Disclaimer

The articles excerpted on this site report on the state of the industry as seen by mainstream media, and do not necessarily reflect the opinion of the officers of the ILWU Coast Longshore Division.

First meeting between POLB, POLA under Federal Maritime Commission agreement held earlier this week

The Port of Long Beach (POLB) announced Wednesday that a kickoff meeting earlier this week with the Port of Los Angeles (POLA) marked the beginning of their collaboration to enhance velocity and efficiency throughout the gateway’s supply chain.

As the first meeting under the formal discussion agreement recently approved by the Federal Maritime Commission (FMC), ranking staff from the San Pedro ports, that together make up the busiest port complex in the United States, decided that their number one goal is to get cargo moving more efficiently.

According to the POLB, the initial meeting was held at POLB headquarters to discuss the framework for how the ports will collaborate, work with stakeholders within the supply chain and communicate the results of these efforts.

More at the Long Beach Post

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Cosco International posts $46.3 million profit

The shipping services arm of China Ocean Shipping, Cosco International reported its profit attributable to equity holders for the year ended 31 December 2014 rose 48.6% year-on-year to HK$359 million ($46.3 million).

Revenue, however, fell 18.5% to HK$7.59bn as contributions from the core shipping services businesses decreased.

Cosco International noted that the overhang of shipping capacity continues to exist and the shipping market will remain sluggish. “Cost control by shipowners is expected to remain and business prospects of the shipping services industry will unavoidably be under pressure,” the company said.

The great increase was attributed to the marked increase in operating profits of coatings, ship-trading agency, and marine equipment and spare parts businesses.

More at Marine Link

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Pro-coal Montana tribe weighs in on Cherry Point terminal

Lummi Nation, which has fished the waters off Cherry Point for centuries, and Crow Nation, a tribe in Montana sitting on billions of tons of coal, have taken opposite stances on a proposed coal terminal on the Lummis’ historic fishing grounds.

Crow Chairman Darrin Old Coyote wrote the U.S. Army Corps of Engineers on Jan. 20, asking the federal agency to bring the two tribes together to discuss Gateway Pacific Terminal. The Crow letter was in response to request on Jan. 5 from Lummi Nation to the Corps, asking the agency to reject the terminal because it interfered with the Lummis’ ancient fishing practices, which were reinforced in U.S. law by an 1855 treaty.

In its response, dated March 10, the Corps said it would not organize meetings between the tribes. The agency suggested the Crow ask the Bureau of Indian Affairs.

More in the Bellingham Herald

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FMC Chairman: Congestion preceded labor talks; investments in infrastructure needed

Congestion that has slowed goods movement to a crawl at U.S. ports such as Los Angeles and Long Beach will continue to be an ongoing issue for years, until the nation invests in long-term maritime infrastructure, Chairman of the Federal Maritime Commission Mario Cordero said Thursday.

“Congestion has been a problem long before labor negotiations … and will continue to be a challenge,” Cordero said.

An estimated $78 billion of President Barack Obama’s $478 billion, six-year surface transportation reauthorization proposal has been slated for infrastructure related to the port/freight network, the FMC chairman said.

Meanwhile, the rest of world is investing an estimated $2 trillion in the next six to eight years in port-related projects, with 60 percent of that investment coming from Asia, Cordero said. “Compare that to what we’re doing here, we’ve got a lot of work to do.”

More at the Press-Telegram

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FMC’s Khouri wants container alliances to provide congestion information

Excerpts from American Shipper:

Michael A. Khouri

Michael A. Khouri

Federal Maritime Commissioner Michael Khouri wants the FMC to request the four major alliances of ocean liner carriers to provide new information on the steps each is taking to reduce congestion at U.S. ports.

“We have received private reports and seen numerous press accounts that the operations of the four alliances – G6, CKYHE, Ocean 3, and 2M – may be a contributing factor in the chronic congestion at the West Coast ports, and perhaps at other port facilities,” Khouri said last week.

“In terms of overall costs and service levels in the liner supply chain as experienced by U.S. exporters and importers, there has been a deterioration in service and significant increase in costs due to several factors,” said Khouri.

More at American Shipper

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Hanjin Heavy expected to win container ship deal

France’s CMA CGM SA is in talks to build at least three container megaships, joining the race among the top container operators that already use such vessels to increase their market share on the world’s busiest trade routes, people with knowledge of the matter said Tuesday.

The ships would be able to carry around 20,000 containers each and cost about $420 million in total, the people said. Deliveries would start in 2017, and the order will probably go to South Korea’s Hanjin Heavy Industries & Construction Co., which offered the French company a discount of around 5% compared with other South Korean yards that have so far monopolized the construction of the huge Triple-E class of container vessels, the people said.

More at the Wall Street Journal blog

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LA, Long Beach bring recovery plan to legislators, shippers

From the Journal of Commerce:

Port leaders — including Port of Los Angeles Executive Director Gene Seroka, Port of Long Beach Chief Executive Jon Slangerup and Long Beach Board of Harbor Commissioners President Doug Drummond — also stressed that they were taking responsibility for the months of congestion that brought terminals to near gridlock and were aggressively working to prevent it from happening again.

And they made the case to shippers that Southern California is still the best gateway to bring their cargo through because of sailing frequency, intermodal rail connections, and nearby industrial real estate, among other factors.

Although both ports run under a landlord model where each marine terminal handles its own stevedoring, Seroka said he stressed during the D.C. meetings that he envisions a hybrid approach that encompasses the more hands-on approach of operating ports. Los Angeles is already moving toward this hybrid model by working with the three largest chassis-leasing companies with their formation of a “gray pool” and offering land for a container free-flow operation.

More at the JOC

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Marubeni grain giant fined $800,000 by CFTC

The U.S. Commodity Futures Trading Commission issued an order filing and simultaneously settling charges against Marubeni America Corp., a dealer and merchant of agricultural commodities and the largest overseas subsidiary of the Japanese company Marubeni Corporation, for failing to comply with its obligation to submit accurate monthly reports regarding the composition of Marubeni’s fixed-price cash grain purchases and sales that are part of hedging positions.

CFTC found from July 2010 through August 2013, Marubeni Marubeni filed 38 reports with the CFTC that did not accurately state the quantities of Marubeni’s fixed price cash positions of each such commodity it hedged.

The CFTC Order requires Marubeni to pay an $800,000 civil monetary penalty and to cease and desist from committing further violations. Marubeni America acquired Gavilon’s agricultural commodity business, based in Omaha, in 2013.

More at the Lincoln Journal Star

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Dubai port giant DP World profits rise to $675M last year

From the Associated Press:

DP World, the Dubai-based international port operator, said Thursday its profit rose 12 percent in 2014, a year in which it assumed ownership of a sister company that runs free-trade zones in the Gulf emirate.

The government-backed company said it earned $675 million in profit attributable to its owners last year, up from $604 million in 2013.

DP World ranks among the world’s largest port operators, with business at more than 65 marine terminals globally.

It is heavily focused on fast-growing developing markets, and it runs the Middle East’s busiest port, Dubai’s Jebel Ali. Its portfolio also includes the new London Gateway port in Britain and Embraport in Brazil.

More at this link

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Long Beach port leaders consider dockage fees cap to help with congestion

Harbor leaders will consider Monday extending its cap on dockage fees three more months to give supply chain stakeholders some relief from the congestion issues they’re experiencing at the Port of Long Beach.

Usually, it takes about three days to load and unload goods from ships. But bottlenecks at the port is causing port operators to take longer to load and unload cargo ships, stretching the time a ship remains on dock from the typical four days to seven days.

Costs paid to the port go up after four days. The current exemption, set to expire at the end of this month, caps those costs to four days.

The proposed extension would be in effect until June 30, which would cover the time it would take for the port to address the backlog.

More at the Press-Telegram

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Panama Canal Authority to appeal US$233m award to contractors

The Panama Canal Authority said on Tuesday it had asked for an international arbitration panel to review a decision to award US$233 million to the consortium expanding the canal in a dispute over cement quality.

The consortium, led by Spain’s Sacyr and Italy’s Salini Impregilo, and including Belgium’s Jan de Nul and Panama’s CUSA, said in January it had won US$233 million of the US$463 million it claimed in the dispute.

Any international arbitration would take place in Miami, the canal authority said.

More at International Business Times

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Saskatchewan sees slim 2015-16 surplus, hikes potash taxes

The Western Canadian province of Saskatchewan expects to post a slim budget surplus in the 2015-16 fiscal year, helped by changes in how it taxes potash mining companies, the government said on Wednesday.

The province is home to mines owned by Potash Corporation of Saskatchewan, Mosaic Co and Agrium Inc . Germany’s K+S AG and Anglo-Australian miner BHP Billiton PLC are building mines.

The Saskatchewan government’s 2015-16 budget is expected to hurt PotashCorp’s 2015 pre-tax earnings by C$75 million-C$100 million, the company said on Wednesday.

More at Reuters

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PierPass member terminals increase throughput 46% in first half of March

From a PierPass news release:

In the wake of a tentative labor deal announced Feb. 20 and the formation of a port-wide chassis pool on March 1, marine terminals at the Port of Los Angeles and Port of Long Beach moved 46% more cargo containers by truck during the first half of March compared with the same period in February, PierPass Inc. said.

From March 2 through March 15, nearly 303,000 import and export containers moved by truck into or out of the terminals, compared to nearly 207,000 from Feb. 2 through Feb. 15, according to gate transaction data collected by PierPass. These include containers moved during day shifts and the OffPeak shifts managed by PierPass on nights and Saturdays. The OffPeak program diverts about half of port truck trips out of Monday-through-Friday daytime traffic while roughly doubling the capacity of the Los Angeles and Long Beach ports.

According to the Marine Exchange of Southern California, there were 30 ships waiting to be unloaded at the Los Angeles and Long Beach ports on Monday March 16, down from 36 on Feb. 26.

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Filling ultra-large container ships

Maersk Triple E

MSC is interested in ordering ten ships of 11,000 TEUs — far from the size of the latest megaships of more than 19,000 TEUs.

For those believing that Maersk Line’s 18,270-TEU Triple‐E class ships can actually be filled up to design capacity, says Dynamar, the carrier’s flagship Maersk McKinney Møller recently left Algeciras with 18,168 TEUs on board. “The ship was on its way to the Far East filled with many (if not mostly) empty boxes. Otherwise its deadweight (195,000 tons) would not have been sufficient to load all these boxes. The average gross weight per full TEU to the Far East from Northern Europe stands at around 14.2 tons (working out at 258,000 tons, excluding bunkers and supplies).”

Dynamar reports that Seaspan, an owner that doesn’t operate ultra-large container ships, doesn’t think ships of 18,000 to 20,000 TEUs will become the 747s of shipping, arguing that their deployment will remain restricted to a limited number of ports on the Europe-Far East run. It is convinced that they are missing the flexibility of the 10,000/14,000-teu range of container ships that have developed into the workhorses of an increasing number of liner trades.

As an analyst, Strauss also mentioned the size of the new locks in the enlarged Panama Canal: Roughly 13,000-TEU vessels will be the limit to transit the canal.

Excerpted from the Maritime Executive. Read the full article here.

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LA Times acknowledges chassis 'nightmare snarled ports long before labor talks broke down'

Excerpts from the Los Angeles Times article titled ‘Shifts in oceangoing commerce upend cargo trade at U.S. ports’:

[The] fight between shipping companies and the dockworkers union, resolved last month, was only one of the causes of chronic congestion at the nation’s busiest seaport complex.

Sweeping changes in the global shipping industry have upended cargo trade at major U.S. ports. To cut costs, shippers have formed alliances to combine goods from multiple carriers on so-called megaships, some with nearly twice the capacity of traditional commercial vessels. That means each ship takes that much longer to unload.

At the same time, the shipping companies outsourced the management of truck trailers that carry shipping containers around the country. That transition did not go smoothly, by all accounts, creating a logistical nightmare that snarled traffic at Southern California ports long before labor talks broke down.

“In essence, the maritime supply chain has become unhinged,” said Jock O’Connell, an international trade economist with Beacon Economics. “You’ve got some fundamental problems that will take a long time to resolve.”

More at the Los Angeles Times

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