COS Weekly News - 5 February 2010

Monday, 08 February 2010 11:14

COS News – Week ending 5 February 2010

Issue No. 92

 

 

PORT METRO VANCOUVER 2009 STATISTICS

PMV has released its year-end cargo statistics for 2009.  Total tonnage declined 11 percent compared to 2008, however the bright spots include growth in grain, specialty crops and petroleum products.  Full story.

 

PILOTAGE DISPATCH – INTERIM OLYMPIC PLAN

Please be reminded that between February 6 and March 6, 2010, it is requested that one extra hour be added to the pilotage dispatch and change time for all Vancouver based assignments.  Also, the the Authority’s night shift Dispatchers (1900 to 0700 hours) will be working from home based offices and maintain the regular dispatch numbers 604-666-6776 and 1-800-663-0407 as the primary contact numbers.  Failing a response on the main numbers, 604-313-2219 and 604-313-4299 are direct contact numbers for the Dispatchers.

 

BCMEA FILES HUMAN RIGHTS COMPLAINT AGAINST ILWU

The BCMEA has filed a complaint with the Canadian Human Rights Commission alleging the International Longshore Workers Union Canada ("ILWU Canada") and ILWU Locals 500, 502, 505, 508 and 519 (collectively, the "Longshore Unions") are engaging in discriminatory practices contrary to s. 10 of the Canadian Human Rights Act ("CHRA").  Specifically, the BCMEA alleges that the ILWU Canada and the Longshore Unions are engaging in systemic sex discrimination in their hiring policies and practices and in their policies and practices governing access to work and access to training against: 

(a) the class of potential female longshore workers; and 

(b) the class of current female longshore workers.

 

 

 

Government News

 

INTERIM ORDER RE TRANSPORTATION OF DANGEROUS GOODS

An Order in Council has been issued and published in the Canada Gazette Part I – February 6, 2010 approving the Vancouver 2010 Interim Order Respecting the Transportation of Dangerous Goods (Into, Through or Within Controlled Access Zones).  The measures are in effect immediately and through to March 3, 2010.  These requirements will be enforced by inspectors designated under the Act.  Contraventions of the requirements are subject o prosecution under section 33 of the Transportation of Dangerous Goods Act, 1992.

 

 

CUSTOMS NOTICE CN10-001 - GOODS CONTAMINATED WITH SOIL

CN10-001 announces that the Canada Border Services Agency (CBSA) will be strengthening its commercial importation process respecting goods contaminated with soil.

 

Beginning February 1, 2011, non-compliant goods, i.e. goods contaminated with soil, arriving at the Canadian border will be restricted to a CBSA-controlled area and may be cleaned on-site by a mobile wash facility approved by the CFIA, provided certain conditions can be met, e.g. there is no risk of soil dislodgement during transport, operational capacity exists, availability of a CFIA-approved mobile wash facility. If a CFIA-approved mobile wash facility is not available, or if other conditions listed above are not met, the contaminated goods will be refused entry into Canada under the authority of the Plant Protection Act and the Health of Animals Act.

 

Under the current process, the CBSA may allow contaminated goods to be transported to either a stationary or mobile CFIA-approved treatment facility. However, treatment may only occur if certain conditions can be met, e.g. there is no risk of soil dislodgement during transport, operational capacity exists, availability of a CFIA-approved stationary or mobile wash facility. If the conditions listed above cannot be met, the shipment is refused entry into Canada and ordered removed at the importer's expense.

 

 

CANADA - US AGREEMENT ON GOVERNMENT PROCUREMENT

Canada and the United States have announced a tentative agreement on government procurement, which is subject to the completion of their respective domestic approval processes. This agreement includes permanent and reciprocal commitments under the World Trade Organization (WTO) Government Procurement Agreement (GPA) with respect to provincial, territorial and state procurement and provides for the following reciprocal guarantees of access on a temporary basis:

 

§    Canada has agreed to provide U.S. suppliers with access to a range of construction contracts across Canada’s provinces and territories, as well as in a number of municipalities.

§    The United States has agreed to provide Canadian suppliers with access to state and local public works projects in a range of programs funded by the American Recovery and Reinvestment Act of 2009.

 

 

U.S., CANADA ANNOUNCE JOINT EFFORTS TO PATROL WATERWAYS DURING VANCOUVER GAMES

The United States and Canada on announced on February 3rd new proposals to "bolster cross-border security operations in the waters of Puget Sound and off the Pacific Coast before and during the 2010 Winter Games in Vancouver." In a joint statement, U.S. Department of Homeland Security (DHS) Secretary Janet Napolitano and Vic Toews, Canadian Minister of Public Safety, outlined a new Shiprider pilot project designed to "enable the Royal Canadian Mounted Police (RCMP) and the U.S. Coast Guard to cross-train, share resources and personnel and utilize each others' vessels in the waters of both countries."

 

"This announcement supports our efforts to ensure a safe and secure 2010 Olympic Winter Games. During the Olympics, Canadian and U.S. law enforcement will work together to combat criminal activity in our shared waterways," said Minister Toews. "Together with the United States, we are sending a strong message to criminals that illegal activity at our shared border will not be tolerated," the minister added.

 

 

CANADIAN COAST GUARD SHIP BARTLETT’S REFIT IN BC
Allied Shipbuilders Ltd. has been awarded a $15.5 million contract to complete major repairs to the Canadian Coast Guard Ship (CCGS) Bartlett.

 

This work is the second phase of a major life extension project for the CCGS Bartlett. The first phase was completed by Allied Shipbuilders Ltd. in July. Both contracts were awarded as a result of separate competitive processes.

 

 

Other News

 

DANISH SPECIAL FORCES INTERVENE DURING ATTEMPTED HIJACKING

Danish special forces assigned to the warship Absalon stormed a ship captured by Somali pirates earlier today and freed 25 crew members.  This is believed to be the first time a warship has actively intervened after pirates have boarded a vessel.  Troops in inflatable dinghies moved in after a distress signal from the Antigua and Barbuda-flagged handy size carrier Ariella.  They scaled the side of the ship and freed the crew, who had locked themselves in a secure room.  It appears the pirates fled on recognizing the Danish intentions.

 

 

OLDER VESSELS FACE ENHANCED INSPECTIONS UNDER PARIS MOU

Older ships and those considered to be “high risk” are being targeted for more aggressive inspections within EU ports beginning 2011. Any passenger vessel, oil tanker, gas or chemical tanker more than 12 years old can expect an expanded inspection regime under an amended Paris Memorandum of Understanding. From January 1 2011 owners will be required provide to national authorities at least 72 hours notice of ETA. Under the Paris MOU, the new requirements will extend eastwards to Russia and westwards to Canada, but will be enforceable by law in EU countries.

 

 

U.S. DEBATE OVER DREDGING BUDGET CUTS

A proposed cut of 10% to the U.S. Army Corp of Engineers dredging budget for 2011 by the U.S. Federal Government has been heavily criticised by the national maritime industry. The American Association of Port Authorities expressed its concern over the federal budget, which proposes to allocate $4.9bn for 2011, down from the $5.4bn in 2010. Nearly $800m of that amount is to pay for maintaining U.S. deep draught navigation channels.

 

 

COSCO BUSAN OWNER SUCCESSFULLY SUED FOR PILOT DEFENCE COSTS

Owners of the Cosco Busan which in November 2007 hit the San Francisco Bay Bridge in dense fog have been ordered to reimburse $315,000 in legal costs incurred by Continental Insurance Company to defend the pilot onboard at the time. The legal nuance here is that in upholding the insurance company’s lawsuit, a district court in California found that federal law does not pre-empt a state law that immunises pilots from negligence that leads to an accident.

 

Last summer, the insurer turned to the US District Court for the Northern District of California. The lawsuit stated the insurer should get the money back, on the basis of a California statute which provides that “a vessel, or its owner or operator, shall either purchase trip insurance from the pilot, or defend, indemnify and hold harmless the pilot if an accident occurs due to the pilot’s negligence”.  Owners opposed the claim, on the standard grounds that US federal maritime law pre-empts the state statute however in a 16-page decision handed down by the court last week it was decided that in this particular case, federal law does not pre-empt the California state statute.

 

 

NEWCASTLE, AUTRALIA STRUGGLES WITH CONGESTION AGAIN

The world’s largest coal export port Newcastle, Australia (100m tons annual capacity) is once again struggling with congestion. Delays are said to be costing $4m-$7m a week in demurrage as between 50 and 60 vessels are waiting for 2 weeks or more load. Even so, as will be noted in our market report below, rates for Capesizes are down $4000/day since last week. Newcastle suffered a peak of congestion in 2007 when 79 ships waited patiently in line at anchor.

 

 

INTERNATIONAL UNION OF MARINE INSURANCE (IUMI) SLOW STEAMING CONCERNS

The current trend towards slow steaming and super-slow steaming has not escaped the attention of insurers with respect to the potential for long term damage to main engines which were primarily designed for high speed and therefore high load operation. Trials conducted by Maersk and several other companies in the container sector have concluded that they can operate with engine loads down to 40% without long term adverse effects and perhaps even as low as a 10%-15%. Being alert to the dangers, several marine engine manufacturers, have urged caution and provided guidance to owners on best operating procedures.

 

 

WORLD MARITIME UNVERSITY TO RESTRUCTURE

The World Maritime University (WMU) based in Malmo, Sweden is to drastically slim down its Board of Directors in an attempt to increase focus on important IMO objectives. A new WMU President has been mandated to reduce costs, increase revenue and initiate more research into development of IMO climate change policies. WMU operates under the auspices of the IMO and enjoys the status, privileges and immunities of a UN institution in Sweden.

Established by an IMO Assembly Resolution in July 1983, the aim of WMU is to further enhance the objectives and goals of IMO and member states around the world in support of the international maritime community.

 

Market Update

In the lead up to Chinese New Year, the Baltic Dry Index closed on a disappointing 10% down for the week on Thursday at 2685 points compared to 2963 points last week and 3170 points the week before.

 

                                       Cape Size          Panamax          Supramax          

Index                                  3371                  3109                   2167

Last week                           3706                  3523                   2313

Spot time charter           $30,700/day      $25,000/day      $22,700/day

Last week                     $34,800/day      $28,300/day      $24,200/day

 

Containers: In common with recent improvements in the key Asia / Europe trade, a sudden surge in export demand ahead of Chinese New Year, has seen rates also take off between Asia and the US / Canadian west coasts in the past week. High value time sensitive products are increasingly being forced to buy airfreight as a consequence. With ships overbooked, rates are up around 20% at $2,000 per FEU which is some 40% higher than this time last year.

 

Tankers: The recent strength of the VLCC market was tested this week and did not come out well. Charterers panicked owners into reducing rates from Arabian Gulf to Europe by 40% and to the Far East by 30%. Having said that, the Northern winter is far from over and North American demand for heating oil in particular is expected to maintain rates at acceptable levels.

 

 

Upcoming Events

 

Feb 8                COS Interim Office Hours in Effect (7:00 am – 3:00 pm)

Feb 9                COS Ship & Port Operations Committee Meeting @ 12:00

Feb 10              COS Liner Committee Meeting @ 10:00

Feb 11              Rail Freight Services Review Working Group @ 09:00

Feb 12              Official Opening Ceremony for the 2010 Winter Olympics

Feb 18              COS Navigation Services Committee Meeting @ 10:30

Feb 25              COS Owners Committee Meeting @ 12:00

Feb 28              Closing Ceremony for the Winter Olympics

Mar 3                COS Board of Directors Meeting @ 11:30

Mar 8                COS Annual General Meeting (to be confirmed)

Ship of the Week

Cruise ship “Mona Lisa” berthing in Squamish

 

Built 1966 in Scotland

LOA 201.3 m

Beam 26.6 m

GRT 28,891

Passenger capacity 782

Crew (when cruising) 417

 

The cruise ship Mona Lisa is now berthed at Squamish after a 33 day voyage from Greece from where she departed on December 20. She has been chartered to provide accommodation for VANOC staff during the Olympic period and is expected to remain in Squamish for 56 days. As the Kungsholm, the ship first entered service for the Swedish America line in 1966 as an optional transatlantic liner or cruise ship. In 1975 the Swedish America line ceased trading and Kungsholm was sold to Flagship Cruises, who retained her strong name recognition and employed her for cruising from the United States.

 

 

Kungsholm - original twin funnels

 

In 1978 she was purchased by P&O Cruises and renamed Sea Princess before being  assigned to Australian market . During refurbishment, her appearance was updated including removal of her forward (dummy) funnel and reshaping of her remaining funnel. In 1995 she was renamed Victoria, a name retained for the rest of her career with P&O Cruises. In 1999/2000 Victoria was chartered for the Union-Castle Line centenary voyage and had her funnel repainted in that company's colours.

 

P&O Sea Princess

 

In 2002 she was sold to German interests and renamed Mona Lisa until 2006, bearing a large image of the painting of the same name on her funnel. She was briefly laid up at Pireus, Greece in 2006 following which she was chartered as a hotel ship for the Asian Games in Doha, Qatar. In 2007, the ship was chartered by Royal Caribbean Cruises Ltd. (RCCL), renamed Oceanic II and operated by a company subsidiary for the 2007 northern hemisphere summer season. After a brief unsuccessful charter with ‘Peaceboat” she returned to Pireus for layup prior to her current employment. Along with a number of other older cruise ships, she is expected to cease trading this year due to her inability to meet SOLAS 2010 standards. Whilst in Squamish, the vessel will be hooked up to shore power.

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