FEDEX Express is setting its sights on expanding in India's pharmaceuticals sector, according to Richard Smith, managing director of the company's Life Sciences and Specialty Services division.

To facilitate the company's goal of supporting India's export trade, Mr Smith says, "The government has got to make it easier to do business from a regulatory and tax standpoint."

According to Mr Smith, "India is an extremely important market for FedEx, and we believe it is the place to be in," he was quoted as saying in a report by India's Business Today.

"We are bullish on India not just as an export market but also as a consumption market. India is already a huge export market and we are hoping to see the import and intra-India business starting to grow soon. We believe that there are opportunities in several key sectors such as e-commerce, pharmaceuticals and health care as well as gems and jewellery, which we think can propel the growth of the express logistics industry in India," he said.

"Right now there is a trade imbalance with India and China. We would like our purple-tail flights to go back and forth very, very full."

He added: "We can connect manufacturing hubs, which have shifted to emerging markets like India and Eastern Europe, to any part of the world in one or two business days. This is a huge advantage for pharma because pharma is perishable, high value, and is often shipped in large quantities."

"We continue to add more points in India and around the world, especially as we take possession of our new Boeing 777s, which can fly farther, with bigger payloads. Last year, we acquired AFL, adding significant logistics and warehousing capabilities. We will gear that towards healthcare and high-tech, both high-value industries that are a good fit for express transportation. We are also offering targeted services that health care customers need. This includes prevention of theft, which is possible if we have custodial control. It also allows us to do things like protect temperature, useful in climates like India's."

Source Shipping Gazette - Daily Shipping News

At today’s meeting, the Board of Directors of Kuehne + Nagel International AG has appointed Stefan Paul as new member of the Management Board. The exact starting date will be announced in due time.

Stefan Paul (43) will be responsible for the business unit Road Logistics. He successfully worked for Kuehne + Nagel in various management positions from 1990 to 1997. Stefan Paul can draw on profound expertise and management know-how in the road logistics sector. Currently, he is responsible for a competitor’s German overland business.

Karl Gernandt, Chairman of Kuehne + Nagel International: “I am very pleased to welcome Mr. Paul back to Kuehne + Nagel as a new member of our Management Board. The overland business is of high importance for the further strategic development of our company. Mr. Paul is a very experienced and successful manager, we count on his valuable contributions.”

Until the start of Stefan Paul, CEO Reinhard Lange will head the business unit Road Logistics.


Source Kuehne + Nagel

Discussions at the 2nd IRU/EU Road Transport Conference today brought about a common approach and concrete solutions to further greening road transport. Participants also agreed that road transport can and must contribute to driving economic growth in the EU. To this end, it was agreed to set up a High Level Group to determine the appropriate actions to effectively double collective passenger transport by bus and coach.

The 2nd IRU/EU Road Transport Conference on “Efficient solutions for making road transport greener” held today in Brussels, brought together some 400 political, transport and trade leaders from all 27 EU Member States. The conference, jointly organised by the Danish Presidency of the Council of the European Union, the European Commission and the International Road Transport Union, focused on the main challenges facing the road transport industry, and in particular how to effectively reduce even further, through coordinated action at political and industry level, the environmental footprint of road transport activities, while allowing road transport to drive the EU growth agenda.

Keynote speakers included the Danish Transport Minister, Henrik Dam Kristensen, the Head of Cabinet, Henrik Hololei as representative of the Vice President of the European Commission responsible for transport, Siim Kallas, the IRU President, Janusz Lacny and DG MOVE Director General, Matthias Ruete, among others.

Conference participants agreed that cooperation will have to be strengthened in order to achieve rapid and sustainable growth in the EU, as well as ensure an even more efficient and greener road transport sector, notably through the increased use of all trade facilitation instruments, measures and technical innovations that can support the objectives outlined during the conference.  

The first steps towards achieving the EU growth agenda and further greening road transport were taken within the framework of this conference, as the conference organisers, speakers and panellists agreed to:

-       focus on amending weights and dimensions rules to allow aerodynamic and road safety improvements for vehicle and equipment, and to promote connections between modes;

-       to establish a strategic Public-Private Partnership, involving all relevant European Institutions and road passenger transport industry’s representatives, with the aim to set an action plan within the next 12 months that should lead to doubling the use of collective passenger transport by bus and coach in the next decade.

The Vice President of the European Commission Mr. Kallas highlighted: "Today's event clearly demonstrated that greening road transport and contributing to economic growth are not two incompatible objectives. Quite the contrary: during our discussions, we identified a number of options to make the sector more efficient and to support growth. These include further integration of the internal market, reducing congestion, support to innovation and provision of quality infrastructure, four fields where the Commission has been and will remain very active. The renewed emphasis on road passenger transport will also facilitate economic exchanges. Finally, this event has shown that the Commission and other policy-makers can rely on a constructive cooperation with the industry to reach these objectives, and I look forward to continuing to work closely with the IRU in the future."

Welcoming the reinforced public-private partnership between the road transport industry represented by the IRU and the European Union, both at the level of Member States and the EU institutions, IRU President, Janusz Lacny,  noted: “It should be remembered that commercial road transport is the only transport mode which provides door-to-door service and complements all other modes. I thus call upon all decision makers and relevant industries to cooperate to support the EU growth agenda by applying, without delay, all the available trade and road transport facilitation instruments in the EU, as well as implementing the decisions agreed upon during this conference. In fact, it is the IRU’s firm belief – and I am sure this is a shared belief – that any EU growth objective cannot be successful without including the facilitation of an efficient transport system, where commercial road transport today is and will remain a key driver of economic development.”

Source International Road Transport Union (IRU)

GENEVA-based Mediterranean Shipping Co (MSC), the world's second largest carrier, has announced it will increase the freight rates on the eastbound Asia Europe by US$400 per TEU with effect from April 1.

The general rate increase (GRI) will be implemented on cargo from Japan, Korea, mainland China, Hong Kong, Taiwan, Singapore, Indonesia, Thailand, Vietnam, Malaysia and Bangladesh to Northern Europe (including the UK), Scandinavia, the Baltic Sea, west Mediterranean, Adriatic, east Mediterranean, Black Sea and North Africa, according to the company statement.

Source Shipping Gazette - Daily Shipping News

OCEAN carrier rate increases will result in hard bargaining because excess capacity in the market has given shippers more options, said Maersk Line north Asia CEO Tim Smith.

Having announced Asia Europe capacity cuts of nine per cent, Maersk is now looking at other trade lanes where more capacity could be cut. "There has been no decision yet, but I suspect there will cuts as time goes on," he told a Hong Kong press conference yesterday.

Maersk Line faces a tough year ahead in its drive to restore profitability, Mr Smith said, even expressing doubts that it could be attained this year after the group suffered a US$600 million loss in 2011 - and the "worse quarter I have ever experienced".

The problem, he told journalists, was that while volumes were up 10 per cent and revenue was increased seven per cent, freight rates declined eight per cent and bunker costs rocketed up 35 per cent. "When combined, that means loss," he said.

Henriette Hallberg Thygesen, head of Damco in North Asia, told the gathering of Maersk's forwarding arm expansion into central and western China with offices opening up in several places in including major centres such as Wuhan and Chengdu.

Asked why forwarding appeared to be the only field in shipping where women played such dominant roles (Panalpina and TNT have female CEOs), Ms Hallberg Thygesen said the reason was likely because logistics is "people-intensive" and its rapid growth attracted a more diverse talent pool than usually found in more traditional sectors of shipping.

The controversial Daily Maersk service was doing well, said David Skov, recently appointed head of Maersk Line in south China. He also said the company's "conveyor belt" concept, the core of the Daily Maersk scheme, had contributed to making poor results better than they would have been, rather than to blame for the short fall as one journalist suggested.

Mr Skov also said Daily Maersk was one of the brighter spots in the company's dismal container trade. "We have had 90 per cent utilisation and 98 per cent reliability. And that's very good," Mr Skov said.

Mr Smith assured journalists that the company was not driving for greater market share despite charges to the contrary.

Rival shipping giants thought so, and combined forces, offering co-ordinated services to match the economies of scale promoted by Maersk. One such combination, the association of Marseilles' CMA CGM and Geneva's MSC, provides more tonnage than the leading carrier.

"We anticipated ways in which the market would react but there were ways in which it reacted that we did not anticipate," said Mr Skov, who recently took up his post after working 10 years as an Maersk executive in Nigeria.

Source Shipping Gazette - Daily Shipping News

THE US Port of Savannah's Garden City Terminal has accommodated its largest box ship to date, the 9,200-TEU MSC Roma after being limited to ships of 6,500 TEU capacity only a few years ago.

This development coincides with the release of the latest Global Port Tracker report by the National Retail Federation and Hackett Associates, which estimates that import volumes at all major US retail ports in January were down 3.3 per cent year on year.

However, the Port of Savannah registered a three per cent increase to 118,073 TEU in January, reports the Savannah Morning News.

Import cargo volume at the nation's major retail container ports is also forecast to fall by 6.8 per cent in February compared with the same month a year ago.

In December, the last month for which actual figures are available, US ports handled 1.17 million TEU, representing a decline of six per cent from November, but up two per cent year on year.

Total imports for 2011 amounted to at 14.8 million TEU, up 0.4 per cent compared with 2010's total volume handled.

As for Savannah it handled 1.4 million TEU of imports last year, up 2.5 per cent year on year.

On a brighter note, the report is now forecasting that for the rest of the first half of 2012, US ports ought to post increases.

"With consumer confidence building, retailers are optimistic that the economy is recovering but are continuing to be cautious with their inventory levels," said National Retail Federation vice president Jonathan Gold.

Hackett Associates founder Ben Hackett added. "The question is will wholesalers and retailers be able to manage their inventories as well as they did in 2011? Most likely, yes."

Source Shipping Gazette - Daily Shipping News

CENTRAL China's Hunan province saw common decrease in railway, waterway and air cargo traffic in January, except in road cargo, Xinhua reports.

In this month, most of the cargo train services suspended in order to give way to heavy load of passenger traffic around the Chinese New Year holiday. Railway cargo volume plunged 26.5 per cent to 8.3 million tonnes, with turnover dropping 12.3 per cent to 7.4 billion tonnes per kilometre. Passenger volume climbed 18.8 per cent to 6.3 million persons. Turnover increased 22.2 per cent to 10.7 million persons per kilometre.

As cargo transferred from railway to road, road cargo volume managed to have a rapid increase of 18.2 per cent to 109 million tonnes, taking 85.5 per cent of the province's total. Cargo turnover grew 27.4 per cent to 14.3 billion tonnes per kilometre. Road passenger volume kept a fast growth of 18.6 per cent to 157 million persons. Turnover volume climbed 22.2 per cent to 6.96 billion persons per kilometre.

Waterway cargo volume rose 2.5 per cent to 14.2 million tonnes. Passenger volume soared 60 per cent to 1.1 million people.

Air cargo volume dived 34.5 per cent to only 3,600 tonnes. Turnover fell 28.6 per cent to five million tonnes per kilometre. Air passengers grew 26.8 per cent to 533,500 people.

Source Shipping Gazette - Daily Shipping News

SINGAPORE-listed container carrier Samudera Shipping Line (SSL) has announced its 2011 full-year results, seeing a profit growth of 33.8 per cent to US$12.6 million from $9.4 million a year ago.

The carrier said in a statement that the growth was mainly contributed by successful expansion of the Indonesia domestic container business with an addition of three new vessels.

Besides, its bulk and tanker businesses also experienced an expansion in operating capacity.

CEO David Batubara said: "We foresee a number of challenges in front of us in 2012, as a result of the oversupply situation in the regional container shipping business, continued pressure on freight rates and the hike in bunker prices.

"Thankfully, 2011 saw a good performance in our Indonesia domestic container shipping business as well as our bulk and tanker segment, which helps in mitigating the lacklustre results in our regional container shipping business."

SSL said the overcapacity in key markets continue to exert pressure on freight rates. Also, it warned the ailing Eurozone and an expected slowdown in China's GDP growth could reduce the intra-Asia trade activities.

Additionally, it said charter rates for dry bulk carriers are expected to soften, "as new vessel deliveries in 2012 will likely lead to a lag in demand over vessel supply."

As a specialist carrier in Indonesia trade, it said although the demand on this trade remains "relatively healthy", worsening port congestion, increasing operating cost and newbuilding deliveries are all the negative factors for operations this year.

In response to the challenges ahead, the carrier said it "will prioritise to maximise its fleet utilisation, intensify its cost efficiency measures and exercise prudent cash management, to ensure sustainability of its operations."

Source Shipping Gazette - Daily Shipping News

BANGLADESH's exports growth by value is attributed to the steep increase in raw materials' price and exchange rate fluctuations against a slight volume increase for sea and air cargo, a 6.98 per cent increase year on year of 423,867 TEU.

The volume of total goods exported during 2011 was rather modest, according to Anwar-ul Alam Chowdhury, garment exporter and former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), reported the Dhaka Daily Star.

"We saw more than 40 per cent export growth in 2010-11 due to a hike in the prices of raw materials and exchange rates" creating a record of US$23 billion led by garment sales," said Mr Chowdhury.

Raw material prices, such as cotton, yarn and leather, increased by two to three times showing growth in terms of US dollars, said BGMEA president Shafiul Islam Mohiuddin. Prices for chemicals also increased. @FAXTEXT = Exports by air were down by 27 per cent year on year lower than 2010 tonnage of 155,221 tonnes at 113,481 tonnes due to a rise in on-time delivery, Mr Mohiuddin added.

It forecasts a growth for current financial year of 16 per cent year on year to reach $26.5 billion with its first half of fiscal 2011-12 up 14 per cent to $13.92 billion, just shy of this, according to latest figures from Export Promotion Bureau (EPB).

Source Shipping Gazette - Daily Shipping News

CARGOJET Inc has recorded a 52.2 per cent drop in its fourth quarter 2011 profits, which shrank to US$3.2 million compared to the same period a year earlier on the back of falling volumes in its overnight cargo services.

On the other hand, a report by The Canadian Press said that Q4 revenue held steady at $42.9 million.

"The industry experienced an unexpected decline in domestic volumes during the quarter and last half of the year," president and CEO Ajay Virmani was quoted as saying.

"Combined with previously granted customer pricing discounts, this resulted in a significant impact on Cargojet's yields."

According to Mr Virmani the company plans to implement cost-cutting measures and pricing changes to increase operating margins.

Source Shipping Gazette - Daily Shipping News

INDIAN Civil Aviation Minister Ajit Singh has told state-owned Air India to scrap its tender to sell six cargo freighters after finding irregularities, top sources have told the Indian Express.

The Indian flag carrier's regional subsidiary, Alliance Air, headed by Vipin Sharma, had issued a global tender in December to sell six Boeing 737-200 freighters and spares.

"The tender was against norms as it did not mention any reserve price for these aircraft," said a senior civil aviation ministry official. The matter was brought to the notice of Mr Singh, who ordered an immediate inquiry. "The minister has asked for the tender to be cancelled," said the source.

But Air India only said the bidding date had been extended until March 5. "The tender has not been scrapped," said a spokesman.

The aircraft were converted from passenger to cargo five years ago after undergoing massive engine overhauling and a total expenditure of nearly INR3 billion (US$6.1 million), said sources.

"These aircraft were hardly used for four to five months and remained grounded. The engines alone for these aircraft can fetch INR15 billion to INR20 billion each," the source said. "Absence of a reserve price makes the auction process arbitrary. The tender can be manipulated to benefit a certain party," said a ministry official.

The aircraft, which are at least 25 years old, were transferred from passenger service after the airline decided to brand Alliance Air as a cargo airline.

While four of these aircraft are stationed at Delhi, rest are at Kolkata. The spares included eight engines, aircraft seats and rotables.

Source Shipping Gazette - Daily Shipping News

TURKEY has imposed restrictions on the use of its airspace by Israeli cargo planes carrying "dangerous materials" which include flammable perfumes and batteries, reports the Israeli daily Haaretz.

Henceforth, Turkey requires 10 days notification about such flights to review whether approval will be granted. This is expected to cause substantial financial damage, as most Israeli flights, and to the Far East that use Turkish airspace, are now being forced to use longer routes.

El Al and CAL Cargo Air Lines flights will be affected and most cargo flights in and out of Israel will be subject to new restrictions as any flight carrying such cargo, require special storage, are classed as "dangerous".

El Al and CAL have already contacted the Israeli Civil Aviation Administration, and have asked authorities to respond to the Turkish move with reciprocal measures on Turkish flights.

Turkey has downgraded its diplomatic relations and suspended military ties with Israel after the killing of eight Turks and a Turkish-American on an ship trying to breach the Israeli blockade of Gaza in May 2010.

Ankara says ties will not return to normal unless Israel formally apologises for the killings, compensates the families and lifts the blockade on Gaza.

Source Shipping Gazette - Daily Shipping News

AS China explores widening business opportunities in Africa, Johannesburg-based Barloworld Logistics sees itself as in the best position to provide China shippers the ways and means of achieving their goals on the rapidly developing continent.

"We see Africa as a growth point. One of the few growth points in the world apart from China, of course. So the trade between China and Africa has huge potential," said Barloworld Logistics managing director Deon Heyns, who is based in Hong Kong.

Barloworld Logistics, the exclusive handling agent for this year's Hong Kong VINEXPO, today stresses its focus of developing trade between its offices in Hong Kong, Guangzhou and Shanghai and its other big offices in South Africa and the Middle East as well as Spain.

"Our immediate focus is to develop trade routes between our own offices - strongly to Africa and South Africa and strongly to the Middle East. Spain will follow, and of course, this is supported by a whole range of agents that we have around the world with whom we work - in all the major centres of the world. We also are focused on intra-Asia trade" he said.

As a division of the 20,000-employee Barloworld corporate giant with an annual turnover of US$6.5 billion, the South African company came to Hong Kong in 2008 when it acquired Flynt International Forwarders and its subsidiaries, Flynt Shipping, COOP Freight and FETA Freight Systems.

"There were four companies that we collapsed into one," said Mr Heyns. "And as part of another acquisition in the Middle East, there were branches in China that were involved in business which did not support our long-term strategy, so we exited those."

Barloworld is in an odd position, both being a smaller player in the China logistics market while at the same time being part of a major transnational corporation with automotive businesses in Southern Africa and Australia, handling businesses in the UK, Europe, US, and Southern Africa and handles Caterpillar Equipment sales in Southern Africa, Iberia and Siberia and has had a relationship with Caterpillar and Hyster for more than 80 years.

Because of this, this Hong Kong-Shanghai forwarder is small enough to enjoy personal relationships with a shippers while possessing global resources denied to smaller players.

For the most part, Barloworld handles sea freight to southern Africa and mostly air freight to east, and increasingly to West Africa where oil production and prices are spurring economic growth. It moves everything from electronic fashion products - iPhones and the like - to furniture.

"We do air freight; we do sea freight. On sea freight we do full containers, reefers and we do LCL cargo - both import and export. And we have contracts with major airlines, so we are a master loader on the air freight side. We see Africa as a growth point. One of the few growth points in the world apart from China. So the trade between China and Africa has huge potential," he said.

As to the immediate future, Mr Heyns said: "Our strategic intent is not to become the largest freight forwarder in the world. We want to create long-term partnerships with corporate customers where we can develop specific solutions for their supply chains."

That goal, Mr Heyns said, will be achieved incrementally. To this end, Barloworld has started looking at 3PL in terms of warehousing services in Shanghai and Qingdao, as well as exploiting China's fast developing rail links to the northern parts of the country as coastal industry migrates in search of lower costs.

"Regionally we will be focusing on freight forwarding, then warehousing and distribution services, and once we have built substantial volumes and have started to identify corporate customers, we will to go to these customers and offer our capabilities in supply chain solutions 'As part of our capabilities at Barloworld Logistics, we can do much more than just 3PL services.'

"Once you tie-up with corporate clients, it is a matter of listening to their needs and aligning their supply chain to their ultimate strategy by doing things smart - not necessarily negotiating better rates and prices, but planning better and doing the whole supply chain smarter," Mr Heyns said, adding that Barloworld has the proprietary software products that will help achieve this.

Source Shipping Gazette - Daily Shipping News

TIANJIN Airlines launched a new flight service connecting northern China city Baotou in Inner Mongolia to northeastern city Xi'an and southern city Haikou on March 1.

The service uses E190 passenger aircrafts, offering four flights per week on Monday, Tuesday, Thursday and Saturday. Haikou-bound flight takes off at 1755 hrs from Baotou, reaching Xi'an at 1915 hrs, later arrives at Haikou at 2245 hrs. Return flight leaves Haikou at 1125 hrs, reaching Xi'an at 1520 hrs, then leaves Xi'an and lands at Baotou at 1640 hrs.

Baotou airport was built in 1934. After times of rebuild and expansion, the airport now has a terminal of 10,000 square metres with a passenger capacity of 459,000 persons and a cargo capacity of 3,500 tonnes.

Source Shipping Gazette - Daily Shipping News

 

-      Strong pipeline of new ports sets stage for more growth

The Hague, Netherlands - APM Terminals, the Hague-based global port operator, yesterday reported record breaking annual results for 2011. A revenue growth of 10% year- on-year and an EBITDA of USD 1,059 mio. makes APM Terminals’ result for 2011 “the strongest ever”, according to CEO Kim Fejfer.

Net operating profit after tax was USD 649 mio. Profits of USD 793 mio. in 2010 were heavily influenced by extraordinary items incl. divestment gains. The profit in 2011 before gains and special items was USD 611 mio., 24% higher than the previous year.

Even better: The return on invested capital – ROIC, often described by APM Terminals’  top exec as the most important single key figure for the port operator – reached 13.1%.

This is a significant leap in profitability from 2010 where the return percentage was 10.4% when corrected for divestment gains and special items.

“This shows that APM Terminals is tracking well towards our long term goal of being the best and most profitable global port operator in the world. Profitability is our license to grow,” stated Mr. Fejfer in a comment on the annual results.

And growth is key for the independent port and inland services operator. Most industry analysts forecast a large need for additional port capacity over the next decade, and Mr. Fejfer is eager to secure the lion’s share of global growth opportunities. 

“If there were such a thing as a “market share” for expansion, we believe that APM Terminals would be the #1 global port operator in 2011 in that category. We committed more than 3 billion USD to infrastructure development and facility expansion in 2011 and expect to do something similar in 2012,” added Fejfer.

During 2011,  APM Terminals secured 5 new locations as a result of the company’s active portfolio development efforts: Poti in Georgia, Moin in Costa Rica, Callao in Peru, Gothenburg in Sweden and Lazaro Cardenas in Mexico. These complement the project pipeline of Santos, Brazil; Rotterdam, Netherlands; Wilhelmshaven, Germany and Vado, Italy. APM Terminals has recently also announced upcoming investments in Izmir, Turkey.

The total amount of containers handled – weighted with ownership share – increased by 8% on a like-for-like basis and reached 33.5 mio. TEU.

“And yes - gaining market share is also a long-term ambition for us, but we are only interested in sustainable and profitable growth, not just growth for its own sake,” says Fejfer, who also hopes to offer customers a more stable service level during 2012:

“We are very humble about the fact that although financial performance went well some of our customers’ experience has been more mixed as operations in container terminals in North Africa and the Middle East were negatively influenced by unrest related to the Arab Spring during 2011.”

APM Terminals is part of the global shipping and energy conglomerate A.P. Moller-Maersk, and the customer base consists of more than 60 shipping lines. Volumes from customers outside the ownership sphere increased by 11% year-on-year and now constitute 46 % of volumes handled.

“2011 was also the year where we developed and implemented a new corporate visual identity to enhance the APM Terminals brand as a truly independent company. We will continue to diversify our client portfolio in the upcoming years,” added Mr. Fejfer.

Highlights:

• Number of containers handled increased by 7% compared to 2010. On a like- for-like basis, volumes increased by 8%.
• Revenue of USD 4.7bn was 10% above the level of 2010.
• The customer portfolio was further expanded and share of volumes from customers outside the ownership sphere increased to 46% (44%).
• Net operating profit after tax was USD 649m.
• Profit, excluding sales gains and impairment losses, etc. was USD 611m, 24% higher than in 2010.
• Cash flow from operating activities was USD 912m (USD 845m).
• Return on invested capital (ROIC) reached 13.1% (16.0% and 10.4% excluding divestment gains and other special items).

 

Source APM Terminals