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Milaha launches Sri Lanka – Bangladesh feeder service

Milaha has continued to build up its service network with a new feeder route between Sri Lanka and Bangladesh.

The new service BCX will be operated by two 1,200 teu capacity vessels with Colombo – Chittagong – Colombo rotation with a five day transit time. The service will cater to the garment and general goods markets in Bangladesh.

“We have seen a great response to the direct and fast services that we launched between Qatar and some key South Asian markets earlier this year, and this has encouraged us to continue our strategic expansion into new markets. We believe the BCX service will strongly enhance connectivity to one of the fastest-growing markets in South Asia,” said Abdulrahman Essa Al-Mannai, president and ceo of Milaha.

Faced with sanctions from countries neighbouring Qatar Milaha has been rapidly building up its service network this year and Colombo and Chittagong are and the seventh and eighth new ports of call it has added this year.

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OOCL to launch third China – Pakistan service

Orient Overseas Container Line (OOCL) is continuing to boost its intra-Asia presence with a third China Pakistan Express (CPX3) service.

Just a week after announcing the CPX2 service OOCL said it was launching the CPX3 service giving it three weekly connections from Asia to Pakistan.

“The CPX3 provides additional sailing frequency from Central China to Mundra and strategically expands our service coverage in Pakistan,” OOCL said. The service will operate on a port rotation of Qingdao – Shanghai – Ningbo – Shekou – Singapore – Port Kelang – Mundra – Karachi (SAPT) – Port Qasim (QICT) – Singapore – Qingdao.

The service will be launched on 12 December from Shanghai.

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Oversupply causing fall in container shipping rates

A fall in container freight rates is being driven by oversupply of vessels rather than a drop in demand according to analyst Crucial Perspectives.

In a report issued on Monday it was noted that container freight rates had “fallen markedly” by 4% last week, and were 5% lower year-on-year as overcapacity plagued the Asia – Europe and transpacific trades.

On the demand front though headhaul volumes of the transpacific and Asia – Europe trades have grown 10% and 7% respectively year-on-year, with global container shipping demand growing by 4.9% year to date.

“The weaker freight rates are mainly driven by industry oversupply rather than a reflection of weak shipping demand. Therefore, unless global container shipping demand growth accelerates or more capacity is being taken out, the liners’ planned rate hikes in mid-November and early December may meet with limited and short-lived success,” the report said.

“This trend is likely to continue into next year.”

The percentage of containerships in the global fleet that are idle has shrunk to 1.9% from 7.9% a year earlier.

Meanwhile newbuilding capacity entering the fleet is set to outstrip demand growth in 2018.

“Based on the existing orders, newbuild vessels are expected to add 1.6m teu to the global container shipping capacity next year. We forecast the global container shipping net capacity to grow 5.9% year-on-year in 2018, well ahead of our projected demand growth of 4.7%,” Crucial Perspectives said.

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Credit Suisse targets shipping’s richest for lending via its private bank

The leap in assets at Credit Suisse’s private bank to a record high has been aided by the bank’s new strategy of lending money to the world’s ultra-wealthy. Switzerland’s second-biggest bank is trying to lure more rich customers by helping them fund their businesses and lifestyles, with shipping, aviation and real estate loans a central focus.

“From the bank’s point of view, the deposits and private wealth product is the juice; the value to the bank has to be strong enough to consider making risky loans,” said Basil Karatzas of New York-based shipping finance advisory firm Karatzas Marine Advisors.

According to Reuters, finance sources estimate Credit Suisse’s exposure in shipping alone is at least $12bn. Newsfront Greek Shipping Intelligence data shows the Greek shipping book accounts for over half of that.  Credit Suisse’s new tack of lending via its private bank has helped it make significant inroads into the Greek shipping community – among the richest in the industry – in the past year, capitalising on the exit from the industry of long-time leading lender to Greek shipping, the Royal Bank of Scotland (RBS).

Credit Suisse, replaced RBS as the biggest lender to Greek shipping two years back and the latest data from Petrofin Bank Research earlier this year put the Swiss bank’s Greek portfolio at $6.47bn, up a billion dollars on 2016 and rising.

Greece’s largest shipping group, the John Angelicoussis-led wet, dry and gas operation, comprising some 125 ships of over 25m dwt is among those Credit Suisse has helped finance, Newsfront data shows.

“Presently, Credit Suisse seems to be shedding off part of the smaller [ship] owner portfolio and those who are not top-tier names with top-tier deposits,” said Karatzas. “There is a focus away from the transactional aspect of business towards the relationship-driven business that lowers costs and risks but also builds up on the bank’s traditional core strengths.”

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Cosco Shipping Ports to lease container freight station at Khalifa Port

Cosco Shipping Ports (CSP) has signed an agreement to lease a container freight station from Abu Dhabi Ports Company, the owner and operator of ports in Abu Dhabi, the company said.

The agreement was signed on the sidelines of the groundbreaking ceremony for the CSP Abu Dhabi Terminal at Khalifa Port.

The concession agreement for this terminal was signed in September 2016, and construction and development of the terminal is expected to last approximately one and half years and it will commence operations in the first quarter of 2019.

One of CSP’s major new projects, Abu Dhabi Termial will have an annual designed capacity of about 2.5m teu and is well-placed to be a shipping hub for major international shipping companies in the Upper Gulf Region.

“CSP Abu Dhabi Terminal is the first overseas greenfield project controlled by Cosco Shipping Ports. The project encompasses our passion to build our own strategic terminal and our goal to drive the economic growth of the region. CSP is dedicated to building a highly efficient comprehensive terminal with synergies from port and shipping, a transshipment hub, and a solid services network connecting transportations in the sea, land and air,” said CSP vice-chairman and md Zhang Wei.

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Qinhuangdao Port nine-month profit spikes as economy recovers

The recovering economy also revenue rises and a huge spike in net profit for northern China commodities-focussed port group Qinhuangdao Port in the first nine moths, with profit rising more than fivefold to RMB857.3m ($129m) from RMB155.6m previously on  a 54% rise in revenue to RMB5.23bn.

The good results were  “all  mainly  due  to  the  increase  in  revenue  as  aresult  ofthe  combined  effect  of  the  stabilizing  and  recovering  macro  economy,  the  increase  intransport  volume  of  Datong-Qinhuangdao  Railway,  the  rationalized  competition  from surrounding ports and the resumed coal operating rate”, Qinhuangdao Port said in a stock market announcement.

The group typically does not disclose throughput data in its quarterly updates but forecasted a higher full-year profit for 2017.

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China’s Belt and Road Initiative not all good news for tankers

China’s Belt and Road Initiative (BRI) is not all good news for the tanker market with brokers Poten in particular highlighting a Myanmar to China pipeline.

While China’s massive BRI programme has already generated $900bn infrastructure investments it is “not necessarily” good for the tanker market Poten said its weekly report.

“The most important project that has a direct impact on the tanker industry is the Myanmar to China crude oil pipeline, which was designed as an alternative route for China to receive crude oil from the Middle East and Africa, without having to ship it through the narrow Malacca Straits into the South China Sea,” Poten said its weekly tanker opinion.

The pipeline designed to hand 400,000 barrels per day (bpd) has been ready since 2015 but only started operations in April this year. It runs from Ma Day in Myanmar to Yunnan Province in China where Petrochina has a 250,000 bpd refinery. Monthly volumes by October reached 6m barrels or about 200,000 bpd.

Poten noted a shift from suezmaxes to VLCCs serving the pipeline.

In addition to the Myanmar – China pipeline there is the long talked about Kra Canal cutting across southern Thailand. However, despite resurfacing over the last two years, this project estimated to cost $28bn, remains on hold.

“The Myanmar-China pipeline reduces tanker demand, for example, due to the reduction in ton-miles. The Kra Isthmus canal will do the same, if it ever gets built,” Poten concluded.

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DP World to expand port and logistics facilities in Dominican Republic

DP World is to build a new 400 m berth at the port of Caucedo in the Dominican Republic.

DP World ceo Sultan Ahmed Bin Sulayem met with Dominican Republic President Danilo Medina recently and discussed plans to expand the port of Caucedo and its logistics operations. Building on nearly $400m in existing investments DP World and its partners are looking to further expand operations.

“The Domincan Republic has tremendous potential as a logistics hub and we’re pleased to be working in partnership with the local government to maximise on these opportunities. Adding another berth at DP World Caucedo ensures we remain competitive and can serve the growing demand for our services in the region,” said Bin Sulayem

“We’re also working on expanding the logistics park in Caucedo to attract new businesses and creating an ideal platform for the Dominican Republic to develop into a major hub for trade globally.”

Caucedo Logistics Centre is a joint venture between DP World and Caucedo Development Corporation providing regional distribution facilities.


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South Korea’s shipbuilding and related businesses cut 35,400 workers in first half

The South Korean shipbuilding sector and related businesses have slashed workforces by about one-fifth in the first half compared to the end of last year, according to data from Korea Offshore & Shipbuilding Association cited by Yonhap.

In the January to June 2017 period, the shipbuilders and subcontracted firms let go of approximately 35,400 workers, or down by 21.3% compared to end-2016. The total number of workers stood at around 130,800 as of end-June 2017.

The protracted slump of the shipbuilding industry has led to the country’s three leading yards – Hyundai Heavy Industries (HHI), Samsung Heavy Industries (SHI), and Daewoo Shipbuilding & Marine Engineering (DSME) – implementing self-rescue plans including asset sales and workforce reductions.

In 2016 alone, around 37,000 workers or 18.3% of the total left the shipbuilding and related sectors.


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Dubai signs maritime cluster MoUs with Hamburg and Vancouver

Dubai Maritime Cluster Office (DMCO) of Dubai Maritime City Authority (DMCA) has signed Memorandums of Understandings (MoUs) with Germany’s Maritimes Cluster Norddeutschland and Canada’s Vancouver International Maritime Cluster.

The MoUs were signed on the sidelines of the Dubai Maritime Agenda 2017 and aied to support efforts of Dubai and the entire UAE to position itself as attractive destinations for regional and global shipowners, port operators and maritime investors.

“We confidently look forward to the influence of these new partnerships on the development of an integrated framework and a clear roadmap for promoting investment opportunities available in the maritime clusters of Dubai, Hamburg and Vancouver,” Sultan Ahmed Bin Sulayem, chairman of the Ports, Customs & Free Zone Corporation in Dubai and chairman of DMCA.

“It will also enable maritime industry leaders to contribute more to exploring the future of a global maritime sector empowered by innovation and technology as key pillars for developing marine clusters in line with accelerating changes in the global maritime sector.”

Amer Ali, executive director of DMCA said, “ International cooperation represents an advanced step towards attracting new investments with the potential to further increase the contributions of the maritime sector to the GDP of the Emirate of Dubai which currently stands at 7%, equivalent to AED26.9bn ($7.32bn).

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