COS Weekly News - 18 June 2010

Monday, 21 June 2010 13:31

COS News – Week ending 18 June 2010

Issue No. 111

 

 

2010 MARINE AIR EMISSIONS SURVEY

The 2010 Marine Air Emissions Survey started this week and will capture all commercial cargo and cruise vessels arriving within 200nm of Canada’s coastline between June 15 and September 15, 2010.  This 2010 Survey is part of a national survey conducted by Environment Canada and designed to improve the understanding of air emissions in ports across Canada.  The results from the 2010 Survey will be used to establish a new baseline by which we can measure industry’s performance and the impact of regulatory changes and the implementation of the Emission Control Area.  For more information, email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 

PORT OF METRO VANCOUVER RELEASES ITS ANNUAL REPORT FOR FISCAL 2009

On June 15^th Port of Metro Vancouver released its annual report, which reviewed its performance over the past year and its current financial position. The report is available on the PMV’s website. 

 

CBSA E-MANIFEST NEWS

Canada Border Services Agency has released its spring newsletter with updates on the e-Manfest initiative.  Much of the focus so far has been on the highway mode and implementation of the eManifest Portal for the transmission of cargo and conveyance data.  Earlier this week COS joined a conference call to initiate the marine carriers’ dialogue on the e-Manifest plans for marine conveyance, crew and passenger data scheduled for implementation in 2011-2012.  Under e-Manifest CBSA is expecting these data elements to be transmitted at time of arrival.  Furthermore in the conference call, CBSA indicated that the application of carrier codes in the marine mode will be revisited and that CBSA recognizes the issues of responsibility and liability as they relate to the administrative monetary penalties.  CBSA has indicated that they will likely move towards a policy whereby all shipping lines will have to have their own carrier code.  While the policy sounds reasonable and will resolve the issues around the unfair escalation of penalties against an agent’s carrier code, how the unique carrier codes and the application process will work in practice requires further discussion.  In the meantime, CBSA is encouraging regular shipping lines calling Canadian ports to start applying for their own carrier code.  Information on the application process is available on CBSA’s website.

 

MISSION TO SEAFARERS – MARINE LUNCHEON 2010

July 5^th – Robert Allen of Robert Allan Ltd. will be the guest speaker at the Mission to Seafarers annual lunch held at the Terminal City Club.  The Mission to Seafarers is an Anglican mission that has been caring for seafarers from around the world since 1903 and each year up to 15,000 seafarers from more than 40 countries visit the Mission. Tickets are $55 per person (includes $25 tax receipt).  For more information call 604-253-4421. 

 

PACIFIC COAST TERMINALS CELEBRATES its 50TH ANNIVERSARY

On July 3^rd PCT will open its doors to the public and celebrate its 50 years of operations in Port Moody.  The open house will take place from 11:00 am – 4:00 pm and offer walking tours of the site and a boat tour of Burrard Inlet.   Coinciding with the anniversary is the unveiling of PCT’s new website at www.pct.ca.

 

BC FERRIES ALSO TO CELEBRATE 50 YEARS OF SERVICE

On June 15^th fifty years ago BC Ferries was established by the government of British Columbia under the visionary leadership of Premier W.A.C. Bennett. The service started with two original ships, the M.V. Tsawwassen and the M.V. Sidney, both providing service between Swartz Bay and Tsawwassen.  Over the years BC Ferries has grown to be one of the largest ferry fleets in the world with 36 vessels and 47 terminals and each year carrying over 21 million people on over 182,000 sailings.

 

CITY OF PRINCE RUPERT 100^th ANNIVERSARY

Last weekend ILWU Prince Rupert (ILWU Local 505) manufactured a very creative Parade Float that was entered into the 32nd Annual Sea Festival Parade in Prince Rupert. 2010 is also the 100^th foundation anniversary of the City of Prince Rupert.

HAIDA GWAII NAME RESTORED TO QUEEN CHARLOTTE ISLANDS

A cultural ceremony was held earlier in the week to formally return the name Queen Charlotte Islands to the Crown and restore the name Haida Gwaii which means “Island of the People.”  On June 3, 2010 the provincial government passed Bill 18, the Haida Gwaii Reconciliation Act to legally restore the name and enshrine B.C.’s commitment in the historic Kunst’aa guu – Kunst’aayah Reconciliation Protocol to engage in joint decision-making with the Haida on Haida Gwaii.   This change will be reflected on maps and official government correspondence.

 

Government News

 

WESTERN ECONOMIC AGENDA TO DRIVE CANADA’S 21ST CENTURY ECONOMY

Premiers have agreed on a comprehensive economic agenda for western Canada that will drive the national economy forward with increased investment and job opportunities. The agenda includes the following key priorities: Trade; Labour Market; and Innovation and Investment.  Noted in the press release was the Western Premiers urge for Canada to implement a one project–one assessment approach to reduce wasteful duplication and delays. 

 

GOVERNMENT OF CANADA SECURES EXTENSION FOR CANOLA EXPORTS TO CHINA

The Federal Government of Canada has secured an agreement with China that will allow canola exporters to sign contracts to export the 2010 crop. This is a significant sign of progress, as in the fall of 2009 exports of Canadian canola seed were impacted by import restrictions imposed by the Chinese government as a result of concerns over blackleg. Since the restrictions came into effect, there have been transitional measures in place for the 2009 crop, and the June 14^th agreement is an extension of that temporary import agreement for the 2010 crop. Peter Van Loan, Minister of International Trade, expressed a desire to secure long-term access to the Chinese market for the Canadian canola producers.

 

FEDERAL TRADE MINISTER IN TALKS WITH UKRAINE OVER POTENTIAL FREE TRADE AGREEMENT

The Federal Trade Minister, met with Dr. Ihor Ostash, Embassador of Ukraine to engage in free trade negotiations between Canada and Ukraine. The first round of negotiations took place in Kiev from May 17^th to 21^st, while the next round is set for the fall 2010. The Ukraine’s population is 46 million and in 2009 Real GDP (using purchasing power parity) was USD 294.3 billion, which represented at 14.1% contraction from 2008. GDP is comprised of 10.1% agriculture, 31.2% industry, and 58.8% services. A free trade agreement could boost Canadian exports ranging from agricultural products, seafood, machinery and pharmaceuticals, as well as address non-tariff barriers to trade.

 

SIGNS OF PROGRESS EMERGING IN CANADA-EUROPEAN UNION FREE TRADE AGREEMENT NEGOTIATIONS

Canada’s chief negotiator, Steve Verheul, noted that the discussions are moving along at a remarkable pace, with agreements on the removal of 90 percent of all existing tariffs as well as progress on product standards and labour mobility. The discussions have been taking place with the cooperation of Canada’s provincial governments, a factor that the EU negotiators insisted on with a view to producing a comprehensive agreement. Mr. Verheul also noted that the more difficult issues remain to be dealt. There are some predicted stumbling blocks in the small, but significant number of tariffs not agreed upon, compatible standards, rules of origin, fish and farm products as well a number of other issues.

 

Other News

PANAMA APPROVES TOLL INCREASES
Panama's Cabinet Council on Tuesday approved the Panama Canal Authority's proposed new toll structure, which will result in tolls on container ships rising nearly 14 percent when it takes effect Jan. 1, 2011.  News release.

 

MORE QUESTIONS FOR EUROPEAN EMISSIONS CONTROL AREA

The UK Chamber of Shipping has requested the International Chamber of Shipping to consider making a submission to IMO’s MEPC 61 meeting (27 Sept – 1 Oct) on a study reviewing the impact of the revised MARPOL Annex V1 regulation.  This study has been commissioned by the Belgium, Finnish, German, Netherlands, Swedish and UK Shipowners’ Associations to assess the potential impact on shipping of implementation of the 1 January 2015 0.1% sulphur limit in fuels in the North Sea and Baltic Sea Emissions Control Areas (ECA).  MARPOL Annex VI requires a reduction to the sulphur limits in fuels used in an ECA to a maximum of 0.1% from 1 January 2015.  Northern European ship owners have expressed serious concern that the implementation of this regulation may lead to far reaching negative consequences for shipping, both financially and to the environment by encouraging modal shift in the North Sea and the Baltic Sea areas. 

 

BALLAST WATER TREATMENT SYSTEMS IN DEMAND

Ballast water treatment system manufacturers claim to be in full production as owners prepare to meet the installation deadline for new buildings. Sweden’s Alfa Laval and Norwegian maker Oceansaver have both announced major orders this month and Maersk has placed an order for 14 systems to be installed on South Korean new builds for delivery in 2011/12.

The IMO Ballast Water Convention will take effect when 30 states representing 35% of the world fleet have ratified it. The figure today stands at 25 countries and 24% of the fleet, with a number of countries expressing their intent to sign this year thereby allowing the Convention to take effect in 2011. The net result is that all new builds will be required to have a ballast treatment system onboard. By 2016, or by the ship's next annual survey after that date, all other IMO compliant vessels will be required to have such an approved treatment system installed. The world fleet today stands at around 53,000 ships so there will be an inevitable acceleration towards compliance. The global market for ballast water systems is estimated to be in the order of $35bn.

 

US SENATE COMMITTEE URGES FMC TO RESOLVE SHIP DELAYS FOR AGRICULTURE EXPORTS

US Senate Agriculture, Nutrition and Forestry Committee Chairman Blanche Lincoln and Ranking Member Saxby Chambliss sent a letter to the Chairman of the Federal Maritime Commission, expressing concern with reports that US agricultural exporters are experiencing serious service issues with the foreign-flagged ocean carrier industry. The Senators noted that while the administration has outlined admirable goals to increase US exports, the chain of trade must function fairly and efficiently for American shippers to get agricultural products to key overseas markets.  U.S. exporters may be forced to wait as long as a month to secure space on an ocean carrier compared to earlier wait times of about a week.

 

JONES ACT WAIVERS TO BE FAST TRACKED IN GULF OF MEXICO

With the decision to allocate a number of North Sea shuttle tankers to the Gulf of Mexico, the U.S. Coastguard has prepared for fast tracking of Jones Act waivers as a “necessary contingency” but also probably linked to the charter of the heavy lifter transporter Mighty Servant 3.  This vessel will be used to collect solid debris saturated with oil which will then be stored in a large containment area on the vessel’s deck.                       

Earlier, an offer by a Belgian dredging company to bring an early end to the Deepwater Horizon oil spill was apparently declined because of Jones Act requirements. The owners offered directly to the White house to send their specialized fall pipe vessel the 2007 built Simon Stevin (DWT 36,000 tons) from Singapore to the Gulf of Mexico but the offer was declined on account of the Act. This unique vessel is equipped with a 2,000 m fall pipe, which in the view of the owners could have been used to suck up oil from the broken rig riser.  The pipe on Simon Stevin is considerably wider in diameter than the funnel that BP is now using which would then have facilitated collection of greater volumes of oil for transfer to the chartered in shuttle tankers. In addition, at the bottom of the fall pipe the vessel has an unmanned submarine capable of operating at great depths which in itself the company believed could have significantly expedited control of the oil leak. The ship is designed primarily to place stones on the seabed to fill trenches, cables and pipelines. Another offer to use Dutch dredgers to build sand and stone barriers to protect coastal wetland was surprisingly also turned down for similar reasons despite assurances of less cost in less time.

                                         Simon Stevin

 

 

CHINA’S CONTAINER VOLUMES DRAMATICALLY UP

Container traffic through Chinese ports hit an all time monthly high of 12.44 million TEU in May as the country’s foreign trade surged by nearly 50 percent from a year ago. The record volume was up 21.9 percent from May 2009 and 16.6 percent higher than the same month in 2008, according to Alphaliner. Six of the top 10 ports booked record volumes, led by Ningbo which reported a 52% increase to 1.23 million TEU. Shanghai, Guangzhou, Tianjin, Xiamen and Dalian also recorded all time high monthly traffic.

 

EITZEN BULK SOLD

Navieras Ultragas of Chile has purchased Camillo Eitzen’s 75% stake in Eitzen Bulk for $92.9m. This will result in an offer for the remaining shares, the majority of which are owned by the company’s management team. Eitzen Bulk went public last year following its merger with Copenhagen listed DS Orion. It generally operates a fleet of between 50 and 70 Panamax and Supramax bulkers.

 

NYPE CHARTER PARTIES RULED VALID DURING PIRACY DETENTION

The High Court in London this week ruled that vessels on standard New York Produce Exchange charter parties remain legally on hire even when held by pirates. The decision has been met with relief by loss of hire underwriters, however it is expected that charterers in all sectors are now likely to demand tighter charter party wording to avoid the same liability. The specific judgment relates to a Greek bulk carrier held by by Somali pirates since February and for which the charterers ceased daily hire payments until the vessel was released in May after payment of a ransom. In September last year, an arbitration panel held unanimously that a vessel remained on hire during piracy detention, and that decision has now been upheld. BIMCO has welcomed the London decision, at the same time pointing out that their own standard piracy clause provides for hire to be paid for the first 90 days of a piracy related detention (always assuming of course you can negotiate this into a Charter Party).

 

EUROPEAN SEA PORTS TO AGAIN DISCUSS DEREGULATION

Following two years of negotiations, European terminal operators and unions have agreed to enter a “social dialogue” on the future of the port industry. Discussions on training, safety and qualifications will break the ice before tackling the sticky issues of terminal concessions and deregulation. Two previous attempts to address deregulation led to violent protests and an embarrassing climb down by the European Parliament. One contentious issue is that of port labor pools even though many European dock workers are directly employed by terminal operators rather than being restricted to reliance on pools.

Labour models in EU ports:

 

Country	Model
Belgium	Port companies obliged by law to join employers’ associations, which have an exclusive mandate to engage the services of dock workers. Associations pay wages and other benefits, and hold responsibility for training. The current economic crisis has led to high levels of unemployment among dock workers in Antwerp: 28% during the first quarter of 2010. Idle workers are paid an allowance on top of their unemployment benefits. New collective bargaining agreement due next year.
France	New concession contracts under discussion between unions and terminal operators. Plans to transfer dock workers to stand alone companies resulted in protest strikes in 2008 and 2009. Most professional dockers and all casuals work in labour pools. Manpower surplus and shortages managed through temporary agency.
Germany (Hamburg)	Pool provides flexible workforce to companies. Pool shareholders cover all financial risks. Idle workers are paid a guaranteed wage funded by port customers, who pay a stevedoring levy.
Greece	Federations of permanent employees and dock workers sign a collective agreement with each port authority. Workers are hired for an indefinite period. No pool system; labour shortages eased via overtime. Industrial unrest followed plans for greater private sector involvement in 2006 and continues to this day.
The Netherlands	Dock labour system governed by collective bargaining agreement stipulating that employers shall only use permanent workers from the pool.
Malta	Terminals have to use labour pool for manual work such as lashing, driving and handling of conventional cargo. One common pool serves all ports and terminal operators. Workers are only paid for work carried out, meaning terminals are not burdened with extra costs associated with maintaining the pool system.
Spain	Labour pools legally constituted and owned by stevedoring companies. One pool per port.
UK	Dock Labour Scheme abolished in 1989. Stevedoring companies employ core workforce and run their own recruitment agencies to satisfy peaks in labour demand. According to a report by the Institute of Transport & Maritime Management Antwerp (ITMMA) the combination of privatization, increased capital investments and a plentiful supply of labour has contributed to the revitalization of UK ports.

 

RECORD BREAKING SAILOR

A lone sailor has just returned to shore after spending more than three years at sea without touching dry land. Mr. Reid Stowe, 58, docked in Manhattan after a 1,152 day voyage in a 70-foot two-masted sail boat. Guinness World Records is researching a claim that the trip sets a new record for the longest voyage. Quite fitting perhaps in the Year of the Seafarer – see attached “International Shipping Federation” brochure which has just been released.

 

 

Market Update

Another tumble for the Baltic Dry Index which closed down on Thursday on 2784 points compared to 3423 points last week and 3933 points the week before.

                                                 Cape Size         Panamax                      Supramax

Index                                              3317                3018                             2270
Last week                                       4446                3552                             2458
Spot time charter                       $31,700/day      $24,200/day                  $23,700/day
Last week                                 $46,700/day      $28,500/day                  $25,700/day

Capesize rates headed globally south this week and Panamax rates (particularly in the Pacific) were also fragile as the market took a breather in China.

TANKERS: Chinese terminal congestion has driven VLCC rates to over Worldscale 100 which equates to around $70,000 per day. Earnings for Middle East shipments to the US also rose to around $30,000 per day, an increase of $12,000 per day over the last week. Interestingly, around 2m tons of oil has been traded in $ per ton contracts since they were introduced about three months ago. Some 181 m tons has traded in 2010 and which traders in tanker forward freight agreements have declared a good start. Of some significance, the US is now the second-largest importer of Saudi Arabian crude. 85 VLCCs shipped 22.5m tons from January to mid-June, a figure likely to increase if the moratorium on off-shore drilling should be prolonged.

PRIMARY TANKER SIZES

Class                                      DWT

Product tanker                 10,000-  60,000
Panamax                        60,000-  80,000
Aframax                          80,000-120,000
Suezmax                       120,000-200,000
VLCC                            200,000-320,000

 

WORLDSCALE – WHAT IS IT?

Established in November 1952 by the London Tanker Brokers' Panel at the request of British Petroleum and Shell, Worldscale is defined as a unified system of establishing the cost of shipping oil from one port to another by sea. Its table of published rates covers 320,000 voyage permutations from one or more loads to one or more discharge ports. The freight for a given ship and voyage is normally expressed as a percentage of the published rate and reflects freight market demand at the time of fixing.

 

 

Upcoming Meetings and Events

 

DNV RISK MANAGEMENT & INCIDENT INVESTIGATION COURSE

June 22-23^rd - Det Norske Veritas’ Vancouver office is offering a course over two days on Risk Management & Accident Investigation / Root Cause.  Further information is available from DNV (604 689 7425) or from Stephen at COS.

PORT OF NANAIMO ANNUAL GENERAL MEETING

June 23rd - The Port of Nanaimo 2010 AGM will take place on Wednesday June 23 at 2pm in the Coast Bastion Inn located at 11 Bastion St, Nanaimo, B.C.

CANADIAN TRADE COMMISSIONER SERVICE WEBINAR FOR EXPORTERS

June 23^rd – Learn how to level the playing field against US competitors, find out which Customs compliance and documentation requirements need to be met and get solutions to logistics challenges.  Sign up by June 22^nd – participation is free.  The seminar will be held from 10:00 am – 1:00 pm on June 23^rd.

HAZMAT EXPERTS TRAINING COURSE

July 19-22^nd - Germanischer Lloyd is offering a three-day seminar specifically developed to train HazMat Experts in line with the IMO Guidelines for Preparation of Inventory of Hazardous Materials (IHM). The course outlines the rules and regulations in respect of ship recycling including requirements for shipowners and documentation of hazardous materials for allowing safe ship dismantling activities.  For more information call 1-800-590-3932.

AN EVENING AT THE MUSEUM

July 21^st – The Vancouver Maritime Museum is hosting a fundraising dinner on the opening night of the Celebration of Light.  Tickets are $160 plus HST (includes a $100 tax receipt).  To reserve your tickets, email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 

June 22             DNV Risk Management & Incident Investigation Course
June 23             Port of Nanaimo Annual General Meeting
June 23             Webinar for Exporters
June 24             COS Navigation & Pilotage Committee Meeting @ 10:30
June 24             COS Owners Committee Meeting @ 12:00
June 26             Roberts Bank / Deltaport Open House
June 28             BC Marine Air Vessel Quality Meeting @ 09:00
June 30             PACMAR & NANS Meeting @ 10:30
July 1                Canada Day – Statutory Holiday
July 3                Pacific Coast Terminals Open House
July 5                Mission to Seafarers – Marine Lunch 2010
July 6                CIABC Board Meeting @ 10:30
July 8                Business of Shipping – Enbridge Presentation
July 8                CIFFA Annual Golf Tournament
July 8                Business of Shipping – Enbridge Northern Gateway Project
July 9                IMC Annual General Meeting @ 12:00
July 13              COS Ship & Port Operations Meeting @ 12:00
July 13              ICS Annual General Meeting and Board of Directors Meeting @ 16:00
July 14              COS Liner Committee Meeting @ 10:00
July 14              COS Board of Directors Meeting @ 11:30
July 19              HAZMAT Experts Training Course
July 20              ISSC Annual General Meeting @ 12:00
July 21              An Evening at the Vancouver Maritime Museum
July 22              COS Navigation & Pilotage Committee @ 10:30
July 22              COS Owners Committee Meeting @ 12:00

 

Ship of the Week

                              M.V. KPS Dogan Bay
                             Seagoing Power Plant

LOA 171m
Beam 30m

M.V. KPS Dogan Bay, a converted bulk carrier, is equipped with an on board power plant and is one of two ships to be chartered to Iraq’s electricity ministry.  Conversion was undertaken in Turkey and the vessel sailed in april this year to the port of Umm Qasr in order to provide power to the city of Basra. The vessel now provides an output of 144 megawatts and together with the second platform, an unpowered barge, will eventually supply about 30% of Basra’s power requirements. Karadeniz Holdings of Turkey is a long term energy partner for Iraq and has also supplied the country with electricity via two land based power plants for several years

During 2007 and 2008, Karadeniz acquired a series of second hand generating sets for the floating projects from China and Dubai including, 30 Sulzer 16ZAV40S engines, 17 Wärtsilä 12V46 engines, and 6 Wärtsilä 16V46 engines. Wartsila, a leading global supplier of decentralized power plant solutions, has been awarded two operations & maintenance (O&M) contracts for the floating plants. The "Power of Friendship Project" developed and carried out by the Karadeniz Energy Group aims at meeting electricity requirement of countries with energy ships. Under the project, more than ten countries in the Middle East, North Africa and southern Asia will be provided with 2010 MW of electricity with ten different ships by the end of 2010.

                              

                     Dogan Bay profile

  

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