The Cargo Letter

Our Top Story: Landmark Alameda Corridor Opens For Business - Speeding Cargo For L.A. & Long Beach |
Section A: Section: Trade, Financial & Inland News |
Section B: FF World Air News |
Section C: FF World Ocean News | Section D: FF in Cyberspace |
Section E: The Forwarder Broker World

OUR "C" Section: FF World Ocean News

FF World Ocean Briefs

• Welcome Back! ........ as the Aegis guided missile destroyer USS Cole returned to the U.S. Navy Fleet on April 19, following a 14-month restoration project at Northrop Grumman Corporation's Ship Systems. The ship departeded Pascagoula & returned to her homeport in Norfolk, Va on April 25. Following the terrorist attack in Aden, Yemen which killed 17 crew, Cole was transported to Pascagoula on heavy lift ship M/V Blue Marlin, & arrived in Pascagoula Dec. 13, 2000, after a 6-week journey. The ship was originally built in Pascagoula by Ingalls & delivered to the Navy in 1996. SEE OUR WEB FEATURE & DRAMATIC PHOTOS:
  www.cargolaw.com/2000nightmare_cole.html
• Rethinking The New China Rules ........ as a delegation of Chinese government officials arrived in Washington on April 19 to study U.S. maritime regulatory practices & policies. The delegation was invited to Washington after U.S. government officials, led by Maritime Administrator William G. Schubert, concluded bilateral talks at Beijing in March regarding China's new Int'l maritime regulations. The U.S. had issued a "Notice of Inquiry" seeking information concerning drastic effects of a recent decree of the People's Republic of China affecting the operations of shipping companies in the U.S. foreign trade with China. Chinese officials are said to have not completely understood the U.S. maritime system when undertaking to make China's new Int'l maritime regulations similar. Back to the drawing board? For details see The Cargo Letter for Feb. & March 2002.
• More Push Against Antitrust Immunity ........ as the Organization for Economic Cooperation & Development's transport division has issued a final report on competition policy in liner shipping that recommends governments remove the antitrust immunity of conferences & discussion agreements. OECD "member countries, when reviewing the application of competition policy in the liner shipping sector, should seriously consider removing antitrust exemptions for price fixing & rate discussions," the Paris-based organization said in its final report. "Exemptions for other operational arrangements may be retained so long as these do not result in excessive market power, " the OECD confirmed. The recommendations have been strongly opposed by carriers, but were endorsed by shipper groups, such as the European Shippers' Council & the National Industrial Transportation League.
• Changing Course On Pacific Capacity ........ as the Grand Alliance (Hapag-Lloyd, NYK Line, OOCL and P&O Nedlloyd), the New World Alliance (APL, Hyundai & MOL) & Maersk Sealand will reinstate vessel capacity & services removed last winter in an attempt to reduce oversupply in the trade. The addition of ship capacity represents a change in trends, following removal of capacity by carriers last winter & the recent resumption of cargo growth. Details of all transpacific services & capacities posted on the global liner shipping database ComPairData:
  www.compairdata.com
• But Nine In The Atlantic Say Less Capacity ........ as CP Ships-owned Lykes Lines & TMM Lines, the Grand Alliance carriers Hapag-Lloyd, OOCL, NYK Line and P&O Nedlloyd, and joint service partners COSCO, "K" Line & Yang Ming have reached an agreement to withdraw ships in the overtonnaged transatlantic trade. The 9 carriers in the Atlantic Space Charter Agreement will continue to compete with each other & independently market their respective brands. The capacity rationalization pact is regarded as the most important attempt to bring supply in line with demand since 2000, when more than 6 carriers agreed to combine their transatlantic services. The new agreement, subject to regulatory review in the U.S. & European Union, has been filed with the U.S. FMC. Implementation is expected in 2nd quarter. The move towards less ship capacity in the North Europe/U.S. trade follows a similar agreement reached in Feb. by China Shipping & Zim Israel Navigation Co. in the Mediterranean/U.S. trade. Under that agreement, the Chinese carrier withdrew its own ships of about 1,800 TEUs from the trade, & took slots on Zim ships instead.
• Going South Heads North ........ as carriers of the West Coast of South America Discussion Agreement are planning large increase in southbound freight rates from the U.S. East & Gulf coasts to the West Coast of South America. According to Maersk Sealand, the increases are US$500 per 20-foot container & US$1,000 per 40-foot box for all general store merchandise & FAK cargoes, effective May 1 -- to Chile, Bolivia, Peru, Ecuador & the port of Buenaventura on the W. Coast of Colombia. The carriers are APL, Compania Chilena de Navegacion, CMA CGM, Columbus Line, Crowley American, Compania Sud Americana de Vapores (Chilean Line), Ecuadorian Line, Maersk Sealand, MSC, P&O Nedlloyd, NYK-NOS, Seaboard & Trinity Shipping.
• Eastbound Also Heads North ........ as the Far Eastern Freight Conference, comprising the Eastbound Management Agreement & Mediterranean Rate Agreement, are to implement a rate restoration of US$200 per container on June 1. Member lines are APL, CMA CGM, Egyptian Int'l Shipping, Hapag-Lloyd, HMM, K Line, Maersk Sealand, MISC, MOL, NYK, OOCL, P&O Nedlloyd & Yang Ming.
• Higher Fruit ........ as container shipping lines serving the westbound transpacific trade plan to raise freight rates on high-value refrigerated U.S. summer fruit exports to Asia. Refrigerated container equipment, particularly controlled atmosphere (CA) & modified atmosphere (MA) units, are far more costly to operate & maintain in the westbound market than standard equipment, yet very little refrigerated cargo moves in the reverse direction from Asia to the US. How much? Carriers of WTSA are APL, China Ocean Shipping Co., Evergreen Marine, Hanjin Shipping, Hapag-Lloyd, Hyundai Merchant Marine, "K" Line, Maersk Sealand, MOL, NYK, Orient OOCL, P&O Nedlloyd & Yang Ming.
• Europe To Middle East & India Up ........ as 2 conferences of shipping lines in the Europe/Middle East & Europe/Indian Subcontinent trades will raise rates. The planned increases of the Europe Middle East Rate Agreement & India Pakistan Bangladesh Ceylon Conferences are US$150 per 20-foot container & US$200 per 40-foot box, effective June 1.
• Tanker Rates Tank ........ as rates have retreated to their lowest levels since the mid-1980s after OPEC said it has no plans to pump more oil to make up the shortfall caused by Iraq's suspension of exports.
• Sinogistically A Bad Year ........ as marine disasters in China last year left 401 people dead or missing & caused economic losses of US$1.21Bn according to a report released by the State Oceanic Admin. Last year, huge waves sank or damaged 618 ships in E. coastal Fujian & Shandong Provinces, leaving 265 people dead or missing.
• Dutch Treat ........ as Rotterdam was the 1st of 10 ports selected by U. S. Customs for stricter control of sea containers bound for U.S. ports. Early reports are that Rotterdam stevedores are less than pleased by the inspections.
• See Through Down Under ........ as Australia will toughen border protection with introduction of container x-ray machines at Sydney & Melbourne ports. The x-ray technology, a 1st for Australia, will allow entire containers to be inspected for detecting weapons, drugs & prohibited items. The machines, now at U.S. ports, can x-ray a 40 ft. container in about 10 minutes, enabling Customs to inspect around 100 containers daily at each port. Currently it takes between a few hours & 8 days to physically inspect a container, depending on type of goods. Operations will commence in Nov.
• Navieras/NPR On The Block ........ as a U.S. Bankruptcy Court has approved a proposal by Sea Star Line, LLC, to acquire the ships & assets of Navieras/NPR Inc., which is part of the Holt Group. Sea Star's bid is pending the results of a public auction, at which anyone may offer a higher bid than the US$32M for Navieras proposed by Sea Star.
• Selling The Children ........ as Hyundai, the heavily indebted Korean line, has entered into a special financial agreement with Korea Exchange Bank to resolve its shortage of liquidity. The company has repaid US$620M by transferring future trade receivables & selling investments & property, plant & equipment in Jan. & Feb. Hyundai also signed a memo of understanding with Wilh. Wihelmsen ASA & Wallenius Lines AB to sell its car carrier business. Hyundai reported a net loss of US$241M for 2001.
• Saudis Not To Be Contained ........ as the National Shipping Company of Saudi Arabia will discontinue its container service between Asia & Europe, & sell its three 4,400-TEU containerships employed in this trade. The Saudi line's exit from the container trade follows a sharp fall in freight rates in the Asia/Europe trade, where ocean carriers say they are losing money. The carrier's decision to end container service does not affect its Middle East RO/RO operation or its tanker & shipping services for project & heavy lift cargoes.
• P&O Takes It All ........ as it is to buy the remaining 40% of P&O Stena Line from Stena for £150M as part of a raft of measures to stem losses on some of its short-sea ferry operations. P&O Stena Line was formed on 10 March 1998. P&O has a 60% economic interest & Stena Line 40%.
• Digging To Portland ........ as the U.S. Army Corps of Engineers favors a US$188M plan for deepening the Columbia River's 100-mile shipping channel to Portland along the Washington-Oregon border from 40 feet to 43 feet. The plan would allow vessels that already ply the river to carry more cargo without hitting bottom, but requires about 200 million cubic yards of rock, sand & mud to be moved over the next 50 years, an amount nearly equal to the Panama Canal project. The Corps estimates dredging would yield about $2 in economic benefits for every $1 spent. There is some opposition from environmental groups.
  Army Corps of Engineers: www.usace.army.mil/
  Columbia River Intertribal Fish Commission: www.cyberlearn.com/tribal.htm
  Columbia River Channel Coalition: www.channeldeepening.com/
• Big Ditch Goes Up ........ as the Panama Canal Authority will start charging a US$400 security fee per vessel transit on June 1. The Panama Canal Authority said the fee is related to major investments to improve security and reduce the risk & vulnerability of its facilities -- to include expanding the canal's electronic monitoring & tracking systems. An additional 24-hour security control center has been established for incident & emergency management. Enhanced postings and patrols along the canal & its reservoirs will also increase security.
• Deeper Suez ........ as the Suez Canal Authority (SCA) will create a draught depth of 22 meters in the canal by 2010, according to the Gulf Agency Company (GAC). SCA chairman, Admiral Ahmed Aly Fadel, announced at a conference in the Egyptian city of Alexandria that the project would be completed without any foreign financial or technical input. With a depth of 22 meters, 82% of the Int'l oil tanker fleet, 99% of the Int'l bulk tonnage fleet & all other types of full cargo capacity vessels will be able to use the Suez Canal.
• Navigating The Mekhong ........ as an improvement project on a 33km stretch of the Mekhong River in Laos has begun, which will allow for vessels of up to 100 tons to navigate the river. Almost 150 Chinese engineers are involved in the US$5M project, removing at least 20 dangerous shoals & submerged rock and installing 200 navigation markers in the river. The Mekhong River runs for 4,661km through China, Myanmar, Laos, Thailand, Cambodia & Vietnam, almost half of which crosses SW China.
• Biggest Hits Long Beach ........ as the largest cranes ever seen in a U.S. port arrived at the Port of Long Beach on April 9. The two 350-foot-high ship-to-shore cranes passed through the "Queens Gate" opening of the Long Beach Breakwater aboard M/V Zhenhua 6 -- fully erected, with booms raised. The new US$7M cranes are able to reach across the next generation of ship with 22 rows of containers, while the largest existing crane in Long Beach can reach across 18 rows. These are the 1st 2 of 12 cranes that Long Beach has ordered for a new 375-acre Pier T container terminal under construction on Terminal Island for lease to Hanjin.
• New York Says "No Thanks" To Cargo of Explosives ........ as the U.S. Coast Guard banned French container M/V Utrillo from entry into the Port of New York & New Jersey after inspectors discovered explosive cargo had been put into containers allegedly misdeclared & in substandard condition. The vessel was allowed to dock for an interval in Red Hook, Brooklyn, while Coast Guard officials consulted with the French Consulate in New York before banning Utrillo from the harbor. On April 17, inspectors allegedly found that 19 of 158 containers of military material aboard contained explosives. One additional container, from a civilian source, also held explosives. The war material was being shipped from France to French Polynesia. French military personnel were on the ship, which had been allegedly inspected by the SGS classification society before sailing. Utrillo was built in 1999 & is operated by CMA CGM.
• Elite Int'l Goes INTTRA ........ as the Houston-based freight forwarder, has joined the logistics network of INTTRA Inc., which supports door-to-door ocean transport services for customers that book with one or more carriers, and INTTRA-LINK, which provides logistics data to larger companies directly through enterprise supply chain systems. INTTRA is sponsored by CMA CGM, Hamburg Sud, Hapag-Lloyd, Kuehne & Nagel Int'l AG, Maersk Sealand, MSC Mediterranean Shipping Co., P&O Nedlloyd, & United Arab Shipping.
  www.INTTRA.com/
• FMC Pulls Tickets ........ as it has revoked the ocean transportation licenses of Florida Overseas Services, Miami; Arrisco Int'l, Charlotte, N.C.; Astral Int'l Shipping New Orleans; Costa Rica Carriers, Miami; Rual Nunez, Houston; Road Runner Int'l, Union, N.J.; & S.A. Chiarella, San Marcos, Calif., for failure to maintain surety bonds.
• Throughput. They're Back! ........ as Port of New York & New Jersey cargo volumes increased 5.6% in 2001, with each sector -- containerized cargo, bulk, breakbulk, & rail activity -- reporting growth -- loaded & unloaded container volumes totaled 3.32 million TEUs in 2001, up 8.7% -- loaded TEUs rose 4.2% to 2.33 million TEUs -- total tonnage climbed 13.5% to 73.55 million metric tons. >> Port of Los Angeles' Feb. inbound containers soared a record 52%, to 234,405 TEUs -- but in March, volume shipped through Port of Long Beach to 343,500 TEU, down 4.6% year-on-year -- and also declined at other major West Coast ports including Tacoma & Oakland.. >> Port of Marseilles, France, handled 191,000 TEUs during the 1st quarter, up 9.1% from the year-earlier. >> Exports from Shanghai ports totaled US$17.2bn in the 1st quarter of the year, up 13% over the 2001.
• This Month In U.S. Navy History ........ for April:
  In 1783 - George Washington proclaims the end of hostilities with Great Britain.
  In 1861 - President Lincoln orders the blockade of Southern ports from South Carolina to Texas.
  In 1955 - USS Albany (CG 10) & USS William Wood (DD 715) begin to provide disaster relief to citizens of Volos, Greece; the mission ends April 21.