is
working on the basis that capacity on the main Europe-Asia trades will be
boosted by significant increases in vessel size. By 2005 the largest ships
on the route will be 8,500 TEU, rising to 12,500 TEU by 2010. In the longer
term, by 2015, OSC sees 8,500 TEU becoming the typical vessel size but
expects the largest vessels to stay at about 12,500 TEU, with the
development of so-called malaccamax ships unrealistic. Consequently, within
the western part of the No. European ports range there is likely to be
intense competition for transshipment business, as there is also likely to
be in South East Asia. One of the reasons the push to towards transshipment
will be so large is that port capacity is likely to stay ahead of demand for
quite a long time. Overall OSC expects cargo volumes to have at least
doubled by 2012, compared to 1999s level. There will be overwhelming carrier
demand for dedicated terminals unless major hubs can provide guaranteed
- Maersk Sealand Would Rather Pay .......... as it will pony up a
US$760,000 fine, imposed by the EU's competition authorities, than
participating in an appeal by 14 other ocean carriers against the EU
antitrust. The Commission rules against pricing policies on the Europe –
Asia liner trades. The European & Asian liners filed an appeal with the
European Court of First Instance in Luxembourg. They want to achieve an
annulment or reduction of the fines, which range from EUR 134,000 to EUR
1.24 million. The case relates to the so-called Far East Trade Tariff
Charges & Surcharges Agreement between conference & non-conference
carriers in 1991. At the time the aim was to standardize bunker &
currency adjustments in charges, & terminal handling charges. The
European Commission forced the parties involved to terminate the agreement
in 1994, by issuing a 'statement of objections' which claimed it infringed
EU competition. The conference carriers, which now appeal, include Hapag
Lloyd, P&O Nedlloyd, OOCL, NYK, Evergreen & Hanjin.
- SED Relief For NVOs .......... as the U.S. Commerce Dept.'s Census
Bureau has developed a program that it believes will help
non-vessel-operating common carriers get out of the business of processing
shipper's export declarations. The Bureau of the Census/NVOCC Export
Initiative Agreement would allow NVOs in the capacity of data entry centers
to key shipper's export declarations for their forwarder clients, while at
same time encouraging their clients to file export data directly to Customs'
Automated Export System or through Census' free Internet link AESDirect.
Other aspects of the NVO agreement will include timelines & data quality
conditions to correctly file shipper's export declarations. Census will
provide NVOs with training & help them to deal with noncompliant
customers, if necessary. Census will release the agreement to the NVO
industry this month. The agency will implement it after receiving consensus
from the NVOs. Since last year, Census has struck similar agreements with
the ocean & air carriers.
- FastShip To Philadelphia ........... as it has an agreement with
Consolidated Rail Corp. (Conrail) to acquire a significant portion of a rail
yard and dormant shipping terminal along the Delaware River in the Port
Richmond section of Philadelphia. The sale is contingent upon approval by
Conrail's board of directors. The site, which will be transformed into a
modern transportation hub for FastShip's high-speed transatlantic network,
will be the exclusive No. American terminal for FastShip's unique 7 day,
door-to-door delivery service of cargo from central Europe to the central
U.S. "FastShip is creating a new mode of container transportation
between the U.S. & Europe," said Roland K. Bullard II, president of
FastShip. "We are building a world-class transportation network that
will provide the speed, reliability, frequency and cost that meets the
demands of the rapidly changing world economy. This will fuel economic
development & employment in the Philadelphia region." The US$125M
state-of-the-art terminal will open in 2004 and will nearly triple the
amount of cargo currently passing through the Ports of Philadelphia &
Camden. FastShip's operations will generate more than 7,500 jobs in the
Philadelphia & Southern New Jersey region. FastShip will connect its
high-tech terminal to an inland distribution network to be managed by
Schneider National, Inc. One of FastShip's advantages over traditional ocean
cargo shipping is in its innovative terminal facilities that make it
possible to turn the FastShip vessels around up to 4 times faster than
ordinary cargo ships. The ship can be completely unloaded, reloaded &
refueled in less than 6 hours. All containers will be "live
loaded," connecting immediately with their inland mode of transport;
all import containers can clear the terminal gate within 8 hours of ship
arrival. Conventional container ships require 16 to 24 hours in port, &
cargo may sit for days in storage before distribution inland. http://www.fastshipatlantic.com/
- Customs & NVOs Work On AES .......... as U.S. Customs officials
met with executives from the non-vessel-operating common carrier industry on
Aug. 8 to continue work on automating export data of ocean freight
consolidations. The 3 day meeting at the Port of Newark, N.J. included
executives from neutral, niche, forwarder-affiliated & trucker-based
NVOs. The focus of the meeting was to continue discussion of how NVOs may be
able to supply Customs with their transportation data through the Automated
Export System. Transport data is crucial because its lets the agency know
when exports are leaving the country. Customs believes that 75 to 80% of
export data requirements could be met through NVOs' booking information.
Through continued meetings, Customs hopes to map out a way for NVOs to use
AES by the end of the year.
- Big Stake For Maersk In L.A. ........ as the L.A. Board of Harbor
Commissioners have approved a 25-years lease with Maersk Pacific Ltd. for
the Pier 400 container terminal, which means that Maersk can have its feet
firmly on American soil. However, the lease of the 485 acre container
terminal has to be approved by the L.A. City Council. When the council has
given its consent, the construction works can start of the largest
proprietary container complex, involving an investment of US$466M for the
terminal & the supporting infrastructure. The Pier 400 container
terminal will be constructed over the next 4 years, in 2 major phases. In
the 1st phase about 316 acres will be laid out, including a nearly 40 acre
on-dock railyard. This project is expected to be completed by late august
2002. The 2nd phase construction will follow them, involving 167 acres of
additional development, planned to be completed in April 2004.
- Maersk Joins The Navy .......... as the U.S. Military Sealift
Command has awarded a 3 year, US$108M contract to Maersk Line Ltd. to
operate & maintain 14 Auxiliary General Ocean Surveillance or
T-AGOS-class ships. The vessels support four Defense Dept. programs: the
Navy's Surveillance Towed Array Sensor System operations; the Navy Atlantic
Fleet & Coast Guard counter drug initiatives; & the Air Force
Electronic Systems Command's radar missile tracking system. Maersk Line,
Ltd., based in Norfolk, Va., is the U.S.-flag operation of A.P. Moller. MSC,
the ocean transportation provider for the Defense Dept., operates about 110
noncombatant Navy ships.
- Navy Joins Carriers ........ as more reports of cargo ships being
boarded by Yugoslav military patrols are surfacing in the carrier industry.
The German cargo ship M/V Kaban & Croatian vessel M/V Dea were recently
boarded by Yugoslav soldiers in the Port of Bar in Montenegro. "We have
approached the owners of these vessels to obtain more details to determine
the motives behind these boardings," said Thomas Timlen of the Baltic
& Int'l Maritime Council, which represents about 1,000 shipowners. BIMCO
has asked all its members to report similar incidents off Bar. "We may
find that more vessels have been boarded," Timlen said. The U.S.
government is still investigating a recent boarding of a Farrell Lines
vessel, the M/V Delaware Bay.
- Goodbye Singapore .......... as in one of the shipping industry's
most dramatic developments in years, Danish shipping giant Maersk Sealand
has decided to drop Singapore in favor of the new Malaysian Port of Tanjung
Pelepas (PTP). Maersk Sealand has already started shifting operations from
Singapore to one of Southeast Asia's most strategically located
transshipment hubs, PTP in Malaysia. By Dec. 2000 it is expected that the
changeover will be complete. The shift will see PTP gaining a guaranteed
annual volume of 2 million TEU in the year 2001. This volume does not yet
factor in the volumes by additional feeder lines that are now also in
negotiations with PTP for Southeast Asian & South Asian routes. The
deal, which was finalized on Aug. 17, saw Maersk Sealand buying 30% equity
from PTP's holding company, Seaport Terminal. Worse for the port, Taiwanese
carrier Evergreen will drop weekly calls at the port of Singapore from its
round-the-world westbound service at the end of Aug. to replace them by
direct calls at Laem Chabang in Thailand.
- Italy's Grimaldi Line To Buy ........... as it has emerged as a
likely bidder for Atlantic Container Line after acquiring Philadelphia-based
Holt Group's stake in the trans-atlantic carrier. The family owned company,
which specializes in the Ro-Ro shipping, also has acquired shares in ACL
held by investment funds, lifting its total shareholding to 33.95% involving
an investment of US$50M.
- Dwindling Mexican Flags At Sea ........ as it's maritime transport
companies are finding it difficult to survive, as 95% of merchandise shipped
to and from Mexico by sea is carried by foreign-owned vessels, Mexican
Maritime Transport Industry Chamber (Cameintran, as a Spanish acronym)
President Gerardo Sanchez Schutz said this month. Sanchez said that of the
7,000 ships carrying merchandise that docked at Mexican ports in 1999, only
2 bore the Mexican flag. In the area of cargo-handling, he said, Mexican
firms accounted for only 35% of activity last year. Sanchez said national
sovereignty had been placed at risk by allowing shipping activity to fall
into foreign hands.
- ANZDL Increases U.S. Intermodal Use ......... as an increasing
proportion of shippers in the Australia-New Zealand-to-U.S. container trade
are moving cargo intermodally via a U.S. West Coast port, Australia-New
Zealand Direct Line reported. Containerized volumes that move West to East,
via an intermodal network, have increased 15% since 1995, from 53 percent to
68% of the northbound trade, ANZDL said. ANZDL said that the northbound
transit time to Houston takes 28 days with ANZDL's U.S. West Coast service,
compared to 41 days when shipping via the East Coast. ANZDL is part of the
Canadian-owned CP Ships group.
- Los Angeles Cargo Record ........ as container volume for the
fiscal year ending June 30, 2000, was 4,354,400 TEU, the 1st time in the
history that the port has surpassed the 4 million TEU mark. The port handled
402,600 TEU in June, increasing its container volume total in the 1st 6
months of 2000 to 2,270,100 TEU. The increase represents a 30.1% surge over
the record-setting pace established in Jan. to June of last year. The port
handled 440,731 TEUs in July breaking the one-month record set in May &
soaring 33.5% higher than July 1999. The increase is attributed to numerous
containerships arriving from Asia fully loaded with cargo. Indications that
the U.S. economy is cooling down do not seem to have translated into a
negative impact on inbound cargo traffic either. Next door, giant Port of
Long Beach handled a record 409,979 TEUs in July, 17.8% better than July
- Port of L.A. Back On Line ........ as a dispute with the port's
original web site host is ongoing, so a new address has been designed as
another avenue for customers wishing to access port information. http://www.portoflosangeles.org/
- L.A. Demurrage Alert ......... as the Los Angeles Port Authority
has decided to temporarily shorten the `free time' allowed for
free-of-charge container storage, starting Sept. 1. For the months of Sept.,
Oct. & Nov. the time allowed before a charge is levied against import
containers will be cut from 7 days to 5 days, and for export containers from
10 days to 7 days. The port has decided to take this action to ensure
efficient container flow around the port which is expected to peak late in
the 3rd quarter.
- L.A. Port Again To See Red .......... as for 60 years, the L.A.
area was served by a vast network of electric railway lines operated by the
Pacific Electric Railway. Affectionately known as "Red Cars", the
Pacific Electric’s trolleys blanketed the area on more than 1000 miles of
rail lines. The last remnant of the system was abandoned in 1961. Forty
years later, a small piece of the system is about to be resurrected in San
Pedro, as the Port of Los Angeles Waterfront Red Car Line. Riders will
experience the thrill of a real 1920s-era trolley ride. Regular operation
will be conducted with 2 new replica railcars carefully patterned after an
actual 1909 Pacific Electric “Red Car” design. A 3rd car, restored in
the 1960’s from an actual 1907-vintage Pacific Electric car, will be
available for special operations including charters. The new Port of
L.A. Waterfront Red Car Line is a 1.5 mile vintage trolley line connecting
San Pedro’s cruise ship terminal with other attractions along the
waterfront. It is being financed and constructed by the Port of Los Angeles.
The line will use a former Pacific Electric right-of-way, now used only for
freight operation, rebuilt to accommodate trolley operations with
traditional 600-volt DC overhead trolley wire. http://www.railwaypreservation.com/page8.html
- West Coast Party Ending? .......... as U.S. West Coast exporters
who ship to Asia & Europe have enjoyed 3 years of low freight rates, but
the party is coming to an end. Carriers in the westbound Pacific &
eastbound Atlantic are raising their rates in response to strong market
conditions. Read the full Journal of Commerce story. http://www.joc.com/enews/20000809/sections/ocean/w56900.shtml
- Asia - Africa Rates Up ......... as lines operating in the
Asia/East Africa/Indian Ocean Islands trades have agreed to implement a rate
restoration starting Sept.1, 2000. Member lines will restore freight rates
by US$100 per 20-foot container and by US$200 per 40-foot container for all
shipments from Asia to East Africa & Indian Ocean Islands. The increases
are part of an ongoing program to restore rates to economically viable
levels & partly to offset the cost created by the equipment imbalance in
the Asia/East Africa/Indian Ocean Islands trade. The shipping lines involved
are Maersk Sealand, MOL, PIL & P&O Nedlloyd.
- Europe - Mideast Rate Hike ......... as shipping lines of the
Europe Middle East Rate Agreement have confirmed a plan, announced in June,
to increase freight rates from northern Europe to the Mideast by US$250 per
container, effective Oct. 1. The rate increase applies to dry and
refrigerated cargo. Members of the Europe Middle East Rate Agreement
carriers are Andrew Weir Shipping (Ellerman), CMA CGM, Hapag-Lloyd, Maersk
Sealand, P&O Nedlloyd, Safmarine, Senator Lines & United Arab
- Far East Rates Up ........ as lines operating from the area have
agreed to implement a rate restoration next month. The lines will restore
freight rates by US$100 per TEU & $200 per FEU for container shipments
from the Far East to Karachi & Mumbai/Nhava Sheva. The lines have said
that they have no option but to increase rates since the current levels are
too low to support the investments being made & the operating costs in
the trade. With the operating conditions in both the South Asia & the
Far East regions improving, and with trade volumes expected to remain
buoyant during the rest of the year, the lines are fully confident that
customers will support this rate restoration. Member lines of the Far
East/South Asia trade are APL, Hyundai, Maersk Sealand, Mitsui OSK, NYK,
OOCL, Pacific Int'l, P&O Nedlloyd, Uniglory, United Arab, & Wan Hai
- Dig Deeper ........ as most U.S. exporters who ship to Asia can
expect to pay a US$25 documentation fee for each bill of lading beginning
Friday. The Westbound Transpacific Stabilization Agreement, which represents
13 ocean carriers, announced earlier this summer that its members intended
to initiate the fee on Sept. 1.
- Northern Europe/Canada Westbound Up ........... as it's conferences
will increase freight rates again on Oct. 1. The planned rate rises, the 2nd
this year, are US$250 per 20-foot container and US$350 per 40-foot box. The
price hikes follow increases in westbound rates of US$320 per 20-foot
container & US$400 per 40-footer on April 1. Members of the northern
Europe/Canada/northern Europe conferences are Atlantic Container Line,
Canada Maritime, Cast, Hapag-Lloyd & OOCL. The Canadian conferences
announced no rate increases in the eastbound direction. The westbound rate
rises are the latest evidence of the strength of the Europe-to-North America
trade. The Trans-Atlantic Conference Agreement, which covers transatlantic
cargoes moved by conference carriers via U.S. ports, has said that it plans
to raise westbound tariff rates by US$320 per 20-foot container & US$400
per 40-footer or 45-footer on Sept. 1. TACA conference lines are Atlantic
Container Line, Hapag-Lloyd, MSC, Maersk Sealand, NYK, OOCL & P&O
- TACA Up ........ as the Trans Atlantic Conference Agreement will
increase its eastbound dry van & tank container tariff rates for
shipments from and via U.S. West Coast ports by US$240 per 20-foot &
US$300 per 40 & 45-foot containers, effective Sept. 1. In addition, the
tariff charge for the lines' mini-landbridge service via U.S. Atlantic ports
will be adjusted by US$1,500 per 20-foot & US$1,800 per 40 & 45-foot
- More Nematodehe Fun ........... as the U.S. Dept. of Agriculture
has finalized its process for certifying coniferous solid-wood packing
material exported to China. China's Ministry of Agriculture declared last
year that U.S. coniferous solid-wood packing has been found to carry
pinewood nematode, a pest association with pine wilt disease. China
implemented rules on Jan. 1 that banned coniferous solid-wood packing from
entering the country unless it was properly heat-treated. There is one
change in the USDA's finalized compliance process: "heat treatment must
be performed in the U.S., rather than in other countries," said Richard
L. Dunkle, deputy administrator for plant protection and quarantine with the
Animal & Plant Health Inspection Services (APHIS), a division of USDA.
Coniferous solid-wood packing material must be heat-treated to a core
temperature of 56 degrees Celsius for 30 minutes. APHIS created special
forms, available on its Web site for complying with the Chinese rules.
Heat-treated shipments must be accompanied by a form, which must be endorsed
by a local USDA, APHIS, PPQ or state cooperator office. If no coniferous
solid-wood packing is present in the shipment, the exporter can self-certify
the shipment with a signed statement on company letter head. http://www.aphis.usda.gov
- Watching Methyl Bromide ......... as the Australian Quarantine
& Inspection Service said it will begin monitoring consignments that are
fumigated with methyl bromide, starting Sept. 1. In a notice to the
industry, AQIS said it "has concerns on the reduced effectiveness of
methyl bromide treatments when temperatures within the fumigation enclosure
drop below 10 degrees Celsius (50 degrees Fahrenheit) at any time during the
treatment period." AQIS will initiate a monitoring program for
consignments covered by certificates for fumigation treatment T9047, which
indicate that minimum fumigation temperatures were below 50 F. The AQIS
regulations are of issue with certain North American ports which commonly
experience temperatures below this level. This may require containers to be
redirected for fumigation at quarantine-approved premises in Australia.
Shipping line members of the United States Australasia Agreement are telling
shippers they will continue to offer fumigation services in North America.
However, USAA members advise that should temperatures dictate,
"customers will be responsible for any costs related to cargo
fumigation performed in Australia." USAA member lines are ANZDL,
Columbus Line, CMA-CGM, Contship, P&O Nedlloyd & Wallenius
Wilhelmsen. In related news, the U.S. Dept. of Agriculture's Animal &
Plant Health Inspection Service said it would extend its commend period on a
proposal to allow irradiation as phytosantiary treatment for imported
vegetables & fruits.
- U.S. Coast Guard Goes To School .......... as it wants to know more
about charterers & cargo owners to improve its Port State Control vessel
targeting efforts & to understand how they affect the quality of
shipping. The Coast Guard set up its Port State Control program in 1994 to
deal with an increasing number of substandard foreign-flagged vessels in
U.S. waters. Each year, about 8,000 foreign-flagged vessels make more than
50,000 U.S. port calls. The Coast Guard conducts about 12,000 vessel exams a
year. Through a "risk-based targeting scheme," the agency
considers a vessel's flag state, owner, operator, class society, ship type
and operating history in U.S. waters. If a vessel is determined to be
substandard, then it's detained until the problems are corrected. There have
been recent attempts to improve the quality of vessels operating in Int'l
trade, such as the 1995 Int'l Safety Management Code & amendments to the
Int'l Convention on Standards of Training, Certification & Watchkeeping
for Seafarers. "Despite these new initiatives, substandard vessels
continue to call in U.S. waters," the Coast Guard said. "Although
the number of detentions of substandard vessels fell from 547 in 1997 to 257
in 1999, we believe that there are still too many." The agency has
gathered information which said charterers can exert "considerable
influence" on the quality of vessels operating. They are also not held
accountable by any Port State Control program. According to a recent study
by the Netherlands Ministry of Transport, the expense of operating a
substandard vessel is 14% less than the operating costs of a compliant ship.
The Coast Guard is considering adding charterers or cargo owners to the
Notice of Arrival information and its vessel targeting efforts. The agency's
Vessel & Facility Operating Standards Div. in Washington will take
comments from the industry through Oct. 2. For more details, contact LCDR
Michael Jendrossek at (202) 267-0836.
- Produce At Sea ......... as the U.S. Dept. of Agriculture has
published the Agricultural Ocean Transportation Trends, a semiannual online
report on the ocean container market's cost & service trends. The report
was developed using data reported monthly in the AMS Ocean Rate Bulletin,
which tracks agricultural container rates for high-valued agricultural
commodities to most Asian & some European countries. USDA uses the data
to generate monthly container rate trends in the ocean market to help
shippers & carriers se how the market is responding to changes in trade
patterns or U.S. regulations -- such as the Ocean Shipping Reform Act of
1998, which allows confidential service contracts. http://www.ams.usda.gov/tmd/agott
- Truck Becomes Neutral NVOCC .......... as the well known U.S.
trucking & logistics company, Landstar, headquartered in Jacksonville,
Florida, is now licensed as a Non Vessel Operating Common Carrier (NVOCC).
- OOCL Expands On Line ......... as it will use the Internet for
cargo tracking, checking of tariffs & terms on existing contracts,
notification of progress, B/L information & processing. The Web-based
services will be introduced in Sept., under the name of CargoSmart. OOCL
considers introducing a kind of rate inquiry and negotiation on Internet,
which would bring it into competition with some of the independent online
shipping capacity market places. On these Web-sites tariffs for space on
board ships is negotiated. CargoSmart will act as an independent company
with customer-based services available before the end of the year.
- ANZDL Goes E ........ as Australia-New Zealand Direct Line has
introduced arrival notices by e-mail as an added services to importers &
consignees. The system is available in North America, Australia & New
Zealand and replaces the previous arrival notices by facsimile.
- Pink Slips At Santos ........ as use of Brazil's major port remains
costly due to an excess of needless workers being kept on its payroll,
according to one of the country's leading newspapers. With approximately
5,000 workers more than it needs (amazing!), Santos port could see massive
job cuts in the near future. The prediction comes from the Workforce
Management Body who points to the port's mechanization as the source for the
likely cuts. Despite the port passing to the private sector under the
country's "Port Modernization Program," and an infusion of around
BR1 billion, prices for shippers & shipping lines have failed to
decrease. The Workforce Management Body, which has been responsible for
forming port work gangs since 1996, says the high price of the port's work
force is a major factor in keeping prices up. It says that at least half
will have to seek new jobs in the coming years.
- Shanghai Will Spit In Ocean .......... as it is to construct a
"man-made peninsula" into the sea to increase its deepwater
docking facility. The spit is seen as being necessary as the city has no
deep-water port facilities, retarding the city's aim of becoming a world
class shipping center. The planned peninsula would run 30 kilometers from
the eastern Nanhui District's Shi Pile Port to the northern Hangzhou Bay.
The 1st phase of the project, costing over US$24M to reclaim 2,460 hectares,
was completed in June of this year, while the 2nd & 3rd phases to
complete the project will be finished by June 2002.
- Dutch Port Tunnel Drags ........ as the drilling of the
Westerschelde (West Sceldt) Tunnel in the southwest of The Netherlands,
which will create a faster link between the ports of Rotterdam, Terneuzen,
Vlissingen (Flushing) & Antwerp, will take at least one year longer than
the 2 years planned at the start. The main cause of the delay are problems
with the drilling machines. After well over one year's drilling in the West
Sceldt Tunnel a length of 1.3 kilometers has been reached in the western
tube & in the eastern tube a distance of 1 kilometer. According to the
planning, 3 kilometers of the total length of 6.6 kilometers ought by now to
have been completed. Originally, the opening of the tunnel had been planned
for March 15, 2003. One now hopes to be able - during the finishing stage -
to regain some of the time lost.
- Sunshine Comes To St. Maarten .......... as shippers broke numerous
safety regulations when they delivered 18 tons (16,500 kilograms) of
dynamite to the Dutch Caribbean territory of St. Maarten that was enough to
blow the island away, one officials charged on Aug 7. Customs director Ben
Heinen said officials were not notified of the shipment beforehand, the
freighter M/V Sunshine II was moored at a pier instead of 990 feet offshore,
and the dynamite was transported across the island without a police escort.
The lapses outraged Dutch officials because a May explosion at a fireworks
factory in Enschede, Netherlands, is still fresh on their minds, Heinen
said. That explosion leveled 500 homes, killing at least 20 people and
injuring 1,000. "We could've had another disaster on our hands,"
Heinen said. "The 16,500 kilograms of dynamite should be quite enough
to blow this island away." The shipment arrived July 31 at Pointe
Blanche Harbor on the freighter M/V Sunshine II from St. Thomas in the U.S.
Virgin Islands, Heinen said. It was bound for a quarry in Grand Case on the
French side of St. Martin, the island France & the Netherlands share.
- Not A Disney Cruise ......... as there is a question of whether M/V
Canaveral Star is a strip club or a floating sex playground. Whatever the
cruise ship is -- many of the men who paid to cavort with the women since
June presumed it is the world's 1st floating bordello -- the Port Canaveral
Authority is attempting to evict it. Port officials want no part of it. The
130-foot Canaveral Star, which runs cruises organized by the Buoy Club, is
so popular -- sometimes drawing as many as 200 men -- that its backers say
they will soon add other "adult nude entertainment" cruise ships,
one of which almost certainly will be based in South Florida. Men pay US$50
& women pay US$75 to board the ship. Everything else is extra. The 5
1/2-hour cruise out of Port Canaveral goes beyond the 3 mile limit and,
according to the boat's owners, outside the jurisdiction of Florida law. A
lawyer for the vessel says that rules aboard ship do not allow prostitution.
"There is no sex" says Ira Mihlstin, 31, who dreamed up the
cruises 18 months ago. On a recent Friday night, however, several patrons
said they paid more than US$200 each for a sex act in VIP areas they rented
for US$300 per hour & up. One woman inviting patrons to descend below
said, "I have never met a man yet who left the boat unhappy."
Because the Canaveral Star flies the U.S. flag, it is subject to U.S. law,
no matter where it sails, said Robert Jarvis, an admiralty law professor at
Nova Southeastern University. But Jarvis said he does not remember the feds
ever prosecuting anyone for sex at sea. A federal prosecutor might consider
sending in U. S. marshals to literally arrest the ship while it is in port,
arguing "that it is being used in the furtherance of a crime,"
Jarvis said. Another possible scenario: prosecution under the White Slavery
Act, 19th Century legislation designed to stamp out prostitution. On Aug. 6,
the Seminole County Sheriff's office arrested an assistant manager for the
Buoy Club, on charges of profiting from prostitution in connection with a
raid on a night club, Sassy Merlot's in Maitland. While lawyers for the
vessel battle Port Canaveral officials, there are plans for expanding to
Fort Lauderdale's Port Everglades or the Port of Miami-Dade. They, too, soon
may face this dilemma: How do you square the image of a cruise ship where
the women get naked with the family fun of a ship operated by Disney or
Carnival? How would Port Everglades feel about playing host to the Buoy
Club? "While it behooves us to make certain any operator we provide
services for meets all the laws for its operation, Port Everglades is not in
the business of dictating morality," said Jim Lida, assistant director
of cruise marketing at Port Everglades. The ship has a capacity of 355.
- New Giant ............. as Exxon Mobil Corp. has taken delivery of
the M/T Hawk, a new double-hull very large crude oil carrier (9VLCC). The
Hawk, the 1st of 2 sister vessels The 307,000 deadweight-ton Hawk is 1,100
feet (335 meters) long, 190 feet (50 meters) wide, 102 feet (31 meters) deep
& can carry a cargo of 2.25 million barrels of crude oil. The ship will
be in service worldwide.
- Second Titanic Disaster? ........ as sections of the sunken vessel
are in danger of collapsing as the sea claims the remains of the world's
most famous shipwreck, divers confirmed this week during the latest
expedition to the wreckage site. The ship's bow section, resting about 2-1/2
miles deep on the ocean floor, ``is on the verge of a catastrophic
failure,'' and now paper-thin interior walls of the ship are crumbling,
salvors said on an Internet Web site chronicling the expedition http://www.rmstitanic.net
- Chinese Navy To Pearl Harbor ......... as it's ships will make port
visits to Pearl Harbor, Hawaii, & Everett, Wash., in Sept. as part of a
naval exchange to improve U.S.-China relations. Pearl Harbor is headquarters
for the U.S. Pacific Fleet. Everett is the home port for the USS Abraham
Lincoln carrier battle group. Early this month the USS Chancellorsville, a
U.S. Navy cruiser, made a port call at Qingdao, China - the 1st visit to
China, other than Hong Kong, by an American warship since the U.S. bombing
of the Chinese Embassy in Yugoslavia last year. The Qingdao, a Luhu-class
guided-missile destroyer, & the Taicang, a Fuqing-class oiler, will
visit Pearl Harbor Sept. 5-8, and then make a port call in Everett Sept.
14-18. The senior Chinese naval officer aboard will be Rear Adm. Lu Fangqiu,
the chief of staff of the North Sea fleet. During the visits, U.S. and
Chinese sailors will interact & take tours of each other's ships.
- Hunley Raised ........ as the Confederate submarine CSS H.L. Hunley
was lifted from the Atlantic Ocean on Aug. 8, more than 135 years after it
became the 1st sub to sink an enemy warship & then sank. The submarine
went down with 9 crew members in 1864 after ramming a spar with a charge of
black powder into the hull of the Union blockade vessel USS Housatonic. To
raise the vessel, sitting in 30 feet of water about 4 miles off Sullivans
Island, divers attached slings around it from a steel superstructure that
was placed above the sub earlier. The minute the superstructure broke the
surface, Confederate re-enactors fired a canon volley from Sullivans Island
at Breach Inlet where the Hunley left on its ill fated voyage on Feb. 17,
- Canada Attacks U.S.! ........ as Canadian troops have stormed on
board the U.S.-owned cargo ship M/V GTS Katie on Aug. 3 after a high-seas
standoff in which hundreds of millions of dollars of Canadian military
equipment had effectively been held hostage. "At approximately 1:45
p.m. today the Canadian navy began boarding the vessel on orders of the
government of Canada," a Defense spokesman said. The spokesperson was
unable to say if there were any casualties, but the owners had pledged the
Ukrainian crew would not resist. The Katie was the focus of a bitter
commercial tug-of-war between its owner & the firm that chartered the
vessel to transport the equipment. The squabble drew in the Canadian
government, which grew increasingly impatient to get its cargo of 590 tanks
& other military vehicles back from Kosovo -- about 10% of the army's
entire hardware. The cargo ship is owned by Maryland-based Third Ocean
Marine Navigation, which had halted the vessel in the North Atlantic to try
to force Montreal-based Andromeda Navigation to pay what it was due.
Andromeda denies wrongdoing. The haggling was apparently over a mere
US$100,000 -- compared to the US$151M value of the cargo. But the whole saga
proved irritating & embarrassing for Ottawa, which wanted its shipment
back but which also faced criticism for having to rely on private companies
or foreign nations to fulfill its wide-ranging peacekeeping operations. It
also wanted to bring home 3 Canadian soldiers who were accompanying the
cargo. Canada Defense says that at 1 a.m. the Katie had weighed anchor &
started steaming west from its position S. of Newfoundland toward the Cabot
Strait and in the direction of Quebec, its original destination. It was
shadowed by the destroyer HMCS Athabaskan & the frigate HMCS Montreal.
- This Month In U.S. Naval History ....... as on Aug. 13, 1777, the
1st known use of mine warfare in the U.S. Navy was employed. An American
inventor, David Bushnell, created an explosive device consisting of a line
of contact mines strung together by cables. This device was used against HMS
Cerberus off the coast of New London, Conn. A British "prize crew"
in a captured schooner spotted the mines on Cerberus and hauled them away.
The mines exploded anyway destroying the schooner & killing its crew.
Cerberus was undamaged.
- Throughput: Port of Chennai in India has shown an impressive
performance in the 1st 4 months of its present fiscal year, handling almost
16 & more cargo than during the same period last year, with respective
throughputs of 119,320 TEU & 103,070 TEU. >>> In the 1st 6
months of 2000 the port of Hamburg transshipped 13.6% more containers than
in the 1st half of 1999, to a total of well over 2 million TEU. >>>
Hong Kong is on course to handle a massive 18 to 19 million TEU this year, a
rise of somewhere between 10 & 20% on last year's figure of 16.2 million
TEU. >>> Port of Rotterdam saw containerized cargo throughput rise
3.6% in the 1st 6 months of this year to 3.2 million TEU, compared with 3.1
million TEU in the same period last year.
Visit our new Vessel
Casualties & Pirate Activity Database ......... where daily updates
of this news are posted. Stay up to date!
We're sorry, but there were so many sinkings, explosions, pirate attacks,
fires, cargo mishaps, artillery battles on the water & other disasters at
sea that we do not have room to print even the highlights this month. Well over
1000 people lost their lives at sea this month!!
But you can read all this month's disasters at our special Internet web
feature which provides full details of each event. This month we also include
special day-by-day coverage of the loss of the Russian Oscar II Class nuclear
submarine Kursk. We even have a "dolphin saves boy" story.
This feature is updated for you twice daily!
Bookmark the site and visit every day! http://www.cargolaw.com/presentations_casualties.html
NOTE: The historic dangers of carriage by sea continue to be quite real. Shi
ppers 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 ...............
E-Freight World ..........
annual meeting for e-business in the European freight transportation industry,
20th - 22nd Sept. 2000, at Cumberland Hotel, London
Supply Chain Management Conf
........ as the Marine Machinery Association and Newport News Shipbuilding have
joined to present a day conference entitled "Supply Chain Management: An
In-depth Look at Shipyard Supplier Relationships." The meeting will take
place in Hampton, VA on Oct. 24 & 25, and will include a tour of the
shipyard and the Virginia Advanced Shipbuilding & Carrier Integration
Navigator ........ a quarterly newsletter for the public/private
Food Situation & World Trade .......... download 23 of the
most-requested charts & graphs showing past and future trends in the world
food situation. Many of the figures are based on IFPRI's global model of future
food supply, demand, & trade. New visuals will be added as they become
U.S. National Hobo
JFK Air Cargo Assn.
Int'l Ships Masters Association
City of Adelaide .......... efforts to save the historic clipper ship.
http://www.delphi.com/historicvessels/ - see Carrick / City of Adelaide
Road Wage Express
Delivery Game ........ in this game you've got to deliver...literally!
Your mission is to deliver packages to businesses around town. With each
successful delivery, your bank account grows, making additional, & cooler,
vehicles available to you. Look out UPS! Download Now: http://www.real.com/products/gamesrpbase5.html
DriverNet ......... for truck
drivers & fleet owners.
eRide ........ a
custom U.S. air passenger pickup service.
AWB Label Pro.......... a user
friendly Windows program which lets you print bar coded AWB labels with your own
logo on inexpensive blank labels on virtually any printer. IATA resolution 606
(requiring bar coded AWB labels) has been in effect for some time now, and most
airlines are beginning to take this very seriously. Access the following website
to download a trial version. The software can also be integrated with existing
World Wide Marine
.......... a marine supply store on line.
Bergesen ........ the largest
bulk carrier in the world. Interesting.
Weekly GPS News
Symbols For Your Web Page
Star Wars Episode 2 Move Trailer
......... it's not real, but quite good.
New E-Commerce & Industry B2B Sites of The Month
1hemisphere .......... Int'l
......... portal to subscribing express carriers.
Web-based transaction support for transportation assets in the rail, air,
maritime, & trucking. Using an interactive discretionary trading
environment, eWorldFreight provides a transaction model that allows users to
buy, sell, lease, finance, maintain, service, store, & reposition the
containers, truck trailers, rail cars, & tankers in which freight is moved,
as well as the locomotives, airplanes, trucks, & ships that move them.
..... General Electric Co. will become a strategic investor in this
LoadSource ........ the 1st
U.S. nationwide freight locating service designed for web-enabled cellular
telephones. LoadFone allows the trucker to search in over 60,000 cities for
Logispot ............. import -
export interface with logistics providers, from Turkey.
Marex ........marine industry B2B.
MyAircraft ......... a B2B
for the air industry.
ShipChem ......... a global,
multi-modal, virtual logistics & transportation management solutions
provider for chemical & plastics industry manufacturers & distributors
ShipServ ......... for ship
managers & suppliers.
V-CommeX .......... import -
export database services.
AirNewco ......... an airline
B2B with founding members American, Air France, BA, Continental, Delta, Iberia,
United, UPS & Qantas. AirNewco will launch the marketplace later this year.
Written from wire stories, the Associated Press,
Reuters, Hong Kong Shipping News Lloyds & other world sources.
[an error occurred while processing this directive]