Ports & Ships Maritime News

Nov 16, 2009
Author: Terry Hutson

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  • First View – MSC SINFONIA

  • TPT makes sweeping changes with new business model

  • Maersk Line head hits out at state-aided bailouts and rescues

  • South Africa is ripe for growing cruise industry, says MSC Cruises CEO

  • News from the shipping lines

  • A closer look at the new Customs Control and Customs Duty Bills

  • News clips – Keeping it brief

  • Pics of the day – GEO BARENTS and VICKIE TIDE


    First View – MSC SINFONIA

    MSC’s cruise ship MSC SINFONIA arrived in Durban on Friday morning (13 November) to conclude her maiden voyage to South Africa and the start of a full summer season of cruising in local waters. Guests who attended a gala evening on board the ship in Durban on Friday night were left impressed with her size as well as amenities.

    MSC Sinfonia sailed on Saturday for a short two-night cruise to Maputo and Portuguese Island and is due back in Durban this morning (Monday) ahead of a four-night cruise along the Mozambique coast and islands. During this summer MSC Sinfonia will generate an estimated R220 million in turnover and local travel agents can expect to benefit from commissions in the region of R16 million, said Allan Foggitt of Starlight Cruises, general sales agents in South Africa for MSC Cruises. He announced that MSC Sinfonia will be returning to South Africa for the 2010/11 summer season when 45 cruises out of Durban will take place. Picture courtesy MSC Cruises

    TPT makes sweeping changes with new business model

    Focus on human capital and total quality management intensifies

    Durban, 13 November 2009 – Transnet Port Terminals (TPT) said in a statement issued on Friday that the new business model and management structure it was unveiling signalled a ‘dynamic approach to the quality of [our] operations and a renewed focus on supply chain efficiencies.’

    TPT’s Chief Executive, Tau Morwe, said the organisation’s key priorities over the next two years would be to align the organisation with global standards by focusing on total quality management (TQM) and human capital and development.

    “TPT realises that to improve we have to continuously review our operations and processes and ensure effectiveness to service our customers’ needs,” Morwe said.

    To this end the company has appointed a dedicated General Manager: TQM and Continuous Improvement. 

    Velile Dube

    “The new department, to be headed by Mr Velile Dube, will endeavour to implement transformation and change management processes with the aim of converting customers’ operational requirements to tangible changes that are recognised across the organisation,” said Morwe.

    He said the role would also be responsible for the new Operations Excellence Centre which will drive and sustain improvements across the terminals.

    Other aspects of the new business model and management structure are as follows.

    Management of TPT’s four operational sectors has been re-categorised to offer synergies and supply chain efficiencies to specific industries, from the previous container, bulk, breakbulk and automotive categories to the following:

    Zeph Ndlovu
  • Mr Zeph Ndlovu will head up the Mineral Bulk Sector 

    Victor Mkhize
  • Mr Victor Mkhize will be responsible for the Agricultural Bulk and RoRo Sector

    Siyabulela Mhlaluka

    Mr Siyabulela Mhaluka will remain responsible for the Container Sector

  • Top customers in these sectors will have access to a team of Key Account Executives as key entry points working closely with operations, namely Ms Thembi Mbele for the Agricultural Sector, Ms Tracey Neat for the Mineral Bulk Sector, Mr Sidney Bird for the Container Sector, Mr Gary Kleyn for Break Bulk Liner Services and Ms Beverly Masson for the Automotive Sector.

    In other changes:

  • Mr Litha Mcwabeni has been appointed as GM: Strategy, and tasked with forward planning of future capacity developments aligned to demand forecasts, best practice benchmarking of TPT operations and liaison with key stakeholders regarding policy issues and government liaison.

  • The two Richards Bay terminals, Richards Bay Dry Bulk Terminal and Richards Bay Multipurpose Terminal, will operate under a single management team to improve synergies and customer service through an integrated approach to the Richards Bay corridor. Berth utilisation is expected to improve. Mr Ben Khonyane, former Business Unit Executive at Saldanha multipurpose terminal, will now be Terminal Executive for the Richards Bay terminals.

  • Mr Moshe Motlohi, former Business Unit Executive at the Durban Container Terminal, is now Terminal Executive for the Cape Town terminals. Cape Town Container Terminal and Cape Town Multipurpose Terminal will also operate under a single management team, with priorities including improved capacity and customer service, together with optimal use of the stack capacity in line with the terminal’s five year expansion plan. The agricultural terminal services in the facility would remain a key priority.

  • New management at the Durban Container Terminal will be announced in the near future.

  • The Durban Car Terminal operation is to be integrated to the Durban Point terminal as a ro-ro (roll on, roll off) operation in line with changing market demands. New management at the terminal is yet to be confirmed.

  • Operations at the Agriport and Maydon Wharf Terminals will remain unchanged but will see new leadership in the form of Mr Johann Botha.

  • Mr Hector Danisa, will remain in his position as Business Unit Executive at the Ngqura Container Terminal. The terminal will be developed as a standalone facility. Two more berths will be developed in phase 2 of the project to create a four-berth operation at the terminal.

  • In Port Elizabeth, Miss Ntomboxolo ‘Nikki’ Mbengashe, most recently Business Unit Executive at the Saldanha Multipurpose Terminal and then the Richards Bay Multipurpose Terminal, will assume as BUE at the Port Elizabeth Terminal.

  • Adil Rodgers is now the BUE for Saldanha Iron Ore Terminal.

  • Saldanha MPT, Pier 1 in Durban and the East London terminals remain unchanged in terms of operations and leadership, namely Louis du Toit, Michelle Phillips, and Robert Van Rooyen respectively.

  • Former terminal Business Unit Executives Seleko Mametse (Richards Bay Dry Bulk Terminal) and Oscar Borchards (Cape Town Container Terminal) will be redeployed to head office in the TQ & CI department, while Hannes Human (Cape Town Multipurpose Terminal) and Earle Peters (Maydon Wharf Terminals) will join the Commercial and Planning departments respectively.

    Other changes, Morwe said, included a more aggressive approach to the safety of assets, cargo, terminal users and employees.

    TPT would also implement a reformed planning regime in all port terminals nationally to ensure optimal berth utilisation whilst taking into account sailing time for vessels that call at more than one terminal in South Africa.

    “We will continue to build on the partnership approach to customers and constantly engage, be attentive and respond to their requirements as part of our key strategic thrusts,” he added.

    Maersk Line head hits out at state-aided bailouts and rescues

    The chief executive of Maersk Line has hit out at state-aided bailouts for troubled shipping lines, saying that these “inflict damage on the healthy part of the industry.”

    Nils Andersen declined to identify the companies but it is clear he was referring to French shipping giant CMA CGM, Germany’s Hapag-Lloyd, Chile’s CSAV and Israel’s Zim, each of which have been recipients of or anticipate financial bailouts from their respective governments in order to stay afloat.

    Andersen said this while Maersk was revealing its own heavy loss of US$166 million for the third quarter, amplified by the post-tax loss of more than half a billion dollars by the company’s container divisions. Losses by AP Moller’s various container divisions including Maersk Line amount to US$1.5 Billion for the current year to date.

    The company has however avoided having to turn to the Danish government for assistance by raising cash through the sale of treasury shares and the issuing of new Eurobonds. Maersk line has also taken about ten percent of its fleet out of service as a result of the downturn.

    South Africa is ripe for growing cruise industry, says MSC Cruises CEO

    Confidence in both his product and the local market was behind CEO Mr Pierfrancesco’s Vago’s decision to deploy MSC Sinfonia, one of the bigger and finest cruise ships in the MSC Crociere stable, to South Africa this summer. Vago is the CEO of MSC Cruises and was in Durban to celebrate the arrival in SA of the MSC SINFONIA

    “We know South Africa well and she knows us well as the biggest user of her ports. We felt the market was ready for a more sophisticated ship,” said Vago who since 2004 has steered the innovative family-owned cruise company through unprecedented development.

    Today MSC Cruises sets the global standard for Italian style cruises with the world’s most modern fleet comprising ten ships cruising five regions around the globe. In addition the company employs over 12,000 people in offices across 42 countries.

    “In South Africa, the container division of Mediterranean Shipping Company is by far the biggest user of local ports while MSC (Pty) Ltd is the biggest shipping organisation. This provides extra insurance for exceptional holidays guests can expect on our cruise ships.

    “MSC Sinfonia, with capacity for 2,100 passengers, is almost double the size of previous ships we operated in South Africa, but we are so confident of continued growth in the cruise ship industry that we have confirmed a second 2010/2011 season for her,” said Vago.

    He said the cruise industry is one of the fastest growing and most popular segments of the worldwide travel and leisure industry. In three decades it has experienced a phenomenal increase in passenger carryings, from an estimated 1.4 million in 1980 to over 15.4 million in 2009. The figure is expected to double by 2025.

    Similarly in South Africa a 2008 study outlining prospects for the development of cruise tourism by Mitchell Du Plessis Projects has found that although the country only enjoys less than 1% of the global cruise industry the long term market outlook for the region looks positive with enormous potential for growth.

    “MSC Sinfonia’s visit alone will effectively increase our passenger capacity to 70,000 for the 2009/2010 season,” said Mr Vago.

    The Mitchell du Plessis study forecasts that the local cruise line industry also looks set to contribute positively to job creation. This included both sustainable jobs as cruise operations continued to grow and jobs in related tourism and hospitality industries.

    A total of 1,104 direct jobs will be created in 2010 while the contribution to indirect jobs is set to increase from 1,124 in 2010 to 2,205 in 2025. Total job creation is set to increase from 2,228 in 2010 to 4,358 in 2025.

    “This is an area in which we intend to play a major role,” said Vago who speaks from firsthand experience of the South African labour market.

    He attributes his understanding and growth in the international transport industry to the 15 years he served as Managing Director for a local freight forwarder company headquartered in Johannesburg.

    “It was a dynamic time and I love the country so much that I even chose South Africa as the venue for my wedding!” said Vago who delights in greeting South Africans with a “Molo, Howzit, Gaan dit lekker” and other English, Afrikaans, Xhosa and Zulu colloquialisms.

    He also never misses an opportunity to return and was in Durban for the 13 November gala function aboard MSC Sinfonia to celebrate the ship’s maiden voyage to South Africa and start of her first season in the Indian Ocean.

    Born in Milan, Vago studied economics at Cambridge, England, before starting out in the family business, Franco Vago SpA, a leading Italian transport company with affiliates on every continent. He was General Manager from 1985 to 1989.

    On his return to Italy he took part in a joint venture between SNAV and Hoverspeed (Seacontainer Group), the leader in fast connections on the Adriatic Sea.

    Vago began his rise with MSC in 2001, when he served as Line Manager for the USA, Mexico and Canada until 2003. He was appointed CEO of the MSC group’s cruise division in 2004.

    Mr Vago said the company’s impressive year-on-year growth was highlighted just last month when the MSC cruise fleet welcomed their one millionth guest onboard.

    He estimates that by year end 1,085,000 passengers will have cruised with the company, a 36% increase on 2008. In 2010 the company will be carrying 1.2 million guests per year.

    News from the shipping lines

    Lines opt for slow steaming on long-haul loops

    French shipping line CMA CGM has opted for slow steaming on its service between the east coast USA – Far East via Tangier and the Middle East eastbound service with an added call at Singapore. The objective is to reduce fuel costs although the effect adds another week to the full journey giving a 10 week eastbound voyage. The full rotation is now Houston, Miami, Jacksonville, Savannah, Charleston, Norfolk, Tangier, Jebel Ali, Singapore, Shanghai, Xiamen, Chiwan, Hong Kong, Manzanillo (Panama) and back to Houston.

    The French company also shares a pendulum service with Maersk Line swinging between the US east and west coasts which because of slow steaming will now take 15 weeks instead of 14. The two companies use 15 ships in the 5,000 to 6,500-TEU range with a rotation of Shanghai, Ningbo, Hong Kong, Yantian, Tanjung Pelepas, (Suez Canal), New York, Norfolk, Savannah, Tanjung Pelepas, Hong Kong, Yantian, Shanghai (Yangshan and Waigaoqiao), Busan, Seattle, Vancouver, Yokohama, returning to Shanghai. The call at Shanghai on the eastbound voyage is an addition to this service and is in order to cover both the Yangshan and Waigaoqiao terminals at Shanghai.

    India’s Shipping Corp reported to be considering closing its container division

    India’s state-owned Shipping Corp of India (SCI) is reported to be giving consideration to closing its container business because of reduced demand. SCI operates a fleet of 11 containerships moving cargo between India, Europe and Asia. The company produced losses of US$36 million for the half year of 2009.

    NYK aims at raising US$1.6 Billion to stay fluid

    Japan’s NYK Line intends raising Y142.5 Billion (US$1.6 Billion) by way of a public share offering to ease its way through the current downturn in the container markets. “Through this offering, the NYK Group intends to procure funds for the purposes of capital expenditures, principally with respect to vessels. In addition, the NYK Group seeks to bolster its financial position in order to effectively implement its structural reform plan,” the company said in an investor statement.

    A closer look at the new Customs Control and Customs Duty Bills

    by Ronnie Van Rooyen, Senior Manager:Tax, Deloitte & Touche

    On 30 October 2009 the South African Revenue Service (SARS) launched the new Customs Control and Customs Duty Bills. It is a major milestone in SARS embracing the World Customs Organisation’s (WCO) modernisation program.

    The current Customs and Excise Act, 1964 (Act) was written and amended at a time when Customs administrations worldwide were policing and controlling trade manually instead of facilitating trade using technology to integrate with the global customs community.

    On 18 May 2004 when the South African Government agreed to implement the Revised Kyoto Convention (RKC) it committed to modernise customs in South Africa. As a result the current Act had to be restructured. Drafting of the new Bills commenced in January 2005.

    The new Bills have been designed as follows:

    1. The Customs Control Bill follows a generic supply chain process and the chapters begin, for example, when the vessel, aircraft, train or vehicle arrives at a customs port. It then moves on to transporting the goods to a depot or terminal. Thereafter the goods are cleared for home use or inward processing and finally the export process is considered. Obviously the main focus of the Bill is on customs procedure which ranges from transit, transhipment, temporary admission, warehousing, tax free shops, export, temporary export, inward processing, outward processing and home use.

    2. The Customs Duty Bill is structured around three broad topics: (a) the imposition of duties, (b) the assessment of duties, and (c) the payment and collection of duties. These three topics are dependent on the customs trilogy which is classification (found in chapter 6), valuation (found in chapter 7) and origin (found in chapter 8).

    The new Bills also make use of new vocabulary. Where the current Act refers to, for example, ‘for home consumption’ the new Bills refer to ‘for home use’. Similarly, ‘manufacturing goods’ is now termed ‘inward/outward processed goods’. There are also new concepts that are introduced to the taxpayer. For example the Customs Duty Bill refers to ‘tax due status of goods’ and ‘tax free status of goods’.

    Although there are many new terms and concepts, the Bills are based on global customs principles that have been around for years. The amendments made are aimed at allowing the SARS to move its customs administration from a traditional manual stand alone administration to a new modern administration where its role will be to secure supply chains by involving and integrating customs-to-customs, customs-to-business and customs-to-other government organisations.

    From the above it is clear that when promulgated, the new Bills will have significant impact on business. Since the Act has been completely re-drafted and is not a mere amendment of sections, business may require more time to digest and comment on these Bills. The current deadline of 26 February 2010 (covering the festive period) may need to be extended by SARS.

    This being said, it is an exciting time for all of us. The new Bills are real evidence that SARS is committed to implementing international trends initiated by the WCO and to integrate with the international trade community in a positive way. It also represents a move towards facilitating and controlling international trade using global best practice.

    News clips – Keeping it brief

    French Navy captures pirate mother ship

    FNS FLOREAL at Salisbury Island Naval Station, Durban. Picture by Terry Hutson

    The French Navy patrol ship FNS FLOREAL has captured a suspected Somali pirate mother ship accompanied by two skiffs of the sort commonly used by pirates. Arms and ammunition and a supply of fuel was discovered on board the mother ship which was operating 650 n.miles east of the Somali town of Hobyo and to the north-east of the Seychelles. At the weekend the French were still undecided on what to do with the captured vessel and skiffs and the 12 suspected pirates on board.


    Stuck in the Antarctic

    Passengers on board the Russian icebreaker KAPITAN KHLEBNIKOV have been forced to enjoy an additional week deep in the Antarctic after their ship became stuck in thick ice. The icebreaker, which undertakes regular cruises to the Antarctic, sailed in early November and was due to return this week but will now be delayed until the ice decompresses sufficiently to free the ship, which is however in no danger. On board are 105 passengers of whom the majority are British, who are being entertained by extra lectures from biologists and geologists on board. Also on board is a film crew from the BBC filming a nature documentary series called The Frozen Planet.


    SA Navy hopeful of acquiring simulators

    The South African Navy Maritime Warfare Training Centre in Simon’s Town hopes to acquire two new simulator systems for specialist training within the next three years. The simulator systems will provide training for the Global Maritime Distress Safety System (GMDSS) and for flight deck control. The flight deck simulator would be used to train controllers for the safe launching and recovery of helicopters on the navy’s four frigates and other vessels. The navy currently outsources both forms of training to tertiary institutions.

    Pics of the day – GEO BARENTS and VICKIE TIDE

    The Norwegian research vessel GEO BARENTS (4,979-gt, built 2007) called at Cape Town in the past week for bunkers and supplies. Picture by Aad Noorland.

    An unusual visitor in Cape Town last week was this American crew boat, VICKIE TIDE (494-gt, built 2003), operated by Tidewater Marine. Vickie Tide called for bunkers and equipment. Picture by Aad Noorland

    Don’t forget to send us your news and press releases for inclusion in the News Bulletins. Shipping related pictures submitted by readers are always welcome – please email to info@ports.co.za

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