Ports & Ships Maritime News

15 April 2014
Author: Terry Hutson

Bringing you shipping, freight, trade and transport related news of interest for Africa since 2002

TODAY’S BULLETIN OF MARITIME NEWS

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• First View – Captain Steven L Bennett
• Emission controls set to skyrocket shipping costs
• East African railway project gets underway
• Namibia marine mining moratorium still in force
• Transnet completes dredging training programme
• DP World looks to eliminate Somali piracy at its source
• Awards galore for Wallem
• Int’l Spotlight – Cabotage is a barrier to world trade, says WEF
• Expected Ship Arrivals and Ships in Port
• Pics of the Day – MSC NAMIBIA II

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FIRST VIEW – CAPTAIN STEVEN L BENNETT

The American-flagged general cargo ship CAPTAIN STEVEN L BENNETT became one of the more anticipated callers at Durban as soon as she was picked up on AIS as heading for the KZN port. This was while she was still in the Red Sea, with ports of call to be made along the east coast and by the time she reached Durban all she had for discharge was 6,000 tonnes of wheat, a bulk commodity that was swiftly handled at Maydon Wharf within 24 hours, the ship then sailing again.

What made Captain Steven L Bennett, the ship, of interest is that she is a recent Military Sealift Command vessel of the US Navy. We featured her in our News Bulletin of 31 March where she was shown shrouded with a white canvas to protect ‘delicate’ cargo being carried for military purposes. See that report HERE - use your BACKSPACE key to return to this page.

Since last year Captain Steven L Bennett has been operating in world-wide service in the spot cargo trade. Picture: Trevor Jones

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EMISSION CONTROLS SET TO SKYROCKET SHIPPING COSTS

New ship emission controls are set to increase dramatically by as much as US$ 120 per TEU on shipping operating in the North Sea and Baltic low-sulphur control regions, as from next year, says shipping analysts Drewry.

Different analysts attending the recent Global Liner Shipping conference in Hamburg predicted even higher costs when other emission control zones in the US and the Mediterranean come into force, reported Lloyd's Loading List.

Mercator International partner Jesper Kjaedegaard added that bunker costs could be higher because increased demand for this type of fuel would drive up prices.

Mr Kjaedegaard said other trades lanes would be more affected, pointing out the US east coast would be a control zone, meaning that 60 percent of a transatlantic voyage to North Europe would be forced to consume the costly fuel.

“Very few carriers are equipped with liquefied natural gas engines, instead they have to use low sulphur marine diesel oil, or scrubbers,” said Drewry Supply Chain Advisors director Philip Damas:

Carriers are expected to increase bunker adjustment factor charges 20 percent to cover the higher cost about $300 per tonne, said Mr Damas.

“The impact of this is that the cost per tonne is 50 percent higher than the current fuel. So it's a huge increase next year,” he said.

Drewry's calculations were based on one TEU accounting for a tonne of fuel on the Asia-Europe trade and that portion of the voyage taking place on the North Sea and Baltic Sea emission control areas.

Mr Damas conceded that his estimates were low compared to other companies that predicted costs rising $500 per TEU.

MDS Transmodal managing director Mike Garratt doubted this, saying Mr Damas' estimates were overblown, while agreeing that if the Mediterranean becomes an emissions control area, cost would be even higher.

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EAST AFRICAN RAILWAY PROJECT GETS UNDERWAY

After months of controversy around Kenya’s Ksh327 billion (US$ 3.8 billion) standard gauge railway (SGR) between Mombasa and Nairobi, the project is finally underway. But in Uganda the wrangles are just starting, reports The EastAfrican.

A visit to the Changamwe yard, where Kenya’s President Uhuru Kenyatta launched the project late last year, shows that the implementation is gathering speed. Last Thursday morning, workers were on site clearing a section of the yard where the construction will begin.

Some machinery from Spedag Interfreight, the firm contracted to handle logistics, was at the site. Other materials — including slippers, rail lines, bolts and steel bridges — were said to be on the high seas and would arrive “soon,” an indication that Kenya is keen to start the project after months of controversy.

At issue are the cost of the project to the Kenyan taxpayer, its appropriateness over other options like upgrading the existing line to improve its capacity and speed, and the funding model and integrity of the procurement process for the project, which is to be done by China Road and Bridge Corporation.

In Uganda, efforts to start construction of its SGR line between Malaba and Kampala are mired in a procurement wrangle.

Early this week, Uganda’s Ministry of Works terminated a memorandum of understanding (MoU) with the China Civil Engineering and Construction Company (CCECC), setting off potentially protracted litigation that could expose the country to a multimillion dollar claim in compensation and cause slippage in the schedule for the project.

In an 8 April letter to the president of the construction firm, Ugandan junior Minister for Works John Byabagambi served the Chinese contractor with a three-month notice of intention to terminate the MoU entered into by the parties in March 2012.

“CCECC has shown unwillingness to resolve any differences with the government of Uganda amicably, even before we sign formal contracts for the projects. Instead, the company has resorted to threats of court action among others. I am convinced that CCECC shall not be a reliable partner in the execution of the projects , should the government go ahead to sign contracts with them,” Mr Byabagambi wrote before serving the notice of termination from 9 April to 10 July 2014.

The contractor’s representatives, however, disputed the minister’s grounds, arguing that in all meetings with him, he has attempted to force rather than negotiate positions with CCECC.

“We have also never threatened to go to court as alleged by the honourable minister, and it is only this latest action by him that now invites us to go to court,” the company told The EastAfrican.

The SGR project is poised to open up the East African Community infrastructure. A fortnight ago, South Sudan announced that it would join EAC countries in the development of the SGR to reduce transport costs and boost regional trade.

Kenya reached a deal with Uganda and Rwanda to construct the SGR railway to link Mombasa port to Malaba on the border with Uganda. It will be extended to Uganda, and, by 2018, to Rwanda.

So why did the region opt for SGR? The major point of contention in Uganda revolves around attempts by the minister to reallocate the Kampala-Malaba section from CCECC to a rival contractor, yet the latter had already submitted detailed designs and feasibility studies. - The EastAfrican

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NAMIBIA MARINE MINING MORATORIUM STILL IN FORCE

Diamond recovery vessel ‘dredging’ the ocean bed for diamonds

Namibia’s Minister of Fisheries and Marine Resources Bernard Esau said last week that his ministry has not changed its position regarding the moratorium on marine mining activities in the country.

In September last year, Cabinet decided to place a moratorium on marine phosphate mining to enable the line ministry to conduct a strategic environmental assessment.

Esau said in the National Assembly (NA) that his ministry remains resolute in its commitment to ensure that proper scientific investigations are carried out which will allow the government to make an informed decision about the future of marine phosphate mining in Namibia.

The minister said the substantial body of information which will be collected during the moratorium period will provide an indication as to whether the marine ecosystem will be impacted by such mining.

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TRANSNET COMPLETES DREDGING TRAINING PROGRAMME

Transnet NPA’s maintenance dredger, ISANDLWANA (6,155-dwt, built 2010) which is normally based in Durban and was available for the training programme described below.

At the end of February, the Training Institute for Dredging (TID) conducted a three-day training programme for the Transnet National Ports Authority (TNPA) in Durban.

The main focus was to provide harbour masters with valuable insights into the fundamentals of dredging projects, types of equipment, working methods and contract responsibilities – whilst also considering the specific circumstances and environments in which a port authority operates.

The TNPA provides infrastructure and marine services, including dredging activities to the eight commercial ports on the South African coastline. As TNPA’s harbour masters and dredging services are frequently involved in maintenance dredging, a thorough understanding of the practice is required.

In order to further raise these specific knowledge levels, the Training Institute for Dredging was invited to provide an on-site training programme. The main objective was to increase participants’ capabilities to set up, monitor and guide dredging activities, enabling them to discuss the project’s approach and limitations on an equal footing with all of the parties involved.

Training topics ranged from a general introduction to dredging, expounding on the types of dredgers and dredging projects, to more complex material dealing with issues such as measuring dredging volumes and specific equipment limitations. The subject matter was addressed in a variety of engaging ways, including visual presentations, group discussions and case studies.

To supplement the two-day theoretical component, day three featured a visit to a trailing suction hopper dredger moored in Durban. While on board, the group was informed of the vessel’s capabilities and potential application for the authority’s dredging projects. Visits to dredging sites or vessels are often a valuable and much appreciated addition to TID’s theoretical training programmes. A short excursion to a project or dredger can be helpful in consolidating the contents of a course, combining theory with the ‘nuts and bolts’ of field experience. - Dredging News Online

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DP WORLD LOOKS TO ELIMINATE SOMALI PIRACY AT ITS SOURCE

How to support Somalia to build its economy, attract international investment and create jobs and a future for its young people as an alternative to taking to sea as pirates was the focus of a high level meeting of public and private sector experts on Somalia brought together by DP World in Dubai last week.

The panel discussion, themed “The Business Environment, Regulatory Reform and Key Economic Sectors for Investment in Somalia,” is the first of three that DP World is convening with knowledge partner, the Institute for Near East and Gulf Military Analysis (INEGMA), with the focus this year being on supporting the development of Somalia as part of the port operator’s on-going counter-piracy efforts.

For the past three years, DP World and the UAE Ministry of Foreign Affairs have co-convened an annual international Counter-Piracy Conference in Dubai that brings together more than 750 industry and government leaders to seek solutions to piracy, both at sea and on land. Piracy originating in Somalia has fallen dramatically over that time. Attention is now turning to building the economic capacity of that country.

Included in those attending the discussion were Yusuf Moallim Amin, Minister of Ports, Federal Republic of Somalia, Prof. Ali Mohamed Gedi, former Prime Minister, Federal Republic of Somalia, Ambassador Mahash Saeed Alhameli, Director of International Security Cooperation Department, UAE Ministry of Foreign Affairs, and DP World Group CEO Mohammed Sharaf.

“Marine piracy grew directly out of the twenty years of turmoil in Somalia and it will only disappear once Somalia’s young people have an alternative future – one that allows them to not just survive but thrive in safety, to feed themselves, to raise a family, to participate in the community,” said DP World Group CEO Mohammed Sharaf.

“Somalia has a huge diaspora of people who are proudly Somali and in these discussions we are tapping into that talent to generate ideas and actions to help Somalia once more be a strong trading nation connected to the world.”

“Our more than 30 panelists included representatives from the shipping, financial, telecom and trade sectors, who were unanimous in their optimism for the sustainable long term future of Somalia,” said panel moderator Dr Theodore Karasik, INEGMA Director of Research and Consultancy.

“The discussion identified the strengths that currently exist in Somalia, the opportunities for business both for those in Somalia and those who would like to invest in Somalia, and where the gaps are and how they can be filled.”

During the discussion, the panel stressed that the economic landscape of Somalia had changed radically over the past five years and the time had come for action to attract investment, particularly in agriculture and fishing, and in building the capabilities, scope and scale of supporting financial and other institutions. The panel also highlighted the important contribution of the returning diaspora of young, well-educated Somalis who are working hard to build economic capacity in their homeland.

The panel discussions will feed into white papers that will be made publicly available. The first is due for release mid-May. - Albawaba Business

AWARDS GALORE FOR WALLEM

The Wallem Group has been scooping the shipping awards pool, winning a plethora of awards from peers, seafarers, clients and government.

“We are so proud of the recognition we have received from across the industry – from our clients and peers to our employees and government bodies – it is all endorsement that Wallem is growing its business with best practice and innovation,” said Simon Doughty, Wallem Group CEO.

“We are committed to building on our 110 year heritage with a strategy that takes a long view of our business and includes working with clients that have a similar view on sustainable business, developing our shore and sea staff as shipping’s future leaders, and making a positive contribution to our industry.”

The Shipping Company of the Year title was bestowed on Wallem by the International Seafarers Welfare and Assistance Network (ISWAN) for the Wallem Group’s crew welfare program in the Seafarer Welfare Awards. ISWAN is backed by the ITF (International Transport Workers Federation and nominations for the Award are made by seafarers, endorsing Wallem as a leading employer for seafarers around the world.

The Award was announced last week at a ceremony hosted by the Director General of the International Labour Organisation, Mr Guy Ryder, at the ILO in Geneva.

Wallem Ship Management has received a double recognition from leading Japanese ship owner/operator client NYK Group, winning Car Carrier of the Year Awards for two vessels in management, and the Innovative Bunker and Idle time Saving (IBIS) Award for all NYK container vessels in Wallem’s management.

The shipping industry also recognised Wallem with the Ship Manager of the Year Award at the annual Seatrade Asia awards ceremony in Singapore on 07 April. The Award recognises excellence in ship management, from crewing to technical and procurement services.

Wallem delivers ship management services from the key maritime locations of Hong Kong, Singapore, Europe and North America. Wallem also won the Most Compassionate Employer of Indian Seafarers Award, bestowed by the Indian government, for Wallem’s policies and activities in seafarer welfare.

INT’L SPOTLIGHT – CABOTAGE IS A BARRIER TO WORLD TRADE, says WEF

The World Economic Forum (WEF) suggests lifting supply chain barriers to boost global trade. Its report entitled “Enabling Trade – Valuing Growth Opportunities” indicates that diminishing supply chain barriers “could increase world GDP six times more than merely eliminating tariffs.”

The report identifies four key areas that impact on the freedom of the global supply chain—market access, border administration, transport and communications infrastructure, and business environment.

Additionally, the report estimates that by reducing supply chain barriers global GDP could increase by US$ 2.6 trillion or 4.7 percent and exports by $1.6 trillion or 14.5 percent.

In contrast, removing tariffs could only raise global GDP by $0.4 trillion or 0.7 percent, and exports by $1.1 trillion or 10.1 percent.

Referring to maritime shipping, the report says cabotage – the movement of goods between two points within a country’s borders – complicates logistics and raises both the costs and environmental impact of delivering those goods.

According to the figures from maritime analyst Alphaliner, domestic cabotage trades worldwide absorb a total of 550,000 TEU in container shipping capacity.

Among the top 10 countries with a significant cabotage fleet, seven are Asian countries.

Except for the US and Japan, the rest are all emerging countries including China, Indonesia, Brazil, the Philippines, Malaysia, India, Vietnam and Russia.

China has the largest cabotage fleet, accounting for 45 percent of the total worldwide figure. Indonesia follows with 24 percent, while the US comes next with 10 percent and Brazil the fourth with nine percent. – Container Shipping Manager

EXPECTED SHIP ARRIVALS and SHIPS IN PORT

East London harbour

Ports & Ships publishes regularly updated SHIP MOVEMENT reports including ETAs for ports extending from West Africa to South Africa to East Africa and including Port Louis in Mauritius.

In the case of South Africa’s container ports of Durban, Ngqura, Ports Elizabeth and Cape Town links to Stack dates are also available.

You can access this information, including the list of ports covered, by going HERE - remember to use your BACKSPACE to return to this page.

PICS OF THE DAY – MSC NAMIBIA II

It’s not often that we have the opportunity of showing pictures of ships arriving or sailing from ports outside South Africa, so when a few do come available they are very welcome. Here we see the 1928-TEU container ship MSC NAMIBIA II (27,500-dwt, built 1991) arriving outside the Kenya port of Mombasa and entering the Likoni Channel. Readers are welcome to submit pictures appropriate to Ports & Ships. Pictures: Mubarak Sodha

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