Maritime Market Updates

Monday, 30 September 2013 00:54 -     - {{hitsCtrl.values.hits}}

Major shakeups in ports industry Thamesport in UK has become the first casualty following Hapag-Lloyd, OOCL and NYK switching their transatlantic services to Southampton and Evergreen’s recent consolidation of its’ UK cargo handling at the port of Felixstowe. The increase in ship sizes, vessels cascading, carrier alliance consolidation, combined with a major new entrant (DP World’s London Gateway terminal) has brought in unprecedented change to UK container ports. At Thamesport a well managed terminal, volumes have declined from a high of nearly 800,000 teu in 2008 to less than 300,000 teu in 2012. The port of Tilbury has also seen the announcement by South African Service Consortium (SAECS) that it will move to the new London Gateway terminal. This decision came as a surprise as SAECS operates small vessels in the range of 4,500-5,000 teu, which does not face any size restrictions at Tilbury. As reported in Drewry Maritime Research recently, events affecting Thamesport and Tilbury are just the beginning of more port call shake ups as changing market factors continue to make their mark. Surge in ship orders delay market recovery According to Alphaliner, the recent surge in orders for ultra large container vessels, risks the recovery in container liner shipping beyond 2015. Consequent to a series of orders for large vessels totalling over 600,000 teu in the 3rd quarter, container ship order book has increased to a 14 month high of 3.67 million teu or 21.5% of the existing fleet. New deliveries which will reach 1.59 million teus in 2014 and 1.42 million teus in 2015 represents a capacity growth of 7.6% and 6.5% respectively. However, ship orders to fleet ratio are still low compared to the 2000 – 2013 average of 37.7%. The latest orders were primarily driven by United Arab Shipping Company’s contract for five 18,000 teu and five 14,000 teu vessels ordered last month from South Korea’s Hyundai Heavy Industries. Mediterranean Shipping Company also booked six 18,000 teu vessels from South Korea’s Daewoo ship yard under a bareboat charter with China Bank of Communications Leasing and Minsheng Leasing. Additionally, CMA CGM turned to Chinese financiers to fund three 16,000 teu ships ordered at Chinese shipyards and Seaspan ordered 10 14,000 teu units in South Korea and China under a long-term charter of Yang Ming. “The imbalance created by the excess supply could impede the recovery in the liner sector with no sustainable recovery expected until after 2015,” Alphaliner said. Shippers reject weighing of containers The Asian and European Shippers’ Councils have requested UN maritime officials to reject the proposal of mandatory weighing and verification of maritime containers before they are loaded on board ships. The International Maritime Organisation (IMO) is considering whether there should be global mandatory rules for blanket weighing of containers. The shipper groups which represent 75% of the global container trade said the proposals aimed at improving safely on sea have been made without a proper assessment of possible implications. Shippers say that “making weight verification mandatory will add to the cost, resulting in undue delays in the supply chain without significantly decreasing the risk of occurrence of such accidents”. A one size fits all solution, being discussed by the IMO, is not only ineffective but may even be detrimental to international trade and shipping, the shippers claimed. Bollore Group to invest in Tuticorin Port As reported in Dynaliner’s weekly, African stevedore, Bollore African Logistics, part of the French Bollore Group, has purchased a 49% share in ABG Container Handling, a fully-owned subsidiary of Mumbai based ABG Ports, for US$ 7.5 million. ABG Ports is developing a new 750,000 teu container key at Tuticorin’s former general cargo berth 8, next to PSA Sical facility. China Shipping offloads stake in container terminal According to Shanghai Stock Exchange filings, China Shipping Container Line plans to sell a 55% stake in a newly-built container terminal in Lianyungang in east China’s Jiangsu Province for approximately US$ 125 million. CSCL posted Renminbi 1.26 billion first half net loss, almost on par with Renminbi 1.28 billion deficit in the same period last year. The company has also announced the disposal of two, 27-year-old, 1,000 teu feeders. Crew set fire to cargo ship A crew set fire to a cargo ship carrying 20 tons of cannabis when detected in the Mediterranean by the French Navy. The vessel Luna-S, 82-metre long registered in Tanzania, had been spotted by a French Customs aircraft in international waters. Indications are that the ship had left Morocco for Egypt or Libya and was not transporting any other cargo apart from the cannabis. The cannabis had an estimated street value between Euro 40 million to Euro 50 million. A senior French Customs official said: “To our knowledge this haul is the biggest ever seized by the French state in the Mediterranean and it’s an exceptional take.” The eight-man crew had told investigators they were of Syrian nationality. US import volumes up 5.1% The US import container volumes of retail goods are expected to grow by 5.1% in September, to just under, 1.5 million teus. From this forecast the Global Port Tracker sees the US economy on the road to sustained growth. The total volume of US retail container imports for 2013 at the top 12 gateway ports is forecast at 16.2 million teu, up 2.5% from 15.8 million teu last year. Hackett Associates founder Ben Hackett said: “The US economy is on the road to sustained growth. Second quarter GDP was well above expectations and surprised most forecasters, the unemployment picture is improving and we believe consumer confidence will translate into increased sales during the fourth quarter.” [The writer, a Maritime Economist, is a Chartered Fellow (Logistics Transport), Chartered Shipbroker (UK), Chartered Marketer (UK) and a University of Oxford Business alumnus. He is also a Fellow of NORAD/JICA and Harvard Business School (EEP).]

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