Why is it proving so
difficult to find a way of
weighing containers?
Weighing up
the options
INSIDE THIS ISSUE MARKETS: Delinking the renminbi COMMERCE: Chinese boost for DnB
NOR REGULATION: US sets shipping sanctions trap TECHNOLOGY: Mixed messages on sewage
LOGISTICS: Colombo’s tracks to recovery DECISION-MAKERS: Lakshmi Venkatachalam
this week 8 July 2010
volume 369 issue 6590
every week
?
Shipping must recognise it is part of the
A weighty issue logistics chain. Opening up Africa
Weighing containers would help eradicate
many problems that currently plague the 4-5 Story of the week
box trades. So why is there such resistance Stowage and weight issues continue to
to adopting the practice? asks Miriam Fahey hinder the container sector
look out
Telling them why it matters
Shipping is a part of the logistics chain and must act accordingly
Container shipping is a part of the wider if a stack of overweight boxes collapses in The options include further legislation
logistics and supply chain. Carriers and the heavy seas; not because this might lead to to make weighing containers mandatory,
ships they operate must be viewed along- the stability of the vessel being compro- cajoling the IMO to place overweight
side shippers, terminals and other cargo mised; not because the safety of the ship’s boxes on the safety agenda, and impress-
handlers, cargo manufacturers and other crew is endangered. They should care ing on manufacturers, shippers, handlers,
transport providers. Problems arise when because the shipper has a duty of care for even seafarers, that safety matters.
any part of this collection of logistics play- those further down the chain. Fairplay believes that last option is the
ers declines to take responsibility for what Last month a London conference at- only option. Investing in new technology
they do. The consequences run deep. tracted attendees with its subtitle ‘is is both reasonable – no, weighing con-
The issue of misdeclared containers (see [weighing containers] really that difficult?’ tainers isn’t that difficult – and achiev-
p4) is a classic case of certain players (ship- Not many moons ago, this magazine at- able. But it involves the shipping sector
pers) failing to understand the implications tended a similar conference that sought to understanding that there are elements
of deliberately recording a weight they learn the lessons of the stack collapse on of the supply chain above and below the
know to be false. From their point of view, the feeder ship Annabella. The discussion sea passage. Explaining why something
they have been doing it for years and no led to a series of best practice guidelines. is critical is half way to getting it imple-
one has suffered as a result. Done and dusted, readers might have mented. Pursuing legislation in Brus-
Shippers should care, not because an thought. But no – there’s still enough life sels or agenda items at the IMO won’t
individual cargo supplier will be prosecuted in the issue to generate further angst. guarantee safety. F
Weighing up
the options
Weighing boxes would help solve many problems that
plague the trade. So why is there such resistance to
adopting the practice? Miriam Fahey reports
S
towage and weight issues continue while running through the Baltic Sea in
to plague the container sector February 2007. A report into the incident
two years after the publication of identified a series of failings, including
Safe Transport of Containers by Sea computers not programmed to differentiate
– Guidelines on Best Practices by the Inter- between 30ft and 40ft boxes and declared
national Chamber of Shipping and the weights that were wildly inaccurate.
World Shipping Council. With no Misdeclaration of weight is a serious
solution in sight, calls are grow- safety violation, observed Michael Valcic,
ing for tighter legislation, but are operations manager at MOL. “For the ship,
carriers to blame or is malpractice a it’s a question of physics,” he told the con-
sector-wide concern? ference, but for the shipper it’s a question
A conference in London in June of understanding. He cited the case of one
appears to have emphasised broad carrier in South Africa which found a ship-
ignorance among the shipper com- per had deliberately misdeclared 25 tonnes
munity of why it is important to of bananas as 20 tonnes “because, as they
stow containers correctly and pro- ripen, bananas shrink”.
vide accurate information on variables Valcic could not see what financial gain
such as weight. The ICS/WSC guidelines shippers made by misdeclaring cargo, but
stressed that overloading of containers the problem goes deeper than trying to
can never be condoned and declarations secure a small saving. Shippers and cargo
of weight must be truthful. But there is no handlers don’t understand the dynamics
legislation governing this practice and con- of a ship. “The client might not know that
tainer lines rely on shipper honesty. we [carriers] need weight to calculate the
Why are containers While shippers will not suffer the con- strength of the vessel,” he added.
sequences of badly stowed and stacked Other speakers supported this concern,
not weighed? containers, seafarers will. Relying on including Steve Cameron of Cameron Mari-
honesty isn’t good enough when shippers time Resources. Moisture content of con-
Carriers want to keep their client shippers “don’t care”, opined Peter King, a master tainer cargo can add to weight, he reasoned,
happy by not insisting on weighing their mariner and now MD of marine surveyor which makes it all the more important to
containers Seden Clarke in Felixstowe, the UK’s largest understand the nature of the contract.
Productivity concerns box port. Stacking containers correctly is One possible explanation came from H Ali,
Lack of understanding of the dangers of bad vital because lashing undergoes tremendous CEO of Supply Chain Movers in Ghana. “The
stowage and stacking to vessel stability strain when ships operate in heavy weather. reason why shippers don’t declare the cor-
Cost saving The case that highlighted the dangers rect weight is they want to cheat,” he said.
Weighing is not mandatory of poor stacking was the feeder vessel “This means that instead of shipping two
Annabella, which suffered a stack collapse boxes, they send one – for a smaller box
fee.” Most forklifts in Ghana are not fitted share this information with the carrier.
with weight sensors and can offer no solu- That’s fine for the elite carriers being
tion to the problem of overstowed boxes. handled at the award-winning terminals,
Weighing containers is hardly rocket sci- but most container shipping is way off this
ence and wouldn’t take long to carry out. advanced technology. Without legislation
Manufacturers at the conference were keen making the weighing of containers manda-
to offer the latest technology, but a number tory, malpractice will continue as carriers try
of speakers insisted the problem went to keep shippers happy. As Peregrine Storrs-
further than a carrier, terminal operator or Fox, risk management director of the TT
even a shipper investing in sensors. Respon- Club, says: “We see a disturbing number of
sibility for ensuring containers are safely cases from misdeclared cargoes. This raises
shipped involves the entire supply chain, and alarm from a risk management perspective,
this is the vital bit that’s missing as the industry is highly vulnerable”.
David Wilson, head of health and safety of Helena Kuronen, head of claims and insur-
Hutchison Ports (UK), said he believed many ance at Containerships (Finland) believes it
terminal operators would suffer reduced will take a catastrophe to push the con-
productivity if they had to sideline hundreds tainer shipping sector to make it mandatory
chain
of boxes. For that reason, “we have a system to weigh boxes. Only when lives are lost will
chain
supplychain
shipped
in place. “Until we know what’s happened to the EU take up this issue, she warned.
shipped
safelyshipped
ensuring
the container we won’t release it,” he said. Storrs-Fox favours the IMO taking on the
ensuring
forensuring
Asger Lauritsen at Maersk Line said his problem of misdeclaration. Accidents hap-
company has developed advanced software pen when IMO (or similar) requirements are
for its IT systems calibrating the declared compromised, and safety margins elimi-
the entire supply
commodities with the normal trade nated, he explained. “The manufacturer and
weights. Indian tea normally weighs 13.2 shipper know the most about a cargo. They
tonnes/container, he explained, “and if we have a responsibility to show it’s correct.”
see that a tea container is declared differ- Information and guidelines are out there
containers are safely
ently, then we will update the weight in our already, but how much is being ignored?
systems to get better stowage stability and Capt Peter King, probably speaking on
Responsibility for
a much higher safety norm for our vessels.” behalf of the seafarer community, continues
Lauritsen said he was encouraged to to insist on shippers being taught how to
see that technology on cranes and gate handle containers.
Responsibility
Responsibility
weights has become so advanced and inex- The consensus appears to be that
pensive that terminals can weigh as trucks there’s no need for new legislation, just
move through the gates, again within implementation of existing guidelines.
the ‘yard’ and finally at the ‘portal cranes’. But the key is that carriers cannot be the
containers
involvesthe
containers
Because most accidents take place at the sole source of safety: misdeclaration of
terminals, they will now be able to weigh containers runs through the entire supply
containers at low cost without losing chain, and the issue needs to take tackled
productivity. Terminal operators can now from this perspective. F
involves
involves
www.fairplay.co.uk
www.fa
f irplay.co.uk
fa 8 July 2010 5
Fairplay subscribers have access to listings of newbuildings, ship sales, fixtures and bunker
prices on our website. Go to www.fairplay.co.uk and select the ‘Markets’ link in the top menu
Evergreen Shipping: resumes newbuild ordering Assessing the implications: as China dumps the
renminbi’s dollar peg Pricing anomalies: exposed as earnings fall China: car production bonanza
Worldscale
��,��� ���
The summer driving season is
well under way in the US and �,��� ���
motor gasoline stocks have been
drawn down by 14M barrels in the � ��
Jul �� Jul ��
past three months, according to
reports by the US Energy Informa-
tion Agency (EIA).
Despite US refinery utilisation
levels rising to 89.4% – their high-
$15,000/day Gasoline imports are forecast
to increase by 80,000bpd by
est in two years and in line with daily TCE for TC2 route the end of the driving season
seasonal variations – consumer
demand has taken hold, reports
McQuilling Partners. Drivers have W197.5 – very nearly a high The IEA foresees the US gaso- under higher oil prices. Indeed,
benefited from a price decline of for the year. line-powered vehicle economy higher fuel economy may lower
$0.15/gallon, to $2.44 on average The future of US motor gaso- improving by 1.9%/year to the average cost/mile driven,
($0.64/litre), primarily due to line demand was addressed by 2015, if historical trends for GDP spurring drivers to increase their
lower crude prices. The EIA proj- the IEA’s Medium-Term Oil and remain. Complicating the projec- average VMT” and co-inciden-
ects prices will rise to $2.92/gal- Gas Markets report. It says that tions are fleet growth of 1.2%/ tally renew the attractiveness of
lon ($0.77/litre) in 2011. increasingly strict fuel efficiency year and vehicle miles travelled the light truck market and “thus
Motor gasoline imports to the regulations for new cars (and (up 0.1%/for 2010) but declining slow or even reverse an assumed
US were 127,000bpd lower from light-duty trucks) could be 0.3% thereafter – a continuation rebalancing of the fleet away
March to May compared to 2009, setting up a decline in demand. of a trend. from less efficient, larger vehicles
says the EIA. But demand is In the medium term, the EIA Despite pressures from ethanol towards passenger cars.”
forecast to increase in3Q10 – by expects a decline of 0.6% annu- blending, the IEA says, “the fall The EIA forecasts that liquid
a further 80,000bpd increase ally from 2009 to 2015 – the in US gasoline demand is not net fuel imports (crude oil/
by the end of the driving season forecast period. irreversible in the long term.” refined products), which had
(end 3Q10). MR tankers on TC2 Underpinning the IEA forecast Moves to enforce higher vehicle fallen by 1.4M bpd in 2009, will
(UK/Continent to US Atlantic are assumptions about fleet size, efficiency (such as required by continue to decline in 2010
Coast, 37,000 tonnes) are cur- vehicle miles travelled, average the standards from 2017), “could by an additional 110,000bpd.
rently earning just over $15,000/ mileage and the relationship also paradoxically increase trans- Imports are forecast to increase
day (see graph above), around between these variables. portation fuel demand, even by 90,000bpd in 2011. F
points
index) from information services for most class sizes. However,
group Markit dropped to 55.6 in
June – down from 55.8 in May, as
the 4,250teu Panamax segment
the growth in new orders lost its experienced stronger headwinds
earlier impetus.
as the average rate for 24-month closing level for the ConTex last
week, which is still rising, showing
Consumer confidence dips periods dropped some sector weakess
The corresponding decline in the
new orders-to-inventory ratio
suggests “that output growth Even so, the bank’s chief and freight rates in the container The latest ConTex figures in fact
may weaken further from the economist for China, Hong- trades. The slowdown in enquiry indicate that the positive trend is
strong rates seen during the first bin Qu, gave a comparatively for charter tonnage from still in place for most size classes
half of the year,” Markit said. The optimistic outlook. “Fears about the container lines has put of container vessels.
group’s chief economist, Chris a hard landing are overplayed,” brokers and owners on guard. The ConTex composite index
Williamson, warned, “Of greatest he said. “We expect China to “Whether this is a temporary rose by 11 to 543 points last
concern is a slowing in growth achieve around 9% growth in lull, a seasonal factor or system- week, with geared 2,500teu and
of new orders to the weakest so 2H10, underpinned by massive atic of a demand slowdown will gearless 2,700teu types posting
far this year, as manufacturers ongoing investment and robust soon become apparent,” com- the strongest gains.
face tougher trading conditions private consumption.” mented one broker. However, the 4,250teu
arising from the shift in policy Many economists in the west London shipbroker Braemar Panamax segment that had led
from stimulus to austerity, the agree that growth should ease in Seascope noted in its latest the rate rally in recent months
region’s sovereign debt crisis and the second half of the year but weekly market update: “The experienced stronger headwinds
a slowing in growth of global they dismiss the prospect of a flurry of requirements, especially as the average rate for 24-month
trade flows.” double-dip recession. Denmark’s from the Far East seems to have periods dropped from $24,039/
In the US, the Conference Danske Bank is still upbeat about now been replaced with lines day to $23,952/day – the first
Board – a private research group freight demand from European taking some time to re-evaluate decline since inclusion of the
based in New York – said its Con- shippers, although its leading their services and consolidate 4,250teu type in the ConTex
sumer Confidence Index dropped European Freight Forwarding their respective positions in in early May. � F
32
the first orders for post-
The 74,500dwt Panamaxes are
Panamax container ships due for delivery between 4Q12
and 3Q13 and options for two
Taiwan’s Evergreen Line, the further vessels are attached to
world’s fourth largest box ship this deal. In April, Tanker Pacific
operator, has announced its first 8,000teu vessels ordered four Suezmax tankers
round of firm orders. An earlier are required by from South Korean yard Hanjin
Fairplay report (10 June 2010, Evergreen HI for delivery between May and
p11) detailed the potential for September 2012.
orders of up to 100 container Meanwhile, Chinese yard New
ships from the company. Century Shipbuilding has won its
The very first order in Ever-
green’s new fleet procurement
Evergreen has p����������
rev�������
iously advised
�������� first VLCC order after it signed
contracts with Dynacom Tankers
programme has been won by that it is also in the market for Management of Greece for four
South Korean shipyard Samsung
HI and provides for ten 8,000teu 60 (20 each) 7,000teu, 5,300teu vessels. The 320,000dwt ships
have been priced at $95M each
post-Panamaxes. The vessels, and 2,000teu vessels and are due for delivery between
priced at $103M each, will be split 1H12 and 1H13. It is understood
between the Evergreen Group- that they will be built to Hyundai
listed arm Evergreen Marine Corp ny’s S-type vessels delivered by in 1968, continues to negotiate HI design.
(which will take six ships) and the Japan’s Mitsubishi HI between both the price and the technologi- In the Suezmax sector, Jiangsu
Group’s Panamanian-registered 2005 and 2008 (see box). cal capability of the shipyards to Rongsheng Shipbuilding in
company Evergreen International Delivery of the 24.5kt, 335m meet the carrier’s very strict stan- China has won an order for two
SA (which takes four). Interest- by 46m Samsung newbuildings, dards of environmental protec- Suezmax tankers from Frontline
ingly, this price is less than 20% to be known as L-type, is under- tion and fuel conservation”. of Bermuda.
lower than the prevailing peak stood to be scheduled for 2012 Meanwhile, the company is The 156,900dwt ships are due
levels of 2007/8 for ships of this and 2013. understood to have just signed for delivery in February and May
capacity in South Korea. According to an Evergreen letters of intent for a further 10 2013, with options for two fur-
However, the Evergreen ves- statement: “The 10 ships are the ships of the same design with ther vessels having been secured
sels are understood to be to the beginning of a programme of a fellow South Korean shipyard by the owners. Frontline is a
owner’s specification rather than new generation of container ves- STX. In addition, negotiations previous customer of the
the yard’s standard design and sels that will be ordered by Ever- are believed to be at an advanced yard, having contracted four
will include, among other extras, green Line from several shipbuild- stage with Taiwanese shipyard Suezmax units during 2006.
Evergreen’s ‘Greenship’ environ- ing yards in Asia. Details of the CSBC for 12 ships of this class. Three of these have been deliv-
mental protection systems first entire programme will be made The firming up of these orders ered this year, with the final ship
introduced on board the compa- public as the company, founded would complete Evergreen’s due next month. F
0.5%
Movement of the renminbi against the dollar, 2004-2010*
��
maximum daily movement of the
renminbi against the dollar
�
The Chinese
will not want
Renminbi/$
�
to expose
themselves to
�
the whims of
the capital
�
���� ���� ���� ���� ���� ���� markets
*Pegging introduced July 2008, removed 19 June 2010
!
"# $%&
'
(#)*
+ ,)
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16.1M
from undisclosed interests. Fuel duty changes function in Shanghai. This
The vessel has been on the are helping to drive a falls short of the pre-recession
market for several months. Unlike strong domestic car numbers in the giant American
most Japanese-built product auto sector, a figure of 16-17M China’s estimated vehicle
demand but exports production for 2010
tankers, however, it features a one passenger vehicles. The trend
tank-one pump specification and remain low is sharply upwards. In 2009,
an IMO 3 class notation which China became the largest auto
adds to the range of cargoes which The year-on-year increases in market in the world – helped This huge industrial output
it can carry. As a reference the Chinese passenger car purchases by the stimulus plan and by will have little impact on the car
last MR type sold was the larger have slowed in the past month economic growth. By 2011 carrier sector while it continues
Pacific Serenity (built 2003 Naikai, from 25% reported in May production may reach 21.5M to focus on domestic demand.
47,999dwt) at $24.2M in May. to 11% year-on-year for June units across all sectors of the For 2010, IGI projects that
The revival in container char- 2010. This adds to signs that the automotive industry. Chinese passenger car exports
ter rates is feeding through to economy is cooling, says a report IHS Global Insight (IGI) will grow by 37% to 161,000
improved prices and steady sale from Bloomberg. says that despite increases it units. Recovery in the Russian
and purchase activity. Paragon In May, China produced forecasts production of cars and Egypt markets in the first
is believed to have bought two slightly more than 1M vehicles with less than 1.6 litre engines four months of 2010 are the
3,400teu newbuilding resales due for its domestic markets, accord- will increase by 26.7% to 10.7M principal drivers. By 2011, IGI
for delivery promptly from HDW ing to Chinese statistics, while units. Light commercial vehicles suggests exports could reach
in Kiel for about €40M ($49M) June saw 839,229 vehicles sold, (LCV) will grow 22.% to 5.42M 235,000 units.
each from NSB Niederelbe, while reports the China Automotive in 2010. The Chinese State Other shipping industry
Technomar is said to have paid Technology and Research Center. Information Centre’s estimate sectors will profit from the com-
$17M for the 2,890teu Tara Over the first five months of this is in broad agreement with IGI modities (iron ore, coking and
(built 1996 Kvaerner Warnow, year, the production figure was forecasts, predicting a produc- thermal coal, copper (ore and
38,400dwt) which has already 7.5M vehicles, 56% higher than tion total of 16M units this year. scrap) brought in to support the
been delivered in Singapore and the same period in 2009 and automobile industry. Baosteel
re-named Pisti. a staggering 87% higher than Group, China’s second larg-
In the smaller geared feeder January to May in 2008. IHS Global est steel maker, has said steel
market, the 1,732teu Hansa
Sonderburg (built 2000 Binji-
Over 2009, the country
produced nearly 10.5M units Insight suggests demand for autos has slipped
recently, adding further proof
ang, 23,577dwt) has been sold compared with 6.7M in 2008. Chinese car of a cool-down in the Chinese
for $16M, while Italian buyers China could manufacture 15M economy. IGI expects China’s
are said to have purchased the vehicles in 2010, Gu Xinghua, exports could growth to accelerate to the
1,042teu Mekong Spirit (built
1996 Stocznia Szczecinska,
deputy secretary general of the
China Association of Automo-
reach 235,000 low 10% range year-on-year in
2010, before pulling back to the
12,380dwt) for about $7.4M. F bile Manufacturers (CAAM), units by 2011 mid-8% range in 2011. F
www.fairplay.co.uk 8 July 2010
shipping markets Weekly summary of all the key
industry indices and data
����
-3.4% Capesize Index -24.4% Panamax Index
����
This week: 2,627 3 mth high: 5,455 This week: 2,447 3 mth high: 4,622
����
Last week: 2,717 3 mth low: 2,627 Last week: 3,045 3 mth low: 2,447
����
Supramax Index Handy Index
index value
-6.4% -5.7% ����
This week: 1,995 3 mth high: 3,111 This week: 1,118 3 mth high: 1,520 ����
Last week: 2,122 3 mth low: 1,995 Last week: 1,182 3 mth low: 1,118 ���� BDI
Outlook: Capesize rates in the Atlantic slipped again with the Brazil-China trades softening to the low $20s/ ���� BFA BDI July ��
tonne after Vale appears to have pulled back from the market. Fixtures for Capes in the Pacific were most common, ��� BFA BDI �Q��
but despite demand Western Australia-China has drifted below $8.50/tonne. Lack of enquiry has made Panamax �
��/��
��/��
��/��
��/��
��/��
��/��
rates soften with brokers not optimistic about a pick-up this week particularly for vessels in the US Gulf and South
America. The Pacific saw rates softening as new vessel deliveries and more to come, as well as a lack of cargoes, have
impacted the outlook. Handysize rates have an ever increasing gap developing between west and eastern levels. [ Source: Baltic Exchange data ]
����
Outlook: Despite some uncertainty triggered by Swiss franc 1.0944 1.0578 1.1731 1.0503
US �
���
weaker-than-expected US consumer confidence and
slowing growth rates in purchasing activity, smaller ����
Outlook: The US dollar weakened last week as the
��� euro made gains after investors gained confidence
and medium-sized cellular tonnage saw further rate
in the region following the end of the one-year loan
improvements. CV1100 types are now fixing at $7,000/
facility. Economic data is slightly quieter this week. The
day in Asia while the more flexible B170’s (1,700teu, ���� ���
Feb Mar Apr May Jun Jul main focus will be on Europe with both the
geared) can obtain well over $10,000/day in mixed
BoE and ECB rate decisions on Thursday.
breakbulk/container trades, brokers reported. The
Panamax market is quiet. [ Source: Hamburg Shipbrokers’ Association (VHSS) ] [ www.corporate-fx.co.uk/fairplay ]
Bunker outlook
Outlook: Bunkerworld index prices recently and IFO380 prices in Fujairah be a floor for oil prices this year, with
Major ports saw bunker prices move were at a $4/tonne premium on average markets balancing demand optimism
lower this week as optimism on crude BW380 cSt in June. against over-supply pessimism. For
$440
oil markets evaporated. The BW380 There were no reports of congestion bunker markets, oil prices below $70
index, for example, dropped $10/ or supply problems for Rotterdam this would pressure bunker prices to drop
tonne from last week. The decline in week. Prices were heading for the low below $400/tonne. But whether
bunker levels was also helped by some $400/tonne range across the week for prices will drop below this mark for a
weakening of fuel oil prices. $10 IFO380 – levels not seen since late June sustained period remains to be seen as
Singapore reported strong product – and ended trading at $403. crude only traded in the $60 per barrel
availability but only average demand. BW180 cSt Houston this week saw prices range briefly this year.
$457
Combined with weaker fundamentals, move below June levels when IFO380 Bunker prices were quick to fall this
this allowed prices for IFO380 to fall averaged $428/tonne. By early trading week, and were helped by generally
across the week. Prices for the grade on Friday, prices were at $412. lower fuel oil resupply prices that were
were testing $450/tonne just over a By Thursday, crude oil futures had tracking the drop on crude markets. In
week ago but were down to $423 by the $9 lost nearly $6 from levels around the short term bunker prices appear ready
end of the week. $78/barrel at the start of the week. to quickly move lower. If oil stays weak, it
Fujairah also posted lower values
BWDI distillate Market enthusiasm for global economic will be good news for bunker buyers.
$678
and prices were at $422 on Friday – just recovery appeared to be evaporating,
[ www.bunkerworld.com/prices ]
$1 lower than Singapore. Despite this but it was not yet clear whether prices
discount, Fujairah has been trading would drop below the pivotal $70 level.
slightly higher than its Asian competitor The $70/barrel mark appears to
$12
Sale & purchase All details given in good faith but without guarantee
container and multi-purpose Maritime, United States of America, to Technomar Nav. Italiani, Sulzer/16kt.
Shipping, Greece, $17M. 1996. 38,400dwt, 31,207gt,
Hansa Sonderburg (container ship) ex-CP Kestrel: Xin Dong Guan 6 ex-Zhe Hai 509: sold by Dongguan
2,890teu. Built Kvaerner Warnow, B&W/23kt.
sold by Hansa Treuhand Schiffsbeteiligungs, Germany, Haichang Shipping Co, China, to undisclosed interests,
to undisclosed interests, $16M. 2000. 23,577dwt, bulkers China, $22.5M. 2008. 33,076dwt, 19,983gt. Built
18,335gt, 1,732teu. Built Binjiang Shipyard, MAN- Zhoushan Wuzhou Ship Repairing & Building Co,
Beilun Whale ex-Torm Marta: sold by Hong Kong Wartsila/14kt.
B&W/18kt.
Whale Shipping Co, Hong Kong, to undisclosed interests,
Mekong Spirit (container ship) ex-MSC Biscay: sold by $28M. 1997. 69,638dwt, 36,592gt. Built Tsuneishi Co, newbuilding resales
Starlio Shipping Co Ltd, Cyprus, to undisclosed interests, B&W, 12,121bhp Amphitrite (crude oil tanker) ex-Daewoo 5313: sold
Italy, $7.4M. Last Sale: $23M (2006), 1996. 12,380dwt, by Gulf Marine Management, Greece, to Minerva Marine,
Royal Forest: sold by Mitsubishi, Japan, to
9,616gt, 1,042teu. Built Stocznia Szczecinska, Greece, $110M. 2010. 319,300dwt, 162,200gt. Built
undisclosed interests, $20.5M. 1998. 31,770
B&W/18kt. Daewoo & Marine Engineering Co Ltd, Wartsila, 33,907bhp.
dwt, 19,731gt. Built The Hakodate Dock Co Ltd,
Ocean Luck (general cargo ship) ex-Magdalena Mitsubishi/14kt. sold for demolition
Oldendorff: sold by Kaalbye Shipping International,
Trenton ex-Capitano Giovanni: sold by OceanFreight Athos I (container ship) ex-Ever Guard: sold by
Ukraine, to undisclosed interests, $6.2M. 1983.
(OCNF), Greece, to undisclosed interests, Russia, Technomar Shipping, Greece, $5.38M (375.00/ldt), 1983.
19,943dwt, 18,627gt, 576teu. Built Valmet, Sulzer/17kt.
$26.1M. Last Sale: $40.5M (2007), 1995. 75,265dwt, 43,198dwt, 37,042gt, 2,728teu. Built Ishikawajima-
Tara (container ship) ex-Nautic: sold by Seachange 39,385gt. Built Fincantieri-Cant. Harima HI Co (IHI), Sulzer, 21,601bhp/18kt.
Dry Fixtures
Cargo Vessel From To Tonnes Date Rate Chart Terms
Coal Pioneer Atlantic, 98 Baltimore Ymuiden 70,000-10% Jul 10/20 16.25 Corus FIO;5DaysShinc
Coal Nyon, 99 Baltimore Tianjin 70,000-10% Jul 17/28 48.50 Cetragpa FIO;25,000tShinc/15000tShinc
Iron ore Chihiro, 97 Tubarao Qingdao 160,000-10% Jul 1/15 22.00 Vale FIO;ScLd/30,000t
Iron ore Cape Unity, 07 W Australia China 160,000-10% Jul 11/20 8.90 Oldendorff FIO;ScLd/30,000t
Iron ore Phenix, 90 Tubarao Qingdao 150,000-10% Jul 1/15 22.00 Arcelor-Mi FIO;ScLd/30,000t
Iron ore Iron Beauty, 01 Saldanha Bay China 150,000-10% Jul 2/10 17.25 Kumba FIO;85,000t/30,000t
Wheat Clipper Faith, 98 Houston Durban 25,000-5% Jul 1/10 56.00 Olam FIO;8,000t/6,000t
TimECharters
Consump Vessel From To Tonnes Date Rate Chart Terms
14.5k/58t Anangel Dynasty, 99 Del Off HayPoint Redel China 171,101 Jul 7/15 22,500 BHP-Billit TripOut+$550,000Bonus
14k/36t Epson Trader I, 09 Del Le Havre Redel CPasseroViaEgypt 82,331 Jun 29/30 22,500 Cargill USGulfRd
14k/34t Melite, 04 DelPassGibraltar Redel San Ciprian 76,436 Jul 5/7 28,000 Cobelfret PtKamsarRd;Relet
14k/34t Maritime Hareshio, 06 Del Pass Santos Redel Singapore/Japan 75,740 Jul 11/13 36,000 CNR TripOut+$700,000BB
14.7k/34.5t Genco Leader, 99 Del Gangavaram Redel Singapore/Japan 73,941 Jul 2/5 25,750 CNR ECSoAmRd
14k/31t Kronos, 96 Del Guangzhou Unrptd 73,301 Jul 1/5 25,000 Bunge 3-5MoTrdg
14k/31t Powerful, 94 Del Egypt Med Redel Egypt Med 70,833 Jun 28/30 26,000 EBC BlackSeaRd
14k/31t Mass Glory, 93 Del Inchon Redel Far East 69,555 Jul 28/30 20,500 Cargill NoPacRd
Unrptd Aqua Atlantic, 10 Del Japan Unrptd 56,000 Jul 1/5 23,000 Cargill 3-5MoTrdg
14k/30t Desert Hawk, 99 Del Lagos Redel FarEastViaECSoAm 50,327 Jul 2/3 31,500 WBC Trip out
Unrptd New Fantasy, 96 Del Nemrut Bay Redel E Mediterranean 45,537 Jul 1/5 17,800 CNR TransAtlRd
13.5k/25t Blackfin, 95 Del Black Sea Redel PMuscatViaMEGulf 43,171 Jul 1/2 32,000 CNR Trip out
Unrptd East Ambition, 00 Del CJK Unrptd 28,378 Jul 10/15 17,500 PanOcean 4-6MoTrdg
Wet fixtures
Cargo Vessel From To Tonnes Date Rate Chart Terms
Oil dirty New Vitality, 93 ME Gulf So Korea 270,000 Jul 09 W82 Caltex
Oil dirty Sahba, 09 ME Gulf China 265,000 Jul 10 W87 Unipec Part cargo
Oil dirty Sunrise Jewel, 92 Basrah WC India 262,000 Jul 12 W101 IOC
Oil dirty Astipalaia, 01 W Africa WC India 260,000 Jul 27 4,025,000 IOC PtC;Lump Sum
Oil dirty Jag Lok, 05 Novorossiysk UK/Cont op USAtlUSGulf 140,000 Jul 14 W87\op W80 Clearlake
Oil dirty Genmar St.Nikolas, 08 Black Sea UK/Continent Med 135,000 Jul 06 W105 Clearlake
Oil dirty Donat, 07 Brazil USGulf 130,000 Jul 13 W80 Petrobras
Oil dirty Hellesp Trooper, 96 W Africa USGulf 130,000 Jul 25 W95 Vitol
Oil dirty Trirasa, 91 Kharg Island Cochin 130,000 Jul 19 W86 BPCL
Oil dirty Eagle Sibu, 99 Baltic USAtlantic USGulf 100,000 Jul 08 W97 Litasco
Oil dirty Minerva Gloria, 09 Tallinn USGulf 100,000 Jul 03 W97 Koch
Oil dirty Sea Voyager, 09 Kozmino So Korea 100,000 Jul 15 500,000 Gazprom Lump Sum
Oil dirty CE-Merapi, 96 CPC Mediterranean 80,000 Jul 09 W120 ST Shipp Part cargo
Oil dirty New Amity, 98 Bayu Undan Yosu 80,000 Jul 07 W107 Caltex Part cargo
Oil dirty Baltic Galaxy, 09 Australia Jamnagar 80,000 Jul 09 W89.75 Reliance Part cargo
Oil dirty Sanandaj, 99 Seria Mumbai 66,000 Jul 11 W92 BPCL Part cargo
Oil clean Ocean Explorer, 09 ME Gulf Japan 75,000 Jul 09 W110 CNR Part cargo
Oil clean Atlantic Aquarius, 08 St John USAtlantic 38,000 Jun 28 275,000 IrvingOil Lump Sum
Oil clean Ionian Wave, 09 USGulf UK/Continent Med 38,000 Jul 06 W97 CNR Part cargo
Oil clean Torm Cecilie, 01 UK/Continent USAtlantic 37,000 Jul 06 W170 Chevron
Oil clean CSC Auspicious, 08 WC India Japan 35,000 Jul 04 W120 Shell
Oil clean Citrus, 08 UK/Continent W Africa 33,000 Jul 05 W190 CNR Part cargo
Oil clean Angelina Amoretti,04 Baltic USAtlantic 22,000 Jul 06 W187\ Litasco
For more information on fixtures see: www.fairplay.co.uk/secure/markets.aspx
Asia-Africa potential: Sturrock Shipping expands Building dry bulk: ACM moves into Australia Stolt-Nielsen:
cautious on profits rise Protests at Piraeus: tourism hit Arctic opportunities: assessing environmental impact
to China business
tion to do business with Chinese-
flagged vessels whose owners only
want to borrow in the national
currency, DnB NOR believes it has
put itself ahead of its competitors.
DnB NOR’s ability to DnB’s show of strength
lend to Chinese owners Generating more business
in renminbi will open a DnB NOR ranks eighth in the list of top 10 shipping banks. It has a network of “Having accepted the Chinese
27 branches and representative offices across northern Europe, the US, China, flag, we’re more geared up to do
potential treasure trove.
India and Singapore. In November 2009, shareholders approved a NKr14Bn business,” said Chiang. The licence
Hal Brown reports ($2.49Bn) rights issue – a major relief for the bank’s shipping customers. will “lead to quicker deals”, he
“We can be perceived by our shipping customers as a stronger bank, which added, freeing up the bank to
DnB NOR, the Scandinavian bank, is better equipped to support them,” DnB’s investor relations VP, Per Sagbak- concentrate on generating more
has seriously bolstered its posi- ken, told Fairplay at the time. business with other owners.
tion in China by gaining a licence
to finance shipping customers in
China in renminbi.
World’s top 10 shipping banks* About 95% of all
China’s domestic
The licence means DnB NOR Rank Name Total exposure Market share ship finance is
should be able to attract more 1 Royal Bank of Scotland $13.3Bn 19.85% carried out in
Chinese customers, in particular 2 HSH Nordbank $5.2Bn 7.76% renminbi [ Photo:
state-run shipping lines such as 3 Deutsche Schiffsbank $4.9Bn 7.41% Jim Wilson ]
Cosco and Nanjing Tanker Corp, 4 Credit Suisse $4.0Bn 5.97%
because about 95% of all China’s 5 National Bank of Greece $3.2Bn 4.80% As DnB NOR pushes through its
domestic ship finance is carried 6 Alpha Bank $2.7Bn 3.99% strategy of increasing lending to
out in renminbi. The move, if 7 Emporiki Bank of Greece $2.6Bn 3.91% Chinese owners, the bank is also
it proves successful, could spur 8 DNB NOR $2.5Bn 3.80% keeping an eye on market devel-
other banks to take the plunge 9 Marfin Egnatia $2.4Bn 3.66% opments in China that are driving
and follow DnB NOR’s lead by 10 Calyon (estimated) $2.0Bn 2.98% the shipping industry forward.
jumping into the China market Total $43Bn 64.13% Torbjorn Kjus, an analyst
with both feet. from DnB NOR Markets, told
DnB NOR’s licence comes *Ranked by portfolio size as at 31 December 2009 [ Source: Petrofin Bank Research ] a conference in Oslo at the end
at an auspicious time: China is of May that Chinese car sales,
undergoing a major expansion and which “exploded” over the past
renewal of its domestic fleet. The towards gaining the licence since DnB NOR’s head of Asia. few years (including a large rise
ability to lend in renminbi rather it opened an office in Shanghai in “China is such a large market,” in exports), will boost oil demand
than dollars pushes forward DnB the autumn of 2006. The licence he told Fairplay, “and without further, leading to more business
NOR’s strategy to expand and means the bank can lend to own- a licence we were not able to for tankers – and also more oppor-
strengthen its foothold in China ers with China-flagged vessels – a attack it.” DnB NOR already has a tunities for DnB NOR to lend
at an even faster rate. “significant” development for the strong presence in China, but the to owners eager to expand their
The bank has been working bank, according to Andrew Chiang, new licence means the bank can tanker fleets. F
[ Photo: iStockphoto ]
30%
of Russia’s Consumer Protection fact, the previous restriction mobilised anti-communist
Agency and overseer of all food- only led to a rise in wine prices, and anti-Russian support
stuff imports, is coming down hard “and we believe that if another with the announcement of
on wine shipped from Moldova – a ban is introduced, these 28 June as a “Day of Soviet
move that has spurred his critics schemes will be revived,” Occupation”. Onishchenko,
into accusing him of performing added the source. however, has said his
his job in order to line his pockets crackdown was not linked to
and play politics, rather than Moves against Moldova Ghimpu’s actions
genuinely protect Russians from More than 30 Moldovan enter-
unsafe food. prises ship wine to Russia, and it Steps forward
Previous moves by Onish- is the country’s principal export The Moldovan vice-minister for
chenko have included saving to Russia. Drop in Russian imports of Moldovan agriculture and food industry,
Russians from the perils of In fact, Moldovan wine has wine from 2005 to 2006 as ‘wine Vasily Bumakov, said he was
Belarus milk last June (reported been the market leader in Russia war’ was at its height negotiating with Onishchenko
by Fairplay), and then in January – one bottle out of every two to recognise quality certificates
he stepped in to reject American drunk in Russia is from Mol- issued by a laboratory in Chi-
chicken and pork. dova. At least, that was when sinau, the Moldovan capital.
Onishchenko’s latest target is a Onishchenko wasn’t involved. He also said that Onishchenko
low price red wine from Moldova. Onishchenko’s agency was wasn’t in a hurry to agree, but
16%
According to a notice posted on responsible for the cutbacks, proposed a “phased solution”
29 June by the Federal Consumer which saw Russian imports of to laboratory certification.
Protection Agency (Rospotreb- Moldovan wine drop 30% Vadim Drobiz, head of
nadzor), which Onishchenko from 2005 to 2006. This was the Center for Research
heads, a recent inspection followed by another 16% on Federal and Regional
revealed something “not meet- reduction in 2008. Markets for Alcohol, has told
ing the requirements of safety”. The problems started in Fairplay that Onishchenko
The exact nature of the breach March 2006 when Russia has met representatives from
wasn’t set out in the notice; banned Moldovan imports, the Association of Alcohol Mar-
the only information provided claiming pesticides and heavy ket Participants of the Russian
was that it was a violation of metal traces had been detected. Federation (AURA) and promised
the agency’s regulation San- Then in the second half of Drop in Russian imports of Moldovan that he would not use his inspec-
PiN2.3.2.1078-01. Onishchen- 2007, it was officially decided wine in 2008 tion powers for political reasons.
ko’s spokesman, Lyubov that deliveries from Moldova He also told AURA that Moldo-
Voropayeva, declined to provide
more details on when the inspec-
could resume. In July 2009, all
restrictions on Moldovan wine
‘We believe if van winemakers had to comply
with Russian quality standards,
tion took place and what was were lifted. And now, doubts another ban is but he did not commit himself
wrong with the wine.
A spokesman for the Con-
over safety have been revisited,
at a time when Moldovan wine
introduced, to an agreed laboratory certifi-
cation process. “We should be
sumer Rights Protection Society volumes rose and market share these dubious impartial,” said Drobiz. “Before
said it isn’t sure of the motive. “I
cannot comment on the quality
picked up.
On 26 April, Onishchenko
schemes will accusing Onishchenko of politi-
cal games, the [latest] seized
and composition of the wine said his organisation had seized be revived’ shipment should be analysed by
inspected by Rospotrebnadzor,” a 50,000 litre shipment of wine an independent laboratory.” F
Wizard of Oz
Until now Sturrock has not
Sturrock’s expansion into
$5.9M
ventured much beyond South
Australia opens up Asia- and East Africa. In the latter the
Africa business potential Cape Town-based company has
acquired agencies in Mozambique,
Sturrock Shipping’s move into Tanzania, Kenya, Madagascar and (maximum) paid by Sturrock for
Australia has positioned the South the Sudan. But Sturrock Shipping, establishing a strong presence in
African company to strengthen which was founded in 1969, has the Australian and Asian markets
itself in Africa as it seeks to increase made little secret of its intention
its footprint across the continent. to expand into West Africa.
In May, Sturrock surprised The company began this move
many with the acquisition of the with an agency in Luanda, Angola,
entire share capital in Meware, in 2008. Since then it has been
the holding company for four casting around for opportunities
Australian ship agency businesses in Namibia, Equatorial Guinea, Sao
– Hetherington Kingsbury Ship- Tome, Gabon and Ghana. “Even Which begs the question: why a tanker agency but we’d like to
ping Agency, McArthur Shipping & the big prize of Nigeria is on our did he suddenly move in the strengthen our position with
Agency, Pacific Shipping Agencies horizon,” MD Andrew Sturrock opposite direction into Australia? the dry bulk business,” explained
and West Coast Shipping Agencies. told Fairplay. “Sturrock Shipping is largely Sturrock. “We’re doing this
ACM Shipping founded, focuses on Acquired FFA desk through JV Opened Singapore Opened India office Opened
tanker spot and timecharter business with NASDAQ-listed GFI Group office and started Gas desk Shanghai office
Acquired S&P desk from Seascope Launched research Listed on London’s Acquired small/specialised
(JV); fully merged in 2008 service AIM market tanker desk by purchasing H&D
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ship owners, and operators throughout the world. Find out more at www.veson.com Singapore +65.6225.4881
$46.3M
Less bright spots on the balance ing order of eight large parcel tank-
Norwegian tanker specialist sheet highlight the fragile recov- ers at SLS in Korea that will not be
Stolt-Nielsen has reported a rise in ery: Stolt-Nielsen Gas reported built. Stolt is embroiled in negotia-
1H10 profits year-on-year, mainly losses of $2.6M in 2Q10, due to profits for 1H10 tions with the yard and banks to
due to more operating days and the the weakness in the VLGC market, recover payments of $296M, plus
$296M
sale of ships. and Stolthaven Terminals reported interest, which are covered by
Profits reached $46.3M, up from 2Q10 operating profits of $13.6M, refund guarantees.
$42.1M in 1H09. The rise in prof- down from $15.5M in 1Q10. However, recovering refunds
its for subsidiary Stolt Tank Con- Niels Stolt-Nielsen’s suspicion of payments for eight parcel tankers is easier said than done. “Refund
tainers was driven by a “healthy early economic recovery was raised Stolt-Nielsen is trying to get refunded guarantees are the financial cor-
demand” in global markets, the in April. He warned that Beijing’s nerstone of the shipbuilding con-
company said. gradual phasing out of economic tract, but some owners find they
Despite the group’s decent stimulus measures is likely to put “We question the sustain- aren’t as all-embracing as they first
results, Stolt remains cautious. the brakes on China’s economy ability of the strong recovery in thought,” said Simon Curtis of law
Niels Stolt-Nielsen, CEO of the – which will have implications for China once the stimulus is cut firm Curtis Davis Garrard at a Lon-
group, said he is concerned about international shipping. back,” he said at the time. As don finance conference in May. F
20%
Strikes hit Greece’s main Tourists unable to PAME (the All-Workers Militant
port as angry protesters board ferries at Piraeus Front). It was called to demand
[ Photo: P Aivatzidis ] changes to the ‘anti-social mea-
demand the rich pay up percentage of sures’ being imposed, according to
Greece’s GDP derived the Panhellenic Union of Mer-
Greek tourism has been hit hard from tourism chant Marine Engineers.
10%
by a dock and ferry workers’ Directly affected by the strike
strike that prevented thousands
of holidaymakers from travelling
‘There are no were eight scheduled sailings
to the popular Cyclades islands,
to the islands. At the same time, ships leaving decline in ferry which include Mykonos and Paros,
protests against planned reforms
to pensions and labour laws took
Piraeus port’ bookings in Greece
this summer
and others to destinations in the
Saronic gulf. A ferry to Crete was
place on the streets of Athens. Five also cancelled. Strikes against the
thousand angry marchers carried austerity measures have also hit
banners bearing inflammatory In Piraeus – Greece’s main port and mark – but bookings are report- airports, roads and railways.
statements such as ‘Let the rich the gateway to the Aegean islands edly down by about 10%. “There A bright spot is that the Chinese
pay for the crisis’. – thousands of tourists were are no ships leaving Piraeus port,” have signed a range of trade and
It is yet to be seen how Greece’s prevented by union members from a coastguard official told Reuters investment agreements, and Libya
austerity measures might affect boarding ferries. during the strike. wants to co-operate in energy,
shipping and owners in the long Tourism generates almost 20% The 24-hour strike – the fifth tourism, food production, finance
term, but the immediate damage of GDP – Greece’s economy hovers general strike this year – also and renewable energy – all sectors
caused by the strikes was palpable. at around the €240Bn ($294Bn) included maritime engineers that can involve shipping. F
150
minium smelter
green impact maximum number with capacity of
of Capesize voyages a 400,000 tonnes/
Arctic trade will require impact year through Greenland’s year is currently
assessments to determine waters carrying iron ore from under development
whether it can be sustained at the new Baffin Island project by Alcoa.
the required level of environ- “That will comprise large
mental protection, scientists and numbers of ship movements
academics warned at the World ‘We are moving towards and the government is woefully
Ocean Council’s Sustainable
Ocean Summit last month. diminished ice cover which will unprepared for the kind of traffic
it will see along its coasts,” Low-
The need to review Arctic trade make the Northern Sea Route ings said.
comes as activity is stepping
up. Seasonal retreat of sea ice in and Northwest Passage viable… Improvements to safety
both the Northern Sea Route and
Northwest Passage has encour-
we should pay attention and be He noted that “another project
is the Mary River iron deposit
aged shipowners to evaluate new cautious at same time’ being developed on Baffin Island.
polar routes. What is significant there is size
The Arctic Marine Shipping of development.”
Assessment (AMSA) published will make the Northern Sea require conducting scenario stud- The scale of the project is
last year by the Arctic Council Route and Northwest Passage ies to model projected traffic, and indeed impressive: developer
found that traffic was even viable. This is something we setting that against the demands Baffinland is proposing a mine
higher than it thought. should pay attention to and be for more stringent environmen- producing 18M tonnes/year,
However, port facilities, search cautious about at same time,” tal protection. “One of the nice rising to 30M tonnes/year, of
and rescue resources and regula- Lowings said. things about being behind is very high quality (up to 68% Fe
tion – both at Arctic Council and James Corbett of the Univer- it’s easier to catch up because content) iron ore.
IMO levels – must be improved sity of Delaware, best known you have a roadmap,” Corbett “Assuming the use of
if future levels of ship traffic for his research suggesting that pointed out. 135,000dwt Capesize ships, that
are to be permitted in the area, shipping’s SOx emissions could But if that observation is taken means between 100 and 150
according to Malcolm Lowings be responsible for 60,000 deaths to mean that green laws will voyages a year, all of which will
of Golder Associates, a specialist a year, said there were “concrete constrain Arctic shipping, there take place through Greenland’s
engineering contractor. expectations that the recommen- is little sign of this so far. For waters,” Lowings pointed out.
“There is a lot of posturing dations of the report would be example, Greenland’s shipping “The government is not pre-
and positioning going on and a enacted by members of the Arctic activity was increasing in cruise, pared for that volume and a lot
great many national interest and Council,” and development offshore, tanker and dry bulk sec- of improvements to safety and
defence considerations, but we would be tightly monitored. tors, said Lowings. navigation services will need to
are moving towards diminished Monitoring Arctic trade and Since gaining autonomy be made before it can happen,”
ice cover in the summer which its environmental impact would from Denmark, Greenland has he concluded. F
€8Bn
Reshuffling the German a general reduction of its balance they will dispose of vessels over
state bank sector may sheet – a move that has caused the next 12 months, against only
open up some strategic alarm among many domestic ship- 18% of all respondents in a similar
owners. Some €8Bn in shipping amount in shipping loans already survey last year.
opportunities for Asian earmarked for sale or syndication
loans has already been earmarked Some owners may decide that
ship financiers for sale or syndication. “There by German banks because of increasing ship values
is a fear that German banks will the time is right for them to sell
959
German banks are undergoing not be offering sufficient support older vessels to raise equity for
a major overhaul, leading some when owners move to renew their new projects. However, a pick-up
commentators to suggest there is fleets after the crisis,” warned in vessel divestments should, in
a need for fresh input from new Thomas Rehder, managing owner ships in acute need of fresh part, be driven by the financing
Asian shareholders. of shipowning and brokering firm liquidity, according to a survey banks because the recovery in
HSH Nordbank is one of the Carsten Rehder. carried out by the German values allows them to recoup their
world’s largest shipping banks and Speaking in Hamburg last week, Shipowners’ Association ship mortgage loans from the col-
its dominant public sharehold- Rehder argued that HSH Nordbank laterals. “There are still a host of
ers, the states of Hamburg and should invite large Asian banks problems with many newbuilding
Schleswig-Holstein, must sell their with strong ship finance activities Owners need finance projects and existing ships that
shareholdings, probably by 2014, to become strategic shareholders. German shipowners need bank have not been solved,” commented
in return for a billion euro bail-out They ought to fill the void left by financing both for their record PwC partner Claus Brandt.
last year. The European Commis- the state shareholders and guar- orderbook and for the operation Some 55% of all participants in
sion tied its approval of state aid antee the continuation of strong of existing ships that are laid up the poll said that they need fresh
to an exit of the German states. ship finance activities, Rehder or chartered out at loss-making liquidity to cover shortfalls from
HSH would have faced bankruptcy said. “Why shouldn’t we encourage rates. Some 959 ships are in acute ship operations, and 58% said
without the support of Hamburg Asian banks to become active as need of fresh liquidity, according they are still negotiating longer-
and Schleswig-Holstein. [HSH Nordbank] shareholders?” to a survey by the German Ship- term financing arrangements
The bank is also seeking to slash he asked. owners’ Association VDR. with the banks. F
€200M
Investment in Boulogne’s operators will now look closely to 7,966 units. “We knew that
port is paying off as into how the port and the market Boulogne was an attractive
growing demand for is developing. “The demand for destination for passengers,” said
freight and tourist traffic is obvi- amount invested in a plan to turn Santoni. “Our freight results
freight and tourist traffic the port of Boulogne into a major
ously there,” said Stevens. show that it is also an attractive
entices operators The investment has resulted in centre for shortsea shipping destination for freight.”
two new linkspans, as well as new There was no question of the
The port of Boulogne is benefit- logistics and storage areas. Areas Dover-Boulogne service being
ing from last September’s open- for a rail link and fishing activities Lines, it’s true that the operator’s downgraded in favour of the
ing of the first phase of Hub Port have also been created, and LD increased activity has boosted Ramsgate-Ostend line. “We don’t
Boulogne and is set to attract Lines has been able to introduce Boulogne-sur-Mer’s fortunes. The want to give that impression,”
interest from ship owners and a second vessel on its Dover-Bou- port is now back in competition said Santoni. “For us, it is clear
operators eager to take advantage logne service. with neighbouring Calais as a that Boulogne and Belgium are
of the development. Stevens stressed that the invest- ferry port on the Dover Strait. complementary.” The Ramsgate-
The hub project is part of a ment was not made solely for LD Lines has not turned its Ostend line attracted traffic from
€200M ($247M) investment the benefit of LD Lines. Plans for attention from the strait, contrary the Benelux countries and central
plan aimed at turning the port the hub existed about three years to the impression it might have and eastern Europe, he explained,
into a major centre for shortsea before it was opened, he explained; given when it went into partner- while the Boulogne-Dover line
shipping. Currently, Channel it is a “coincidence” that it came ship with Transeuropa Ferries drew its traffic essentially from
ferry operator LD Lines is the only into being as LD lines was building between Ramsgate and Ostend. France and Spain.
operator using the port. up its business. He added that one Indeed, LD Lines’s introduc- As to where traffic growth on
Nick Stevens, spokesman for the of the main aims of the invest- tion of a second vessel on its the Boulogne-Dover line is coming
port, told Fairplay that there had ment project is to boost business Dover-Boulogne service dem- from, Santoni said that it was diffi-
been no “cast iron commitment” by creating a port that can accom- onstrates that the opposite is cult to be sure but some traffic was
from other operators to ply their modate any type of vessel “world- true, according to LD Lines MD doubtless being attracted from
trade at the port, but the success wide”, be it cargo or passenger. Christophe Santoni. the company’s western Channel
of the hub project means other While the hub project was not Vessel Norman Trader (formerly competitors and some from lines
operators have shown interest and developed exclusively for LD Dawn Merchant) was brought using neighbouring Calais. F
$5M/year
shipping community was that a
UN Iran sanctions breakthrough
would deter the US Congress
from passing its own harsher leg-
islation. That hope was dashed on
24 June, when lawmakers passed limit of Iran products import support under the
their final draft by near-unani- US sanctions
mous consent.
President Obama signed the
bill into law 1 July, with sanc- to deal in dollars – is so enormous Congress specifically targeted P&I clubs bear to ‘enforce’ pro-
tions entering force immediately. that it could put companies out insurance in the belief that if hibitions? “It seems like they’re
The Comprehensive Iran of business.” coverage is pulled, the Iran trade looking for more than just a
Sanctions Act of 2010 penalises US sanctions don’t just target would collapse. policy exclusion,” cautioned Wat-
foreign firms transporting foreign shippers and vessel The P&I clubs’ conundrum is son, Farley & Williams’ senior
refined petroleum products to owners and operators. They also that they don’t know where their associate Jane Freeberg-Sarma.
Iran. Violators may be disbarred jeopardise service providers, insured vessels sail so a new clause Whether this requires insurers to
from US dollar exchanges. “It’s including brokers, financiers and has been inserted into the final review voyage records or monitor
a trap for the unwary, designed insurers. Sanctions will apply if draft providing safe harbour for AIS information is a “grey area”,
to ensnare foreign companies,” “fair market value of goods, ser- insurers who “exercise due dili- she said.
Seward & Kissel partner Bruce vices, technology, information or gence in establishing and enforc- The new law creates similarly
Paulsen warned Fairplay. “The support” exceeds $1M/products ing” prohibitions. alarming uncertainty for other
potential sanction – the inability voyage to Iran or $5M annually. But what responsibilities do global maritime players. An earlier
comment
Nutrients feed mixed messages on sewage
Nutrient content has been proposed as a new way to evaluate sewage discharge from ships. Dr Wei
Chen, head of R&D at Hamworthy Water Systems, questions the benefits for the marine environment
During the February meeting of the European Urban Wastewater Treatment including those that serve the port ‘availability’, the specification must
IMO’s Marine Environment Protec- Directives (����������������������������
91/271/EEC)�����������������
. The Directives reception facilities (PRFs), shipboard define influent nutrient concentrations,
tion Committee, Helsinki Commission do not require nitrogen removal for point sewage treatment plants perform the inclusion of various greywater
(HELCOM) administrations sought to discharges from populations of less than much better. streams as well as methodology for
establish Special Areas for the preven- 10,000 people. HELCOM stated that five major PRFs assessing percentage removal limits. All
tion of pollution by sewage, and to Baltic countries have introduced nitro- would address 80% of the ship waste- these are unique shipboard conditions
designate the Baltic Sea as such. The gen removal targets for discharges from water offloading requirement. Three of that require specific attention by the
submission included nutrient reduction less than 10,000 people, which require these will be made ‘adequate’ by 2013. marine regulators.
for sewage discharged, such as 20mg/
����� a 30% removal to be achieved by 2018. However, no assessment was made of
litre of nitrogen or 70% removal,������
from Advanced waste treatment plants cur- the actual capacities and the perform- Science-based limits
passenger ships with capacity for as few rently fitted on cruise ships, such as the ances of available WWTPs. While MEPC must review the issues
as 12 passengers��. on scientific and legislative grounds, I
The annual nutrient input from
all sources to the Baltic Sea includes After the successful introduction contend that existing proven sewage
treatment plants on board passenger
736,720 tonnes of nitrogen, with an of MEPC 159(55) by IMO in 2010, ships, type-approved to MEPC 159(55)
allowable input of 601,720 tonnes – a standards, are perfectly suited for con-
reduction target of 135,000 tonnes. standards for ship discharge are tinued operation in the Baltic Sea, even
HELCOM estimated the total shipping
contribution to be 356 tonnes, while
better than equivalent land- when it is designated a Special Area.
Why should ship owners and opera-
industry calculated the cruise ship contri- based standards tors have to switch off the shipboard
butions at some 74 tonnes. By contrast, sewage treatment plants, carry
a major city like Helsinki discharges some Membrane Bio Reactor (MBR) systems A hold-and-discharge policy by ship wastewater at the expense of natural
500 tonnes of nitrogen/year from its provided by Hamworthy, have already operators would increase the fuel used to resources and carbon emissions, only to
state-of-the-art wastewater treatment achieved this future target set for smaller carry thousands of tonnes of wastewater discharge this to a shore receiving facil-
plant (WWTP). local communities. up and down the Baltic Sea – counter to ity whose treatment plant offers similar,
HELCOM claimed that nutrient After the successful introduction of undertakings given by the administra- or inferior, performance?
discharges from ships are “concentrated MEPC 159(55) by IMO in 2010, the tions, and by IMO, to reduce carbon It is important to establish sci-
along the shipping routes��”��������������
and
�������������
“causing standards for ship discharge are better emissions and greenhouse gases. ence-based nitrogen limits based on
serious effects locally���������������������
”��������������������
, but no scientific than the equivalent land-based stand- For suppliers who believe they have environmental needs and effectiveness,
evidence was provided to support this. ards. For example, hardly any of the developed a solution, with Hamworthy with due consideration for their demands
Nitrogen distributions from previous land-based WWTPs have faecal coliform being one of them, it is yet to be seen if on natural resources and carbon emis-
studies contradict such a claim. consents or a disinfection stage. While such efforts will be made obsolete by the sions. Maritime regulators must first
Marine water is in general defined as millions of faecal coliforms are legally hold-and-discharge policy. demonstrate that their proposals will
“less nutrient sensitive area” under the discharged from the land-based WWTPs, In order to assess technological yield tangible environmental benefit. F
The world’s leading supplier of compressed air systems for marine use.
7%
lift the country’s logistics I N D I A peninsula, has been earmarked as
a logistics centre, along with the
infrastructure out of its it
S tra nearby Palaly airport. A rail track
near-obsolete state lk Kankesanturai
Pa is to be re-laid towards Talaiman-
nar pier, on the northwestern tip,
Project cargo, much of it in the Sri Lanka’s current and from here ferry services to
form of railway rolling stock and economic growth rate Dhanushkodi in India, disrupted
components for the creation of by war, are to be resumed.
track infrastructure, is being Trincomalee Southern coastal tracks will be
imported to Sri Lanka at a steady Gulf of upgraded and extended, increas-
rate. Following the end of the ing train speed and volume of
Mannar
country’s 30-year conflict in May S R I passenger and goods transported
2009, growth is running at 7% so and connecting with the new
far this year. Colombo
L A N K A deepwater port of Hambantota
Peace is allowing Colombo to and a new international airport.
rebuild and modernise its rail net- PP Wijesekera, general man-
work, which was either destroyed ager of Sri Lanka Railways, said
by the war or rendered obsolete Hambantota reconstruction work is being
over time. Logistics group GAC’s fast-tracked with aid from India
Sri Lanka unit has already won and China for both the northern
significant business in the railway Multimodal links are planned, to tracks and the upgrading and lay-
rebuilding project, transporting
15,000 tonnes of concrete sleep-
handle a forecast five-fold ing of new tracks in the south.
“We’re going to replace all
ers, steel girders and other equip- increase in rail’s share of freight trains with new trains and
ment to a variety of sites along improve tracks to run fast trains.
the country’s southern track. GAC And we already have a rail link
has also handled more than 500 els 20 years ago, severing regular the transport of passengers and to Colombo port which can be
containers shipped from India and contact between the Tamil and goods, better connecting indus- revived at minimal cost.” Sri
arranged their delivery, transport, Sinhalese communities. “Often, trial and agricultural producers Lanka Railways has received 15
de-stuffing and stacking. mobility is the first casualty of with markets, and upgrading diesel multiple units (DMUs)
Several big projects are envis- conflict,” said professor Amal logistics with a strategic shift from China for suburban travel
aged to re-connect impoverished Kumarage, head of the transport towards rail. A goal of the policy is and has ordered 20 DMUs from
regions in the island’s north and & logistics management depart- to increase rail’s share of passen- India for long-distance transport.
south, which have been convulsed ment of Moratuwa University. ger and freight transport to 10% The organisation has also ordered
by three separate insurgencies in Sri Lanka Railways now and 5% respectively by 2016. 15 oil wagons from Pakistan to
the past 40 years. accounts for only 6% of all pass- To that end, multimodal link- move petroleum products by
Rail tracks to the north, the enger journeys and 1% of goods ages are planned for the north train, as storage tanks are located
main pre-war mode of transport, journeys. The national transport where the previous transport near rail tracks or are linked to the
were blown up by Tamil Tiger reb- policy has the aim of improving infrastructure was either national rail network. F
$2,607/feu
them in China are holding back
by a pattern of short production in order to drive up
notice box rate rises, prices, Robertson told Fairplay.
“In the recession when the lines
which is causing weekly Hong Kong-Los Angeles container rate benchmark
were in cost-saving mode they
planning headaches embarked on a process of stop-
Chinese factories that make ping positioning, hiring as much
Container freight rates are con-
tinuing to rise on firming demand containers are holding back kit as possible and stopped build-
ing new units. So the normal
and carriers’ efforts to restore production in order to drive momentum in a line – where
profitability following heavy lines’ secure equipment to cover
2009 losses, but a shortage of up prices their organic growth, replacing
both notice and boxes is conspir- worn out units and adding units
ing against shippers. to account for any deterioration
“The rebound in spot container Eastbound trans-Pacific freight according to Alan Robertson, in their container productivity
freight rates has been phenom- rates, under annual contracts director of UK-based consultancy – slowed or stopped.”
enal, as rates now substantially signed in May and June for the Webster Robertson. “Now that there is an upturn,
exceed pre-crisis levels of about 2010/2011 season, were also Lines rarely quote a rate for there are units basically in the
$2,000/40ft box,” said Philip more than twice the previous low more than three months ahead, wrong place at the wrong time,
Damas, editor of the Drewry Con- levels of the 2009-10 season. “It’s Robertson said, which is incon- containers that were sold as worn
tainer Freight Rate Insight report, a mini container shipping boom, venient for shippers as they lack out will not return to the fleet and
which contains the data. ahead of the full recovery of the visibility of their freight cost the China factories are deliber-
Drewry, the UK-based con- real economy,” Damas added. beyond that period. ately holding production back
sultancy, said its weekly Hong While freight rates rise, Shippers would prefer a model in order to drive the box prices
Kong-Los Angeles container rate shippers say they often receive whereby the earlier one booked, up. There is also little capacity in
benchmark has hit $2,607/feu poor service. Some lines impose the lower the freight rate charged, the leasing industry as they have
– 19% higher than the previous a surcharge for late arrival of something akin to that used in hardly any stock and are stuck
week and 182% higher than the container to dock, yet ships the air freight sector, according to with the container factory prob-
same week in 2009. themselves are often delayed, Mike Harrison, director of Freight lem,” Robertson concluded F
Star sailor
source in our solar system, of space. First is the problem of getting off
the sun, making use of the planet. This could be solved by using a
two powerful forces – radiation pressure ‘Space Elevator’ (Fairplay, 11 February 2010,
and solar winds. On Earth, of course, drag p25), which is designed to send masses of
Cargo ships once sailed across the oceans and inertia render these useless as sources material into space far more cheaply than is
powered by sail. Now, similar techniques, of propulsion but, in space, there is no drag possible today.
such as tacking, are being discussed to navi- to overcome, only the inertia of the vessel The second problem is moving people and
gate space – using solar sail power. at rest. This could mean that, over time, the material through empty space but solar sail
The technique is now being investigated continuous pressure exerted by sunlight technology would do away with these prob-
by such bodies as NASA in the US and the against a solar sail could gradually acceler- lems, its supporters believe. While the sun
Japan Aerospace Exploration Agency (JAXA). ate the spacecraft, eventually enabling it to shines, propulsion will be available wherever
In fact, the Japanese agency launched an travel faster than a ship powered by even the craft is in the solar system. Theoretically
experimental solar sail vessel on 20 May the biggest chemically-fuelled space rockets. the two technologies together could make
and says on its website that “a solar sail can “Because there’s no friction in space,” a access to, and transport through, space
move forward without consuming pro- NASA statement notes, “once a solar sail practically and commercially feasible.
pellant as long as it can generate enough starts moving, it can go on forever. Indeed, It’s easy to imagine how they would work
energy from sunlight.” long after a rocket would run out of gas and together. Several solar sail propelled ships
It adds that the idea is over 100 years begin to coast, a solar sail ship could still be could continuously travel back in a loop, at
old but many technical hurdles have stood accelerating, achieving speeds much faster an incredibly fast speed, between the Earth
in the way of realising it. Recently, how- and covering distances far greater than any and, say, the Moon. Passengers and freight
ever, JAXA believes it has overcome these rocket.” It puts this in perspective, pointing leaving the Earth, via the Space Elevator,
obstacles and launched IKAROS – Interplan- out that the Voyager space probes have left would wait on a space station in orbit.
etary Kite-craft Accelerated by Radiation the solar system “but it’s taken more than When the next solar sail propelled ship
of the Sun. Its sail takes the form of a huge three decades to do it. A sail launched today comes sweeping by, the people and the
square measuring 20m across its diagonal, would probably catch up with them in a freight could blast off from the station
only 0.0075mm thick and made of poly- single decade.” aboard a conventional rocket to catch
imide resin. Solar sails have an important similarity to up with the sailing ship and dock with
At sea, of course, sails propel ships by conventional sails, NASA points out. “Like it, later detaching when it swept by the
trapping airflow or by acting as aerofoils, a marine sail, a solar sail could also bring Moon. The return journey would be much
generating lift as they redirect airflow across you home. You could use the solar sail to the same and, in this way, the solar ship
them. A solar sail works in much the same tack your vessel making it travel against the would act much like a liner service for
way – although it obviously does not rely on ‘wind’, back to Earth.” containers or passengers. Perhaps that’s
moving air in the vacuum of space. Today, there are two main problems that one liner service for the likes of Maersk, MSC
Yet it can tap into the greatest power prevent the extensive commercialisation or Hanjin to think about. F
LAKSHMI VENKATACHALAM
J
ahaz Bhavan (Ship Mansion), the general DT Joseph for maintaining a tight ogy into the policy framework. In less
headquarters of the Directorate Gen- balancing act aimed at serving the interests than two years of office as DG of Ship-
eral of Shipping in Mumbai, is a model of both national shipping and the trade. ping, Venkatachalam has pushed success-
of an Indian government bureaucracy She is emphatic, however, that the fully for enhancing the efficiency of the
in motion. Like many bureaucracies, it overriding concern should be growth. “If examination system by harnessing the
has often been accused of sluggishness we lose that perspective we will not be latest technology.
by frustrated investors – and successive fair to any sector.” The Indian economy Her proposal for an online examination
heads of the directorate have been known is expanding and offering numerous op- system has been approved by the ministry
to sympathise with shipping industry portunities for global players to come in and a pilot project is to be implemented
concerns, rolling out policies to attempt to and participate in its growth. The poli- soon in collaboration with a Bangalore IT
ease their administrative burden. cies being unveiled in shipping, port and solutions provider, International Insti-
Take the example of Lakshmi infrastructure are aimed at facilitating this tute of Information Technology. This will
Venkatachalam, who took over as director- process, she observes. assist in developing a framework that
general in late 2008. “We need not India’s energy requirements alone offer will streamline the whole approach and
handicap the Indian industry,” she told substantial cargo-carrying potential. As process of conducting examinations for
Fairplay, affirming her support for the much as 52,000MW of additional capacity certification of seafarers.
demand of Indian owners for flexibility in in the power sector to April 2012 will be Bureaucrats are known to be hard
crew recruitment policies. While trying to coal-based. Venkatachalam points out drivers and Venkatachalam does not
remove what she feels is a misconception that up to 10% of India’s coal requirement spare herself in the search for new ac-
that bureaucracy is all about imposing is imported, amounting to almost 60M complishments. Seven years after joining
controls, she agrees that owners have a tonnes annually. India also imports huge the Indian Administrative Service in 1978
strong case for urging the removal of a quantities of crude oil, as 68% of domestic she relocated to the US to study for a
number of additional taxes, given that a oil consumption is met by imports – which master’s degree in economics and busi-
tonnage tax regime is already in place. exceed 100M tonnes/year. ness administration. She now has three
On the tricky issue of cabotage regula- The growth story cannot be written degrees, the first of which is in literature,
tions she commends former director- without integrating advances in technol- from India’s Jadhavpur University.
26%
Grimaldi, linking Nantes-Saint
3.5%
$250M
Investment in Nazaire with Gijon. €4M will
Expected construction of a also be received from the
annual increase in global 1,380m deepsea EU’s Marco Polo motorways
fertiliser consumption dry bulk jetty at of the sea programme
between 2009 and Oman’s Sohar Oil production in the Gulf
2014, according to the port, being of Mexico shut in due to
International Fertilizer built to support Hurricane Alex. Natural gas
2011
Industry Association. Demand Vale’s iron ore production was reduced Date by
for nitrogen and phosphorus pelletising plant by 14%, according to the which the
is predicted to reach 187.3M and distribution centre. It is Bureau of Ocean Energy International
tonnes by 2014, and 158.5M due to come into operation Management, Regulation Labour
tonnes for ammonia in 1Q11 and Enforcement Organization
expects the
Maritime
$115M
$3Bn Forecast value
Labour
Convention
of exports of timber products to be
and finished wood products internationally ratified. The
from Vietnam in 2010, tonnage qualifications have
according to the Vietnam been met and it is expected
Credit secured by Karachi Port Trust from the World Bank for the Timber & Forestry Product that the requisite number of
reconstruction of berths as the city’s east wharf to accommodate Association, up from ILO member states will be
100,000dwt vessels by creating a 922m quay wall and 16m draught $320M in 2009 achieved by early 2011
There is so little fairplay in the world. If our own efforts succeed, we shall have taken the first steps towards
promoting the habit of calling things by their right name and looking at them through uncoloured spectacles…
Founder: Thomas Hope Robinson, Fairplay, 18 May 1883
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