World Maritime News

WMNF 2019/06/27


  • Container group in push for reefer telematics standards

The Container Owners Association hopes to have its first open standard publicly available by this November in an effort to promote interoperability between container tracking and telematics devices.

The trade body, which represent container equipment manufacturers and users, focuses on the technical and engineering side of equipment. Members include the carriers and large leasing companies, as well as technology vendors.

The Container Owners Association had been proactive in reaching out to the Digital Container Shipping Association, the recently launched standards body founded and supported by major container carriers, including Hapag-Lloyd, ONE and Maersk.

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  • Chassis utility model proposed for ports and hubs

The inability to ensure the availability and road ability of chassis has prompted a former executive to propose a ‘utility’ arrangement in which port or hub operator would set prices and ensure adequate supply.

Bill Rooney, vice president of strategic development at Khune+Nagel and former president of Hanjin America, said the chassis utility model would be based on the full interoperability of chassis, which would save money for shippers and truckers while setting compensatory rates for equipment operator who contribute chassis to the grey pool.

Chassis models vary widely at ports such as Los Angeles-Long Beach, New York-New Jersey. Norfolk, and at inland hubs such as Chicago and Memphis. The common thread at all these locations is that “Truckers and shippers are getting screwed” Rooney told the annual meeting of the Agriculture Transportation Coalition. The chassis utility model would be structured like that of the Port of Virginia, where the port authority leases equipment from a variety of sources and then handles the rates and billing itself.

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  • Rail project completion boosts NY-NJ port’s Midwest reach

Staking a larger share of Midwest cargo handled by West Coast ports, GCT Bayonne aims to more than double share of rail lift through the completion of a US$ 149 million project at its container terminal in the Port of New York and New Jersey.

Railed cargo jumped by a third since the first phase of the terminal’s rail project opened in January, raising the share of railed cargo handled by the marine terminal from 6 % to 8 %.

The near-dock terminal, with a capacity of 250,000 lifts per year, will increase the capacity of New York-New Jersey’s rail system to about 1,5 million lifts a year.

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  •  Canal competition for US East Coast cargo heats up

The Panama Canal Authority has published a proposal to modify its current toll structure for vessel using its neo-panamax locks. The proposal offers more attractive rates for customers who benefit from the Panama Canal Loyalty Program.

The escalating US-China trade war and the high cost of fuel are expected to play significant roles in determining which canals are used by carriers on the Asia-US East Coast trade- Panama or Suez- as the alliances meet over the next few weeks to plan their 2020 schedules.

With an expected steep rise in operating costs, carriers are certain to be scrutinizing their routes in next year’s service planning meetings and seeking shorter voyages, where possible.

A direct bearing on transit distance is the manufacturing shift in Asia. The series of tariffs on US imports from China is causing manufacturers to move at least a part of their production to Southeast Asia, from which services to US East Coast ports via the Suez are more competitive than via Panama.

Philipp Damas, head of supply chain advisors to Drewry said “There is no doubt that the switch to more costly low-sulphur fuel from January will favor the Suez routing for Southeast Asia-US East Coast all-water services. This can be expected to influence the routing of China-Southeast Asia-US East Coast loops, unless the Suez and Panama tariffs amend their discount policies.”

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  •  ‘Dark ship’ detection exposes sanction-busting ships

Vessels failing to comply with international sanctions will not be able to avoid being tracked in real time as technology used to detect illegal fishing is fully adapted for commercial shipping.

The so-called practice of ‘going dark’ by establishing complicated logistics chains to avoid detection and thus disguise the origin and destination of oil cargoes.

At the center of this strategy is the practice of turning off Automatic Identification System (AIS) transponders.

Shining light on these operations has been the use of synthetic aperture radar (SAR) technology. Satellites can see through clouds to detect vessels via microwave pulses to produce two-dimensional images with a resolution of two meters, according to Pekka Laurila, co-founder of Iceye, the leader in the commercial application of this technology. When married with AIS tracking, this can provide a complete overview of any voyage. Currently images are only available every 24 hours. Iceye forecasts that within two years application of SAR will be widespread throughout commercial shipping and allow 24-hour tracking regardless of AIS signal.

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  • Middle East crude shipping costs surge on higher freight rates and insurance premiums

Oil companies face higher premiums to ship Middle East crude as freight rates surge and new charter agreements add hefty marine insurance costs to voyages.

War risk premiums have risen tenfold following the mystery explosions on two tankers, amid escalating tension between the US and Iran.

The additional premium levied on war risk cover is now around 0.25% to 0.4% of the value of a VLCC, according to a marine-insurers surveyed by Lloyd List. That adds an additional cost of US$ 171,500 to US$ 274,000 for the voyage based on the price of a five-year-old VLCC.

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  • LA may overturn port comissioners’ vote automation permit

The battle over automation at the Port of Los Angeles will move to the city council as dockworkers continue to challenge the project in fear of job losses. The Los Angeles Board of Harbor Commissioners voted three to two on June 20 in support of a permit that will allow APM Terminals to begin work leading to automation of their Pier 400 facility at the port.

But after the vote, city councilman Joe Buscaino said he would file a motion June 21, requesting the 15-member council to veto the commission’s decision.

International Longshore and Warehouse Union sought to halt implementation of the permit that had originally been approved in January this year. The ILWU claims that automation of Pier 400 will lead to job losses and harm the surrounding community economically.

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  • Major shipping companies unprepared for low-carbon future

Most of the major shipping companies are not preparing for a transition to a low-carbon future, according to a new study published by environmental organization CDP, because internal governance is weak and spending on technological innovation is limited.

The UK-based organization that examines environmental efforts by corporations and which formerly called itself Carbon Disclosure Project found that out of 18 major shipping companies, just three are actively pursuing low-carbon fuels.

NYK, Maersk and MOL make for the top three best-performing companies in this regard.

CDP judged the 18 companies based on the efficiency of their existing fleets and their asset buying strategy, their low-carbon innovation activities and their internal climate governance.

Biofuels, hydrogen and ammonia-based fuels that can deliver significant emission reductions are under developed with only a few companies showing evidence of collaborating to facilitate their development, the report said.

Board-level oversight of climate issues is very low compared with other sectors. Only three companies have a formal climate or environmental committee at the board level.

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  • Biofuel trial and Hydrogen production

Maersk’s biofuel trial continues the carrier’s drive to meet ambitious IMO emissions targets that require the shipping industry to reduce carbon dioxide (CO2) levels 50 percent by 2050 as compared with 2008 levels while pursuing mid-term measures that will decrease CO2 emissions 40 percent by 2030. The carrier has committed to running fully decarbonized fleet by 2050, a commitment that goes the furthest of any carrier and way beyond the IMO targets.

The goal of pilot project using biofuel is to try to unlock potential sustainable fuels so they become commercial reality. This is a direction hailed by the American Bureau of Shipping (ABS), which regards the development of low-to-zero-carbon emitting fuels as the best route forward to meet the IMO targets.

A report from the International Energy Agency (IEA) says shipping can benefit from new international trading routes enabled by upcoming hydrogen production projects over the next few years. Regions such as Africa, the Middle East and Chile have the potential to produce hydrogen at a relatively low cost, whereas other areas, such as Japan and Europe, face high production costs and may well opt for imports of the clean fuel.

Japan has major plans for imported hydrogen in power generation, reflecting the potential for imported ammonia to be co-fired in existing power plants to reduce CO2 intensity, the IEA said. Europe could also benefit from importing hydrogen from Africa and the Middle East where green hydrogen can be produced cheaply.



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  • Ship operators face fuel compatibility questions

Concern remains regarding the quality of fuel that will be available for owners when the new sulphur cap rules are introduced in six months’ time, and how fuels from different sources will interact with each other.

One of the major issues is a lack of standards for the new fuels entering the market to meet the IMO’s requirement that ships emit no more than 0.5% sulphur.

Because of that lack of a standard, refineries and bunker suppliers are left to come up with their own solution to reducing the sulphur content. The simplest way to do this is to blend high-shlphur fuel with 0.1% distillates. But each of these blends will have its own recipe. And it is here that the issues can arise. While the individual blend may meet all required specifications, when mixed with another blend compatibility issues may arise.

The paraffins will also affect compatibility. You could have two perfectly stable fuels but when you mix them, they may well become incompatible.

One other risk from the move to low-sulphur blends is that the more refined product mixed with 3.5% bunker fuel runs the risk of small particles of silica and aluminum from the refining process making it through to the final product.

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