APL Logistics Opens New Vietnam Facility

APL Logistics announced the opening of its latest consolidation center in Ho Chi Minh City, Vietnam. It is the largest single-roof container freight station (CFS) within the company’s South East Asia CFS network. The facility will add further scale to the company’s consolidation and value-added services network for customers with growing global and regional sourcing needs.

The CFS is strategically located near major sea and airports around Ho Chi Minh City. It includes over 500,000 square feet of bonded / CFS warehouse space, 80,000 square feet of secured parking space easily accommodating 200 forty-foot trucks, and 170 loading and receiving bays, translating to approximately 170 trucks at one time. Besides being scale-efficient, transport time to international sea and airports will be equal or better than existing facilities around the city. The facility is also compliant with international standards for security and safety with environmentally-friendly features.

APL Logistics Opens New Container Freight Station in Jakarta

APL Logistics announced the opening of a new container freight station (CFS) at the Tungya Collins Terminal in Cakung, North Jakarta.

The new CFS extends APL Logistics’ footprint in Indonesia where it offers export consolidation and warehousing services. It also complements APL Logistics’ existing facilities across Asia as a sourcing hub for both international and domestic distribution.

MAERSK LINE in the black after four quarterly losses

Rebounding container rates helped Maersk Line post a third quarter operating profit of $547 million compared with a loss of $255 million and made parent A P Moller-Maersk raise the group's full-year outlook.

Group chief executive Nils Smedegaard Andersen cautioned rates could reverse for Maersk Line, which returned to profit after four successive periods of losses, reported Reuters.

"I think one should be careful expecting that this is now very stable," Andersen told reporters. "It does not mean there is no chance of a relapse for prices on some routes."

The container unit, a barometer of world trade as its fleet carries more than 15 percent of all seaborne containers, has struggled with profitability due to the global economic slowdown and an oversupply of vessels. Maersk Line successfully managed to implement rate hikes in the third quarter along with rivals, but spot rates on the crucial Asia to Europe route were easing again this week, worrying some analysts.

"The profits are not sustainable for Maersk Line," said Alm Brand analyst Jesper Christensen. "I believe the unit will hold up in the fourth quarter but that rates will fall to unprofitable levels at the beginning of next year," Christensen said.

The Maersk group said it still expected a modest positive result in 2012 for Maersk Line, based on higher average rates in the second half, but downgraded growth estimates for seaborne container demand to three percent from four percent.

It did not offer outlook for next year, but raised its 2012 group net profit forecast to US$3.7 billion from "slightly above" last year's $3.4 billion result. Group net profit jumped to $933 million in the third quarter from $371 million in the same period last year, lagging an average forecast of $1.20 billion by analysts in a Reuters poll.

Maersk Oil reported a 33 percent fall in operating profit to $1.16 billion, lagging forecasts.

Shipowners are struggling with an oversupply of vessels that could intensify next year. Raising rates and cutting costs are amongst ways the companies can cushion falling volumes as trade slows worldwide.

The group said last month it would step up investment in its oil, ports and drilling businesses to cut its exposure to the volatile container shipping industry.

The shipping downturn has forced banks to pull back from shipping finance amid a four year-long downturn that is likely to extend well into 2013. Maersk could decide to increase its planned bond issue program, Smedegaard said.

"Our bond programme is still of a limited size and what will decide how large it will be is how the banks' behaviour will change in the future," he said. "If the banks view credit for large companies increasingly in terms of bonds, we will definitely increase our bond programme," Smedegaard said. The group's four core businesses are Maersk Oil, APM Terminals, Maersk Drilling and Maersk Line.

Singapore's APL to quit Westbound Transpacific Stabilisation Agreement

SINGAPORE's APL, the container shipping arm of shipping group Neptune Orient Lines (NOL), is quitting the Westbound Transpacific Stabilisation Agreement (WTSA), the discussion forum covering the westbound trade from the US to Asia, with effect from September 1.

APL is the third carrier to leave the WTSA over the past decade, following in the footsteps of MOL's departure in June 2005 and previously Maersk Line, which was known at the time as Maersk Sealand and left the group in July 2002.

This reduces WTSA members to nine shipping lines: Hapag-Lloyd, Hyundai Merchant Marine (HMM), "K" Line, NYK Line, OOCL, Cosco, Evergreen, Hanjin and Yang Ming.

According to Alphaliner estimates, the remaining WTSA carriers, as of August, control 55 per cent of the total westbound Asia-North America capacity.

It said the 15 member ocean liners of the WTSA's eastbound counterpart, the Transpacific Stabilisation Agreement (TSA), control an estimated 92 per cent of total capacity on the Asia-North America route.

TSA members include: APL, Maersk, China Shipping, CMA CGM, Mediterranean Shipping Company (MSC) and Zim.

The Westbound Transpacific Stabilisation Agreement  (WTSA) was established in 1990 to replace a more rigid rate conference system for the US-Asia market. It offers a discussion forum for its members to develop non-binding guidelines relating to freight rates, surcharges and other fees.

CSAV posts net 2011 loss of US$1.24 billion, revenue falls 1.2pc

CHILEAN shipping major CSAV, the world's 17th largest carrier, posted a loss of US$1.25 billion in 2011 down from a $182 million profit in 2010 with an operational decline of $959 million and 1.2 per cent fall in revenue to $5.15 billion.

In the fourth quarter, the carrier lost $145 million on operations, posting a $280 million loss on discontinued operations with a $205 million provision for losses to be incurred in 2012 as a result of a restructuring started last May.

CSAV has announced it intends to make its SAAM terminal, tug and logistics businesses into a separate company. Its SAAM unit's operating profit was up 15 per cent to $64 million in 2011 with a 18 per cent rise in revenue to $426 million.

Also, the company has undertaken a second shareholder stock offering which helps the carrier secure additional $1.2 billion capital.

"We are a new company today," said the carrier's general manager for shipping containers Oscar Hasbun. "Through this restructuring we are better prepared to face the scenario affecting the industry and on a better footing for benefiting when market conditions improve."

CSAV said 90 per cent of its operations are joint services, compared with 30 per cent in early 2011. It has been returning chartered ships and building its self-owned fleet to exceed 30 per cent in the second half of the year from nine per cent at the outset of 2011.

source: Shippingazette [dot] com

Container transit in Singapore continued to decrease

The volume containers which transit at the Port of Singapore continued to decrease. In 2009 as many as 60-65 percent of containers from Tanjung Priok, Jakarta has to transit in Singapore, while in 2010 only 20 percent, but now only 18 percent. In 2011, Pelindo II has discharged nearly 6 million units of 20-foot container.

"This accomplishment is due to the better performance of Tanjung Priok, Jakarta, the equipments more complete. The container to East Asia has shipped without transit in Singapore, "said Director of PT Pelindo II, RJ Lino.

Lino said in 2012 Pelindo II is also working to achieve the standard port of the world. "In the ports of the world, after (vessel) berthing, only took 15 minutes for loading and unloading. In Tanjung Priok still need 15-30 minutes, but at the other Indonesia ports it took two hours, "he said.

Lino asserted, Pelindo II will help the government accelerate work Inaport site so that standard is reached. "What also becomes the bottleneck is the desire to go up and down the quarantine on all vessels. That's a long time, "he said.

At the end of 2012, said Lino, Pelindo has finished installing vessel traffic information system (VTIS). With the device, vessel traffic can be regulated electronically, with no radio communication.

The bottom line, says Lino, all efforts aimed at revamping ports to reduce costs and optimize the logistics of port infrastructure without having to invest too big.
"In February 2012, a container vessel with a capacity of 5000 TEUs will be bert at Tanjung Priok, Jakarta. Soon, container vessel with a capacity of 6000 TEU will also come. With a large vessel, transiting in Singapore no longer needed, "said Lino.

Shipping industry observers from Sepuluh November Institute of Technology, Saut Gurning said, if the Korea, China, and Japan destination without having to transit in Singapore, logistics costs are more competitive.

"The container vessel which more likely to stop at Tanjung Priok, Jakarta is interesting from economies of scale. More efficient. However, it should be noted, not only the size of vessel that are important, but also requires the availability of routes and frequencies are competitive, "said Saut Gurning.

picture: google.com

MOL president warns of 'prolonged harsh' business environment

MOL president Koichi Muto says last March's Japanese earthquake has hit his company hard, compounding the effect of a deteriorating business environment, which coupled with a strong yen, high fuel prices and sinking rates due to oversupply, are combining to create an industry-wide downturn.

As a result, the first half of fiscal 2011 saw the biggest loss the group has ever suffered.

"The management environment surrounding MOL remains unpredictable and clouded by imminent oversupply of vessels as more new ships reach completion, and slumping business sentiment. These factors are expected to impact containership operations, especially, where conditions are extremely harsh with the impending completion of a large number of ultra large containerships, and the prolonged slump in the economies of Europe and the US," said Mr Muto.

"Large-scale completion of new vessels is expected to continue this year, so we should prepare ourselves for a prolonged harsh business environment, and approach it with due care," he warned.

"After 2013, however, the number of new vessels completed is expected to level off, providing light at the end of the tunnel. Over the medium to long term, we predict that the excessive production capacity of shipyards in China, two-thirds of which is privately operated, will be brought into balance by the market mechanism, and we expect the oversupply of ships to be relieved," said Mr Muto.

Talking about ensuring the survival of the company he identified four key areas to strengthen, namely to provide safe transportation services at a competitive price while effectively reducing the shipping impact on the environment.

The second key area is its financial performance. To strive to improve the balance sheet and cash flow in the short term through persistent efforts to trim costs and other measures. Thirdly, its performance, in terms of ensuring that cargo is delivered in perfect condition and on time. The fourth area for improvement is sales with the goal being to build stronger relationships with customers.

With regards to slow steaming, last year most MOL ships made more diligent efforts to apply slow steaming. Mr Muto said this practice not only reduces fuel consumption, but is also expected to help mitigate the impact of oversupply in vessels and help the environment.

These sentiments were echoed by in a speech from NYK president Yasumi Kudo: "Since stagnant demand in the west and oversupply of mega-ships are predicted, our ordering of new containerships should be suspended for a while, and a light-asset business model should be adopted whereby vessels and space would be leased as needed, thereby minimising downside risks and sustaining business," he said.

According to the NYK head, strong growth in emerging economies such as in Asia would be important for the carrier, in light of the difficult economic and trading conditions currently in Europe and the US.

"I am confident that we are heading in the right direction to grow further by differentiating ourselves and focusing on emerging markets such as Asia," said Mr Kudo.

"When we focus on the emerging countries we see a different outlook ... rapid economic growth in Asia and the developing countries, which account for more than half the population of the world, is the biggest opportunity, without any doubt.

"We cannot deny the risk of weaker demand in the west having a negative effect on Asia, which largely depends on exports. However, growing demand in Asia will be the key to strong growth in the region and overcoming the slump in the west.

"Now we see a major shift in the trend, Asia is no longer only an exporting region, but creating an enormous consumer market surpassing the US or Europe," he said.

picture: google.com / source: Shippingazette.com

MSC announces first batch of revamped services with CMA CGM

THE Mediterranean Shipping Co (MSC), the world's second largest carrier, has announced its first batch of revised Asia-Europe services jointly run with CMA CGM under its new partnership with the world's third largest container carrier.

MSC hopes to reduce capacity under the new arrangement. The three new joint Asia-Europe services will be launched at the outset of March next year, reported Newark's Journal of Commerce, adding that MSC will also revamp its port rotations of its current Silk and Lion services.

The first new service is the Swan string, which will be run by CMA CGM with eleven 11,400-TEU vessels. Its port rotation is Xingang, Busan, Qingdao, Shanghai, Xiamen, Singapore, Port Kelang, Tangiers, Le Havre, Hamburg, Bremerhaven, Antwerp, Zeebrugge, Beirut, Jeddah, Port Kelang, Singapore and back to Xingang.

Next is the Condor service, which will be operated by MSC with eleven 4,000-TEU ships and call at Ningbo, Shanghai, Gaungzhou-Nansha, Hong Kong, Shenzhen-Chiwan, Shenzhen-Yantian, Vung Tau, Southampton, Hamburg, Bremerhaven, Rotterdam, Zeebrugge, Le Havre, Malta, Korfakkan, Port Kelang, Singapore, Shenzhen-Yantian and back to Ningbo.

The third one is the Jade loop, which will be jointly operated by the two carriers with nine 9,500-TEU vessels. Its calls include: Shanghai, Ningbo, Hong Kong, Shenzhen-Chiwan, Shenzhen-Yantian, Singapore, Port Kelang, Gioia Tauro, Malta, Tangiers, Port Kelang, Singapore, Vung Tau and back to Shanghai.

For MSC's existing Silk and Lion services, MSC will also undergo rotation changes.

The Silk Service will be run by eleven 14,000-TEU ships with the following rotation: Dalian, Xingang, Kwang Yang, Busan, Qingdao, Ningbo, Shanghai, Singapore, Port Kelang, Felixstowe, Zeebrugge, Antwerp, Rotterdam, Southampton, Valencia, Jebel Ali, Singapore, Hong Kong and back to Dalian;

For the Lion Service, MSC will deploy eleven 14,000-TEU ships, with the following rotation: Ningbo, Shanghai, Xiamen, Shenzhen-Chiwan, Shenzhen-Yantian, Sines, Le Havre, Rotterdam, Antwerp, Felixstowe, Gioia Tauro, Singapore, Shenzhen-Chiwan, Xiamen and back to Ningbo.

picture: google.com / source: shippinggazette

NYK suffers US$150 million first half LOSS, expects losses to widen

NYK LINE, Japan's second largest container carrier, has followed MOL and "K" Line in posting half year losses - in its case, a US$150.3 million loss with an estimate of full-year decline of $225 million.

From April to September, NYK’s revenues shrank 9.8 per cent to $11.35 billion while costs rose 0.4 per cent. Operating losses totalled $120.4 million against an operating profit of $961 million in the same period last year.

The carrier's container business posted a loss of $86 million, compared with an operating profit of $213 million a year earlier. Liner revenue was down 12.1 per cent to $1.4 billion.

North American and European trades suffered from declining rates due to overcapacity, said NYK. South American trades had a good supply-demand balance in the past six months, but rates were weak.

For the full fiscal year ending March 30, 2012, NYK lowered its group-wide revenue forecast 5.5 per cent to $22.7 billion, expecting an operating loss of $131 million and a $280 million loss on recurring operations.

The world's 11th biggest carriers said running in the red was due to strong yen and weak global economy with "tepid" container volume, overcapacity and falling rates. The operating environment has been very harsh over the past six months and is expected to be difficult next year.

NYK projects the yen will stay strong against the dollar and the bunker prices will remain high. A strong yen impairs the performance of Japanese carriers because revenues are mainly in US dollars while most of their expenses are in yen.

Also, the recent flooding in Thailand will have negative impact on its car carrier volumes, said NYK, but its dry bulk section is promising, while the tanker division is suffering from a supply-demand imbalance due to the deployment of new vessels.

picture: google.com / source: shippinggazette