News & Announcements

OT Africa Line (OTAL) has announced improvements to its service connections with the main West African industrial oil hubs of Onne, Nigeria, and Takoradi, Ghana.

The carrier has restructured its East Feeder service to improve the transit time to Onne by 7 days from the main European ports. OTAL also has revised its DIAMS service to reduce the transit time for European cargoes to Takoradi by 3 days.

Ocean carriers are re-activating increasing numbers of laid-up container ships to keep pace with growing cargo volume on key liner trade routes.

Laid-up ships are returning to active service with the introduction of new services, capacity upgrades on a few “loops” and additional extra slow steaming, according to Alphaliner, the Paris-based consultancy.

This will lead to employment of about 40 additional vessels of over 3,500 20-foot equivalent units capacity by the end of April, with more than 15 ships drawn from the pool of idled vessels.

The remainder will consist of shipyard deliveries and vessels being freed up by their current charterers.

“Carriers are gearing up for the summer shipping season with optimism nurtured by a revived demand in most main trade lanes,” according to Alphaliner.

Charter ships of 4,000-5,000 TEUs are becoming harder to find after a wave of chartering in the past few weeks.

Several carrier-controlled vessels of 4,000-7,000 TEUs are laid up but some could be re-activated at short notice if cargo demand warrants their return to service.

The carrier-operated idled fleet has dropped from just over one million TEUs to 630,000 TEUs over the past twelve months, and the figure could fall below 350,000 TEUs in the coming two months as lines re-active unemployed vessels.

Carriers have shrunk their idled fleet by returning surplus tonnage when charters expire, and selling or scrapping older ships.

The total idle fleet, including charter vessels, stood at 1.24 million TEUs on March 1, the lowest level since July 2009, Alphaliner said.

The unemployed fleet could fall below one million TEUs within the next two months as new services and additional demand created by extra slow steaming continue to absorb surplus tonnage and some older 2,500-4,000 TEUs vessels are scrapped.

- Bruce Barnard, The Journal of Commerce.

The Montreal Port Authority has signed an agreement with R. J. Corman Railpower to purchase a next-generation locomotive for $1.6 million, with an option for four more. The 2,000-horsepower GenSet locomotive uses technology developed in Canada by Railpower.

GenSet locomotives feature a power-regulating device that can start up one, two, or all three generators, depending on the size of the task at hand, thereby allowing for finer control of diesel fuel consumption. Furthermore, when the locomotive remains stationary for more than five minutes, the on-board computer puts the locomotive into standby mode, shutting off all the generators. According to the port, this system helps reduce fuel consumption by 30% and cuts greenhouse gas emissions by more than 50%.

“The Montreal Port Authority is proud to have made the replacement of its locomotive fleet an opportunity to work towards substantial reductions of diesel consumption and greenhouse gas emissions,” said Sylvie Vachon, president and CEO of the Montreal Port Authority.

Vachon also pointed out that the port’s railway system, located dockside, is a decisive competitive advantage. “Our intermodal system, which makes it possible for put together trains loaded with containers right beside ships, is the envy of our competitors. In fact, they’ve named it the “Montreal model,” she said.

The agreement with R. J. Corman Railpower followed a call for proposals launched in 2009. The purchase was made with federal assistance under Transport Canada’s ecoFREIGHT program.

OOCL is limiting the acceptance of online booking requests, the company informed its U.S. customers on Monday. Outbound cargo space via oocl.com or cargosmart.com will be limited to the current week (as of March 8 ) plus the following seven weeks because of the continued tight space availability in the North American export market.

OOCL said it is accepting booking requests for export space from phone or email customers only on a current week plus three-week basis.

The Hong Kong based carrier said customers that book export space online will be able to book their shipments out four weeks beyond those customers who do not book via its online service options.

OOCL said the eight-week booking acceptance window will enable it “to better control the management of available vessel space and the related equipment supply planning”.

The carrier said it has experienced an increase in closed vessels and canceled bookings in the last few months in part due to overbooking and customer multiple carrier booking activities in order to secure space.

It said the eight-week booking window would help it improve space management.

- Peter T. Leach, The Journal of Commerce.

On March 8, Kansas City Southern (KCS) (NYSE: KSU) announced its acquisition of the Puerta Mexico intermodal facility at Toluca in the State of Mexico. Later this month, Kansas City Southern de Mexico, S.A. de C.V. (KCSM), will add direct train service from Lazaro Cardenas to Puerta Mexico.

Patrick J. Ottensmeyer, KCS executive vice president sales and marketing commented, “The growth of manufacturing activity and international trade flows in the Mexico City area is increasing the demand for modern, multi-modal terminals in Mexico’s industrial heartland. The strategic location and modern facilities at Puerta Mexico will allow KCS to better serve these growing markets.”

The Puerta Mexico serves the industrial centers of Mexico and the U.S., several important seaports and the Toluca-Mexico City industrial corridor. It provides intermodal rail and truck services and warehouse storage, and, the railroad said, it has the only inland customs-clearing facility in the State of Mexico.

In addition to train service, Puerta Mexico offers multi-modal terminal services and on-site customs and bonded warehousing facilities to ocean carriers, intermodal and other logistics service providers. It has an estimated capacity of more than 150,000 containers and 2 million tons of cargo per year.

“Since 1996, KCS has invested over $3 billion to expand and improve Mexico’s rail infrastructure. The purchase of Puerta Mexico further demonstrates KCS’ commitment to Mexico and its institutions, the appeal of Mexican markets and the viability of direct foreign investment in Mexico,” said Jose G. Zozaya, KCSM president and executive representative. “Puerta Mexico is a key link in KCS’ International Intermodal Corridor, creating a continuous cycle of economic growth for Central Mexico.”

The monthly increases in imports that began at the nation’s major container ports in December are expected to climb at single digit rates through the spring and accelerate to double-digit rates through the summer as the economy improves, according to the latest Global Port Tracker forecast released Monday by the National Retail Federation and Hackett Associates.

Retail imports are expected to grow by 13 percent in March compared with the same month a year ago, Port Tracker forecast.

“These numbers show that retailers continue to anticipate improvements in the U.S. economy,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said.

“This is very different from the past two years when merchants were continually cutting their imports in an effort to manage inventory,” Gold said.

Port Tracker said many ports experienced a stronger fourth quarter last year than would have been expected from the historical average and expect growth throughout the year, with some ports returning to 2008 volumes.

U.S. ports handled 1.08 million 20-foot container units in January, the latest month for which actual numbers are available. That was down just under 1 percent from December as imports wound down after the holiday season, but up 2 percent from January 2009.

It was also the second month in a row to show a year-over-year improvement after December broke a 28-month streak of year-over-year monthly declines.

The trans-Pacific trade performed more weakly than the trans-Atlantic in January, in part because of the weakness of the euro and the pound against the dollar, which fueled stronger growth at east Coast ports.

February volume was estimated at 1.08 million TEUs, the same as January but a 29 percent increase over unusually low numbers in February 2009, and March is forecast at 1.09 million TEUs, up 13 percent from the previous year.

Port Tracker forecast April volume at 1.17 million TEUs, up 19 percent as retailers begin to stock up for spring and summer, May at 1.21 million TEUs, up 17 percent, June at 1.26 million TEUs, up 25 percent, and July at 1.33 million TEUs, up 20 percent.

The first half of 2010 is expected to total 6.9 million TEUs, up 17 percent from last year’s 5.9 million TEUs. Imports for 2009 totaled 12.7 million TEUs, down 17 percent from 2008’s 15.2 million TEUs and the lowest since the 12.5 million TEUs reported in 2003. First-half growth is down from the 25 percent increase forecast a month ago, but reflects statistical issues at West Coast ports rather than a change in retailers’ import intentions.

Hackett Associates founder Ben Hackett said the U.S. economy appears to be in true recovery rather than the mid-point upswing of a double-dip recession.

“We are in a cautious but sustained growth cycle,” Hackett said. “Trade will grow and as a result of statistical comparison with the trough in 2009, the growth rates will appear to be healthy.”

- Peter T. Leach, The Journal of Commerce.

Shippers caused container shipping’s deepest crisis by exploiting overcapacity to drive down freight rates below vessel operating costs, the head of Mediterranean Shipping Company said.

Shippers also contributed to persistent and damaging price instability, according to Gianluigi Aponte, chief executive of the world’s second largest ocean carrier.

“Shippers are not that deep,” Aponte told the Financial Times newspaper.

“They worry always who will ship for $50 less. The shippers are concerned solely by the price,” the London newspaper quoted him as saying.

Aponte also criticized shippers for lobbying the European Union to commit the “grave error” of outlawing liner shipping conferences from European trades in October 2008 at the onset of the crisis in container shipping.

“Shippers’ insistence on eliminating the conference … will create a lot of instability in the future for the European and worldwide economy,” Aponte said.

Conferences enable carriers to discuss capacity and demand, thus smoothing out freight rate movements, according to the chief executive of privately-held MSC.

Since conferences were abolished in Europe, the cost of shipping a 20-foot container from Asia has veered between $350 in January 2009 to about $1,500 currently, Aponte said.

“We have multiplied by five the rate in the space of one year. If the situation continues, maybe the rate can even double again,” Aponte said.

Aponte said there will be substantial rate volatility in the future, which “will be against the interests of the consumer.”

Aponte denied shippers’ claims that Geneva-based MSC aggressively cut freight rates to maintain market share at the start of the industry slump. “It would have been crass and irresponsible for a company in our business to lower the rates,” he said.

The leading carriers will emerge strong from the crisis, Aponte predicted.

“I think that the big operators will come out very strong. We will all recover our losses in 2010.”

Aponte’s forthright comments over the weekend mark a break for the usually reticent MSC which rarely comments on the state of the industry or its own financial position.

Aponte was speaking in Hamburg where movie star Sophia Loren launched the MSC Magnifica, the latest cruise liner to join the fleet of MSC Cruises, the company’s ocean cruise unit.

- Bruce Barnard, The Journal of Commerce.

The carriers of the Caribbean Shipowners Association (CSA) — Bernuth, CMA-CGM, Crowley, Seaboard Marine, Seafreight Line, and Zim — have agreed to implement a pair of general rate increases over the coming months, the organization announced on March 8.

The rate hikes will apply to all dry and reefer cargo moving both northbound and southbound between the United States and Anguilla, Antigua, Dominica, Grenada, Montserrat, Saba, St. Barths, St. Eustatius, St. Kitts & Nevis, St. Lucia, St. Maarten, St. Vincent, Trinidad, Jamaica, Guyana, and Suriname. They will apply to all public tariffs and service contract rate levels.

The two increases, which will take effect on May 2 and on Sept. 5, 2010, will each be as follows:

• US$50 per 20′ dry/reefer equipment
• US$100 per 40′ dry/reefer equipment
• US$113 per over 40′ dry/refrigerated equipment

In addition, the CSA member carriers have announced plans to implement a peak season surcharge from Oct. 10, 2010, through Dec. 12, 2010. The CSA said its members are voluntarily implementing the surcharge to encourage customers to ship either before or after that season, which sees substantial cruise line activity in the region. The amount of the surcharge will be announced before June 1, according to the CSA.

Mitsui O.S.K. Lines, Ltd. (MOL) has announced a new service, SMX, linking Laem Chabang, Singapore, Port Kelang, and Chennai. The service will start with the call of the M/V MOL Evolution at Laem Chabang on March 23, 2010.

The port rotation of the new service is as follows: Laem Chabang - Singapore - Port Kelang - Chennai - Penang - Port Kelang (Thur, Fri) - Singapore (Sat, Sun) - Laem Chabang.

Evergreen Line is implementing a variety of rate increases effective April 1, 2010, for cargoes moving from the United States and Puerto Rico to destinations around the world. In addition to these changes, the carrier is imposing increases on cargoes from Canada to Asia, the Middle East, and Australia; the rate hikes also take effect on April 1. Over a longer horizon, Evergreen has also identified planned “rate restoration” increases for shipments from the United States and Puerto Rico to Europe that will take effect on July 1 and October 1, 2010.

The April 1 changes are as follows:

• From the United States and Puerto Rico to Asia:
  • For all dry cargoes (including exempt commodities, but excluding raw cotton):
    • US$240/20′ and all equivalent units
    • US$300/40′, 40′ high-cube, 45′ high-cube and all equivalent units
  • For all reefer cargoes:
    • From U.S. West Coast ports:
      • US$240/20′ reefer
      • US$300/40′ high-cube reefer
    • From U.S. East Coast ports, and all intermodal:
      • US$400/20′ reefer
      • US$500/40′ high-cube reefer
  • For cotton, for the port-to-port rate from both the U.S. East Coast and the U.S. West Coast:
    • US$150/40′ and 40′ high-cube
• From the United States and Puerto Rico to Australia and the Middle East:
  • For all dry cargoes (including exempt commodities, but excluding raw cotton):
    • US$240/20′ and all equivalent units
    • US$300/40′, 40′ high-cube, 45′ high-cube and all equivalent units
  • For all reefer cargoes:
    • From U.S. West Coast ports:
      • US$240/20′ reefer
      • US$300/40′ high-cube reefer
    • From U.S. East Coast ports, and all intermodal:
      • US$400/20′ reefer
      • US$500/40′ high-cube reefer
• From the United States and Puerto Rico to the Caribbean, for all commodities:
  • US$150/20′ container and 20′ equivalent unit
  • US$250/40′ and 40′ equivalent unit
  • US$250/40′ high-cube container
  • US$400/40′ high-cube reefer container
• From the United States and Puerto Rico to the West Coast of South America and the Pacific Coast of Mexico, for all commodities:
  • US$400/20′ container
  • US$500/40′ and 40′ high-cube container
  • US$500/40′ high-cube reefer container
• From Canada to Asia, the Middle East, and Australia:
  • For dry cargo:
    • From all origin points in Canada (ports and IPIs) to the Far East, the Middle East, and Australia, except India, Pakistan, Bangladesh, and Sri Lanka:
      • US$160/20′ container
      • US$200/40′, 40′ high-cube, 45′ high-cube container
    • From all origin points in Canada (ports and IPIs) to India, Pakistan, Bangladesh, and Sri Lanka:
      • US$240/20′ container
      • US$300/40′, 40′ high-cube, 45′ high-cube container
  • For reefer cargo to the Far East, the Middle East, and Australia, including the Indian Subcontinent:
    • From Toronto, Montreal, Winnipeg, and IPIs:
      • US$400/20′ reefer
      • US$500/40′ high-cube reefer
    • From the port of Vancouver:
      • US$200/20′ reefer
      • US$300/40′ high-cube reefer

Rate changes effective later in the year for cargoes from the United States and Puerto Rico to Europe are as follows:

• Effective July 1, 2010, for all commodities:
  • US$300/20′ container
  • US$400/40′, 40′ high-cube container
  • US$400/40′ high-cube reefer container
• Effective Oct. 1, 2010, for all commodities:
  • US$300/20′ container
  • US$400/40′, 40′ high-cube container
  • US$400/40′ high-cube reefer container