Ports & Ships Maritime News

12-13 January 2012
Author: Terry Hutson

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TODAY’S BULLETIN OF MARITIME NEWS

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• First View – MSC BUSAN
• Nigerian strike enters fourth day with no sign of let-up
• BIMCO foresees a challenging year ahead
• US keeps AGOA going but no new members
• Piracy: Tanker reported highjacked
• Malaysia seizes R6 million of ivory smuggled from Cape Town
• TFR orders another 43 class 43 diesel-electric locos
• Pics of the Day – MSC CHELSEA

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FIRST VIEW – MSC BUSAN

Mediterranean Shipping Company’s MSC BUSAN (89,954-gt, built 2005) sails from Durban this week on a typically hot, humid summer afternoon, seen here in the entrance channel with the ship facing the high seas once more. Picture by Trevor Jones

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NIGERIAN STRIKE ENTERS FOURTH DAY WITH NO SIGN OF LET-UP

As the national strike across Nigeria enters its fourth day today (Thursday), there is no sign of let up or a relaxing of tensions in the West African country. In several states of the country the state curfews have been imposed – in the southwest state of Oyo a 12-hour curfew between 7pm and 7am each day is now in force and in the northern city of Kaduna a 24-hour curfew was imposed after thousands of fuel protesters attempted to force their way into government complexes.

Police fired teargas into the crowds to disperse the protesters.

At the other end of the scale the strike is having its amusing moments as well. Strikers are playing on the Nigerian president’s first name, Goodluck Jonathan. As one man wrapped a goat in a union flag, which presumably carries its own message, others were seen carrying around a coffin labeled ‘Badluck’.

And while police in some areas have been quick to react when it came to crowd control, in other areas soldiers and police were seen to be clapping as protesters marched by. Lagos and several other cities including the capital Abuja and Kaduna are reported to have been brought to a standstill with shops, businesses and airports closed.

This about sums up the action in Nigeria, where in the north the army and police are fighting a war of insurgency against a terrorist group calling themselves Boko Haram which is thought to have affiliations to Al-Qaeda, while up to eight million workers have downed tools in their demand that a fuel subsidy be reinstated. In the fuel dispute the Nigerian government has so far kept its resolve, saying that the fuel subsidy cost Nigeria nearly US$8 billion in 2011, money which the federal government says is required for improving Nigeria’s inadequate infrastructure.

The rank and file of the ordinary people, who have faced years of corruption among its leaders in government are saying they don’t trust people in government anymore and are demanding that the fuel subsidy be reinstated immediately.

Meanwhile the federal government says it will enforce the ‘no work, no pay’ policy if the strikers don’t return to work.

News from the respective ports is sketchy and it is difficult to report on whether they are open or have shut. Indications are that some of the ports have been adversely affected by the strike although this has not been confirmed.

One area of shipping that appears not to be greatly influenced is the oil export side, where industry has indicated that ships are loading cargo and that export production has not been affected.

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BIMCO FORESEES A CHALLENGING YEAR AHEAD

MSC Melody arriving in Port d’Ehoala (Fort Dauphin), Madagascar

BIMCO has just published its Reflections 2012, which examines critical issues facing the shipping industry now and in the coming year.

This concise but thought-provoking annual analysis of the world in which shipping operates considers the challenges facing one of the world’s most essential industries and its principal sectors. It emphasises the need for regulation to be maintained on a global basis, and calls for practical and pragmatic moves on environmental rules. On the important human element, it notes the need for fair treatment of seafarers, and when considering the menace of piracy, calls for a new a strategic political approach by governments.

Call for leadership

Reflections 2012 begins with a call for “daring and decisive political leadership”, especially as it confronts the challenges within the EU and US, with their considerable influence on maritime trade. It points also to the need to stimulate domestic demand in Asian nations, despite their own regional difficulties. It forecasts a 4% GDP growth worldwide – similar to that of 2011- but warns about the significant oversupply in shipping tonnage in all three main sectors, with no short term comfort discernable, recommending the traditional remedies of idling and recycling to control this tonnage glut.

While there might be prospects for growth in the product tanker sector, and general help from slow steaming, the container sector can look forward to a markedly challenging year with another 50% increase in the number of very large containerships entering service. Nevertheless, owners are urged to learn from past lessons of “expecting the unexpected” with India, perhaps starting to fulfil its import potential during the coming year.

Reject regional rules

On regulations Reflections 2012 reiterates BIMCO’s demand for a global perspective to prevail, with international ratification of important conventions and a rejection of regional alternatives. There is, moreover, a need for shipowners and shipbuilders to more fully realise their interdependence and to work more closely together on a whole range of issues common to the two industries.

A section on Shipping and the Environment focuses on the further development of the Energy Efficiency Design Index for new ships built after 1 January 2013, this being seen by BIMCO as a significant key to international progress on atmospheric emissions. The organisation once again expresses its scepticism on regional initiatives which would tend to cloud the issues and provide impossible complexities for internationally trading ships. It also hopes to see movement on the important Ballast Management and Recycling Conventions in the coming year.

Treat seafarers fairly

The fair treatment of seafarers, especially those who might become enmeshed in the aftermath of environmental incident, is seen as an important part of the organisation’s human element agenda, when viewed against a trend that clearly identifies the continuing injustices of a presumption of guilt in such cases. BIMCO also highlights the growing demand for a better trained and educated industry workforce, which has encouraged the organisation into becoming, with its eLearning Diploma Programme, a major educational hub for the industry.

Political will on piracy

On the continuing issue of piracy, Reflections 2012 offers strong views on the lack of political will to confront the realities of this plague and to recognise the harm being done to international trade. Public opinion also needs to be galvanised over the many outrages which face shipping operating in pirate infested areas. While providing practical assistance with the development of standard contracts for armed guards on ships BIMCO calls for a new strategic approach to combating piracy, noting that the industry continues to bear the brunt of international failure on the political front. The New Year will see BIMCO addressing political leaders directly, calling for a new approach and emphasising the significant threat to world trade represented by piracy on such a scale.

Still new opportunities

There may be serious challenges facing shipping in the coming year but Reflections 2012 notes that the good news is that “the world is still turning and trade is growing”. In his introduction to Reflections 2012 BIMCO President Mr Yudhishthir Khatau suggests that even in difficult times “there will continue to be new opportunities and many will be tempted and some rewarded for exploring them”. He forecasts consolidation in the industry, pointing out the realities of operating in a business dominated by cashflow. The President however suggests that “shipping will prevail and find calmer waters, as has always been the case”. It is the date and time of this recovery which remains in doubt!

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US KEEPS AGOA GOING BUT NO NEW MEMBERS

The US government has kept the number of sub-Saharan African countries eligible to trade under the African Growth and Opportunity Act (AGOA) at 40.

As of June 2011, there were 37 countries, but on October 25, 2011, President Barack Obama signed a presidential proclamation designating Côte d’Ivoire, Guinea and Niger as eligible for AGOA benefits.

US Trade Representative Ron Kirk announced on 29 December 2011 that during the 2011 review process, President Obama determined that all the countries currently eligible for trade preferences and other benefits under the African Growth and Opportunity Act (AGOA) would remain eligible and that no new countries would be added as AGOA beneficiaries.

Each year the US administration examines whether the countries named in the act had met AGOA’s eligibility criteria. Those criteria include establishing, or making continual progress toward establishing, a market-based economy, rule of law, economic policies to reduce poverty, protection of internationally recognized worker rights and efforts to combat corruption.

Countries eligible for AGOA also may not engage in activities that undermine US foreign policy interests, or engage in gross violations of internationally recognised human rights, the US government states.

However, not many of these African countries are making the most of this arrangement. During the first Africa Trade Forum in Addis Ababa, Ethiopia November 2011 some participants expressed disappointment in the fact that AGOA is not benefitting African countries as it should.

Some participants blamed the foreign missions of African countries in the US for being inefficient in disseminating information about the programme to their home countries.

Poor communication from the embassies in Washington DC was cited as a factor that has hampered African countries from enjoying the full benefits of AGOA.

Meanwhile, despite the exponential increase in the volume as well as the value of goods and services traded across borders, Africa’s share in global trade continues to decline.

Global trade (in current prices) has increased from US$13 trillion in 2000 to an estimated $30 trillion in 2010, but Africa’s share in world trade has been in decline since 1980 and currently stands at about three per cent, according to the African Trade Policy Centre (ATPC) of the United Nations Economic Commission for Africa (UNECA).

The ATPC says on its website, “The continent remains heavily dependent on the export of a few primary commodities, most of which until recently had suffered significant decline in prices over the years, leading to large trade losses and worsening balance of payments.”

AGOA was first signed into law by President Bill Clinton in May 2000 with the objectives of expanding US trade and investment with sub-Saharan Africa.

According to information available on the AGOA website, the programme expands the list of products which eligible sub-Saharan African countries may export to the United States subject to zero import duty under the Generalized System of Preferences (GSP). While general GSP covers approximately 4,600 items, AGOA GSP applies to more than 6,400 items. AGOA GSP provisions remain in effect until 30 September, 2015.

In 2010, over 93 percent of US imports from AGOA-eligible countries entered duty-free, either under AGOA, GSP, or zero-duty Most Favoured Nation rates.

AGOA, it says also provides reforming African countries with the most liberal access to the US market available to any country or region with which the United States does not have a Free Trade Agreement. It supports US business by encouraging reform of Africa’s economic and commercial regimes, which will build stronger markets and more effective partners for US firms.

Total two-way goods trade with sub-Saharan Africa countries during 2010 was $82 billion. US imports under AGOA totalled $44.2 billion. Non-oil imports under AGOA totalled $4 billion and included value-added products such as apparel, footwear, processed agricultural products and manufactured goods, the information adds.

The top five beneficiary countries were Nigeria, Angola, South Africa, Republic of Congo and Chad. Source Agoa.info

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PIRACY: TANKER REPORTED HIGHJACKED

The tanker Liquid Velvet, highjacked in October last year and which is thought to be back at sea with the Somali pirates using her as a mother ship.

Unconfirmed reports say that an Iranian chemical tanker was highjacked by pirates but details of the incident, if it took place, remain sketchy.

Iran has in the past made similar claims that have not been borne out by facts later determined. Iranian news agencies state that a chemical tanker was attacked and seized by pirates yesterday (11 January) while the ship was sailing towards North Africa. At the time of this report being prepared none of the international piracy reporting centres had corroborated the reports.

However, all vessels sailing in the Gulf of Aden are advised to stay on high alert, particularly after the previously highjacked tanker LIQUID VELVET was reported to be operating as a pirate mother ship between Socotra and the northeastern tip of Puntland earlier this week.

Also earlier this week two Iranian fishing vessels were rescued by Danish and US naval forces operating in the region. In one of these incidents the US Coast Guard cutter MONOMOY rescued six Iranian fishermen/sailors who were being held hostage by pirates on the cargo dhow YA-HUSSAYN.

Indian seafarers freed off Nigerian coast

The Norwegian tanker Spar Rigel at Maputo last year. Picture by Jean Mandeville/Vesseltracker

Twenty-one seafarers on board a Norwegian-owned and flagged ship, the bulk carrier SPAR RIGEL (58,000-dwt, built 2010) were rescued this week by naval forces after they locked themselves in a citadel on the ship, to prevent armed pirates from using them for hostage purposes.

The statement by the Indian Shipping Ministry did not specify where the incident took place except that it was off the Nigerian coast – one source suggests the ship was in the approaches to Port Harcourt at the time of the attack.

The crew of the Spar Rigel consists of 20 Indian and one Ukrainian seafarers.

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MALAYSIA SEIZES R6M OF IVORY SMUGGLED FROM CAPE TOWN

Customs officials in Port Klang in Malaysia have seized a container filled with elephant tusks with an estimated value of US$760,000. The tusks were hidden among motor vehicle tyres while the paperwork said the container carried polyster and nylon strand matting.

The container had been shipped from the port of Cape Town. Malaysian Customs officials said the container was destined for Malaysia and was not being transhipped through the South East Asian country.

According to reports a number of containers found to be carrying smuggled tusks have been detained in Port Klang.

It is thought that Cape Town is being used for the smuggling of containers out of South Africa as the port lacks x-ray scanning equipment such as that used in Durban.

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TFR ORDERS ANOTHER 43 CLASS 43 DIESEL-ELECTRIC LOCOS

TFR’s class 43 diesel-electric locomotive. Picture Wikipedia Commons

Transnet Freight Rail (TFR) has ordered another 43 of the class 43 diesel-electric locomotives which will be put to use on several of the export lines.

TFR already has an order for 100 of the class 43 locos, which was placed with the US company of General Electric (GE). The locos are based on GE’s 3,300-hp C30-ACi fuel- efficient platform and are the most powerful diesel-electrics in service with TFR. The first ten of this class were delivered from the United States – the balance are being manufactured under license by Transnet Rail Engineering (TRE) at its workshops in Koedoespoort north of Pretoria.

The 143 locomotives of this class are to be deployed on the Phalaborwa-Richards Bay corridor (53), the Sishen-Saldanha iron-ore corridor (30), the Witbank-Nelspruit- Komatipoort line (32) and to transport coal to Eskom power stations (28).

By relying on improved technology that uses alternating current (AC) GE engineers say they have been able to ramp up engine efficiency and hauling capacity without any additional fuel increase. As a result, three GE locomotives can do the work of four older locomotives, lowering emissions by 1,400 tons of carbon dioxide and saving the rail operator as much as 160,000 gallons of fuel per year.

According to Transnet chairman, Mafika Mkwanazi, the deal with General Electric sets up the TRE Koedoespoort plant as a potential supplier of locomotives for third parties, in particular those in other parts of Africa but also internationally including possibly to Queensland in Australia which uses the same 1067mm Cape gauge of railway as in South and southern Africa.

The first 90 locomotives being assembled at Koedoespoort have a local content of approximately 20%, which will increase for the second batch of 43 to approximately 30%. Locomotives are being delivered at a rate of three a month – so far 28 of the locally assembled units have been delivered.

PICS OF THE DAY – MSC CHELSEA

Mediterranean Shipping Company’s Chinese-owned and ageing container ship MSC CHELSEA (17,468-gt, built 1983) made what may have been her first call in MSC colours to Cape Town this week, although the ship has no doubt visited the Mother City under a variety of different names and operators in the past. Pictures by Ian Shiffman

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