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.
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.
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).
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.
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.
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.
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.
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.
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.
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.
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.
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.
The Port of Vancouver has joined the newly launched Getting to Zero 2030 Coalition. This coalition is an alliance of more than 70 public and private organization and calls on the shipping industry to make the transition to zero emission ships by 2030. The creation of an industry roadmap will engage stakeholders to identify technologies, investments and timelines for decarbonization of fuel and associated infrastructure.
The Government of Canada is investing $1.4 million in a project that will help the Port of Montreal reduce greenhouse gas emissions during container handling. Under the project, Termont Montreal, a LOGISTEC joint venture, will convert 57 terminal tractors into diesel-electric hybrid vehicles equipped with automatic stop-start technology. With this financial support, Termont will become the first port operator in the world to convert its entire fleet into hybrid vehicles and will help reduce greenhouse gas (GHG) emissions at the Port of Montreal. Montreal-based environmental technology company, Effenco, expects its hybrid propulsion system to improve air quality for port workers by burning 26 per cent less fuel and emitting 39 per cent less nitrogen oxide. It also reduces engine use by 46 per cent.
The Pacific Pilotage Authority has advised that the pilot launches will be undergoing major haul out maintenance services over the next six to eight weeks. Pilot transfer services at the Cape Beale pilot boarding station will not be available until the boats are back in service.
The US Department of Agriculture has confirmed that private exporters sold 464,000 tonnes of U.S. soybeans to China for shipment in the 2019/20 marketing year that began Sept. 1.This announcement was part of a flurry of activity resulting from a tariff-free quota awarded to some importers causing soybean prices to rally ahead of trade talks nexxt week. Chinese buyers purchased more than 1.5 million metric tons of U.S. soybeans last week alone, according to data from the US Agriculture Department, and have purchased at least 716,000 tons this week.
Senator Edward J. Markey, a member of the Senate Foreign Relations Committee and Senate author of the Green New Deal, has introduced the Block all New (BAN) Oil Exports Act (S. 2527) to amend the Energy Policy and Conservation Act to reinstate the four-decade ban on the export of crude oil and natural gas produced in the United States. This move follows Senator Markey’s concerns with the US dependence on foreign oil following the Saudi Oil Field Attack. The Green New Deal seeks to transition to 100 percent clean, renewable, zero-emitting energy and put an end to America’s dependence on fossil fuels that put the US economy and national security at risk.