SOUTH China's Haikou port has started to build passenger-ro-ro terminal capable of handling other cargo, designed to enhance capacity to meet expected demand after next year, reports Xinhua.

The new terminal lies in the north of south station of the Guangdong-Hainan Oversea Railway in the Xinhai port area, the nearest place in the island province of Hainan to the mainland 12 nautical miles away.

The CNY2.4 billion (US$380 million) facility will be built in two phases. Its first phase costs CNY1.8 billion and will open in 2013. It will be equipped with 18 berths of 3,000 to 10,000-tonne capacity with an capability of handling 3.1 million cars and 20 million passengers a year.

Source Source Shipping Gazette - Daily Shipping News

GUAM is asking its representatives and those from Puerto Rico, Hawaii and Alaska to support efforts to win exemptions from the restrictive Jones Act that requires commercial vessels between these ports and the US mainland to be flagged, owned, crewed and built by Americans.

By waiving the law's provisions, barriers to providing competitive low-cost ocean freight service would be removed, said Guam Republican Senator Frank Blas in a resolution he wants Guam Democratic Congresswoman Madeline Bordallo to present to the US House of Representatives.

Guam is unable to benefit from its current exemption in lowering shipping costs "because other non-contiguous US ports that shippers would need to connect to make a shipping route sustainable are subject to all the restrictions," Mr Blas said.

The rates for shipping a container part-way across the ocean from the US west coast are rising which means the end-consumer suffers, said Mr Blas.

Proponents of the Jones Act uphold its importance for national security and job numbers but Mr Blas says it is outdated - "a vestige of the post-World War I years, when the vulnerability of US shipping to German U-boats was still in the public's mind".

Jones Act lobbyists such as the Navy League and the American Maritime Partnership (AMP) stressed the importance of the act to foster shipbuilding for the navy and the US Coast Guard.

"Shipbuilding, ship repair and ship modernisation create well-paying jobs for thousands of workers and, when added to the equipment and material supply companies, add a large number of jobs to the US work force," said an AMP statement.

Charlotte, NC-based Horizon Lines, a Jones Act carrier, discontinued its (FSX) transpacific container shipping service between the US west coast, Guam and China last autumn following the end of a long-term space charter agreement with Maersk Line on its eastbound leg from China.

The expected growth in Guam from infrastructure improvements in connection with the military redeployment from Japan's Okinawa base has been delayed by budget problems in Japan and the US, particularly in the wake of the earthquake and tsunami.

Source Source Shipping Gazette - Daily Shipping News

CHINA's largest railway companies, China Railway Group and China Railway Construction Corporation (CRCC), expect lower profits this year due to sharp decreases in railway spending and civil strife in the Arab world, reports the South China Morning Post.

National spending on new railways plunged 67.5 per cent to CNY20.8 billion (US$3.3 billion) in the first two months of 2012. SinoPac Securities cut its revenue prediction for China Railway Group this year by nine per cent, and China Railway Group's Shanghai-listed subsidiary, China Railway Erju, has predicted a 70 per cent fall in its net profit in the first quarter.

CRCC has set a revenue target of CNY430 billion this year, six per cent lower than its full-year revenue in 2011. Both companies are diversifying with China Railway planning to expand into airport construction, mining, property development and road building, while CRCC will add housing construction, mining and dredging projects to its portfolio.

"Due to the slowdown in construction of high-speed railway in China, we forecast the company's construction revenue will decrease in the first quarter, causing our profit to drop," said a China Railway Erju statement.

Said CRCC: "The continuous unrest, wars and riots in North Africa and Middle East since 2011 have affected the company's overseas operations. The weak global economic recovery, overall bleak prospect of the international economy, and growth of trade protectionism all lead to relatively high uncertainty in overseas construction operations," said CRCC.

When civil war broke out in Libya earlier last year, CRCC evacuated thousands of workers from its projects in the North African country.

The companies' reduced expectations reflect the steep drop in the mainland's spending on new railways, which plunged 67.5 per cent to CNY20.8 billion in the first two months of this year, according to the website of the Ministry of Railways.

"The domestic economy remains beset by a host of problems such as imbalanced and unsustainable development. Competition in the international market is set to intensify with growing instability and uncertainty. A market environment that is even more complex and challenging is ahead of us," said China Railway.

CRCC's revenue fell 2.72 per cent to CYN457.37 billion last year, but net profit jumped 82.6 per cent to CNY7.88 billion. Overseas revenue fell 23.5 per cent to CNY17.2 billion in the period.

Source Source Shipping Gazette - Daily Shipping News

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Margin pressure, cost increases and antitrust fine impact results

Schindellegi / CH April 16, 2012 – Despite further volume growth, cost increases, lower margins in the forwarding business and an antitrust fine of CHF 65 million imposed by the European Commission led to unsatisfactory results for the first quarter 2012. At CHF 4,834 million, turnover remained stable compared to the previous year’s period (currency adjusted: increase of 5.4 per cent). Gross profit improved by 3.0 per cent (currency adjusted by 8.1 per cent) to CHF 1,502 million. The operational result (EBITDA) declined by 12.4 per cent to CHF 218 million, including the one-off item for the antitrust fine to CHF 153 million. Net earnings decreased by 14.2 per cent to CHF 133 million, including the one-off item to CHF 68 million.

“In the first quarter of 2012 we had to cope with a number of adverse factors,” said Reinhard Lange, CEO of Kuehne + Nagel International AG. “Our investments in growth initiatives resulted in considerable cost increases. We will counteract this trend with strict cost control and measures to improve productivity. Furthermore, profit margins declined in sea and airfreight. In addition, there are one-off charges due to a high antitrust fine, which was reported on March 28, 2012. Nevertheless, we achieved growth above market average.”


In seafreight, Kuehne + Nagel increased container volume by 9 per cent while – according to first estimates – the global container market grew between 3 and 4 per cent. In line with its strategic goals, Kuehne + Nagel increased growth in the transatlantic and transpacific trades. As a result of margin pressure, influenced by significant rate increases in several trade lanes, and high investments in IT and sales, EBITDA-to-gross profit margin declined from 35.9 per cent to 30.3 per cent. The operational result decreased by 15.2 per cent compared to the previous year’s period.


The international airfreight market experienced a significant volume decline in the first three months of 2012, resulting in a contraction of 3 per cent after an encouraging volume development in the same period of 2011. Kuehne + Nagel raised tonnage by 4 per cent. Beside the ongoing positive demand in South America, the intra-Asia business developed well and volumes increased in the trades from Asia-Pacific to the Middle East, partly due to the acquisition of an Australian company specialised in Perishables Logistics. Investments in growth initiatives and IT resulted in a decline of the EBITDAto- gross profit margin from 32.3 per cent to 26.5 per cent. At CHF 54 million, EBITDA was 14.3 per cent below the previous year. Due to the inclusion of the one-off item for the antitrust fine a loss of CHF 11 million was recorded.

Road & Rail Logistics

Good progress was made in the European overland business. Freight volumes increased in the segments groupage and full and part loads despite the difficult economic situation in Southern Europe. The British RH Freight Group, member of the Kuehne + Nagel Group since 2011, considerabl  contributed to the overall improvement of net turnover by 18 per cent in local currencies. EBITDA increased by 7.7 per cent; at 1.9 per cent the EBITDA margin remained stable at the previous year’s level.

Contract Logistics

The contract logistics business saw divergent regional developments in the first quarter of 2012. Strong demand in Central Europe, Asia and South America resulted in an increase of net turnover by 6 per cent (currency adjusted). In contrast, high margin pressure and volume declines especially in France and Southern Europe led to a decrease of the business unit’s operational result by 19.5 per cent. EBITDA margin was at 3.1 per cent (previous year: 3.9 per cent). Reinhard Lange: “As a consequence of the experiences made in the first quarter of 2012, we have intensified our cost management. We are confident that the measures implemented as well as solid growth will contribute to an improvement of results in the second half of the year.”

Source Kuehne + Nagel

HONG KONG's major ground handler Hong Kong Air Cargo Terminals Limited (Hactl) posted a 2.5 per cent year-on-year first quarter decline to 633,935 tonnes with a narrowing 0.7 per cent loss in March providing the best month in 2012.

"We have progressively closed the gap which opened up during 2011, when we experienced a fall to as much as 12 per cent below the previous year's strong performance in May 2011," said Hactl executive director Lilian Chan.

March saw exports up 0.4 per cent on the previous year at 137,598 tonnes, the best performance in 16 months. Meanwhile, transhipments were up 7.7 per cent to 58,543 tonnes, also the best showing on 2012. But imports were down 10 per cent on 2011 figures to 57,630 tonnes.

For the first quarter, Europe was the top export market, absorbing 27.9 per cent of the total. And south east Asia led in import market with a total share of 40.4 per cent, which also dominated transhipment traffic with 42.5 per cent of the total.

Said Ms Chan: "The anomaly created by the different dates of the Chinese New Year in 2011 and 2012 has now worked its way through, so comparisons are more meaningful again. But what is not yet clear is whether the rest of 2012 will track the trends of 2011 again, or whether our first quarter recovery is a sign that we are now gradually returning to 2010 traffic levels, and underlying growth."

Looking ahead, she said the outlook is hopeful but cautious. "Important markets in Europe and the US are still unsettled. We continue to support our customer carriers with heavy investment and rigorous quality controls, and we hope these are factors in the improved market shares shown by some. But global trade is bigger than all of us defies accurate prediction," Ms Chan said.

Source Shipping Gazette - Daily Shipping News

GERMANY's Lufthansa Cargo's volume dropped 12.6 per cent in March year on year on a capacity decline of 7.2 per cent

The cargo drop to 160,000 tons is attributed to the night flight ban at Frankfurt airport enforced on October 3 and recently upheld by a Leipzig court.

It's traffic for the first quarter ending March dropped by 9.3 per cent compared to same period 2011 at 426,000 tonnes.

Americas tonnage was down 9.9 per cent but a lesser drop in revenue at 2.9 per cent decline. Asia Pacific routes were down 12.3 per cent and revenue by 7.7 per cent year on year. Traffic on the Middle East-Africa route dropped 13 per cent to 17,000 tons.

The airlines that make up the Lufthansa group, which includes Swiss, reported an overall cargo decline of 10.6 per cent to 183,00 tons in March. Overall year-on-year, capacity and revenue was down by 5.5 per cent, enabling the company to grow the load factor by 0.1 points to 69.7 per cent.@FAXTEXT = It has frozen investment of US$1.35 billion at the Frankfurt hub and will make a case for selected flights in its next planning application. A permanent night-flight ban will cause "severely adverse" consequences for the long-term future of the carrier.

Source Shipping Gazette - Daily Shipping News

AIR France-KLM's total air freight volumes dropped by 3.4 per cent in March 2012 year on year on a capacity decline of 0.6 per cent.

The March load factor fell by two points year on year to 69.2 per cent. Adjusted unit revenue per available ton kilometre (RATK) ex-currency remained flat compared to March 2011, the company said.

Three out of the five regions covered by the group's network saw declines in cargo volumes measured in revenue tonne-kilometres (RTK), with the America's registering the highest decrease in March traffic of 6.3 per cent on a capacity decline of 0.5 per cent, and the load factor dropped 4.3 per cent compared to the same month a year earlier.

This was followed by Europe, including France, which registered in March a 4.1 per cent drop in volumes, with the load factor down 0.7 per cent on a capacity increase of one per cent year on year.

The Asia Pacific region also registered a weaker performance in March compared to the same month a year earlier with air freight volumes down 2.8 per cent on a capacity decrease of 3.3 per cent. However, the load factor was up by 0.4 per cent.

On a brighter note, Air France-KLM Cargo's freight operations in Africa and the Middle East achieved modest year-on-year gains with air cargo activity measured in RTK up 0.4 per cent on a capacity increase of 1.3 per cent, yet the load factor fell 0.6 per cent.

The best performing region was the Caribbean/Indian Ocean, which achieved a freight tonnage increase of 4.5 per cent measured in RTK on a capacity increase of 7.3 per cent year on year. On the other hand, the load factor was down 1.2 per cent.

Air France KLM's passenger activity in March 2012 recorded a 6.8 per cent rise in total traffic on a capacity increase of 1.8 per cent year on year. The load factor improved by 3.8 points to 82.5 per cent. The number of passengers rose 6.3 per cent to 6.37 millions.

"Activity in March benefited from a favourable comparison basis due to the Japanese tsunami and the political crisis in Ivory Coast last year," it said in a statement.

Source Shipping Gazette - Daily Shipping News

THE court ruling upholding the Frankfurt airport night flight ban has been condemned by The International Air Cargo Association (TIACA), which says the decision will damage the local economy and undermine the city's reputation as the premier European air freight hub.

"We are extremely disappointed. The danger is that the decision could be repeated at other major gateways. Not only will air cargo suffer, local communities and national economies will also pay a higher price, both financially and environmentally," said TIACA industrial affair committee chairman Oliver Evans.

The industry association also said restricting freighter movements would reduce investment and lead to job losses, and impact on the environment from greater trucking operations. Consumers can also expect higher prices due to higher supply chain costs, TIACA said.

"Today, night-time cargo flights are part of a seamless supply chain that means consumers and businesses can plan their stock levels and production schedules with confidence. This is now at risk," Mr Evans said.

The decision by a judge at the Federal Administrative Court in Leipzig to uphold a night-time flight ban at Frankfurt airport "will damage the city's reputation as one of the world's premier gateways for international trade and harm the local and national economy," he said.

Despite industry protests, the court ruling means the ban on flights at Frankfurt between 2300 hrs and 0500 hrs will also reduce the number of flights one hour before and one hour after the night-time period, said TIACA.

Source Shipping Gazette - Daily Shipping News

TURKISH Airlines (THY) cargo flights will fly to Moscow's Vnukovo International Airport rather than the Sheremetyevo Airport, the company has announced.

A ceremony took place at the Vnukovo Airport to mark the first flight of a THY cargo jet with the participation of THY Russia manager Mefail Deribas, deputy director general of THY marketing and sales Department Halit Anlatan and Vnukovo cargo department manager Valeriy Sturmin.

THY passenger jets have been flying to Vnukovo Airport since March 25.

Source Shipping Gazette - Daily Shipping News

MARSEILLES based French shipping giant CMA CGM has announced US$385 per TEU "emergency rate restoration" on all cargo from Asia to north Europe, Russia, Mediterranean and Black Sea ports starting May 1.

CMA CGM rates will also rise $300 per TEU on all cargo from Far East and south east Asia to the Indian subcontinent. A few days earlier, Maersk announced it would increase its rates on cargo from Far East Asia to the US on May 1, noted London's International Freighting Weekly.

Shipments to the US west coast will increase $400 per TEU, $500 per FEU, $565 per 40-foot high-cube and $630 per 45-foot high-cube, east coast rates will rise $560 per TEU, $700 per FEU, $790 per 40-foot high-cube and $885 per 45-foot high-cube.

Europe-Asia backhaul rates will increase $160 per TEU, $200 per 40-foot high-cube and $250 per 45-foot high-cube.

Far East to Canada rates will increase $400 per TEU, $500 per FEU, $565 per 40-foot high-cube and $635 per 45-foot high-cube, and from Far East Asia (excluding Japan) to Europe, rates will rise $400 per TEU. Backhaul rates will rise $160 per TEU and $200 per 40-foot and 45-foot high-cube starting May 10.

Rates on cargo from the Middle East to the Indian subcontinent and to north Europe and the Med will increase $200 per TEU and $400 per FEU and routes from Latin America to India, they will rise $1,000 per TEU from May 5.

Source Shipping Gazette - Daily Shipping News

THE Port of Los Angeles posted an 8.27 per cent increase in March container volume to 650,452 TEU year on year and reported a 55.1 per cent increase from February, but the big leap was attributed to the late February arrival of the Chinese New Year factory shutdown in China this year, which in 2011 came in January, thus skewing 2012 comparative results.

Imports increased 9.34 per cent to 324,758 TEU while exports declined 2.43 per cent to 188,155 TEU. Empties increased 23.99 per cent to 137,538 TEU. Year to date volumes were up 3.23 per cent to 1,874,820 TEU from January to March year on year.

Exports were not expected to go up 14 per cent as they did last year, said port spokesman Philip Sanfield, but the port was "cautiously optimistic about import growth in the coming months".

Source Shipping Gazette - Daily Shipping News

DENMARK's Maersk Line is forecasting revenue losses and ongoing freight rate increases following its implementation of increases on March 1 and April 1, said company chairman Michael Pram Rasmussen.

Maersk Line's two rate increases of US$750 and $400 per TEU achieved a measure of what is needed, but higher rates will be applied to make up the difference, Mr Rasmussen told the company's annual general meeting in Copenhagen. "This is not done, there will be more," he said.

The carrier has also cut capacity on its Asia-Europe trades by nine per cent since February and will also be reducing the speed of its ships and increasing the number of port calls, reports Reuters.

Source Shipping Gazette - Daily Shipping News

WAN Hai Lines has held a naming ceremony, with company chairman Po Ting Chen in attendance, for the line's latest newbuilding, the Wan Hai 275, at the CSBC Corporation's Keelung shipyard in Taiwan.

The carrier said in a statement that it has ordered a total of 14 vessels from CSBC Corp, including four 1,800-TEU vessels, four 1,000-TEU ships and six 4,500-TEU ships that are slated for delivery over the next two years.

The Wan Hai 275 has a length of 172 metres, a draft of 9.5 metres and a cruising speed of 20 knots. The containership is also said to be equipped with the latest and most advanced naval technologies to ensure quality services.

Source Shipping Gazette - Daily Shipping News

CHINA posted a US$5.35 billion trade surplus in March, a reversal from the$41.48 billion deficit in February and almost entirely because of a sluggish 5.3 per cent growth in imports, reports the Wall Street Journal.

This was below the 9.3 per cent forecast and far below the 39.6 per cent growth in February prompting fears about a fall of in consumer demand.

China customs statistics chief Zheng Yuesheng expected a "relatively big" risk of a downward slide.

Said Credit Agricole economist Dariusz Kowalcyzk: "This suggests domestic demand is weakening and may revive hard landing concerns. It is also likely to convince policy makers to ease monetary policy to stimulate the domestic segment of the economy."

The International Monetary Fund (IMF) is considering revising downward its projection of China's long-term current account surplus to five per cent from seven per cent, a move analysts say would bolster Beijing's argument that the yuan is valued fairly.

Source Shipping Gazette - Daily Shipping News

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The magazine JŪRA has been published since 1935.
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