COS Weekly News - 3 August 2012
Friday, 03 August 2012 15:47
COS News – Week ending 3 August 2012
Issue No. 220
HAPPY BC DAY WEEKEND AND GOOD LUCK TO OUR OLYMPIANS
ASIAN GYPSY MOTH ALERT
The Canadian Food Inspection Agency and the US Department of Agriculture have issued that attached urgent memo advising industry of the recent findings of live Asian Gypsy Moth egg masses on the superstructures of ships and cargoes. We previously advised that 80 vessels have arrived in Canada this high risk season without certificates and were subject to inspection by CFIA prior to entry in to Canadian waters, resulting in significant delays and costs to our industry. Unfortunately we now find ourselves in a situation where compliant vessels, i.e. vessels that have certificates attesting that the vessels were inspected at the last regulated port of call, are being inspected by CFIA alongside and subsequently found with live stages of Asian Gypsy Moth egg masses on board. When live stages of AGM egg masses are found, vessels are required to immediately evacuate the port, clean and be re-inspected and approved for re-entry. We were informed that there have been 26 compliant vessels so far on the US and Canadian west coast that have been ordered out due to AGM findings.
In Japan, we have been advised that inspection companies are removing hundreds of egg masses from vessels prior to departure. Strong populations in southern Japan and on Hokkaido have been detected and vessels particularly en route to US and/or Canada from this region are requested to perform their own comprehensive self-inspection according to the attached Gypsy Moth Inspection Pocket Guide, which CFIA is in the process of updating. Also attached is a document containing recent photos of egg masses found on vessels and cargo arriving in Vancouver.
IMMIGRATION ADVISORY
CBSA Regional Intelligence officer, Shawn Beaver, has advised that a local shipping agency was contacted recently by two different Indian nationals regarding employment in their company. The individuals were provided with a fraudulent letter of employment that appeared to be from the local shipping agency. If you receive a similar approach from foreign nationals or any other suspicious correspondence please contact Shawn Beaver directly at tel: 604-696-3130.
NORTH AMERICAN EMISSIONS CONTROL AREA NOW IN EFFECT
After what seems to have been years in the making, the North American Emissions Control Area (ECA) finally came into effect on August 1. Due to legislative delays, Canada will not be in a position to enforce ECA compliance until probably late November, however, Transport Canada is encouraging voluntary compliance in the meantime. Inevitably, not every question related to ECA enforcement has a clear cut answer, not least that of vessels on innocent passage. We do however encourage vessels to log all transits of the ECA zone in anticipation of questions that may arise during future port state control inspections.
the NA ECA stretches approximately 200 nautical miles offshore (left) whilst all existing and potential future ECAs are shown on the right
Here in Canada, there is no mandatory requirement to issue a non compliance report before the ECA legislation formally takes effect. However, when conducting Port State Control inspections, Transport Canada may seek to inspect recent bunker delivery notes (BDN) and will be issuing reminders that mandatory ECA compliance will come into effect in Canada later this year. We are also aware that the US is already inundated with non-compliance reports. Low sulphur HFO has been trading in Pacific Northwest ports at a premium of $240-270 per ton this week – even higher in Los Angeles on account of very limited supply.
MARINE TRANSPORTATION SECURITY CLEARANCES
The five-year anniversary of the Marine Transportation Security Clearance (TSC) program is upon us and we are working with Port Metro Vancouver to ensure that TSC holders are notified six-months in advance of their TSC expiry. Please note that the expiry date on your port pass may not necessarily be the expiry date of your TSC expiry as the five-year port pass program was implemented before Transport Canada’s TSC program. We have encountered some anomalies in our systems, resulting in TSC holders not receiving the six-month advance notice of expiry. If your port pass was issued by the Chamber of Shipping and you are unsure of your TSC expiry date, send an email to This e-mail address is being protected from spambots. You need JavaScript enabled to view it . The renewal process has not been simplified by Transport Canada, therefore in order to renew your TSC the same application and security processing is required.
ACPA RESPONDS TO FMC REPORT
The Chair of the Association of Canadian Port Authorities, Robin Silvester, has issued a statement in response to the US Federal Maritime Commission’s report, “A Study of US Inland Containerized Cargo Moving Through Canadian and Mexican Seaports.”
GEARING UP FOR MISSIONS TO SEAFARERS ANNUAL SEPTEMBER FUNDRAISERS
For the cyclists out there, join Stephen, Bonnie and the Chamber of Shipping team on September 15 for the annual Cycling for Seafarers fund raiser. The target this year is 100 riders and $40,000 of sponsorship. You can register online at http://www.flyingangel.ca/ for a 40 or 100 km ride – the choice is yours. Then on September 27 we have the annual fund raiser dinner at the Royal Vancouver Yacht Club where we will this year pay tribute to the 50th Anniversary of the Canadian Coast Guard with Assistant Commissioner Vija Poruks as our guest speaker. Contact the COS secretariat for more information 604-681-2351.
ILWU CLERICAL WORKERS IN CONTRACT STAND OFF
Contract negotiations between ILWU office clerical workers and an attorney representing 14 shipping lines and terminal operators in Los Angeles-Long Beach were abandoned after only two hours earlier this week but efforts are being made to bring the parties back to the table. The latest proposal from the Office Clerical Unit of International Longshore and Warehouse Union Local 63 is said by the employers to represent an increase in employers’ costs of 49% over the life of the contract and would negate the efficiencies from technology that employers bought and paid for in previous contracts through wage and benefits provisions. The 600 office workers in Southern California have been working without a contract since June 2010, and negotiations have been held only sporadically and for short durations since then.
International News
MSC FLAMINIA AWAITING PERMISSION TO ENTER UK SHELTERED AREA
The owners of the heavily fire damaged container ship MSC Flaminia have advised that the vessel and her accompanying trio of tugs are positioned approximately 100 nautical miles off the SW coast of the UK in unseasonally poor weather conditions. Last weekend a team of firefighting experts boarded the vessel to begin a detailed assessment of damage and to try and establish the cause of the original explosion that generated a fire in hold No.4. Firefighters are also dealing with hot spot flare ups as they occur. The vessel is pictured below 9left) with a pall of smoke still radiating from the burned out cargo areas. Permission to enter a sheltered coastal area (Port of Refuge) is likely to be granted in the coming days.
Salvage crews in Malaysia also continued this week with their fight to prevent the spread of a spill of fuel oil from the burned out chemical tanker Bunga Alpina (above right). Sadly the death tally has mounted to five crew members. The vessel had been loading methanol from the Petronas Chemicals Methanol Sdn Bhd terminal in Labuan on July 19 when the vessel was reportedly struck by lightning which triggered an explosion and fierce fire.
ICS PROPOSES AMENDMENT OF IMO BALLAST WATER CONVENTION
The International Chamber of Shipping (ICS) has drafted a new ballast water proposal to the IMO Marine Environment Protection Committee (MEPC) which next meets in October. Many countries have raised concerns that under current schedules up to 60,000 ships are required to install treatment systems over the next four years – a physical impossibility. ICS has therefore proposed that the IMO should modify the BWM Convention’s requirements so that existing ships should not be required to be retrofitted with treatment equipment until their next full special survey. In view of the pressures on shipyards that will need to fit the equipment, this would smooth out implementation over a 5 year timeline around the date of entry into force of the Convention, rather than 2 or 3 years as at present. It is also proposed that ships approaching their 4th special survey should be exempted from the equipment requirements. The issue is further complicated by the fact that the US standards for type approval of equipment, under its Environmental Verification Program, are more robust than the IMO equivalent.
US SANCTIONS ON IRAN TIGHTENED ANOTHER NOTCH
The latest round of U.S. sanctions on Iran effectively bans the chartering, selling of ships or providing Iran with any shipping services whatsoever. The action will also see the U.S. emulate European Union restrictions on the provision of insurance to any carrier of Iranian crude oil, with specific prohibition on offering cover to National Iranian Tanker Co. Flag states that facilitate the reflagging of Iranian vessels are also in the firing line, after accusations that “Islamic Republic of Iran Shipping Lines” has engaged in systematic cat-and-mouse reflagging tactics in a bid to circumvent sanctions against it. Iran’s financial sector has also come under further scrutiny with a requirement for companies listed in the U.S. to disclose activities in Iran, while current executive order sanctions against Iran’s central bank are formally codified.
Not to leave anything to chance, under a further executive order issued this week by the U.S. entitled “Authorizing Additional Sanctions with Respect to Iran” sanctions now capture those engaged in “knowingly conducting or facilitating significant transactions with a private or public foreign financial institution or other entity for the purchase or acquisition of Iranian oil”. The U.S. objective is to dissuade the two countries that are continuing to purchase large volumes of Iranian oil, namely China and India. There is also growing pressure for UK-listed satellite communications group Inmarsat to switch off the communications links for up to 27 vessels linked to Iran.
EU DROPS P&I INTERNATIONAL GROUP INVESTIGATION
After spending a lot of time and other people’s money, the European Commission this week issued the following brief statement in relation to a two year investigation into the business practices of P&I Clubs:
“The European Commission has closed its antitrust investigation into certain provisions accompanying claim-sharing and joint reinsurance agreements in the marine insurance sector. P&I Clubs are mutual non-profit making associations that provide Protection & Indemnity insurance - a type of direct marine insurance - to their members, the ship owners.
The investigation focused on the International Group Agreement (IGA) and the Pooling Agreement between the P&I Clubs that contain rules on the sharing of insurance claims and joint reinsurance as well as rules on the contractual relationships between the P&I Clubs and their members. The aim of the procedure was to examine whether certain provisions of the agreements lessened competition between P&I Clubs and/or restricted, to a certain extent, the access of commercial insurers and/or other mutual P&I insurers to the relevant markets.
After opening proceedings in August 2010 the Commission conducted a market investigation with ship owners, brokers and commercial insurers. The market investigation was not sufficiently conclusive to confirm the Commission's initial concerns. The agreements concluded within the International Group of P&I Clubs were previously exempted from the competition rules of the European Union by a Commission Decision of 12 April 1999. The exemption expired on 20 February 2009”.
HMS HOOD’S BELL TO BE RECOVERED?
Billionaire U.S. philanthropist and Microsoft co-founder Paul Allen has offered his private yacht be used in the recovery of the ship’s bell of HMS Hood, sunk by the German battleship Bismarck in the Denmark Strait 1941 with the loss of 1,415 lives, the largest loss of life ever suffered by a single British warship.
HMS Hood in the Panama Canal in 1924 (left) and an underwater picture of the famous bell (centre) – yacht Octopus (right)
The loss of HMS Hood had a profound demoralizing effect on the British war effort such that Prime Minister Winston Churchill ordered the Royal Navy to "sink the Bismarck at all costs”. The order was fulfilled on 27 May 1941. If recovered successfully, the bell will be preserved as a memorial to the ship. Mr. Allen’s yacht Octopus is equipped with a remotely operated vehicle (ROV) will be used for the operation.
RIMPAC WRAPS UP TODAY
The fleet underway (left), Canadian submarine HMCS Victoria in Pearl Harbour (centre) and Singaporean frigate RSS Formidable alongside USS Nimitz (right)
Twenty-two countries contributed more than 40 ships and submarines, more than 200 aircraft and 25,000 personnel to the biennial Rim of the Pacific (RIMPAC) exercise off the Hawaiian Islands which took place this year from June 29 to Aug. 3. RIMPAC is the world’s largest multi-national maritime exercise and which is designed to sustain the cooperative relationships that are critical to ensuring the safety of sea lanes and security on the world’s oceans.
Market Update
Thankfully the London Olympics are here to distract everyone’s mind from the abysmal markets. Just when we thought that things can’t get any worse – they did. Just down the street there was no sign of much prized gold medals with the Baltic Dry Index closing down on Thursday on a miserable 861 points compared to 958 points last week and 1053 points the week before.
Cape Size Panamax Supramax
Index 1178 931 1010
One week ago 1224 1058 1099
Spot time charter $4,300/day $7,400/day $10,600/day
One week ago $4,900/day $8,400/day $11,500/day
Containers: Drewry’s latest Hong Kong-Los Angeles benchmark was up by a modest $72 per FEU at a time when carreirs were targeting peak season increases of $500. On the bright side, rates are still 60% higher than a year ago. Spot prices on the eastbound Pacific trades are now more than $2,400 per FEU
At the beginning of July, Lloyd’s List Intelligence data shows the fleet active on liner trades stands at 5,062 vessels, with an aggregate intake of 16.2m TEU. This represents a net rise of 5.4% in TEU terms, compared with January 2012. It takes into consideration the amount of new tonnage that has entered service against the number of vessel scrappings that have occurred in the first six months of this year.
Upcoming Events
VANCOUVER TRANSPORTATION CLUB GOLF TOURNAMENT
Aug 9th - The Vancouver Transportation Club's annual golf tournament will be held at Greenacres. To register see the attached form.
CYCLING FOR SEAFARERS 2012
Sept 15 – The Mission to Seafarers’ 5th Annual Cycling for Seafarer invites participants to join in on the 40 or 100 km bike ride through Vancouver to Port Moody on Saturday, September 15th. Registration is now available and space is limited so don’t wait to register. See attached for more information or visit www.flyingangel.ca. This year’s target is to raise more than $40,000.
WORLD MARITIME DAY BANQUET
Sept 27 - The Mission to Seafarers' 3rd Annual World Maritime Day Banquet will be held on September 27th this year. This year the Banquet will recognize the 50th anniversary of the Canadian Coast Guard and recognize the IMO theme for 2012, 100 years after the Titanic. The Banquet will return to the Royal Vancouver Yacht Club – please see attached for booking details and sponsorship opportunities.
MARITIME SECURITY CHALLENGES (MSC) 2012
Oct 1–3 – The 5th annual conference presented by Maritime Forces Pacific and Royal Roads University will take place in Victoria, BC and will address the illegal movement of people and goods at sea, security issues in the Gulf of Guinea, maritime applications of unmanned and autonomous vehicles, and shipbuilding and future naval requirements. To register or for more information on the conference or sponsorship opportunities visit: http://mscconference.ca/
Aug 9 Vancouver Transportation Club Golf Tournament
Aug 15 Plimsoll Club @ Nat Bailey Stadium
Sep 4 COS Board of Directors Meeting @ 12:00
Sep 12 Regional CMAC
Sep 18 COS Ship & Port Operations Committee Meeting at 12:00
Sep 18 VMAA Board of Directors Meeting
Sep 19 COS Liner Committee Meeting
Sep 21 COS Navigation & Pilotage Committee Meeting @ 10:00
Sep 25 COS Northern Committee Meeting
Sep 26 WMCC PACMAR/NANS Meeting
Sep 27 COS Owners Committee Meeting @ 12:00
Sep 27 World Maritime Day Banquet
Ship of the Week
Pacific Orca – wind farm installation vessel
Swire Pacific Offshore Operations (Pte) Ltd, parent company of Swire Blue Ocean A/S has recently taken delivery of the Pacific Orca, the world’s largest vessel specifically built to install offshore wind farms. The vessel can be floated up to 17m above sea level, using six legs, and the vessel’s 1,200 mt crane allows the installation of power generation towers, rooms and wings
Built 2012 by Samsung Heavy Industries, South Korea
LOA 161m
Beam 49m
Designed to install in depths of up to 60m
Demand for this type of vessel is forecast to grow as the focus of wind power generation shifts from land based to off-shore based wind farms. Pacific Orca is currently the world’s largest such wind farm installation vessel and is capable of transporting and installing 12 units of 3.6MW. Always looking for market niches, many of the world’s shipbuilders are focused on developing wind farm installation technology based on predictions of the rapid increase in demand.
The vessel will be deployed to provide service for the Danish utility company DONG Energy, the country’s largest power generator. Swire Pacific Offshore has another wind farm installation vessel on order with Samsung Heavy Industries namely Pacific Osprey which is scheduled for delivery at the end of this year and is planned to be deployed for the Dan Tysk project off the coast of Germany.
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