DAILY SHIPPING NEWS - WEDNESDAY NOVEMBER 23, 2016

Air Freight News :

Lufthansa – German Carrier cancels 876 flights due to Pilot’s strike.

Lufthansa said it was cancelling more than a third of its flights on Wednesday 23-11-2016 due to a 24 hours strike by its pilots, the latest disruption to its operations to be caused by a pay dispute. This cancellation will affect roughly 100,000 passengers.

The strike, the 14th to hit the airline in its dispute with the Vereinigung Cockpit Union, will run from midnight and affect both long haul and short haul flights departing from German airports. Already the carrier is in red and this will worsen the financial performance more.

CHEP scoops SIA Cargo deal.

·         Singapore Airlines Cargo (SIA) has awarded a five-year global maintenance and repair agreement to CHEP Aerospace Solutions for its fleet of ULDs.

The deal will see CHEP will provide maintenance and repair services in Singapore, Hong Kong, Sydney, Melbourne, Amsterdam, Frankfurt, Brussels, Los Angeles, San Francisco and Dallas, with additional stations likely to be included in the global repair network.

In addition to the core ULD maintenance and repair services, CHEP will provide storage, control, inventory reporting and delivery of pallet nets, corner ropes, straps and other consumables at some of the appointed stations. CHEP's proprietary repair management software ACTIS will provide SIA with real-time insight into all elements of the repair process. The deal comes shortly after the ULD firm announced it was being taken over by investment firm EQT infrastructure.

Swiss WorldCargo to allow shipment tracking devices.

·         Swiss WorldCargo will now allow customers to use certain tracking devices in their shipments and has added a new team to help with queries related to any deviations registered by the devices.

The cargo division of Swiss said it had decided to allow the use of tracking devices because "timely information and transparency is a key requirement in supply chain logistics, since, despite careful planning, cargo irregularities can occur, such as temperature deviation, misrouting or pilferage".

In line with the development, Swiss WorldCargo is providing a 24/7 dedicated intervention team able to react to any deviation worldwide based on ATD data.

Alain Guerin, head of product, services and technology management, said: “This service is unique to Swiss WorldCargo customers as it offers the transparency of real-time information and an intervention team which can influence transportation quality in real-time.

UPS adds Californian flights ahead of the peak season.

·         UPS will add flights out of San Bernardino International Airport (SBD) in California to cover the peak season rush in demand.  From December, the US express operator will operate four flights per week from between the airport and UPS' Louisville hub using a Boeing 757 aircraft.

President of UPS’ South California District Tom Cuce said: “This is our busiest time of year, and with the huge spike in holiday shipments, we need additional capacity to deliver for our customers. The flights from SBD will fly directly to Worldport, our main air hub in Louisville, connecting the Inland Empire to UPS’s worldwide network.”

UPS expects to deliver more than 700m packages globally between Thanksgiving and Christmas Eve, a 14% increase over 2015.  The airport boasts a new air cargo facility located adjacent to 60 acres of aircraft ramp, and access to three major interstate highways.

National lends a hand for Haiti.

·         National Airlines has been providing support for Haiti as that country rebuilds following the devastation caused by Hurricane Matthew.   The airline has transported large power generators as well as critical water purification equipment into the most difficult to reach places in Haiti.  "Nearly 1.4m people in Haiti remain in need of humanitarian assistance and 40% of those are children, according to the United Nations," said Chris Alf, National chairman and chief executive.

"We are proud to be a part of these efforts to bring much needed equipment to Haitians during a critical time."

Mark Burgess, president of National, added: "Very few privately held airlines are properly equipped to move such large quantities of heavy equipment with unusual, emergency-driven lead times.  National is uniquely positioned to facilitate such last-minute transport."

Sea Freight News :

Shapoorji Pallonji to acquire majority stake in Gopalpur port IB Times Shapoorji Pallonji Group, a diversified business conglomerate with interests in construction, real estate, textiles, engineering goods, home appliances and shipping among others, is likely to acquire majority stake in Gopalpur port in Odisha. Gopalpur port is the second private port in this eastern state after Dhamra, which is run by Adani group. In 2006, the port project was won by a consortium of Orissa Stevedores Ltd (OSL), metal trading firm Sara International. This all-weather port which is being run on a build, own, operate and transfer (BOOT) model, had earlier seen exit of Noble group in 2010. According to sources in the know of the deal said Shapoorji Pallonji Group is likely to buy majority stake from Sara International with OSL holding on to its 49 percent stake. An official of Gopalpur port told that discussions were going on for some time and the deal would take another two months to be sealed.

Reliance Ports received Rs 1,767 cr irregular I-T sops: CAG Millennium Post CAG has pulled up the Income Tax department for giving benefit of Rs 1,767 crore to the port and terminal arm of Reliance Industries by allowing deductions meant for public facilities to the company’s captive jetties. CAG said the income tax assessing officer (AO) allowed deduction of Rs 5,245.38 crore to Reliance Ports and Terminals Ltd towards construction of four captive jetties at Port Sikka in Gujarat without examining the eligibility criteria for allowance of the deduction. In a performance audit of tax holiday for development of infrastructure sector, which was tabled in Parliament today, CAG said: “The irregular allowance of deduction by the AO has resulted in under assessment of income of Rs 5,245.38 crore involving tax effect of Rs 1,766.74 crore”.

Container shipping headed right direction, but distortions in store Seatrade Maritime The glass is either half full but perhaps with a fizzy drink or half empty and leaking fast for the container shipping industry, depending on who you ask. The prognosis for recovery in the liner shipping industry fell very much along professional lines at the Asian Logistics and Maritime Conference in Hong Kong as a panel of industry practitioners debated the issue of what's on the horizon for liner shipping. For Alphaliner executive consultant Tan Hua Joo, demand growth in the developed markets of Europe and North America hold the key to recovery while in a counterpoint, McKinsey partner Steve Saxon suggested that recovery is much more likely to come from the emerging market countries with their higher proportion of consumer-oriented demand.

Mumbai Port Trust launches New York-style plan to unlock waterfront assets Business Standard Mumbai Port Trust (MbPT) has launched a slew of projects to unlock the potential of waterfront properties, along the lines of World Trade Centre properties in New York City and Singapore Marina. It aims to transform the premier port into an attractive commercial and entertainment destination, at a total investment of over Rs 1,000 crore. The master plan envisages utilisation of a part of port land for other than port and port-related activities. It seeks and to unlock the untapped commercial value of its land assets with the development of a marina, sea-front walkways, promenades, water sports, plazas, floating restaurants, public transport, entertainment hubs, heritage tourism places, convention centre and a marine museum. MbPT chairman Sanjay Bhatia told, "The entire master plan is an integrated exercise that links the waterfront facilities with the overall east coast development of Mumbai's last open lung space.

Jawaharlal Nehru Port steps up cargo process automation JOC Jawaharlal Nehru Port Trust, which loads the majority of the containerized freight passing through India’s major, or public, ports, is continuing to invest in automation to standardize cargo procedures as part of its “ease of doing business” program to shore up productivity. The top port last week issued a customer advisory calling on all cargo interests to do away with individual systems for issuing of delivery orders and instead migrate to a common electronic application, named e-DO, to facilitate trade. “In order to streamline the container delivery process, as part of the Ministry of Shipping directives, the Indian Ports Association, or IPA, was advised to develop a web-based application, so as to eliminate the manual interfaces,” JNPT said. “All customs house agents are requested to ensure that the e-DO generated by the web-based application be used for all the three terminals and common procedures be adopted for the convenience to the trade.”

Why Colachel port brings tears to fishers Times of India Even as we celebrate the World Fisheries Day, fishermen of Colachel in Tamil Nadu's Kanyakumari district live in fear of losing their livelihood once the proposed Colachel International Container Transmit Terminal takes off. With the Wedge Bank - the third largest fishing ground of the world - being situated in the west coast of Kanyakumari district, fishing remains the only source of livelihood for nearly 1 lakh fishermen in the area. It also provides jobs to more than 50,000 people in the harbour and the fish market. The fishermen of Kanyakumari district are well known for fishing in the deep sea for multiple days. They go fishing from 500 to 1000 nautical miles into the sea and stay in the deep sea from 15 to 50 days. Their catch includes varieties like shark and tuna. Although such expeditions are often risky to the lives of fishermen, the catch helps them eke out a decent livelihood.

New Mangalore stevedores oppose port proposal on multipurpose berth Business Line The Association of New Mangalore Port Stevedores has opposed the proposal of the New Mangalore Port Trust (NMPT) to hand over the multi-purpose deep-draft berth no. 8 as container terminal to a private party on PPP (public private partnership) mode. M Shekar Pujari, president of the association, told Business Line that the port has not held consultations with the stakeholders such as local stevedores and C&F (clearing and forwarding) agents on the proposal. More than 5,000 stevedores and C&F agents will be affected, if the proposal is implemented, he said. He said the proposal is misleading as it is called a container terminal, though it is nothing but taking over a multi-purpose deep-draft berth. The average growth in container cargo was around 16 per cent in the last six years.

Watch for demonetisation's effect on exports. It isn't good Money Control Things have changed fast. Indian equity markets are reeling under the effect of demonetisation and question marks swirl around its impact on the economy. Meanwhile, the Dow and S&P are within touching distance of all-time highs and the Nasdaq has hit a peak. The Baltic Freight Index, an indicator of movement of global freight rates, has hit a new 15 month high signifying a pickup in trade across the globe. In India, export-oriented industries, in particular, are battling a slowdown on account of supply disruptions thanks to demonetisation. A Reuters report says that exports of 1 million bales of cotton from India are delayed after government's move to ban high value currency notes prompted farmers, who prefer cash payments, to postpone their sales. The problem of cash arises for export-oriented units mainly on account of payment to labour, especially daily labour and temporary workers.

EEPC report calls for more trade pacts with Latin America Business Line To meet the challenges of an uncertain global market, India needs to explore more preferential trade agreements (PTA) and economic engagements with Latin American countries (LAC) which hold potential due to the big size of the market and comparatively favourable regulatory conditions, an industry report has proposed. “Trade negotiations are on the anvil by several LAC economies to promote trade with major economies and emerging markets of the world including India to reduce trade barriers and attract investment. This is an appropriate time when Indian small, medium and micro enterprises can rise up and significantly contribute towards enhancing bilateral trade with LAC,” according to a report titled ‘Doing Business in Latin America and the Caribbean’ brought out by the Engineering Exports Promotion Council.

Raw cashew exports rise even as kernel shipments dip Business Line Exports of Raw Cashew Nuts (RCN) have risen sharply in October even as cashew kernel exports for the April-October period continued to plunge. In October, 2,288 tonnes of RCN were shipped out and with this the total shipments in the period soared to 2,309 tonnes valued at ₹32.96 crore from 1,666 tonnes valued at 15.74 crore. Shipping of RCN took place when “we are one of the largest processors in the world and our dependence on imported RCN has so far been perpetual with over 50 per cent of our requirement being met by imports every year,” said Sundaram Prabha, Chairman, Cashew Export Promotion Council of India (CEPCI). Cashew exports continued to show a declining trend every month with total shipments in the April-October period dropping 24 per cent in volume and 12 per cent in value, he said.

CMA CGM settles loan to acquire NOL but posts Q3 loss of US$268m Sea News CMA CGM has posted a third-quarter loss of $268 million, reversing a profit of $51 million a year earlier due mainly to lower volume and rates, IHS Media reported. Excluding expenses related to the company's September acquisition of NOL, parent of APL, the container line's loss was $202 million, the third quarterly loss in a row. CMA CGM called the performance "unsatisfactory" but said the company was "resilient" and had managed to maintain "operating discipline" by "keeping a tight rein on costs" and being selective about the freight carried. The carrier also said it had fully repaid ahead of schedule a loan taken out to acquire NOL, with payments totaling $880 million from the proceeds of two sale and lease-back transactions involving 11 vessels that were completed on last Wednesday. The payment, along with two others made earlier, means the full loan of $1.7 billion taken out to acquire NOL has been repaid, the company said.

HMM, 2M to Look at Other Cooperation Possibilities World Maritime News After some five months of talks with South Korea’s shipping firm Hyundai Merchant Marine (HMM) on the possibility of HMM to join the world’s largest alliance 2M, the parties have now decided “to look at other cooperation possibilities.” Since July 2016, the alliance, comprising shipping giants Maersk Line and Mediterranean Shipping Company (MSC), has been in discussions with the Korean container carrier on HMM joining the 2M vessel sharing agreement (2M VSA). The parties “discussed the possibility of HMM joining 2M as an operating partner,” according to a spokesperson from Maersk Line, however, the talks have now shifted to the possibility of HMM partnering with the 2M network through a slot exchange and purchase agreement. Hyundai Merchant Marine was looking to join the 2M alliance after their membership in the G6 alliance expires in 2017.