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HK needs a centralised port authority to cope with rising competition

BIFA warns of lack of directions to deal with no-deal Brexit

Rotterdam port handles record 240m tonnes of cargo

ICL switches UK port call to Southampton, dropping Liverpool

CN posts record Q2 earnings, revenue and operating income

London September 11 conference on salvage casualty response

Asia Pacific air cargo demand drops in June with weaker exports

DHL Parcel raises charges due to higher transport and personnel costs

Kuehne+Nagel strengthens perishables network in Canada

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HK needs a centralised port authority to cope with rising competition

HONG Kong's 50-year-old Kwai Tsing Container Terminal, which has undergone successive expansions nearly every decade since it was completed in the 1970s, needs to be managed by a centralised port authority, according to experts.

The terminal, which at present can deal with 24 cargo ships berthed simultaneously, is facing rising competition from other logistics and port operators around the region.

Unlike other ports in the region, Kwai Tsing's facilities are shared among five independent operators, a system that is "quite unusual" for the region, according to Professor Collin Wong Wai-hung, a supply chain and logistics expert at Hang Seng University in Sha Tin, Hong Kong.

He pointed out that Singapore has a single operator in the form of the Port of Singapore Authority, which could help to explain its rising throughput volumes, whereas Kwai Tsing is the only port in the top five globally to lose traffic in the four years to 2018.

Roberto Giannetta, executive director of the Hong Kong Liner Shipping Association, said Hong Kong has to take aggressive action to deal with declining volumes, particularly in transshipment trade.

"Without a port authority, Hong Kong cannot compete on the same footing [as other ports]," he said.

He noted the failure of local government departments to work together on port issues, citing the six-year failed effort to relax air draft restrictions at the Tsing Ma Bridge, which limits larger ships from traversing Hong Kong waters, according to the the South China Morning Post.

Hong Kong's share of the transshipment business could face further pressure due to the trade tensions. Drewry, a UK maritime consultancy, has reduced its total container throughput growth forecast from 3.9 to 3 per cent for 2019, citing US-China trade war concerns, global instability and new emissions regulations affecting the shipping industry.

About 70 to 75 per cent of Kwai Chung's container business involved transshipments, compared to about 90 per cent in Singapore, according to Dr Wong.

Hong Kong's competition watchdog has opened an investigation into whether a new 'super alliance' between four of the five operators at the Kwai Tsing Container Terminal breaches antitrust regulations.

The Hong Kong Competition Commission has promised to investigate claims by trucking associations that the alliance will lead to a port operator cartel.

But Dr Wong defended the Seaport Alliance as a "reasonable move", saying that Hong Kong had to compete with Shenzhen on port on efficiency and cost.

Alan Lee Goldstein, a marine engineer and planner who helped design container ports for SeaLand, said Hong Kong needs a port authority similar to that of New York and London. "It needs to be somewhere between public and private [in operation], like the MTR," Mr Goldman said.

Mr Giannetta said: "If we continue to lose cargo throughput and shipping companies' regional offices, we will not be able to attract those other peripheral maritime services."

He said shipping agencies such as CMA CGM and the Japanese shipping conglomerate ONE have recently established regional headquarters in Singapore instead of Hong Kong.

"Hong Kong cannot rely on its historic presence as the No 1 container port in the world to retain its position in the future. Hong Kong is no longer a must-call port," said Mr Gianetta.

BIFA warns of lack of directions to deal with no-deal Brexit

THE British International Freight Association (BIFA) says that the Confederation of British Industry (CBI) has "hit the nail on the head with its warning that neither the UK nor the EU is ready for a no-deal Brexit on October 31".

BIFA director general Robert Keen said in a news release: "As the trade body that speaks for the sector of the economy that is responsible for managing the supply chains that underpin the UK's visible international trade, we've been vocal in our concerns that our members cannot prepare for a no-deal Brexit, given the ongoing uncertainty over many issues that affect how they conduct that trade."

Earlier in June the news that very few companies have registered for a new government online system designed to protect value added tax revenues on foreign parcels in the event of a no-deal Brexit prompted BIFA to question whether government is actually taking heed of advice from industry experts.

Mr Keen continued: "In the last few days, we have a seen a completely new government installed, which is intent on the UK leaving the EU with, or without a deal.

"With less than 100 days to the Brexit deadline, departments in that new government must urgently step up their preparations, engage with and listen to trade associations such as BIFA, immediately step up their preparations and deliver clear advice on how trade will be conducted after October 31, deal or no deal.

"Talk is all well and good; but what we now need is clear information and instructions," he added.

Rotterdam port handles record 240m tonnes of cargo

THE Port of Rotterdam handled a record 240 million tonnes of cargo in the first half of the year on the back of all-time high container volumes that rose six per cent when calculated by TEU. Total TEU rose faster than total cargo tonnage due to a large number of empties handled.

The rise in box throughput was attributed to an increase in import and transshipment volumes within the European market. Containerised cargo from Asian exporters rose, an indicator of strong consumer demand within Europe, reported The Maritime Executive, Fort Lauderdale, Florida.

The increase in total cargo volume helped push up the first-half operating result by seven per cent year on year to US$155 million.

Energy shipping was also up - especially LNG, which doubled compared to the same period last year thanks to rising exports of competitively-priced American natural gas to Europe. Crude oil imports from the US also rose markedly, due to a discount on American oil relative to Brent, the port said.

The port's ro/ro traffic has been significantly affected by Britain's Brexit preparations. In the first quarter, shippers made preparations for the expected March deadline for Brexit, leading to stockpiling and a rapid increase in ro/ro trade with UK ports. When a "hard" Brexit did not materialise as anticipated, shippers drew down their stockpiles, leading to a decline in ro/ro throughput.

"In the macroeconomic field, relations between the world's major trading blocs remain strained," CEO Allard Castelein was quoted as saying: "There is also ongoing uncertainty about the introduction of trade tariffs post-Brexit. Both developments are rendering the prospects for the further growth of world trade uncertain. Given the global uncertainties. The port of Rotterdam Authority expects a slight weakening of the growth in cargo throughput in the second half of 2019."

ICL switches UK port call to Southampton, dropping Liverpool

TRANSATLANTIC operator ICL has switched its UK port call from Liverpool to Southampton in a bid to boost year-round schedule reliability. The shipping line has called at the port of Liverpool for two decades.

The arrival of the 2,546 TEU vessel Independent Spirit signalled the implementation of the shift to Southampton.

The managing partners explained that increasingly adverse weather conditions in the North Atlantic has caused delays to its service each winter and they assured their customers that this port switch will result in better reliability for their own supply chains, reported WorldCargo News, Leatherhead, Surrey.

In a letter to customers, the shipping line's managing partners John Kirkland and Dale Ross said: "While ICL remains at the top of transatlantic reliability as per Sea-Intel data, each winter is bringing more weather challenges in the north Atlantic and keeping schedule becomes more difficult. This change will allow us to get back to 100 per cent reliability year-round.

"We have planned and coordinated various intermodal options that will allow your cargo to be picked up and delivered at the same award-winning intermodal service levels and your local ICL representative will be in touch with you to ensure a seamless transition as we change our UK port of call."

DP World head of UK Ports James Leeson said: "DP World is delighted to welcome ICL to Southampton, which is considered the highest productivity terminal in the UK. Working closely with ICL we look forward to demonstrating to its customers our trademark service for reliability, productivity and efficiency."

In the US, ICL calls at Chester, Pennsylvania, Wilmington, North Carolina, and then sails onto Southampton, UK and Antwerp, Belgium, with four ships on a 28-day rotation providing a weekly service.

CN posts record Q2 earnings, revenue and operating income

CANADIAN National Railway (CN) achieved second-quarter revenue growth of nine per cent year on year to stand at CAD3.96 billion (US$3.002 billion) due to the inclusion of newly acquired TransX Group in the intermodal commodity group, the impact of a weaker Canadian dollar, freight rate hikes and higher petroleum crude and grain volumes.

Operating income in the quarter surged by 11 per cent to CAD1.68 billion. CN posted an operating ratio of 57.5 per cent, an improvement of 0.7 points compared with Q2 2018, a company statement said.

"The CN team delivered record second-quarter results, and we remain optimistic on CN's volume prospects in the second half of the year while maintaining our vigilance on costs," said chief executive officer JJ Ruest.

"Our focus on delivering profitable growth and advanced technologies to modernise our scheduled railroading model is expected to continue driving long-term value creation for our shareholders."

RTMs, which measure the relative weight and distance of freight transported by CN, rose two per cent from the year-earlier period. Freight revenue per RTM was up eight per cent.

Operating expenses climbed eight per cent to CAD2.3 billion, primarily due to the inclusion of TransX, the negative translation impact of a weaker Canadian dollar and higher costs resulting from higher traffic volume.

London September 11 conference on salvage casualty response

THE 10th Annual Maritime Salvage & Casualty Response conference is to take place on September 11-12 London, and will be chaired by Jim Elliot, CTO, Teichman Group.

Mr Elliott currently serves as president of the American Salvage Association, a non-profit organisation dedicated to the improvement of salvage and firefighting response operations in North, Central and South America as well as the Caribbean Sea. He also serves as vice president of T&T Salvage, responsible for managing worldwide marine salvage, heavy lift, commercial diving and emergency response operations.

With three decades of leadership experience in maritime operations, he has served as a senior Coast Guard officer, incident commander, salvage master, commercial diver and a project manager on salvage operations from the Equator to the Arctic. Mr Elliott holds three master's degrees with distinction and was awarded over 70 Coast Guard medals and honours, including the agency's Inspirational Leadership Award.

A press statement from conference organiser said Mr Elliot will speak in the morning of Conference Day 1 and his presentation will focus on "Marine Firefighting: Case Studies, Lessons Learned and the US Framework", where he will provide case studies on international container ship fires, and discuss tank vessel and freight ship firefighting operations.

Other topics to be discussed at the conference include: Salvage operations at Fire, LNG fuelled vessels, offshore oil gas decommissioning, container loss and major salvage operations, casualty risk management and insurance issues, environmental hazards and limiting the damage and consolidation in salvage: less expenses and high ethics.

The organisers said those attending will include salvage companies, tug and towage companies, local authority representatives, ship owners, ship managers, P&I Clubs, maritime lawyers and consultants.

Asia Pacific air cargo demand drops in June with weaker exports

AIRLINES in Asia Pacific saw air cargo demand as measured in freight tonne kilometres (FTK) decline 7.2 per cent in June, compared to the same month a year earlier, on the back of lower export orders globally. The result marked the eighth straight month of falling volumes, according to data compiled by the Association of Asia Pacific Airlines' (AAPA).

The average international freight load factor dropped by 5.1 percentage points to 58.8 per cent in June, after accounting for a one per cent rise in offered freight capacity, a statement from AAPA said.

Commenting on the results, AAPA director general Andrew Herdman said that in the first half of year: "Asian airlines recorded a 6.2 per cent decline in air cargo demand, reflecting prevailing weakness in international trade flows across regions, as widening trade disputes and higher tariffs continued to disrupt global supply chains."

Looking to the months ahead, Mr Herdman said: "The outlook for the region's travel markets is broadly positive, with continued expansion in air passenger demand. On the other hand, with moderating global business optimism levels and the absence of significant progress in trade negotiations, air cargo demand is expected to remain weak.

"Overall, the region's airlines will closely monitor changes to operating conditions, whilst managing business operations with the aim of sustaining profitability."

In the first six months of the year the number of international passengers carried by Asian airlines grew by 4.7 per cent to a combined total of 186 million, "supported by strong leisure demand, which continued to outpace the global rate of economic expansion."

DHL Parcel raises charges due to higher transport and personnel costs

DHL Parcel will implement a toll surcharge of EUR0.10 (US$0.11) per parcel separately from the parcel price, starting from September 1. As in the previous year, the company said it will adjust the prices for customers with individually agreed conditions at a later date.

Deutsche Post DHL Group chief marketing officer Ole Nordhoff said: "To reliably process the increasing parcel volumes, we are continuously investing in the expansion and modernisation of our parcel network. In July 2019, we also transferred around 13,000 employees from subsidiaries to the company's collective agreement, thereby further improving working conditions and fair wage structures."

In March the company announced annual investments of EUR150 million for personnel, further automation and the expansion of its postal and parcel infrastructure, reported London's Air Cargo News.

It said these investments will improve quality and performance, particularly as volumes in the parcels market continue to increase. With this price hike, the company is also "responding to the generally significant increase in transport and personnel costs in order to ensure the high quality of service for its customers in the future as well."

DHL said it is also responding to the demand of many customers to disclose external influences, such as government charges on transport costs in the course of the expansion of the truck toll to all German federal roads since July 2018 and the rise in toll rates this January.

Kuehne+Nagel strengthens perishables network in Canada

SWISS global logistics giant Kuehne+Nagel (K+N) has acquired Worldwide Perishable Canada (WWP), which further expands the perishable division of the business.

Founded in 1999 and headquartered in Nova Scotia, Canada, WWP is a leading freight forwarder that is particularly involved in the exporting of tuna.

K+N already has a strong presence on the east coast of North America. Its acquisition of WWP will strengthen its perishable network in Canada, thereby allowing it to provide its customers with an extended service offering, reported London's Air Cargo News.

The combined volume of both companies' business portfolios will account for more than 17,000 tonnes air export of perishables per annum out of Canada, strengthening K+N's market leading position in North America.

Greg Martin, regional airfreight manager at K+N North America said: "Perishables logistics is one of our strongest growth drivers at K+N. Thus, we have been continuously investing in the expansion of our dedicated network: through selected acquisitions and by connecting key production countries to major markets."

Chief operating officer at WWP, Doug McRae, said: "We are looking forward to joining K+N. Combining the strengths of both companies, we will add outstanding value in the regional and international perishables business. For both, our customers and our employees this will generate growing perspectives and services."

Jamie Wood, national manager, K+N Canada, added: "Acquiring a specialised player in seafood logistics, K+N consolidates its leading position in the market. Using the network and experience of both companies, our customers can benefit from an enhanced offering and the best possible solution to their needs."

Over the past few years, K+N and rival Panalpina have expanded their perishable portfolios with acquisitions. The perishable sector is considered low margin, but it offers a regular flow of traffic, often on backhaul trades.