The G6 Alliance unveiled plans today to expand into the trans-Atlantic and Asia-U.S. West Coast trade lanes in a widely expected response to the proposed P3 Network partnership between the world’s three largest carriers, Maersk, Mediterranean Shipping Co. and CMA CGM.
The G6 carriers — Hapag-Lloyd, NYK, OOCL, Hyundai Merchant Marine, APL and MOL — will deploy 240 container ships serving 66 ports in Asia, America and Europe.
The alliance plans to complete the expansion of services by the second quarter of 2014, pending regulatory approval, to coincide with the launch of the P3 network on the Asia-Europe, trans-Atlantic and trans-Pacific routes. Details on port coverage will be announced at a later date.
The lines, which currently cooperate on the Asia-Europe and Asia-U.S. East Coast routes, will operate 76 vessels covering 12 services connecting 27 ports in Asia and on the West Coast of the United States.
A further 42 ships will operate five trans-Atlantic services, including two pendulum services, calling at 25 ports in the U.S., Canada, Panama, Mexico, the Netherlands, the U.K., France, Belgium and Germany.
“The proposed expansion will complement our existing services in the Asia–North America East Coast and Asia–Europe trades, allowing us to deploy the most suitable ships for each loop across the trades,” the G6 carriers said in a joint statement.
“With greater service flexibility and operational synergies, the G6 alliance will have an even more resilient and robust network – giving shippers a wider coverage area and shorter transit times without reducing the total capacity.”
Each G6 carrier will be able to offer almost twice as many sailings on the Asia-North America trade as what it currently operates separately, the alliance said.
The six container lines that make up the G6 accounted for 27.1 percent of U.S. containerized export trade and 28.6 percent of U.S. containerized import trade in the first nine months of 2013, according to information compiled from PIERS, the Data Division of JOC Group Inc. Not all services offered by these lines will be included in the G6 expansion; Hapag-Lloyd, for example, has noted that it will continue to offer its Montreal and ATA services, as well as Mediterranean services, outside of the G6.
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PORT KLANG (April 3, 2013): Port Klang Authority (PKA), the regulator of Northport and Westports, is yet to receive a reply from the Ministry of Finance (MoF) to its proposal for a steep cut in its RM4.63 billion loan from the government used to develop the controversial Port Klang Free Zone (PKFZ), said its chairman Datuk Teh Kim Poo.
He told an audience of close to 100 people attending a networking session with the port authority yesterday that PKA is not bankrupt and able to fulfil its financial requirements, which includes the repayment of the Treasury loan, up till 2018.
The soft loan, which was forwarded to PKA in 2007, was initially to run for a period of 20 years and to cover the cost of land and assets as well as the development of PKFZ.
Under a restructuring plan revealed by Teh in November last year, PKA seeks a RM1.87 billion hair cut to the loan on the grounds that the assets and land that PKA would be paying for would ultimately be owned by the government.
Teh estimated that the plan put forward by PKA would ultimately see its repayment run over a 30-year period and the instalment reduced to about RM100 million a year.
Under the current loan structure, PKA has to repay RM100 million this year and RM340 million next year. For subsequent years, PKA would also have to service its loan to the tune of RM300 million, Teh had reportedly said.
PKA general manager Captain David Padman told SunBiz after the event, that with an annual income of RM300 million and cash reserves of a “few hundreds million”, PKA would be able to manage annual loan repayments of around RM100 million but not between RM200 million and RM300 million that the current loan structure would demand of the port authority.
In November last year, PKA’s cash reserves reportedly stood at about RM400 million.
On the port authority’s plans for PKFZ, Teh said he would reveal more at a PKFZ lease signing ceremony to be held in “a week or two”.
PKA chaired the first-of-its-kind networking session with the port community yesterday.
While there were a few heated questions regarding road infrastructure, the competitiveness of Port Klang and the efficiency of the port delivery system, the event ended without incident ahead of schedule.
It was attended by representatives from the Royal Malaysian Police, Customs, Marine Department, Road Transport Department, Northport (Malaysia) Bhd and Westports Malaysia Sdn Bhd.
On a separate issue, Padman said the licensing of container depot operators’ will come under the purview of the Land Public Transport Commission (SPAD) once a law to give it powers to do so comes into force.
Currently, the depot operators are licensed by the respective local councils and not subject to any form of supervision.
The issue of unsupervised depot operators was highlighted when some 1,000 container haulage drivers at Port Klang took to the streets to protest against an increase in depot gate surcharge in May last year.
Under SPAD, the container depot operators will be monitored and subject to yearly licence renewals.
Padman said it makes sense for SPAD to be the licensing authority as container depots are spread out across the country and are not necessarily located near ports.
Source: the Sun Daily
THE 5,095-TEU CMA CGM Florida has continued to Shanghai after colliding with the 175,569 dwt bulker Chou Shan, and spilling oil over an area two miles long and 200 miles wide.
The CMA CGM Florida’s tank, containing 645 tonnes of bunker fuel continued to leak as the ship made its way to Shanghai’s Yangshan terminal 124 miles southeast of the collision. The bulker Chou Shan has arrived in a ship repair yard in Zhoushan, and appears to have suffered limited damage.
Despite damage to its fuel tank, hull and containers, the UK-flagged box ship seems to have escaped the worst after remaining on the scene for more than a day, reports London’s Containerisation International.
“The ship is not in danger of sinking and is sailing to Yangshan now,” a Shanghai Maritime Safety Administration official told Lloyd’s List. “It may go to a shiprepair yard later as the clean-up operations continue.”
The 2005-built bulker owned by Taipei’s Sincere Navigation hit the CMA CGM Florida amidships northeast of Shanghai early Tuesday morning, and suffered damage on its port side and to four rows of containers.
Shanghai safety officials deployed a five-vessel clean up squadron, and “operations will continue for a while as the boxship is going to Yangshan with a leaking tank, so more spills may occur”, the official said. No containers have fallen into the sea and no one was injured.
Of the bulker, Sincere Navigation vice-president Lee I-Jen said: “There is some damage to the vessel. But things appear to be not too bad. The ship was not loaded when the accident happened. It still had power so it sailed to the repair yard by itself.”
A team of investigators from the UK’s Marine Accident Investigation Bureau has been deployed to China to investigate. The CMA CGM Florida was on its way back from the US east coast via Panama.
Source: Asian Shipper
MCC Transport, the Singapore-based intra-Asia container shipping unit of the AP Moller-Maersk group, is extending the port rotation of its IA2 service to Indonesia with a new call at Jakarta.
The IA2 provides direct connections to North Asia and a Jakarta-Laem Chabang link. It also acts as an additional Jakarta feeder to Tanjung Pelepas and Singapore, reports Alphaliner.
The port rotation for the upgraded IA2 is Tokyo, Yokohama, Nagoya, Kaohsiung, Hong Kong, Shenzhen-Yantian, Tanjung Pelepas, Singapore, Jakarta, Tanjung Pelepas, Singapore, Laem Chabang, Hong Kong, Xiamen and back to Tokyo. It will turn in five weeks.
It said OOCL will participate in the Thailand-China-Japan-Taiwan string branded as the KTX5 service to succeed to its existing KTX5 loop, which is to be scrapped. OOCL participation will be limited to the following port sequence of Laem Chabang, Hong Kong, Xiamen, Tokyo, Yokohama, Nagoya, Kaohsiung and back to Hong Kong.
The service will deploy five 2,700-TEU ships, four of which will be provided by MCC and one by OOCL. It explained that the OOCL ship will run the entire service, including on the non-OOCL legs.
Gold Star Line will continue purchasing slots on the service from MCC. As GSL’s Thailand-Japan Express (TJX) service, it will call at the ports of Laem Chabang, Hong Kong, Shenzhen-Yantian, Tokyo, Yokohama and Nagoya.
Source: Asian Shipper
27 Jan 2013
Malaysia Today reported that industry players in the piping and construction segments may experience a hike in raw material prices in the immediate term when the Ministry of International Trade and Industry’s decision to cease duty exemption on 18 grades of steel imports comes into effect on February 1st.
Sources said MITI has assigned a working group comprising Malaysian Iron and Steel Industry Federation and various players in the steel industry to work on a pricing mechanism which will benchmark the price of local raw steel to international standards.
The current duty imposed on imported steel is about 20%. MITI announced that it will stop giving duty exemptions for 18 grades of steel in an effort to curb the dumping of cheap steel in Malaysia.
The exemptions will end on February 1st but companies which have been awarded temporary certificates of approval to import the affected grades will be considered for fast track clearance for 6 months. This will give them time to make necessary adjustments to adhere to the streamlined process to import steel and iron products.
Industry players told The Malaysian Reserve that the cessation in duty exemption will cause prices for the 18 grades of hot rolled coil steel to move in an uptrend.
Soh Thian Lai MISIF president said that “The 18 grades of HRC steel are all steel grades that local producers are able to provide and meet the demand of customers both in terms of quality and quantity. Although the quality is not so high end it is still usable and acceptable. For the high end quality HRCs MITI still allows users to apply for duty exemption.”
Alpine Pipe Manufacturing Sdn Bhd one of the major local players in the piping industry, are among a few of the companies which will be hit by the move to cease duty exemption.
The company uses materials such as HRC cold rolled coil, hot dip galvanized steel coil and chequered coil in its business of pipe-making.
Source: Malaysia Today
Comment by Nazery Khalid
SHIPPING is the faithful servant of global trade and a fulcrum of economic growth, facilitating an estimated 90% of global trade volume.
As such, the shipping industry is influenced by factors such as the economy, trade, consumption, production, financing and technology that drive the demand and supply of manufactured goods, raw materials and shipping services.
Just as the shipping industry enjoyed a spectacular boom during the boom years during the mid-2000s when the global economy performed well, its fortunes are now also inextricably related to the recent slump in the global economy.
The curtailment of economic activities and consumption has resulted in a drop of trade volumes and low demand for maritime transport.
It is therefore not surprising that the shipping industry has suffered along with the global economic recession and financial crisis.
The shipping industry is facing what can only be described as the longest and most severe downturn in modern merchant shipping history. Freight rates in key shipping trades such as bulk, container and trade have slumped to nearly all-time lows, as shipowner struggled with low demand for their vessels.
They also have to face with high the challenge of high fuel costs which can take up 70% of the cost of operating vessels.
With poor revenues, they have struggled to repay the loans and are saddled with vessels whose prices are much lower than when they were bought prior to the recession. Amid the tightening of credit and lack of liquidity, shipping companies also face the difficulty of raising financing to purchase vessels and for working capital.
During the “golden age” of merchant shipping before the current downturn hit, freight rates in all the major shipping trades were heading skyward.
Prices of vessels were at an all-time high; a very large crude carrier (VLCC) was priced at around US$160mil (the price is around US$80mil now).
The shipping industry was awash with cash; banks were eagerly lending huge amounts at very competitive rates to shipowners who went on an expansion binge and aggressively enlarging their fleet.
Ports were enjoying record throughputs, thanks to the insatiable demand for all kinds of goods and materials, largely fuelled by the spectacular growth in developing economies namely the BRIC (Brazil, Russia, India and China) countries.
The global recession which began in 2008 has resulted in a sharp downturn in the shipping markets.
Demand for shipping services has declined dramatically and freight rates have suffered a sharp drop.
For example, the freight rates for Aframax tankers have declined at a 15-year low to around US$12,000 per day currently, according to the authoritative Oslo-based shipping research outfit Nordea Markets (the rates reached at an all-time high of around US$87,000 a day in 2008).
The decline can be attributed to lower demand in Europe for crude oil on the back of the eurozone crisis.
This is compounded by the persistent entry of huge new tonnage in major shipping trades – namely bulk, container and tanker – which has exerted downward pressure on freight rates and has halted recovery in those trades.
Amid a flurry of negative developments such as the continued financial crisis in the eurozone, the spectre of double-dip recession and financial cliff in the United States and slower growth in China, it is difficult to be bullish about the prospect of the global economy and the shipping industry to rebound anytime soon.
World Bank projected that the global economy would register a weak 2.5% in 2012 and would not grow more than 3% in 2013.
With these in the background, the shipping industry looks set to carry on the bearish mood of 2012 into 2013.
The combination of low demand for shipping services and persistent entry of new tonnage into the shipping markets has resulted in severe overcapacity in key trades such as bulk, container and tanker.
International shipping consultant Alphaliner projected earlier this year that almost half of the container ships slated for delivery in 2012 have capacity of above 10,000 twenty-foot equivalent units (TEUs), most of which earmarked to serve the Asia-Europe trade.
One such ship, the 11,400 TEU Andromeda owned by French giant container shipping group CMA-CGM, called at Westports at Port Klang.
Such behemoths are the norm in the container trade as shipowners strive to attain economies of scale in servicing key routes like Asia-Europe which can offer sizeable cargo volumes and have ports to accommodate the big vessels.
The delivery of newbuildings with huge capacity has exacerbated the oversupply situation in already beleaguered trades such as container and tanker.
More new tonnage is expected to flood the shipping markets in 2013 and this will exert further downward pressure on the shipping industry’s attempt to recover from the downturn.
Freight rates in the Asia-Europe and Transpacific routes will continue to be depressed by the oversupply of huge new ships meant to serve these trades. Main line operators are expected cut capacity and introduce rate restoration measures in these trades to mitigate low demand for their services, excessive capacity and high oil prices.
The picture painted is admittedly not a bright one. It would take a confident punter to wager a bet on the shipping industry rebounding convincingly in 2013. It looks like the bearishness in the industry will continue a bit longer before things get better.
However, this should not obscure the opportunities and bright spots available in the shipping industry. For one, the intra-Asian and intra-Asean trade provide a reliable growth area for container players, given the strong economic performance of regional economies.
There should also be strong demand for the offshore support vessel and workboat segments, amid growing exploration and production activities in the offshore oil and gas industry.
Despite the overall gloom, shipping must be viewed with a long-term lens to put its prospect in the right perspective. Volatility is the name of the game in this industry, and the peaks will always follow the troughs.
Notwithstanding the current downturn, the shipping industry, as key facilitator of trade, will rebound once the global economy and trade volumes pick up.
Shipowners who persist amid these trying times will be the first to benefit once the demand for their services picks up steam again when the global economy recovers.
·Nazery Khalid is senior fellow at Maritime Institute of Malaysia. The opinions expressed are the author’s own.
Source: the Star
LONDON area Inchcape Shipping Services’ (ISS) Lighthouse Relay Voyage baton arrived in Australia for Christmas – raising additional funds for local charities around the world.
The ISS Lighthouse Relay Voyage baton, which raises money for local charities supporting sick and disadvantaged people, has arrived in Sydney, Australia, on the latest leg of its global tour.
The ISS fundraising initiative has now raised nearly US$125,000 since its journey began at the Inchcape Reef, off the coast of Abroath in Scotland, meaningful to the two Scotsmen who formed the company in Calcutta in 1847.
From its original departure at the home of the Bell Rock Lighthouse, the baton left Sydney for Auckland, New Zealand, for the next stop of its Australasian journey. Over the last six months it has travelled across parts of the Far East and south east Asia, including Hong Kong, Shanghai, Taiwan and Indonesia.
The baton arrived in Hong Kong aboard 1,118-TEU San Cristobel and was received by ISS Hong Kong operations manager Sunny Chan from ship’s captain Marcin Pielas, at a ceremony where a donation was made to Stephen Miller, chaplain of the Mission to Seafarers.
Next stop was Shanghai, aboard Hamburg Sud’s 5,560-TEU Monte Pascoal. ISS China’s charity, the Red Cross, received its donation in a special presentation with students. This organisation helps students who have been orphaned or disadvantaged by supporting their studying and living conditions.
The baton was then handed over on the 5,245-dwt bulk carrier Blue Star by the ISS China general manager David Young to ship’s captain Zhou Genguam.
Source: Asian shipper
Unfortunately, malaysiashipping.info isn’t 100% up and running. I’m able to still post from mobile but can’t login to admin screen.
You may not notice the difference though but posting will be less frequent as I can only do it from my phone!
Not the best thing for me in Christmas but life goes on..
Merry Christmas and Happy 2013!