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Milaha launches warehousing and logistics services at Port of Sohar, Oman

As sanctions against Qatar by neighbouring continue Milaha is setting up a warehousing and third party logistics operation in Oman.

The Qatar-based shipping and logistics company has set-up warehousing logistics operations in the freezone of the Port of Sohar.

Milaha has also shifted its regional transhipment operations to the Port of Sohar. Following sanctions by Saudi Arabia, the UAE, Bahrain and Egypt, Qatar’s imports and exports were no longer able to move via the UAE.

Milaha is currently calling both the ports of Sohar and Salalah in Oman. It also calls the ports of

Nhava Sheva, Mundra and Kandla in India and the company said it was “actively evaluating” the expansion of services.

“We are pleased to be setting up in Oman as we seek to strengthen our position as a leading international provider of marine transport and logistics services,” said Abdulrahman Essa Al-Mannai, president and ceo of Milaha.

We are excited about the opportunities this will bring for our partners and ourselves, especially as we add new value-add services such as distribution and LCL, among others, over the next few weeks. We will aim, as always, to provide the most cost-effective and efficient solutions to our clients.”

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New Panama Canal tolls to start on 1 October

On 8 August Panama’s Cabinet Council officially approved a proposal to modify the Panama Canal tolls structure, and the new tolls structure will enter force on 1 October 2017.

After a thorough analysis of the current utilisation and productivity of the Neopanamax locks, and after meetings with Panama Canal executives, customers and industry representatives in Europe, Asia and North America, the proposed tolls modifications were officially announced on 1 June 2017.

This was followed by a formal consultation period to ensure all interested parties could provide feedback for consideration. And on 5 July 2017, the Panama Canal held a public hearing to discuss the tolls structure modifications proposal, where the ACP received written comments from 12 representatives of associations, shipping lines and shippers—three of which presented comments in person at the hearing. All comments received were then carefully evaluated and analysed.

The approved tolls modifications are scheduled to go into effect on 1 October 2017, at the beginning of the Canal’s fiscal year 2018 (October 2017-September 2018).

For the containership segment, the approved tolls structure offers more attractive rates per loaded containers on the return voyage, applicable only to neo-panamax vessels deployed on the Canal route in the head and back haul legs, and when: (1) the utilisation rate of the northbound transit is higher or equal to 70%, and (2) the time lapse between the northbound and the southbound transit is not greater than 28 days.

In order to promote the use of the services provided within Panama’s logistics hub, any additional days that the vessel requires to perform port-related activities in the Panamanian terminals will not add to the 28-day period.

Additionally, the new structure modifies the tolls charged to LNG and LPG vessels, which will be set at the levels presented in the original tolls proposal. This decision was made after a careful analysis of the impact of the proposed increases in the supply chain and final user.

Finally, container/breakbulk vessels—formerly part of the others market segment—will be reclassified into the general cargosegment, thus resulting in more attractive tariffs for customers in this category.

The approved proposal will better facilitate the Canal’s goal of providing outstanding service and reliability to the global shipping and maritime community, while allowing the ACP to safeguard the competitiveness of the waterway.

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Abu Dhabi Ports inks $300m investment cooperation with China

UAE’s Abu Dhabi Ports (ADP) has signed a $300m investment cooperation agreement with China’s Jiangsu Province to strengthen economic ties in the free trade zone (FTZ) area in Khalifa port, as part of China’s One Belt One Road (OBOR) initiative.

The initial $300m investment plan will be from five Chinese companies based in Jiangsu Province that would create more than 1,400 jobs.

Under the terms of the agreement, China-UAE Industrial Capacity Cooperation Construction (Jiangsu) Management, a UAE company newly established by the Jiangsu Provincial Overseas Cooperation and Investment Company Limited (JOCIC), will occupy and develop approximately 23.7 million square feet of the FTZ for the Chinese companies. This represents 2.2% of the available FTZ in Khalifa Industrial Zone Abu Dhabi’s (KIZAD) newly allotted Khalifa Port Free Trade Zone (KPFTZ) area.

The five Chinese tenant companies are Hanergy Thin Film Power Group, Jiangsu Fantai Mining Development (Group) Co, Xuzhou Jianghe Wood, Jiangsu Jinzi Environmental Technology, and Guangzheng Group.

The land lease includes an option for China-UAE Industrial Capacity Cooperation (Jiangsu) Construction Management to establish and develop a further 107,639,100 square feet of free zone at KIZAD Area B to meet additional demand by Jiangsu province businesses.

Commenting on the investment agreement, H.E. Dr. Sultan Ahmed Al Jaber said: “We have worked hard to make KIZAD not only the largest free zone in the region, but also one of the most sophisticated and high-potential free zone areas in the world, particularly for the industrial and manufacturing sectors.”

The agreement also saw the establishment of a 50-year Musataha Agreement, signed by Abu Dhabi Ports with JOCIC.

“The Musataha agreement between Abu Dhabi Ports and JOCIC will attract foreign investment into Abu Dhabi – an ideal environment for investment opportunities due to the competitive advantages KPFTZ enjoys, including its strategic location, world-class infrastructure and logistics solutions. Khalifa Industrial Zone and Khalifa Port are both expected to see a surge in global investments,” added H.E. Al Jaber.

The UAE is considered a gateway to about 60% of China’s exports to regional markets at an annual volume of exchange of $70bn.

China’s H.E. Vice Governor Huang Lixin stated: “We will work together with Abu Dhabi to build the UAE-China Industrial Capacity Cooperation Demonstration Zone into a landmark program of the ‘Belt and Road’ initiative and a beacon of UAE-China exchanges and cooperation.”

Captain Mohamed Juma Al Shamisi, ceo of ADP, said “the agreement plays a pivotal role in the Abu Dhabi government’s plans to strengthen the infrastructure and transport sectors in Abu Dhabi, in line with the Abu Dhabi Economic Vision 2030.”

Al Shamisi added: “Last year, ADP signed with Cosco Shipping, the world’s largest container operator, who chose Khalifa Port as the hub for its operations in the Middle East, and is expected to raise the annual capacity to 6m teu in both its existing container terminals.”

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Newbuilds could push idle containership fleet to 1m teu by 2018: Alphaliner

Although the idle containership fleet has dropped below 500,000 teu it could pass the 1m teu level by the turn of the year as an onslaught of newbuildings hits the market analyst Alphaliner warns.

he idle containership fleet stood at 472,995 teu as of 24 July the first time it had dropped below the 500,000 teu capacity level in two years Alphaliner reported in its weekly newsletter.

The current good news was tempered though by the fact newbuilds in the 14,000 – 21,000 teu range would continue to be delivered at one a week over the summer period.

“During the first six months of this year, 26 ships of over 14,000 teu have been delivered, and a further dozen newbuildings of this size are expected to join before the annual low season begins in October,” the report said.

In total over 700,000 teu in capacity is expected to be delivered over the next five months while just 150,000 teu is likely to be headed to the breakers yard. The net result could be the idle fleet rising to over 950,000 teu by the end of the year.

“Idle ships figures, which have fallen to 472,000 teu in the past week, are expected to creep up this autumn and they could again pass the 1m teu mark around New Year,” Alphaliner warned

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Seaboard Marine launches new Miami – Latin America services

PortMiami’s largest cargo terminal and carrier, Seaboard Marine, has added a new direct service between Miami and Latin America calling Guayaquil, Ecuador, Callao, Peru and Paita, Peru.

The weekly service is scheduled to start in early August and will be supported by three dedicated vessels transiting via the Panama Canal to and from Ecuador and Peru.

“Our customers who appreciate the high level of service and convenience at PortMiami, have been requesting faster transit times to and from Ecuador and Peru,” said Edward Gonzalez, Seaboard Marine president.

“This new weekly service does exactly that by providing more rapid southbound transit to Guayaquil, Callao and Paita from Florida. Moreover, the new northbound transit times to PortMiami are unmatched by other carrier and are ideal for the transportation of both dry and refrigerated cargoes from both Peru and Ecuador,” said Gonzalez.

“PortMiami provides its customers with fast, efficient, but most importantly, reliable service critical for the delivery of time sensitive shipments,” said Juan M. Kuryla, PortMiami director and ceo.  “We proudly welcome Seaboard Marine’s new service to Miami and thank them for trusting the PortMiami team.”

The dedicated weekly vessels depart each Friday with arrival at Guayaquil every Saturday, Callao every Sunday and Paita every Wednesday. Northbound cargo to PortMiami, arriving every Thursday with same day availability, will depart from Guayaquil every Friday, Paita every Wednesday and Callao every Tuesday.

Also, effective 23 August 2017, Seaboard Marine will begin offering two weekly sailings to Costa Rica. The first sailing will offer a three-day transit to Puerto Limon departing from PortMiami every Wednesday with cargo availability Monday mornings.

 

Additionally, Seaboard Marine will continue to offer a second weekly sailing with three-day transit departing PortMiami each Friday with cargo availability on Tuesday mornings in Puerto Limon.

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Cosco Shipping Ports sees June box numbers rise 14% to 7m te

Cosco Shipping Ports (CSP) continues with its good performance with overall throughput rising 14% in June to 7.4m teu from 6.5m teu in the previous corresponding period.

Growth was driven primarily by CSP’s burgeoning overseas ports, which saw throughput rise by more than a third to 1.5m teu from 1.1m teu previously. Even previously laggard regions such as the Pearl River Delta cluster of ports saw volumes rise 13% to 2.3m teu from 2.0m teu in June 2016.

The newer ports on the Southeast and Southwest coasts also continue to ramp up nicely, with throughput growing by 15% and 30% to 454,500 teu and 113,700 teu respectively.

Meanwhile although the Yangtze River Delta region showed good growth of 7% to 1.7m teu from 1.6m teu in the previous corresponding period, the key Bohai Rim cluster seems to be slackening off with a rise in throughput of 4% to 1.4m teu.

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CMA CGM and Seatrade launching alliance

CMA CGM and reefer specialist Seatrade are launching an alliance linking the Europe, the Americas, Pacific Islands and Australasia.

The French container line and Seatrade are combining their PAD and Meridian services in a vessel sharing agreement.

The service will link Northern Europe, the East Coast of the United States, Central America, the Pacific Islands, Australia, New Zealand, Peru and the Caribbean on a weekly basis.

CMA CGM and Seatrade will both be contributing six vessels to the service with one further vessel from Marfret. The 13 vessels will have a capacity of 2,200 – 2,500 teu with a minimum of 600 reefer slots.

The service is due to launch in October this year subject to relevant regulatory approvals.

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Cosco’s 20,000-teu boxships to sail with high efficiency rudders

Cosco Shipping Lines’ largest containerships of 20,000 teu are set to sail with high efficiency rudders supplied by Dutch firm Van der Velden Marine Systems.

Netherlands-headquartered Van der Velden, part of the Damen Shipyards Group, has been contracted to supply rudders for five of the 20,000 teu mega containerships ordered by Cosco Shipping and built at Dalian Shipbuilding Industry Co (DSIC) and CSSC Shanghai Waigaoqiao Shipbuilding (SWS).

The full spade rudders being supplied are Van der Velden’s largest Atlantic rudders with ART (Asymmetric Rudder Technology) design and bulb, each having an area of approximately 100 sq m and weighing over 250 tonnes.

The rudders can be optimised for minimum cavitation at high speed, as well as ensuring course-keeping and manoeuvrability. Their water-lubricated synthetic bearings are long-lasting and require little maintenance. The rudders are designed for easy dismounting when inspections and repairs are needed, according to Van der Velden.

“We are very proud that China Cosco Shipping Corporation Limited, one of the largest container shipping lines in the world, has selected Van der Velden Marine Systems as the supplier for the rudders on their newest mega container vessels. With these contracts, we are pleased to say that we have strengthened our position in the Chinese market,” said Wim Knoester, managing director of Van der Velden.

The delivery of the rudders is scheduled to take place this year and the five vessels are expected to be launched in 2018.

State-owned Cosco Shipping ordered a total of eleven 20,000 teu containerships. Last month, the first 20,000 teu boxship, Cosco Taurus, was launched at SWS.

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Cosco-OOIL acquisition said to be sealed, announcement imminent

SPECULATION is rife that China Cosco Shipping Group has finally inked an agreement to acquire Orient Overseas (International) Ltd, with an official announcement expected by Monday.

A message, thought to have been sent by OOIL management to its staff, has been circulating on Chinese social media over the weekend. It says the company’s chief executive, Andy Tung, whose family controls 69% of Hong Kong-listed OOIL, confirmed via an internal conference call on Friday that the family had agreed to sell all its shares to Cosco Shipping.

“It will take about half year for the transaction go through government approvals, after which OOIL will remain listed in Hong Kong, ” the message said, adding that the company’s container shipping outfit, OOCL, would keep its trademark and brand.

The Hong Kong-based company would see no major changes within two years, the message continued. “More details would be revealed on Monday.”

When approached by Lloyd’s List, an OOIL executive said he was aware of the talks, but unable to confirm the authenticity of the message.

Lloyd’s List was told by separate sources that the acquisition was likely to be the entire equity of OOIL and could be worth more than $6bn.

An exchange filing from Shanghai- and Hong Kong-listed Cosco Shipping Holdings, the container shipping and port outfit of the Chinese conglomerate, could be expected to come by Monday morning.

Share trading of CSH has been halted at the Shanghai Stock Exchange since May 17, when the company made an initial disclosure that its parent was planning a major event.

The long-waited deal, if it materialises, will mark yet another major acquisition move in an industry where economies of scale appear to have become increasingly crucial for each carrier’s survival, with an escalating level of consolidation.

Maersk Line is in the process of acquiring Hamburg Süd for $4bn, following CMA CGM’s purchase of NOL last year for $2.5bn. The three Japanese shipping giants — NYK, MOL and K Line — have also just established a joint venture business to merge their container shipping and overseas port operations.

The transaction, assuming it goes through, will boost the Chinese carrier’s fleet capacity to 2.4m teu, outstripping its Ocean Alliance partner CMA CGM and becoming the world’s third-largest carrier, according to Alphaliner statistics.

With the orderbook included, the merged fleet capacity would increase to 3.1m teu, trailing just behind Mediterranean Shipping Co’s 3.3m teu.

The reorganisation in capacity will change the balance of power within the container shipping industry, with the top three carriers no longer all European. It will also shift dynamics within the Ocean Alliance, where CMA CGM is currently the largest member.

But while scale matters, Cosco Shipping will gain more than just capacity. OOCL is regarded as one of the best-run container lines in the business. While there should be fewer clashes of corporate culture than if Cosco had succeeded in its tentative bid for Hamburg Süd last year, the Chinese carrier should benefit from OOCL’s westernised business disciplines.

The Cosco group is undoubtedly on the march, buying terminal assets as well as expanding its container operations, first through the merger with China Shipping, and now the bid for OOIL. The deal will also add to Cosco’s port interests, with OOCL owning the concession for the state-of-the art Long Beach Container Terminal in southern California. That in turn will add to further pressure to consolidate terminal operations in the LA/Long Beach complex, where alliance partners Evergreen and CMA CGM each have separate facilities, as does Cosco.

More immediately, though, this takeover — assuming it goes through — will add to further concentration in the container shipping industry, which has involved just about every major carrier, with the exception of Mediterranean Shipping Co.

But none of this will make any sense unless the industry can produce decent financial returned. And yet, ironically, the line that probably achieved the best results during a difficult 2016 was MSC, which prefers to grow through ship purchases rather than corporate acquisitions, so avoiding all the pitfalls of trying to integrate another company, while picking up new business during the inevitable upheaval of the amalgamation process.

OOCL customers are used to a tip-top service. All the other carriers will be trying to woo them as Cosco and OOIL embark on what is likely to be a tricky and sensitive takeover of one of container shipping’s top names.

Speculation over the deal had been swirling around the market since late last year, despite repeated denials from the two companies.

Last month, Lloyd’s List was told by a banking source close to Cosco Shipping that the acquisition discussions were real, although pricing OOIL was a tough task for the state-owned giant. The source suggested by then that a takeover at a premium against the book value of OOIL would be difficult.

Management of OOIL later denied the takeover talks during the recent Daiwa Auto & Industrials Leaders Conference, while adding that a sale was only possible if a buyer was willing pay at a very attractive price in cash.

OOIL’s share price closed at HK$60 ($7.68) on Friday, a 78% surge from the beginning of this year.

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The Minister of Ports and Shipping has greenlit a proposal to formulate a national policy document on maritime and logistics, to be prepared in three months’ time, after which it will be presented to the Cabinet of Ministers for approval.

Sri Lanka Ports Authority (SLPA) Chairman Dr. Parakrama Dissanayake revealed this at the annual general meeting of the Sri Lanka Freight Forwarders Association (SLFFA) held in Colombo last week.

“Chairmen and ministers will come and go, but we don’t have a policy. Let’s formulate a national logistics and maritime policy. It has to be an inclusive approach where we get all stakeholders involved,” said Dr. Dissanayake, speaking at the event.

Ports and Shipping Minister Mahinda Samarasinghe has given his blessings for the endeavour, according to Dr. Dissanayake, and the policy will likely go beyond maritime and encompass all forms of transport.

“We have also embarked on a national port master plan – an inclusive approach to look at medium and long term needs of this nation,” he said.

As a small nation, Dr. Dissanayake went on to say, Sri Lanka has done exceptionally well in the field, what with the country’s ports handling nearly six million containers a year – an especially high number compared to India’s 11 million.

According to Dr. Dissanayake, the SLPA plans to modernise the Jaya Container Terminal (JCT) 4 to be able to handle two deep draft ships. The Colombo Port’s shortage in terminals able to handle deep draft ships is a huge challenge that needs to be addressed, he said.

A cargo distribution centre is also on the pipeline, to be constructed at Bloemendhal, in addition to a logistics corridor that will be established in consultation with the proposed Western Megapolis project.
We can look at working on these projects on a Public-Private Partnership (PPP),” said Dr. Dissanayake.

“The SLPA by itself does not have the expertise in 3PL, 4PL operations, though we have the land and the infrastructure in place. SLFFA can get involved. These are two landmark projects that we want to embark on without much delay,” he said.

A detailed study of a port on the north side of the Colombo Port is also being considered, according to Dr. Dissanayake, with funding from the Asian Development Bank (ADB) to carry out the study.

Expressions of interest have also been called in for a yacht marina project and ship repair and service centre in the Port of Galle.

In Trincomalee, expansion of the Ashroff jetty has been proposed to accommodate large vessels, with a rail connection to China Bay.

Up north, the quay of the Kankesanthurai (KKS) Port will be lengthened, according to Dr. Dissanayake, and plans are also underway to rehabilitate its breakwater.

“As the saying goes, if you fail to plan you’re planning to fail. That’s fine, but what we see is that you may have plans, but if you don’t execute it’s of no use. Working with the new Minister is all about action and timelines, I can assure you,” said Dr. Dissanayake, adding that SLFFA would be consulted on the formulation of the national maritime and logistics policy as well as on the national port master plan.

Outgoing SLFFA Chairperson Tania Polonnowita Wettimuny speaking at the event said that it was disheartening to note that industry-related decisions were taken by the authorities without guidance which has adversely impacted many of its members.

“Our collective vision should be to achieve the efficiency, seamless trade facilitation practices which have been adopted by major commercial hubs such as Singapore and Dubai,” she said.

Automation has been discussed and widely anticipated, said Wettimuny, but over the years little progress has been observed to simplify the process related to import and export by connecting all stakeholders to a single window concept.

The shortage of equipment, machinery and labour issues time to time has created delays, double handling, damage and loss with no compensation in LCL and multi country consolidated cargo – higher than acceptable costs to clear out these goods – have all impacted SLFFA customers’ daily operations, she added.

“It’s disappointing to note that our warehouse facilities within the port premises, while the country’s vision is to promote the hub concept, very little effort has gone into infrastructure development, relating to improvement of warehouses, CFC facilities to cater to our customers locally and globally,” said Wettimuny.

However, the outgoing chair was appreciative of the Government’s efforts to develop the Hambantota Port.

“We’re very excited to note the initiative and effort taken by the current Government to activate the port of Hambantota. At the same time involvement of the private sector related industries is a must in order to make sure what is being developed is properly marketed,” she said.

SLFFA is also closely watching the Government’s efforts to restructure SriLankan Airlines and associated activities such as ground handling, she said, adding that her association has always advocated the need for a strong, efficient national carrier with a level playing field.

Newly-appointed SLFFA Chairman Jagath Pathirana, who also spoke at the event, highlighted the challenges faced in what he called the current volatile market situation.

“We are no longer a small player in the international arena. We have the potential to be Colombo to India as much as Hong Kong to China,” he said.

Pointing out that there are some 10 trade associations operating in Sri Lanka with a membership exceeding 570 and over 13 authorities connected, Pathirana said that all these bodies were seeking solutions for individual members.

“In their attempts, they tend to brush shoulders against other stakeholders and trade bodies connected, to carve out an advantageous position for their members. In this struggle, it is my belief that we have lost our direction and purpose,” he said.

Commending the Ministry’s initiative to formulate a national policy for the sector, Pathirana proposed a mechanism to include aviation and road transportation – something SLPA Chairman Dr. Dissanayake later alluded to in his speech.

Pathirana also highlighted a list of unclear challenges that include the need for a single window for ease of doing business on a well-defined policy framework as a game changer for Sri Lanka, and a need for policy and guidelines on emerging e-commerce and online consumerism on movement of goods purchased online.

There is also a need for acceptance of digital signature and promotion of paperless trade. Recognising and establishing a dry port for all ocean freight inbound cargo is another challenge, he said.

“I have a humble appeal to all present here. Let’s rally around and work together towards a national interest to exploit Sri Lanka’s great strategic location in realising the ‘logistics hub of the region,’” he added.

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