COS News – Week ending 27 August 2010

Issue No. 121

 

 

OFF-SHORE WIND FARMS LEAD THE WAY IN RENEWABLE ENERGY

Now that the wind turbine on Grouse Mountain finally has the green light to generate power, there may be greater incentive for other such projects. There has been much debate recently about the intrusion of off-shore wind farms into traditional shipping routes but it seems clear that given the ambitious targets being sets for production of renewable energy, the trend will continue. Today, around 50 major off-shore wind farms are in operation or under constructions with a similar number proposed and seeking approval. Europe is by far the leading geographic jurisdiction in terms of renewable energy production and within Europe, it is Denmark that is setting the pace. Indeed world’s largest offshore wind farm the 209 MW Horns Rev 2 project, located 30 kilometers off the west coast of Jutland in the North Sea, was inaugurated in September 2009. The project consists of 91 Siemens turbines and produces about 800 GWh of electricity per year - enough for 200,000 households.

The 270m Euro project which lies in up to 14 metres of water is 14-20 kms off-shore and consists of 80 wind turbines, each 110 metres in height. In addition to the being the current record-holder for offshore capacity, Horns Rev 2 is the first offshore wind farm to be manned year round by up to 24 workers on an offshore maintenance platform, dubbed Poseidon.

         a perspective of tower height

 

Closer to home, the NaiKun Wind Energy Group is focused on developing Canada’s first offshore wind energy project off the northwest coast of BC. Located in Hecate Strait, between Haida Gwaii and Prince Rupert, up to 110 turbines are expected to provide renewable energy to meet B.C.’s growing electricity needs. The project is in response to the government’s Energy Plan, which sets a target of electricity self-sufficiency by 2016 and could power some 130,000 B.C. homes. Haida Energy Field consists of some of the strongest, most consistent winds in Canada.

NaiKun has secured a 550 square kilometer permit area within which it plans to build the first phase of the project, a 396 MW offshore wind farm.

 

 

Government News

 

TSB WARNS OF FAULTY RAIL CARS

The Transportation Safety Board warned that tens of thousands of faulty railway cars may be in operation, hauling dangerous goods across Canada. In its final report (R09W0016) into a 2009 accident near Dugald, Manitoba, the TSB says a faulty stub sill went undetected, allowing a tank car loaded with 51 500 pounds of flammable liquid propylene to separate from the rest of the train before coming to a stop. A stub sill is part of the frame which connects the tank cars.  The TSB further noted that in many cases the regulator, Transport Canada (TC), was either unaware of, or had limited information regarding stub sill failures so the problem went undetected.  The Board also found that stub sills manufactured according to older design criteria may be more susceptible to failure in the current operating environment of longer heavier trains.

 

CANADA TAKES ACTION TO PROTECT MARINE WILDERNESS IN THE ARCTIC

The Government of Canada is taking concrete action to protect one of the world’s largest seasonal populations of beluga whales by establishing the Tarium Niryutait Marine Protected Area.  The Area will consist of three individual areas called Niaqunnaq, Okeevik, and Kittigaryuit, and covers approximately 1,800 square kilometres of the Mackenzie River Delta and estuary in the Beaufort Sea. It is the first Marine Protected Area of its kind in the Canadian Arctic. It will be a vital part of Canada’s expanding network of protected ocean regions.

 

CCG COMPLETES EMERGENCY RESPONSE TRAINING IN NUNAVUT

Canadian Rangers from across the North and selected Resolute residents participated in a week-long environmental response training session led by the Canadian Coast Guard (CCG) in the Hamlet of Resolute Bay, Nunavut. The training focused on safety and emergency response techniques in the event of a tanker fuel spill. It included the proper use of pollution control equipment supplied by the Canadian Coast Guard, shoreline cleanup, and boat handling.  New skills were put to the test in a one-day scenario-based exercise on the shoreline.

 

CANADA INVESTS IN NEW WINDSOR PORT MARINE FACILITY

The Government of Canada will contribute $10.1M towards the creation of a new multi-faceted marine facility that will handle petroleum products and aggregate materials on Windsor Port Authority property. Improvements include an extended dock, a 20-acre storage facility, new loading-unloading infrastructure, and new office and warehouse space.  Under the Infrastructure Stimulus Fund the total eligible project cost is more than $20.2 million.

 

 

Other News

 

EPA TO ESTABLISH NO-SEWAGE DISCHARGE ZONE OFF CALIFORNIA

The Environmental Protection Agency issued a news release announcing its intention to establish the largest coastal no-sewage zone in the US.   The EPA will sign a rule preventing vessels over 300 gross tons from discharging sewage within three nautical miles off California’s coastline.  The formal proposal will be published soon in the Federal Register. Comments on the proposal should be submitted within 60 days.

 

EU COMMISSION TO PROBE P&I CLUBS

Perhaps emboldened by the scrapping Liner Conferences and an extended probe into the International Association of Classification Societies (IACS), the European Commission has again turned its attention to the International Group of P&I Clubs with an antitrust investigation. P&I Clubs operating within the International Group represent around 93% of the world fleet and operate within the parameters of two separate agreements, the International Group Agreement and the Pooling Agreement. These lay down rules on sharing of insurance claims, joint reinsurance and contractual relationships between the P&I Clubs and their members. The International Group Agreement was successful in arguing two previous 10 years exemptions.

 

GREECE COMPLETES ABOLITION OF CRUISE CABOTAGE

Despite maritime labour protests, the Greek parliament has approved the government’s proposals for abolition of cabotage in the cruise sector. Non EU flagged vessels will now be allowed to use Greek ports as “home ports” and offer round-trip cruises without obligation to employ Greek crew members. A had tax in support seafarers’ welfare will be levied but will be reduced by 7% for each further port of call in the vessel’s itinerary.

 

PARIS MOU TANKER DAMAGE STABILITY CAMPAIGN

The International Chamber of Shipping has published a series of questions and answers exchanged with the secretariat of the Paris Port State MOU in relation to the campaign launched on tanker damage stability. Guidelines to Port State Control inspectors are also published in the attachments to this week’s newsletter.

 

INDIAN CONTAINER EXPORT FRAUD

An investigation is underway in India after the International Maritime Bureau (IMB) identified a number of fraudulent bills of lading related to export container shipments of clothing and footwear. In fact the shipments were non-existent despite documentation issued by an NVOCC. To disguise the fraud, container numbers detailed on the bills of lading related to actual containers, however the boxes in question were at entirely different ports around the world on the dates on the bills of lading.

 

In the world of maritime documentary fraud, perpetrators will often focus on commodities in high demand and offer them at competitive prices along with what appears to be authentic documentation. Under letters of credit, sellers may present convincing (but false) documents confirming cargo consignment to the buyer and supposedly loaded on a vessel. The negotiating bank then pays the non-existent shipper and by the time the buyer realizes the cargo doesn’t actually exist, it’s too late.

Apart from the obvious pre-occupation with piracy, one of the functions of the IMB is to provide an authentication service for trade finance documentation. It also investigates and reports on a number of other topics, notably documentary credit fraud, charter party fraud, cargo theft, ship deviation and ship finance fraud.

Map showing all piracy and armed robbery incidents reported to

          the IMB Piracy Reporting Centre during 2010 so far.

 

 

Market Update

After enjoying several consecutive positive days, the Baltic Dry Index lost ground on Thursday eventually closing on 2703 points compared to 2644 points last week and 2437 points the week before. Thoughts as to where the market is headed are really diverse – everyone it seems has an opinion but in reality, nobody knows.

 

                                       Cape Size                Panamax          Supramax

Index                                   3362                       3025                  2118

Last week                            3363                      3031                   2034

Spot time charter           $32,900/day            $24,300/day       $22,100/day

Last week                      $32,100/day            $24,400/day        $21,300/day

 

 

 

Upcoming Meetings and Events

 

DNV CLIMATE CHANGE SEMINAR

September 1^st - Det Norske Veritas is presenting a seminar on Climate Change presented by Dr. Mark Trexler.  Dr. Trexler has 21 years of climate change experience, starting with the World Resources Institute in 1988, and developing and managing a climate change consulting firm from 1991-2007.  

 

 

NANAIMO CRUISE SHIP TERMINAL OPEN HOUSE

September 8^th - The Nanaimo Port Authority is holding an informational open house on the new Cruise Ship Terminal and Welcoming Centre on Wednesday, September 8, 2010 from 2:00 PM - 3:00 PM in the Departure Bay Room at the Conference Centre. 

 

 

WEST COAST PULP CHARITY INVITATIONAL 2010

September 16^th – This year’s tournament at the Beach Grove Golf Club will be raising money for Literacy and the Chilean Earthquake relief efforts.  Entry fee is $250 and includes golf, cart, shirt, lunch and dinner.  This tournament continues to build on its success and has raised $180,000 for the Raise-a-Reader campaign since 2005.  For more information or to register, visit: www.westcoastpulpcharity.com.

 

 

CYCLING FOR SEAFARERS

September 18^th – Support and/or join the Mission to Seafarers 3^rd Annual Cycling for Seafarers ride.  This is a great opportunity to put together a corporate challenge.  Participants can join in either the 100km or the 40km ride leading to Belcarra Park, Port Moody.  Participating cyclists will be transported back to the Mission by the Royal Vancouver Club Yachts while Seaspan International will return the bicycles to the Main Street Dock where a Salmon BBQ will be provided for cyclists and volunteers.  Each participant is required to raise at least $350.  For more information or to register, visit the Mission to Seafarers website at www.flyingangel.ca.

 

 

WORLD MARITIME DAY – GALA DINNER & DANCE

September 24^th – The Mission to Seafarers will hold a World Maritime Day fundraising event at the HMCS Discovery to commemorate the Year of the Seafarer and the Canadian Navy Centenary. Tickets are $150.  For more information call Caroline Simister at tel: 604-681-2351.

 

 

BUSINESS OF SHIPPING – GRAIN HANDLING SEMINAR

October 7^th – Save the date as more details will follow.  Planning is underway to develop a half-day morning seminar that will discuss the operational aspects of loading grain vessels.

 

 

BUSINESS OF SHIPPING – FULL DAY COURSE

October 28^th – The next full-day Business of Shipping course will be held on October 28^th.  For more information contact Rose Bray at 604-681-2351.

 

Sep 1                COS Board of Directors Meeting @ 11:30

Sep 6                Statutory Holiday – Labour Day

Sep 7                COS Navigation & Pilotage Committee Meeting @ 10:30

Sep 7                ICS Seminar – Piracy Mitigate Risk / Maximize Profit @ 12:00

Sep 8                COS Liner Committee Meeting @ 10:00

Sep 9                VMAA Board of Directors Meeting @ 12:00

Sep 14              PMV Security Stakeholders Meeting @ 09:30

Sep 14              COS Ship & Port Operations Committee Meeting @ 12:00

Sep 15              ICS Board of Directors Meeting @ 12:00

Sep 15              Plimsoll Club Board of Directors Meeting @ 12:00

Sep 21              CIABC Board of Directors Meeting @ 10:30

Sep 21              ISSC Board of Directors Meeting @ 12:00

Sep 22              Regional Canadian Marine Advisory Committee Meeting @ 10:00

Sep 23              Northern Committee Meeting

Sep 24              World Maritime Day Gala Dinner & Dance @ HMCS Discovery

Sep 29              PACMAR & NANS Meeting @ 10:30

Sep 30              COS Owners Committee Meeting

 

 

Ship of the Week

 

                                    TASMAN COMMANDER

                                         geared multi-purpose vessel, departing Tauranga, NZ

 

 

Built 1994

Owned & operated by The China Navigation Co. (Swire Group)
LOA 185 m

Beam 28 m

GRT 18468

DWT 25410 MT

TEU capacity 1000 (+/- 100 depending on stack weight)

Reefer capacity 150 TEU

Speed 18.5 knots on 48 tons/day

5 electro/hydraulic cranes (2 x SWL 26 tons & 3 x SWL 35 tons)

Previous name “Oceanic Challenger”

 

 

 

COS News – Week ending 20 August 2010

Issue No. 120

 

 

 

GATEWAY INFRASTRUCTURE FEE

Last Friday, Port Metro Vancouver announced its decision on the new Gateway Infrastructure Fee (GIF) as a result of a comprehensive consultation process with industry stakeholders to develop an effective, efficient and fair mechanism to recover the cost of the Gateway Improvement Program (GIP) projects.

It is estimated that the rate structure for GIF will be as follows:

 

                                                      Gateway Infrastructure Fee Rate*

Trade Area	2011-12			2013-14		2015**
	Cargo		TEU	Cargo	TEU	Cargo	TEU
North Trade Area Shore	$0.05	N/A		$0.10	N/A	$0.15	N/A
South Trade Area Shore	$0.05	$0.50		$0.10	$1.00	$0.22	$2.13
Roberts Bank Rail Corridor	$0.03	$0.30		$0.06	$0.60	$0.10	$1.00

 

The GIF Backgrounder provides an overview of the GIF including: Fee Structure, Collection Mechanism, Term and Annual Evaluation. 

The GIF Consultation Summary Report was prepared by Kirk & Co Consulting Ltd., an independent company that was retained by Port Metro Vancouver to design and lead the GIF consultation program. 

The Consideration Memo summarizes how key themes from stakeholder input have been considered in refining the structure and implementation of the Gateway Infrastructure Fee.

Port Metro Vancouver will be having further discussions with industry stakeholders from August to mid-October to discuss the details of collection to ensure that the implementation of GIF is efficient.

Port Metro Vancouver will contribute ten per cent towards the overall industry component of the GIP projects and will recover the remaining 90 per cent from industry stakeholders through the GIF.

 

 

RIDLEY TERMINALS ON TRACK FOR NEW RECORD

Ridley Terminals Inc. (RTI) is on course to set a record for product handling this year.  Results for the first two quarters of 2010 indicate that the corporation is on its way to achieving record throughput volumes of bulk products, particularly coal, over the entire year.  Year-to-date figures up to June 2010 show that RTI has handled 3.9 million tonnes of bulk products moving through the terminal, 3.3 million tonnes of which were coal.  News Release.

 

 

NANAIMO ASSEMBLY DOCK – WI-FI AVAILABLE

The Nanaimo Assembly Dock has completed the installation and testing of the Wireless Internet Access connection. Ships will be provided the password on the DOS form presented on arrival. The next phase is to extend the connection to the Duke Point Dock sometime in the next month.

 

 

INSTITUTE OF CHARTERED SHIPBROKERS – 2010 EXAM RESULTS

The following local ICS students have now passed and completed their ICS Professional Qualifying Exams:

§     Robert Heal, Pacific Basin Shipping (Canada) Ltd.

§     Ivelin Tenev, ACGI Shipping (Canada) Ltd.

§     Andriy Tereshchenko, OOCL (Canada) Inc.

 

Sukhvir Bilkhu of Orient Steamship Canada Ltd. has received the MICS (Member) designation and certificate from ICS.

 

 

BCMEA OKAY TO COMMUNICATE WITH CASUALS

The BC Maritime Employers Association was successful in a recent arbitration decision regarding their right to communicate directly with casuals to inform them of increased work opportunities to avoid potential labour shortages.

 

The Arbitrator found nothing that would prohibit this in the Collective Agreement and stated that, “The Union has no greater right to talk to casuals than the Association, subject of course to the specific terms of the Collective Agreement, such as Article 9”.  "

 

 

BC FERRIES RELEASES FIRST QUARTER RESULTS

British Columbia Ferry Services Inc. (BC Ferries) released its first quarter results. Net earnings were $0.9 million for the first three months ended June 30, 2010 compared to net losses of $3.6 million in the first quarter of the previous year.

 

In the first quarter, revenues increased by 6.7 per cent to $190.2 million, with total expenses increasing 4.1 per cent to $189.3 million, compared to the first quarter last fiscal year. The increase in expenses is largely attributed to fuel, interest and amortization expenses, as well as wage rate increases in accordance with the Collective Agreement. News Release.

 

 

WESLEY FERRIS JOINS PORT METRO VANCOUVER

Wesley Ferris has been appointed Manager, Security for Port Metro Vancouver effective August 16th.  As Manager, Security, Ferris will be responsible for providing assistance to the Director, Operations and Security to fulfill PMV’s responsibilities as described in the Marine Transportation Security Act and the International Ship & Port Facilities Security (ISPS) Code.  He will also be responsible for the protection of corporate assets, the investigation, reporting and follow-up of related incidents. 

 

Ferris joins Port Metro Vancouver with extensive security, marine operations, occupational health & safety, and import logistics experience, which he gained while working for Canada Border Services Agency. Ferris has worked for CBSA for most of his working career and held a number of positions including Chief Marine Operations, Chief Commercial Operations, Manager Security Services and Manager Airport Logistics. Most recently, he was Manager Import Logistics and Marine Security Planning for the 2010 Olympic and Paralympic Winter Games. In this role, he was in charge of establishing methods of facilitation for Olympic Games imported goods with expedited release through a variety of CBSA processing procedures and methods. Ferris’ vast experience is complemented with broad business, management and university training.

 

 

Government News

 

MINISTER CANNON RELEASES CANADA’S ARCTIC FOREIGN POLICY STATEMENT

The Honourable Lawrence Cannon, Minister of Foreign Affairs, released the Statement on Canada’s Arctic Foreign Policy: Exercising Sovereignty and Promoting Canada’s Northern Strategy.  The statement articulates Canada’s priorities with respect to sovereignty, economic and social development, environmental protection and governance in the Arctic region and underscores the important role of Northerners, including Indigenous peoples and territorial governments, in shaping Canadian foreign policy on Arctic issues. Canada will continue to show strong leadership and demonstrate responsible stewardship to build a region that is responsive to Canadian interests and values.

 

GOVERNMENTS OF CANADA AND BC LAUNCH ASIA TRADE PROGRAM

Joint funding of $2M for the B.C. Economic Innovation Partnership Program, a program to boost trade and investment with Asia, was announced by the Government of Canada and the Province of British Columbia.

 

The BC Economic Innovation Partnership Program, delivered by the Province’s Ministry of Small Business, Technology and Economic Development, supports activities that promote trade and investment between Asia and British Columbia such as seminars, inbound and outbound trade missions and online marketing initiatives. The program involves businesses, academia, industry associations and various levels of government.

 

One element of the program is an initial business accelerator pilot project operating out of the Province’s Trade and Investment Representative Office in Bangalore, India. Through this pilot project, companies from BC can temporarily set-up shop at the trade office and tap the staff’s on-the-ground expertise and network of contacts while exploring the Indian market, developing partnerships and creating business opportunities.

 

 

 

Other News

 

GULF OF MEXICO – UPDATE ON US LEGISLATIVE PROPOSALS

Please see the attached summary of comprehensive but conflicting U.S. legislative proposals in response to the Deepwater Horizon spill which remain on the table during the summer recess of both Congress and the Senate. The summary information originates with the Chamber of Shipping of America and has been circulated by the International Chamber of Shipping.

 

Oil production in the US Gulf of Mexico is reported to be about 100,000 barrels per day lower than expected in 2011 because of the impact on drilling operations from the Deepwater Horizon disaster. According to latest estimates from the International Energy Agency, the US ban on drilling in the region has halted several development projects representing around 5% of the region’s total oil output, estimated at 1.7 million barrels per day, equivalent of 85% of a VLCC. The biggest project delayed by the drilling ban is Petrobras’ Cascade and Chinook deepwater development, where the Brazilian oil company was expecting to start production from two fields via subsea wells tied into the US Gulf’s first floating production storage and offloading vessel.

The White House decision to ban deepwater drilling until the end of this year has been challenged in the appeal courts in the US, but has meanwhile brought a halt to almost all drilling in the Gulf of Mexico.

Projects affected by drilling moratorium:

 

Project                         Delay

Allegheny                      Producing field — halt to drilling a new well

Cascade-Chinook           New field due on stream in October — assuming slower production ramp-up

Front Runner                  Producing field — halt to drilling a new well

Hoover-Diane                  Producing field — halt to drilling a new well

Mirage                           Tie-back to existing Telemark hub — ramp-up of new well production delayed

Shenzi                           Producing field — lower product from new wells

Tobago                           Part of Perdido project — assuming slower production ramp-up

Caesar-Tonga                 Delay to tie-back of wells to Constitution spar

 

Source: IEA

 

CHINA PRESSES TERRITORIAL CLAIMS IN SOUTH CHINA SEA

China’s continued assertion of sovereignty claims over the islands of the South China Sea is generating increasing tension with its near neighbours namely Indonesia, Taiwan, the Philippines, Malaysia, Singapore and Vietnam. All have overlapping claims underlined by the odd military face off between the latter country and China over the Parcel and Spratly Islands. The U.S. expressed support for non-Chinese claimants in the South China Sea at the most recent ASEAN Post Ministerial Conference at the end of July following which China elected to stage large scale military exercise in the area. China was also not best pleased by the recent US-South Korean naval exercise east of the Korean Peninsula.

 

The Pentagon’s annual report to Congress raised customary concerns over China’s military policy which includes a significant naval force and is rumoured to include plans for an aircraft carrier. On the other hand, China maintains consistent naval presence in the Gulf of Aden and is an important contributor to the fight against piracy in the region.

 

 

RUSSIAN NORTH-EAST PASSAGE TRANSIT

Following up on previous report, two nuclear-powered icebreakers are currently escorting the Russian tanker Baltika carrying gas condensate from Russia to China in a trial voyage via the Arctic rather than through the Suez Canal, a saving of 5000 nautical miles. The move is aimed at justifying some of Russia’s oil projects in the region notably the so called Shtokman project, which aims to develop the 32 trillion cubic meter oil and gas condensate field in Russia’s white sea.

 

Russia’s latest icebreaker “50-years of Victory”

Escorting icebreakers include Russia’s latest named “50-Years of Victory” launched in 2007. Russia’s gas monopoly Gaprom last year began construction of a gas condensate facility in Russia’s far east. The gas is then put into a condensed state and delivered by tankers. Shipments from Western Russia to the Far East via the Northern Sea Route have not occurred for many years. During the voyage, statistical data will be collected to lay the basis for planning similar shipments in 2011 and to further research needed to plot new deep-water shipping routes in the Arctic.

 

 

TITANIC STILL PROFITABLE
A US judge has praised RMS Titanic Inc. for the company's work in retrieving and conserving artefacts removed from the wreck of the Titanic.  The company was awarded $110m for salvaging artefacts but the court will now consider whether the company has ownership of the objects or must dispose of them. Seven expeditions to the wreck site 2.5 miles (4km) below the north Atlantic, have resulted in retrieval of more than 5,500 artefacts. The research vessel Turcot, currently in St. John’s NF, departs on a scientific expedition this coming weekend to assess the deteriorating condition of the Titanic but also to create a detailed three-dimensional map that will "virtually raise the Titanic".

 

WHAT’S HAPPENING TO WORLD WEATHER?

 

                           THE JET STREAM AND EXTREME WEATHER

 

A season of extreme weather from Russia to Pakistan has been linked to unusual distortions in the path of the jet stream - the high speed air currents that circulate the globe in the upper atmosphere

One fall out of the highly unusual weather pattern is that Russia has now imposed it’s ban on grain exports until the end of the year due to the severe drought and a spate of wildfires devastated crops. The government has suggested the ban could remain in place until well into 2011 since this year's crop could be as low as 60 million tons, well below last year's 97 million. Russia needs almost 80 million tonnes to cover domestic consumption alone. The US Department of Agriculture (USDA) has sharply cut its outlook for world wheat production after revising down its forecast for Russia. Global production is now expected to be around 645 million tons.

 

 

FOCUS ON 2010 YEAR OF THE SEAFARER   

With 2010 nominated by IMO as the Year of the Seafarer, there is greater than ever debate on the issues faced by seafarers criminalized by their innocent proximity to pollution incidents, the threat of piracy attacks and increasingly the issue of intrusive searches of shipboard cabins, which are in effect seafarers’ homes. Authorities in many countries, Canada included, take the view that they have free rein to search crew members’ private quarters. A recent court decision in the US found that CBP officers do not need a warrant or even reasonable suspicion to search crew cabins on ships in US ports. This is in contrast with passenger cabins on cruise ships so the question begs - why?

 

In contrast, where seafarers are victims of crime, whether committed by someone else on board or from an external source such as pirates, they are not provided even the most basic protection that they would be onshore. In what other scenario are violent attackers caught in the act of piracy released without charge to repeat the exercise?

 

Industry is forever trying to come up with strategies to attract young people but given the environment of their employment, the question begs as to who in their right mind would wish to be a seaman in today’s world? The Japan International Transport Institute estimates that there will be a 3.5% shortage of officers and ratings by 2015 equal to 16,000 officers and 672,000 ratings. By 2020 the figures will more than double in each case to a 7.2% shortage. These numbers, starting from the shortage today, could well be under-estimated, depending on how the recovery and the industry’s demand profile develops.

 

COS is always anxious to hear of unnecessarily heavy hand treatment of seafarers and appeals to our members to advise us of any such incidents.

 

 

Market Update

Last week’s gains were consolidated with advances to varying degrees across the board. The Baltic Dry Index closed on Thursday on 2644 points compared to 2437 points last week and 1978 points the week before.

 

                                           Cape Size                    Panamax            Supramax

Index                                     3363                             3031                     2034

Last week                              3212                            2829                     1787

Spot time charter             $32,100/day                 $24,400/day        $21,300/day

Last week                        $29,900/day                 $22,700/day        $18,700/day

 

Whilst Capesizes have struggled to a two month high, the recovery in Panamax spot rates last week is slowing as charterers try to hold the line. Panamaxes have gained $7-8000 per day in the past month as Chinese demand for coal continues to be a key market driver in this sector.

 

TANKERS: VLCCs continue to struggle with over capacity. Arabian Gulf to Japan equivalent earnings are averaging only $12,000 per day, down from $19,000 in July and $58,000 in June. Arabian Gulf to Europe is less than $10,000 per day which is obviously below operating costs. Whilst demand is strong, a VLCC new build has entered the market every week this year thereby more than off-setting scrapping activity.

 

 

 

 

Upcoming Meetings and Events

 

RICHMOND MARITIME FESTIVAL

August 20 – 22^nd - Celebrate Richmond's traditional connections with the sea at the 7th Annual Richmond Maritime Festival. This family event at Britannia Shipyard National Historic Site will include a variety of maritime exhibits, such as knot tying, rope making, model boat building, and net mending. The whole family can enjoy live entertainment (sea songs and shanties) and participate in hands-on demonstrations. The waterfont will showcase a floating exhibition of boats for your viewing pleasure. Many boats will be at the docks of the shipyard, including a 1930's rum-runner, historic fishing boats and classic power and sail boats.  

 

On Saturday, August 21^st at 2pm John Horton, Marine Artist, will be giving a presentation on Captain Vancouver and his exploration of the NW coast of North America though his paintings and on the following day at 2pm a presentation on the 100^th anniversary of the Canadian Navy through the eyes of artists. 

 

The Steveston Lifeboat will be on display during the festival, as will many others.  Go aboard and meet the volunteer crew and find out why you should support this non profit, no government funding, search and rescue boat.   John Horton’s boat is an historic wooden boat that was built by the US in Pearl Harbor in 1944 and used by Admiral Nimitz as his barge (ship to shore transportation).  The Steveston Lifeboat has been in service since 1988 and is currently patrolling the Fraser River during the sockeye fisheries openings.  This is a preventative operation to help the commercial ocean going ships that travel up and down the river avoid the fishing nets that are strung across the River when the fishery is happening.   Come and see this historic boat and talk to the crew about the exciting patrols.

 

 

WEBCAST – MAKING CUSTOMS COALITION PROGRAMS WORK

August 24^th (11:00 – 12:00 pm PST) - The Journal of Commerce is hosting a webcast on customs trade partnership programs and how they benefit supply chain compliance and security. The webcast will cover the benefits of participating in customs trade partnership programs such as C-TPAT, ISA, and AEO and it is free.  For more information or to register visit JOC Event Registration.

WEST COAST PULP CHARITY INVITATIONAL 2010

September 16^th – This year’s tournament at the Beach Grove Golf Club will be raising money for Literacy and the Chilean Earthquake relief efforts.  Entry fee is $250 and includes golf, cart, shirt, lunch and dinner.  This tournament continues to build on its success and has raised $180,000 for the Raise-a-Reader campaign since 2005.  For more information or to register, visit: www.westcoastpulpcharity.com.

 

 

CYCLING FOR SEAFARERS

September 18^th – Support and/or join the Mission to Seafarers 3^rd Annual Cycling for Seafarers ride.  This is a great opportunity to put together a corporate challenge.  Participants can join in either the 100km or the 40km ride leading to Belcarra Park, Port Moody.  Participating cyclists will be transported back to the Mission by the Royal Vancouver Club Yachts while Seaspan International will return the bicycles to the Main Street Dock where a Salmon BBQ will be provided for cyclists and volunteers.  Each participant is required to raise at least $350.  For more information or to register, visit the Mission to Seafarers website at www.flyingangel.ca.

 

 

WORLD MARITIME DAY – GALA DINNER & DANCE

September 24^th – The Mission to Seafarers will hold a World Maritime Day fundraising event at the HMCS Discovery to commemorate the Year of the Seafarer and the Canadian Navy Centenary. Tickets are $150.  The event flyer is attached or you can visit the COS website for more information.

 

 

Aug 20 -22        Richmond Maritime Festival

Aug 24              Plimsoll Club – Vancouver Canadians Nooner at Nat Bailey Stadium @ 13:00

Sep 1                COS Board of Directors Meeting @ 11:30

Sep 6                Statutory Holiday – Labour Day

Sep 7                COS Navigation & Pilotage Committee Meeting @ 10:30

Sep 8                COS Liner Committee Meeting @ 10:00

Sep 9                VMAA Board of Directors Meeting @ 12:00

Sep 14              PMV Security Stakeholders Meeting @ 09:30

Sep 14              COS Ship & Port Operations Committee Meeting @ 12:00

Sep 15              ICS Board of Directors Meeting @ 12:00

Sep 15              Plimsoll Club Board of Directors Meeting @ 12:00

Sep 21              CIABC Board of Directors Meeting @ 10:30

Sep 21              ISSC Board of Directors Meeting @ 12:00

Sep 22              Regional Canadian Marine Advisory Committee Meeting @ 10:00

Sep 23              Northern Committee Meeting

Sep 24              World Maritime Day Gala Dinner & Dance @ HMCS Discovery

Sep 29              PACMAR & NANS Meeting @ 10:30

Sep 30              COS Owners Committee Meeting

 

 

 

Ship of the Week

                                             M.V. ACADIAN IN ST JOHN’S NF

product tanker serving Canadian east coast

 

Built 2005

Length 176m

Beam 27.3m

DWT 37,515 MT

Canadian flag, operated by Irving Oil Ltd.

 

 

 

 

Port Metro Vancouver undertook a comprehensive consultation process with industry stakeholders to develop an effective, efficient and fair mechanism to recover the cost of the Gateway Improvement Program (GIP) projects through a Gateway Infrastructure Fee (GIF). Industry stakeholder input was carefully considered as part of the consultation process and has been incorporated, where possible.

The GIF Backgrounder provides an overview of the GIF including: Fee Structure, Collection Mechanism, Term and Annual Evaluation. 

The GIF Consultation Summary Report was prepared by Kirk & Co Consulting Ltd., an independent company that was retained by Port Metro Vancouver to design and lead the GIF consultation program. 

The Consideration Memo summarizes how key themes from stakeholder input have been considered in refining the structure and implementation of the Gateway Infrastructure Fee.

Port Metro Vancouver will be having further discussions with industry stakeholders from August to mid-October to discuss the details of collection to ensure that the implementation of GIF is efficient.

Port Metro Vancouver will contribute ten per cent towards the overall industry component of the GIP projects and will recover the remaining 90 per cent from industry stakeholders through the GIF.

 

COS News – Week ending 13 August 2010

Issue No. 119

 

 

MIGRANT SHIP ARRIVES IN ESQUIMALT

The MV Sun Sea arrived in Esquimalt Harbour this morning and is carrying as many as 490 Sri Lankan Tamils.  The vessel was intercepted by the HMCS Winnipeg and was boarded yesterday by Canada Border Services Agency offices, RCMP and Canadian Forces.  It is suspected that human smugglers and terrorists are among the migrants.   The MV Sun Sea is the second Tamil refugee ship to arrive in Canada in the past year.  Transport Canada has restricted airspace above Esquimalt Harbour up to 2,000 feet while the ship is in the port.

 

PACIFIC PILOTAGE AUTHORITY INVOICE CALCULATOR

PPA has made available an on-line invoice estimator at http://pilot.kleinsystems.com/Billing/ProForma.aspx.

 

Also, following recent elections the new Fraser River Pilots Committee is as follows: 

 

Capt. David Marjoribanks    Chairman

Capt. Mike Armstrong

Capt. Brian Crow

Capt. Gord Cooper

 

 

BRITISH COLUMBIA PORTS HANDBOOK – RELEASE DATE EARLY 2011

The next edition of the British Columbia Ports Handbook is now in production with an early 2011 release date.  The Handbook is a useful reference book that contains information on Western Canada’s ports, terminals, professionals and other service providers.   This next edition will be made available in an electronic format that will facilitate broad worldwide distribution ever achieved for the publication.   If you are interested in advertising and/or receiving a copy of the 2008/09 edition, please contact us at 604-681-2351 or email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 

 

 

Government News

 

PROPOSED REGULATIONS TO ESTABLISH TIMELINES FOR ENVIRONMENTAL ASSESSMENTS

The Government of Canada is proposing new regulations that would establish mandatory timelines for the Canadian Environmental Assessment Agency (the Agency) when it is responsible for conducting comprehensive studies.  The proposed Establishing Timelines for Comprehensive Studies Regulations are available for consultation in the August 14th edition of the Canada Gazette, Part I and the deadline for comments is September 13, 2010.

 

 

SOUTH FRASER PERIMETER ROAD AGREEMENT SIGNED

The Province of British Columbia and the Fraser Transportation Group have entered into a design, build, finance and operate agreement for the completion of the South Fraser Perimeter Road Project.  Under the contract, Fraser Transportation Group will be undertaking construction work costing $658 million. Fraser Transportation Group was selected to carry out the final design and construction of the SFPR through a rigorous competitive selection process. This public-private partnership agreement finalizes a performance-based, fixed-price contract with Fraser Transportation Group to design, build, finance and operate the road for a term of 20 years. The contract includes $200 million in private-sector financing and makes certain that Fraser Transportation Group assumes construction, cost, schedule, design, long-term maintenance and operational risks, as well as other costs related to the project.

 

 

Other News

 

CSL FIRMS UP NEWBUILD ORDER

Canada Steamship Lines (CSL Group) has firmed up an order for new buildings at China’s Chengxi Shipyard said to be worth $514m.The order is described as a new design of high specification self-unloading bulk carriers, a business sector in which CSL is a pioneer. The order is reported by CSL to comprise three Panamax bulk carriers with an option to purchase a further three, and two Handysize bulk carriers with an option for a further two. Delivery is scheduled for the second half of 2012. Of some frustration to CSL and other Canadian owners is the continued federal delay in announcing the lifting (or otherwise) of the 25% import duty on vessels constructed overseas for Canadian flag cabotage restricted operations.

 

 

RO-RO OPERATORS TRIM ORDER BOOK

The current world order book for ro-ro tonnage stands at 123 vessels of which MOL has 24%, Wallenius Wilhemsen / Eukor 21% and NYK 16%. The overall order book has shrunk by 40 vessels and 35 vessels scrapped since the beginning of the year in a concerted attempt to manage the capacity supply side.

Figures recently released for projected car sales in 2010 (2009 numbers in brackets) are:

§    USA 11.5 million (10.4)

§    Canada 1.5 million (1.4)

§    Western Europe 12.2 million (13.6)

§    Asia 20.4 million (17.7m)

§    South America 4.3 million (3.9)

 

After averaging consistent growth in sales of around 2 million vehicles per year China’s forecast for domestic sales in 2010 has been trimmed to around 1.5 million units which likely reflects government efforts to constrain credit. Worldwide, some 52 million cars will be produced in 2010, down from almost 55 million units in 2007. China overtook the U.S. in 2009 as the world’s largest car manufacturer.

 

 

UNDER WATER ENERGY TURBINE UNVEILED

Representing the culmination of a 10 year project, the largest tidal energy turbine in the world Atlantis Resources unveiled at in Scotland prior to being mounted on a barge and towed to the European Marine Energy Centre test site off the Orkney Islands. Unusually, the device which is 22.5m in height has two sets of blades designed to move under water at six to eight revolutions per minute to harness both ebb and flood tides and is engineered to withstand even the harshest environment.

 

Owners of the device, Atlantis Resources Corporation, has been leading a plan to use tidal energy to power a computer data centre in the far north of Scotland. Atlantis is a renewable marine energy power company providing project origin, resource assessment, installation & completion management along with operational & maintenance services to utilities and power companies worldwide. The company has plans to install about 200 similar units in seas around the world over the next five years, and about 800 over the next decade

 

 

CHINESE OIL IMPORTS TAKE A SLIGHT BREATHER

China’s crude imports for the first half of 2010 are down 4.5% year on year but are still around 19 million tons per month equivalent to 2 -3 VLCC’s per day. Meanwhile a number of VLCCs have been withdrawn from the market until returns at least exceed operating costs. Our summer intern Russell Henderson has compiled the following information charts on Chinese oil import demand after comparing several sources of data.

Annual Crude Oil Levels	2000	2001	2002	2003	2004	2005	2006	2007	2008	2009
Consumption in barrels/day	4,795,000	4,917,880	5,160,710	5,578,110	6,437,480	6,695,440	7,263,330	7,582,000	7,381,000	8,200,000
Imports in barrels/day	1,401,000	1,353,000	1,395,000	1,806,000	2,449,000	2,599,000	2,905,000	3,264,000	3,848,000	4,208,000
VLCC'S/Day equivalent *	0.70	0.68	0.70	0.90	1.22	1.30	1.45	1.63	1.92	2.10
VLCC'S/Annum equivalent**	255.68	246.92	254.59	329.60	446.94	474.32	530.16	595.68	702.26	767.96

  

* Assumes a VLCC capacity of 2 million US barrels

** Daily rate for the period multiplied by 365

 

 

As may be seen, the impact of China alone on the demand for tankers and the overall health of that market sector are considerable and rapidly growing.

 

 

RAMADAN

The month of daylight fasting for Muslims will begin on August 11 and last until September 9. For shipping industry operations in the Muslim world, the lead up to Ramadan is signaled by frantic activity clearing the deck of regular business and invariable port congestion. The main Saudi ports of Jeddah and Dammam have this year come in for huge criticism due to long waits for a berth followed by unprecedented delays in the processing of containers.

 

Although Ramadan is always on the same day of the Islamic calendar, the date on the Gregorian calendar varies from year to year, since the Gregorian calendar is a solar calendar and the Islamic calendar is a lunar calendar. This difference means Ramadan moves in the Gregorian calendar approximately 11 days every year. The date of Ramadan may also vary from country to country depending on whether the moon has been sighted or not.

 

 

TALL SHIPS PARADE – HARTLEPOOL UK

The parade of tall ships in Hartlepool on the north-east coast of the UK last weekend – a total of 58 vessels participated in a magnificent spectacle.

 

 

Market Update

 

An unexpected resurgence in the Baltic Dry Index this week had brokers abandoning their beach towels and manning their I-phones. The index closed on Thursday up 24% at 2437 points compared to 1978 points last week and 1942 points the week before.

 

                                               Cape Size                      Panamax            Supramax

Index                                        3212                     2829                   1787

Last week                                 2029                     2567                   1734

Spot time charter                  $29,900/day          $22,700/day        $18,700/day

Last week                            $16,600/day          $20,600/day        $18,100/day

 

On the back of recovery in demand for shipment of iron ore from both Australia and Brazil , the Capesize Index in particular has been taken off life support and is breathing more easily. Iron ore prices on the spot market have also perked up from their 2010 low of $118 per ton last month to around $145 per ton, not least due to uncertainty over future supply from India. Karnataka, the second-largest iron ore producing state in India, plans to permanently ban iron ore exports from 10 ports and stop issuing permits to transport ore to other export ports after the country exported 116m tons in 2009. This development when combined with the ban effective August 15 on Russian grain exports is also certain to increase ton/mile shipping demand for smaller size vessels as other exporters, notably the U.S. pick up the slack.

 

 

Upcoming Meetings and Events

 

PLIMSOLL CLUB – VANCOUVER CANADIANS GAME

August 24^th – Join the Plimsoll Club members at an afternoon barbeque buffet and baseball game at Nat Bailey Stadium on Tuesday, August 24^th from 1:00 pm.  Tickets are $37 per person.  To register, email: This e-mail address is being protected from spambots. You need JavaScript enabled to view it or call 604-681-2351 before August 17^th to guarantee your booking.

 

 

WEST COAST PULP CHARITY INVITATIONAL 2010

September 16^th – This year’s tournament at the Beach Grove Golf Club will be raising money for Literacy and the Chilean Earthquake relief efforts.  Entry fee is $250 and includes golf, cart, shirt, lunch and dinner.  This tournament continues to build on its success and has raised $180,000 for the Raise-a-Reader campaign since 2005.  For more information or to register, visit: www.westcoastpulpcharity.com.

 

 

CYCLING FOR SEAFARERS

September 18^th – Support and/or join the Mission to Seafarers 3^rd Annual Cycling for Seafarers ride.  This is a great opportunity to put together a corporate challenge.  Participants can join in either the 100km or the 40km ride leading to Belcarra Park, Port Moody.  Participating cyclists will be transported back to the Mission by the Royal Vancouver Club Yachts while Seaspan International will return the bicycles to the Main Street Dock where a Salmon BBQ will be provided for cyclists and volunteers.  Each participant is required to raise at least $350.  For more information or to register, visit the Mission to Seafarers website at www.flyingangel.ca.

 

 

WORLD MARITIME DAY – GALA DINNER & DANCE

September 24^th – The Mission to Seafarers will hold a World Maritime Day fundraising event at the HMCS Discovery to commemorate the Year of the Seafarer and the Canadian Navy Centenary. Tickets are $150.  The event flyer is attached or you can visit the COS website for more information.

 

 

Aug 24              Plimsoll Club – Vancouver Canadians Nooner at Nat Bailey Stadium @ 13:00

Sep 1                COS Board of Directors Meeting @ 11:30

Sep 6                Statutory Holiday – Labour Day

Sep 7                CIABC Board of Directors Meeting @ 10:30

Sep 8                COS Liner Committee Meeting @ 10:00

Sep 9                COS Navigation & Pilotage Committee Meeting @ 10:30

Sep 9                VMAA Board of Directors Meeting @ 12:00

Sep 14              PMV Security Stakeholders Meeting @ 09:30

Sep 14              COS Ship & Port Operations Committee Meeting @ 12:00

Sep 15              ICS Board of Directors Meeting @ 12:00

 

 

 

 

MANAGEMENT OF RISKS AND EMERGENCIES – POTENTIAL COURSE OFFERING

Germanischer Lloyd is considering offering a course at a future date covering the Basics of Maritime Accident and Incident Investigations.  Individuals or companies interested in participating in this one day course (see attached for further details), please contact Andrew Robertson at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or tel: 778-554-0172.

 

 

Ship of the Week

 

 

 

                               M.V. CARIBBEAN STAR

                               refrigerated container ship

 

Delivered in 1997 by Shikoku Dockyard, Japan

LOA 154 m

Beam 24 m

Hold capacity 16,000 cbm plus 254 TEU on deck

Speed 20.5 knots

Owned and managed by Star Reefers, Norway

 

 

Whilst the demise of the world’s specialized reefer fleet has long been predicted there remain more than 800 such ships in service today. The fleet age profile is however growing and the average vessel age is now around 25 years. Customarily, the reefer fleet low season is the northern summer and around 15% of the fleet is currently recorded as inactive. There are currently nine new builds on the order books. Ultimately, the ability of reefer ships to compete with the pure container sector will dictate their survival but key trades such as banana exports from the countries of Central America are likely to require at least a nucleus of such vessels having the ability to service small ports with proximity to banana plantations. The major distribution hubs for bananas on the west coast are the ports of San Diego and Port Hueneme. The largest operators of reefer ships today are NYK-Cool and Star Reefers.