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Economic crisis blog

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Economic crisis update
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March 15, 2012
  Company shorts - 15 Mar. 12

APM Terminals is to invest US$150 million into a $600 million new container terminal with an annual capacity of 860,000 teu at Savona-Vado, in Italy, expected to be operational by 2016.

Hong Kong-based container line Orient Overseas Container Line (OOCL) reported a six per cent increase in volumes, but has gone into red in the second half of 2011.

Port Spencer in South Australia could become a deepwater dry bulk port after a US$250 million development, pending approval of the South Australia state government.

Japan's Mitsui OSK Lines (MOL) has announced a new feedership route between Singapore and Yangon in Myanmar, a twice-weekly service offered in cooperation with Thailand's Regional Container Lines.

Taiwan-based Evergreen Line is to start next month weekly services in cooperation with the CKYH Alliance (Cosco, K-Line, Yang Ming and Hanjin Shipping) on the Asia-Europe route. 

Hong Kong-listed dry bulk operator Sinotrans Shipping has posted 2011 profits of US$92 million, 28 per cent lower than the previous year, as its operation costs soared by 21 per cent to $198.7 million.

Sources: International Freighting Weekly, Lloyd's List; 15 March 2012

    Posted By: NicS @ 03/15/2012 04:03 PM     Global news  

  CMA CGM looks for investors

French shipping line CMA CGM has stopped the newbuilding programme and seeks funds to restructure its US$5 billion debt and return to profit. The world's third largest carrier wants to sell a minority stake in its wholly owned ports unit Terminal Link, after raising $300 million from an earlier disposal of half of the shares held in Malta Freeport. CMA CGM has been in talks with French sovereign wealth fund Fonds Stratégique d'Investissement, but does not exclude the option of asking Turkish group Yildirim for a further cash injection of $500 million in return for a 20 per cent stake.

Source: Lloyd's List; 14 March 2012

    Posted By: NicS @ 03/15/2012 03:59 PM     Global news  

  Automatic operations at TraPac

Terminal operator TraPac Inc, a subsidiary of Mitsui OSK (MOL), which handles freight for members of the New World Alliance, is to become the first automated container terminal on the US west coast. The Port of Los Angeles has confirmed that automated straddle carriers would be operational this year, as part of an expansion plan aimed at dealing with megaships. TraPac is expecting the delivery of ten Kalmar automatic stacking cranes and 17 automatic shuttle carriers until 2013. In two years, almost two-thirds of TraPac handling operations are planned to be automated.

Source: Lloyd's List; 14 March 2012

    Posted By: NicS @ 03/15/2012 03:42 PM     Global news  

  Rate hikes after 2011 losses

The 15 container lines members of the Transpacific Stabilization Agreement (TSA) have recommended a general rate increase of US$300 per feu, effective from 15 March 2012. It is the second rate increase this year and a further one of at least $500 per feu is planned for May, as shipping lines are trying to bring the freight rates closer to their 2011 levels. Fuel prices have gone up since January and the market is still uncertain. Last year's carriers fight to secure the market share brought them huge losses, about $11.4 billion, according to the Danish consultancy firm SeaIntel Maritime.

Source: International Freighting Weekly; 14 March 2012

    Posted By: NicS @ 03/15/2012 03:40 PM     Global news  

  Maersk Flagship services

Danish carrier Maersk Line has signed a partnership agreement with the US railroad BNSF to provide dedicated non-stop rail services scheduled to arrive at an agreed time. Further to the launch of the Daily Maersk Asia-Europe service, freight will be delivered directly from Asia to five key markets in North America: Chicago, Dallas-Fort Worth, Houston, Memphis, and Northwest Ohio. The vessels of Maersk Line are handled by APM Terminals Los Angeles Pier 400. In another development, Maersk Tankers announced that six vessels, three on the French second register and three Danish, are to be reflagged to Singapore as a cost-cutting measure.

Source: Lloyd's List; 14 March 2012

    Posted By: NicS @ 03/15/2012 03:38 PM     Global news  

March 8, 2012
  Company shorts - 08 Mar. 12

Ferry operator DFDS Seaways, which provides passenger and freight services in the Channel, Baltic Sea and the North Sea, has announced an operating profit of £174 million for 2011, following a jump of 18 per cent in turnover to £1.35 billion.

Switzerland-headquartered commodities giant Glencore posted a 28 per cent surge in revenues to US$186 billion and a seven per cent increase to $4 billion profit for 2011. At the end of last year, Glencore had a $2.2 billion charter book.

Australia's mining company Rio Tinto has announced a US$2 billion investment in the iron ore mining project located in the state of Orissa, India. Plans include rail links and port infrastructure developments in order to increase Orissa production of iron ore to 15 million tonnes per annum.

Italian shipbuilder Fincantieri is to renovate the Carnival Destiny cruiseship. The US$155 million investment will see the 100,000 gt converted into Carnival Sunshine by 2013.

UK-based group Clarksons saw its 2011 core profits slightly declining to £32.2 million after a four per cent decrease in annual revenues to £202.6 million. The world's largest shipbroker has predicted a challenging year for the tanker industry.

Daewoo Shipbuilding and Marine Engineering has sealed a US$2 billion order to build a floating production storage and offloading vessel for Japan's company Inpex, with delivery scheduled for 2016.

Source: International Freighting Weekly, Lloyd's List; 7-8 March 2012

    Posted By: NicS @ 03/08/2012 06:28 PM     Global news  

  Container rates pick up pace

Spot rates on Asia to Europe and the Middle East trades have jumped by almost 75 per cent over the last week, pushing the Shanghai Containerised Freight Index up 19.1 per cent to 1163.96. The World Container Index, a joint venture between Drewry and Cleartrade Exchange, indicated a surge of 114 per cent for westbound freight rates from Asia. This is a consequence of a general lift in rates announced by many carriers, and some of them are considering further hikes to be implemented in April. However, a deployment of larger tonnage could increase the pressure on cargo rates in the near future.

Source: Lloyd's List; 7 March 2012

    Posted By: NicS @ 03/08/2012 06:26 PM     Global news  

  Megaships to arrive at the US west coast

The US ports of Long Beach and Los Angeles are ready to handle large containerships with capacity of over 10,000 teu. MSC Fabiola is the first 12,500 teu boxship operating in the Pacific trade to arrive at Long Beach, followed by two 11,000 teu vessels deployed by Mediterranean Shipping Co in an upgraded service in cooperation with CMA CGM. MSC Fabiola is expected to berth at Hanjin Shipping's Total Terminals International on Terminal Island. The port of Long Beach, whose throughput was affected last year by the move of Hyundai Merchant Marine's California United Terminals to Pier 400 in Los Angeles, is planning to invest US$1.2 billion in a development aimed at doubling its capacity to 3.2 million teu.

Source: Lloyd's List; 7 March 2012

    Posted By: NicS @ 03/08/2012 06:25 PM     Global news  

  Green logistics hub planned at Liverpool

British group Peel Ports has called for bids to build a new deepwater container terminal at the Port of Liverpool. The £300 million project, part of the Mersey Ports Master Plan for the port of Liverpool and Manchester Ship Canal, is designed to be the UK's first green logistics hub. The new box terminal Liverpool 2 will be able to handle 13,500 teu megaships. Its initial capacity in 2015, when is expected to open for business, will be 500,000 teu. As volumes are forecast to increase by 70 per cent over the next 20 years, Liverpool throughput could reach an annual handling capacity of 2.4 million teu.

Source: International Freighting Weekly; Lloyd's List; 7 March 2012

    Posted By: NicS @ 03/08/2012 06:24 PM     Global news  

  CMA CGM posts 2011 losses

French shipping line CMA CGM has reported losses of US$30 million for 2011, but is confident it will return to profit later this year. The company's volumes hit 10 million teu, up 11 per cent compared to 2010. Revenues for 2011 increased by four per cent to $14.9 billion for the year, but earnings before interest, tax, depreciation and amortisation dropped to $711 million from $2.5 billion in 2010. In an effort to seek protection against volatility, CMA CGM has recently signed a new type of contract by linking freight rates to a non-shipping index.

Source: Lloyd's List; 8 March 2012

    Posted By: NicS @ 03/08/2012 06:23 PM     Global news  

March 1, 2012
  Company shorts - 01 Mar. 12

Asian container lines Nippon Yusen Kaisha (NYK) Line, Hyundai Merchant Marine (HMM), Hanjin Shipping and Evergreen will start a new six-week service between the US east coast and South America.

Stockholm-listed shipowner Transatlantic is splitting its shipping business from the offshore and icebreaking division, which is planned to move to Denmark. This is part of a restructuring process, as the company reported a US$66.2 million loss in 2011.

French ports of Le Havre, Rouen and Paris, which formed Haropa, an economic interest group to promote trade along the Seine, could be merged into a single transport authority, according to a report commissioned by the government. 

Profits at the Nasdaq-listed dry bulk shipowner Globus Maritime have dropped 12 per cent, in spite of a 20 per cent increase in revenues following a 42 per cent enlargement of the company's fleet capacity.

Singapore-listed shipbuilder Cosco Corp has sealed orders worth US$190 million for seven dry bulk vessels for two European companies.

Losses at the New York-based tanker company Overseas Shipholding Group (OSG) have hit US$192.9 million for 2011, although the full-year revenues remained flat at $1.1 billion.

Sources: Lloyd's List, International Freighting Weekly; 1 March 2012

    Posted By: NicS @ 03/01/2012 04:40 PM     Global news  

  Maersk Line and Maersk Tankers in the red

Two divisions of the Danish conglomerate AP Møller Maersk have posted losses for 2011, but the group had an overall profit of US$3.38 billion, down 33 per cent from $5 billion a year before. Maersk Line, the world's largest carrier, expects another difficult year after losing $537 million in 2011, in spite of an 11 per cent surge in volumes to 8.1 million feu and a five per cent increase to $25.1 billion in revenues. The box line said high fuel costs, lower rates and oversupply had a negative effect on profitability. Maersk Tankers, the third largest tanker in the world, made a $151 million loss in 2011, about $33 million worse than in 2010. On the other hand, the group's container handling division, APM Terminals handled 33.5 million teu, eight per cent more than in 2010, and posted a $649 million profit, a 24 per cent annual surge.

Source: Lloyd's List; 29 February 2012

    Posted By: NicS @ 03/01/2012 04:38 PM     Global news  

  Ports in North Europe affected by austerity

Imports through six Northern Europe ports (Le Havre, Antwerp, Zeebrugge, Rotterdam, Hamburg and Bremen/Bremerhaven) are expected to increase moderately by three per cent to 16.5 million teu this year, and outgoing volumes to grow by five per cent to 17.8 million, according to Hackett Associates and the Bremen Institute of Shipping Economics and Logistics (ISL). Total European import grew by 4.8 per cent in 2011, after a weak forth quarter. Incoming volumes at the container ports in North Europe drop seven per cent in the last quarter and are forecast to remain flat for the first three months of 2012, amid signs of a mild recession.

Sources: International Freighting Weekly; Lloyd's List; 29 February 2012

    Posted By: NicS @ 03/01/2012 04:35 PM     Global news  

  Dublin port master plan

Dublin Port Co (DPC) has unveiled expansion plans to double Ireland's largest port's throughput to 60 million tonnes by 2040. Some €110 million will be invested during the first five years of the €600 million master plan to build a €30 million cruise terminal and a car storage facility. Cruise Dublin, a joint initiative between DPC, Dublin City Council and Dublin Chamber of Commerce is to look into the needs of the cruising industry. The programme is also aimed at increasing the rail freight volumes over the next three decades.

Source: Lloyd's List; 29 February 2012

    Posted By: NicS @ 03/01/2012 04:34 PM     Global news  

  Shipping giants seek rate increases

Geneva-based Mediterranean Shipping Co has announced a US$400 per teu rate increase to be implemented for Asia to Europe trade from 1 April 2012, in addition to a $750 rate restoration and emergency bunker surcharge planned to come into effect from 1 March. Maersk Line, Cosco Container Lines and Hapag-Lloyd have notified shippers of similar rate hikes for westbound trades from Asia. The ten members of the Westbound Transpacific Stabilization Agreement have announced rate increases for US to Asia routes. Shipping lines say they had to increase the rates in order to provide reliable services.

Source: Lloyd's List;  29 February 2012

    Posted By: NicS @ 03/01/2012 04:30 PM     Global news  

February 24, 2012
  Company shorts - 24 Feb. 12

Copenhagen-listed logistics operator DSV forecast an annual increase of at least four per cent in sea freight this year, after handling 728,000 teu in 2011. The company's annual pre-tax profit was up nine per cent to DKr2.4 billion.

The US port of New York and New Jersey handled 5.5 million teu last year, more than the record volumes reported before the crisis. ExpressRail, the port's on-dock rail system, handled 422,144 teu, up 12 per cent compared to 2010.

Swedish shipowner Stena Bulk has announced plans to expand its LNG fleet up to 10 fuel-efficient vessels.

The productivity at the Peruvian port of Callao soared 63 per cent after a US$27 million investment from APM Terminals, which operates the port since July 2011.

US-listed shipowner Danaos Corporation returned to profit in 2011. It posted a US$13.4 million net income, after being $102.3 million in the red a year ago.

New York-based dry bulk company Genco Shipping & Trading has reported an unexpected profit for the last quarter of 2011, although the voyage revenue and the average daily time charter equivalent rates plummeted.

Source: Lloyd's List, International Freighting Weekly; 23 February 2012

    Posted By: NicS @ 02/24/2012 04:14 PM     Global news  

  Maersk Line reduces Asia-Europe capacity

Freight rate environment and fears of oversupply have made Danish giant Maersk Line to announce a nine per cent reduction of its 850,000 teu capacity on Asia to Europe trades. The company is committed to cut costs and keep its market share, and hopes its vessel sharing agreement with French carrier CMA CGM the Asia-west Mediterranean trades would benefit both shipping lines. Maersk has recently given up its option for a further ten mega-ships with capacity of 18,000 teu. In addition to lay-ups and slow steaming, Maersk is to introduce a rate increase of $775 per teu in the Asia to north Europe and Mediterranean routes.

Source: Lloyd's List; 22 February 2012

    Posted By: NicS @ 02/24/2012 04:13 PM     Global news  

  World bulker fleet hits new record

The global fleet of bulk carriers could reach 10,000 vessels by the end of this year as more tonnage is scheduled for delivery, according to London-based shipbroker Clarksons. Although 1,539 vessels with a capacity of 90 million dwt are scheduled to be delivered this year, it is estimated that only 70 per cent of them with enter service. There have been 165 bulkers with 13.5 million dwt delivered so far this year, and the dry bulk fleet stood at 9,021 vessels on 17 February 2012, approximately 1,500 more than in January 2010. The handysize fleet accounted for 3,065 ships, the handymax segment stood at 2,504 vessels, and the panamax fleet has seen the largest increase to 2,066 vessels. The capesize fleet of vessels over 100,000 dwt is 1,386 vessels, almost double compared to the figure of 2007.

Source: Lloyd's List; 22 February 2012

    Posted By: NicS @ 02/24/2012 04:12 PM     Global news  

  NOL posted 2011 losses

Singapore-based Neptune Orient Limes (NOL) Group has finished 2011 in the red, with losses of US$478 million, mainly because of the APL, its container line unit. The company blamed poor market conditions, weak demand and higher cost of fuel for a $320 million loss in the forth quarter. Last year, NOL Group's revenues were two percent down to $9.2 billion, compared to 2010, when NOL made a total net profit of $461 million. APL saw its 2011 revenue declining by five per cent to $7.9 billion. In spite of an overall increase in volumes, average revenues per feu dropped 10 per cent and the container line reported a $446 million loss. In contrast, revenues of APL Logistics surged 12 per cent to $1.4 billion.

Source: International Freighting Weekly; 22 February 2012

    Posted By: NicS @ 02/24/2012 04:11 PM     Global news  

  HPH Trust posts Q4 profit

Singapore-listed Hutchison Port Holdings (HPH) Trust, a unit of Hong Kong-based giant Hutchison Whampoa, has announced operating profits of HK$1.2 billion (US$154.7 million) for the last quarter of 2011, slightly below the expected levels. The quarterly throughput of the container port business trust at its China's terminals in Shenzhen grew 5.5 per cent, even though volumes were 9.4 per cent lower than predicted. The revenue of HPH Trust, affected by the global economic slowdown, has increased by lower-than-forecast 6.7 per cent to $3.1 billion. In 2011, the company's total throughput at all terminals was four per cent higher than the previous year. HRT Trust expects a recovery based on growth in the US and intra-Asia trade.

Source: Lloyd's List; 22 February 2012

    Posted By: NicS @ 02/24/2012 04:10 PM     Global news  

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ITF House, 49-60 Borough Road, London SE1 1DR  |  +44 20 7403 2733   |  mail@itf.org.uk