Friday, 11 October 2019 14:39

China to Ask US to End Sanctions on COSCO

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China plans to ask the US to lift sanctions against the Dalian units of China COSCO Shipping Corp. during trade negotiations that started earlier today in Washington. Four other Chinese entities were also sanctioned last month along with COSCO but it is unclear if the Chinese delegation plans to seek relief for those companies.


Nearly 300 oil tankers globally have been placed off limits as companies fear violating US sanctions against Iran and Venezuela, driving freight rates to new highs. Day rates for VLCC’s are rising rapidly toward the $200,000 per day threshold and some have already fixed at a much higher level. The Tankers International pool reported on Oct. 11 that the 2012-built VLCC Ingrid has just been booked at the equivalent of $301,219 per day (on the basis of 45.4 days). The percentage of the VLCC transport cost to cargo value is now quadruple what it was one year ago – but there still appears to be plenty more room for rates to run. US-listed tanker stocks are now surging upward in response.


Friday, 11 October 2019 14:37

STB seeks relief on demurrage from rail

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The US Surface Transportation Board (STB) is urging railroads to work closely with shippers to address concerns about demurrage practices shippers consider unreasonable and nothing more than revenue generators for the railroads. The federal agency issued a proposed rule on two of three petitions it considered but declined to go beyond a policy statement on the main topic of demurrage and accessorial policies. The statement, however, was clear that railroads must meet certain standards when imposing penalties. Although the decision applies only to non-containerized cargo, the general standards are relevant to the Federal Maritime Commission’s (FMC's) proposed interpretive rule on port demurrage, which remains open for comment through Oct. 31. The STB’s decision on the three petitions is open for comment through Nov. 6. The same questions are at the heart of both inquiries. What are reasonable business practices? What is the line between shippers taking too long to turn assets (containers, boxcars, gondolas, or hopper cars) and unreasonably short periods placing an undue burden on shippers?


The rail demurrage policy statement comes after two days of testimony in May when shippers argued Class I railroads will deliver large bunches of railcars while providing only 24 hours to unload the cargo before assessing penalties. Although the testimony was about commodities, precision scheduled railroading emphasizes longer train sets and can also cause bunching of containers. Class I railroads consider demurrage vital to maintaining network fluidity.


Friday, 11 October 2019 14:35

Proposal to protect Pacific Humpback Whales

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The federal government proposed a new rule today to designate 302,961 square nautical miles in the Pacific Ocean as critical habitat for three populations of endangered humpback whales. The proposal is to help protect migrating whales from ship strikes, entanglement in fishing gear, and oil spills.


The rule designates 48,459 square miles of critical habitat off the coast of California, Oregon and Washington for the humpback population that winters in Central America. The Mexico population got 175,812 square miles in the North Pacific Ocean, including Bristol Bay, Bering Sea and Gulf of Alaska — regions that also made up the 78,690 square miles listed for the Western North Pacific humpback population. Eliminating the overlap among the three populations, a total of 175,812 square miles are proposed for protection (proposed maps available here).


Friday, 11 October 2019 14:32

148kg of Cocaine seized at Port of Quebec

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The Canada Border Services Agency says it seized $7 million worth of possible cocaine at the Port of Quebec last week.  Some 148 kilograms of the substance was found, in total. The suspected cocaine was found aboard the Navios Luz, a container ship which docked at the port last week. The ship, which flies the flag of Malta, was carrying iron pellets. So far in 2018-2019, the agency said, it has seized 1,430 kilograms of cocaine and crack. 


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Shipping Corporation of India may be privatized by the government as part of a wider privatisation programme involving a number of key state assets. The government owns 63.75 per cent of the flagship carrier, which has a fleet of 64 ships, comprising 15 bulkers, 22 tankers, two containerships, four gas ships and 10 offshore support vessels (OSVs), as well as significant real estate holdings in Mumbai. The privatisation plans need approval from the central cabinet before any sales process can commence, reported Singapore's Splash 247. SCI was established 58 years ago through a merger between Eastern Shipping Corporation and Western Shipping Corporation.

Friday, 11 October 2019 14:29

Tokyo Gas rejects vessel after malfunction

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Tokyo Gas has rejected the delivery of an LNG cargo aboard the carrier Energy Atlantic, after the vessel suffered a power outage and engine malfunction shortly after entering Tokyo Bay Thursday morning. The vessel – chartered by Cheniere – regained power, but Tokyo Gas did not take delivery for safety reasons, as the carrier operator did not know the reason for the outage. The Energy Atlantic is a 157 000 m3 tanker and loaded the cargo on 3 September at the Corpus Christi LNG terminal in the US.


Friday, 11 October 2019 14:27

Panama Canal sets record in 2019

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The Panama Canal saw a 6.2 percent increase in the 2019 fiscal year (FY19) with a record tonnage of 469 million Panama Canal tons (PC/UMS), exceeding its own projections for the year. Most of the increase can be attributed to the increase in transits for the liquefied natural gas (LNG) and liquefied petroleum gas (LPG) segments that rose by 37.6 and 6.9 percent respectively, representing the largest gain across all segments. Additional segments with significant transit increases included crude product tankers with a 5.6 percent increase and vehicle carrier/RoRo with a 5.5 percent increase, compared to the previous fiscal year. In terms of tonnage, the container segment continued to dominate with 164.87 million PC/UMS tons, of which 126.2 million PC/UMS tons transited through the Neopanamax Locks.


The main routes using the Panama Canal by cargo tonnage in FY19 include between the US East Coast and Asia, followed by the US East Coast and the West Coast of South America, Europe and the West Coast of South America, the US East Coast and the West Coast of Central America, and the US intercoastal route. The main users of the waterway were the United States, China, Japan, Chile and Mexico.


Friday, 11 October 2019 14:24

TK Shuttle Tankers places green bond

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Teekay Shuttle Tankers has placed USD 125 million senior unsecured green bonds due October 2024 to be listed on the Oslo Stock Exchange. The proceeds from the bond issue will be used in accordance with Teekay Shuttle Tankers’ green bond framework to partially fund four E-Shuttle newbuilds currently under construction and with planned deliveries in 2019 and 2021.


Another TK related news item, Teekay was presented the “Shipping Company of the Year” award at the International Seafarers’ Welfare awards held during the London International Shipping week. Teekay Shipping provides free internet to all its ships and a support line for seafarers experiencing challenges in their work of personal life. The company provides modern gym equipment on board and social interaction is encouraged with onboard team competitions.

Friday, 11 October 2019 14:21

Fuel Cell Project for Shipping

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By early 2021, Carnival Corporation’s German market brand, AIDA Cruises, aims to be the world’s first cruise company to test the use of fuel cells on a large passenger ship on board its LNG fueled cruise ship AIDAnova. The fuel cell trial will be apart of the Pa-X-ell2 research project funded by the German Federal Ministry of Transport and Digital Infrastructure to develop a decentralized energy network and a hybrid energy system with a new generation of fuel cells for use in oceangoing passenger vessels.  In addition to AIDA Cruises/ Carnival Maritime GmbH, other partners include shipbuilder Meyer Werfts and fuel cell specialist Freudenberg Sealing Technologies. The objective is to find practical solutions for climate-neutral shipping.


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Cargill, Maersk Tankers and Mitsui & Co. have established a strategic collaboration to accelerate the reduction of global greenhouse gases (GHGs) within shipping.  The companies will fully exploit existing fuel-saving technologies and explore new technical solutions. These projects will involve measures to optimize vessel performance by sharing and using data from the vessel in conjunction with weather routing and other mechanisms that will improve performance. The goal is to demonstrate that there are economic benefits that can be derived from sustainable shipping solutions.

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On October 2, 2019 the British Columbia Maritime Employers Association (BCMEA) and Local 514 Ship and Dock Foremen reached a tentative agreement. The last Foremen’s agreement expired on March 31, 2019 and negotiations resumed shortly after the longshore collective agreement was ratified at the end of June. The parties have agreed that no details of the agreement will be released until the tentative agreement has been ratified by both parties.


Friday, 04 October 2019 11:34

Grain harvest behind schedule

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Slow harvest due to rain and early snowfall in Western Canada is delaying the movement of grain to prairie elevators and export terminals on the West Coast and at Thunder Bay. Some are saying the harvest is behind as much as 30 percent and CP indicated that they have shipped about 1,000 cars fewer compared to the first three weeks of last season. The size of this year’s crop is estimated at 70 million metric tonnes plus. 

Canola values remained sluggish with predicted canola production of around 19.358 million tonnes. Despite continued disinterest from China, increased demand from the European Union has provided support to values. Traders anticipate more demand from the European Union later in the year, totalling between one million and three million tonnes. If a deal with China were to come back into the mix, export sales would be considerably stronger.


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