Friday, February 13, 2015

AltaSea Project Receives $20 Million Donation

By Mark Edward Nero

AltaSea, an in-development marine research center at the Port of Los Angeles, will receive a $20 million gift from the Annenberg Foundation, the foundation’s president and CEO said Feb. 11 at an event to unveil designs for the project.

Wallis Annenberg, Chairman, President and CEO of the Annenberg Foundation, announced the contribution toward the development of AltaSea, a new public-private endeavor in the Port of LA that brings together science, business and education to generate solutions to the challenges of sustainability.

“The ocean may be the most precious public resource we have, a life source unlike any other on the planet,” Annenberg said. “AltaSea is about uniting business, academia, and our scientific community to turn the Port of LA’s public waterfront into the mecca for jobs, discovery and sustainability that it should be.”

AltaSea, now in its first phase of development, came to fruition in 2013 when the LA City Council approved a lease agreement to transform a pier on the Los Angeles waterfront in San Pedro into AltaSea.

Located on a 35-acre campus in the Port of Los Angeles, AltaSea is said to be the only urban, ocean-based ideas and innovation center in the world.

Planning and permitting for Phase One has begun, with construction expected to begin in 2017 and be complete by 2019. The total project budget is $217 million, with a goal of $160 million in private funding.

The 50-year master lease for the 35-acre site requires $53.25 million to be raised by the first quarter of 2017 for the port to begin construction and ensure occupancy by the end of 2019.

Hanjin Terminating Portland Calls

By Mark Edward Nero

Hanjin Shipping said in a Feb. 10 letter to customers that it is terminating direct call service to the Port of Portland in early March. “However, we will continue to provide services to/from Portland, Oregon and nearby regions via rail and truck transportation to/from Seattle,” the letter said in part.

The revised rotation consists of calls at the ports in the cities of Ningbo, Shanghai, Pusan, Prince Rupert, Seattle, Vancouver, Pusan, Kwangyang and then back to Ningbo. The rotation begins with the arrival of container ship Hanjin Los Angeles at the Port of Ningbo-Zhoushan in China on March 9, according to the letter.

The correspondence advises those with questions to contact their Hanjin sales representative for more information. Hanjin leaving Portland could cripple the port’s container movement business: an estimated 80 percent of business at the port’s only container terminal is Hanjin related.

Although no reason was given for the change, the Port of Portland has been struggling with labor issues for years that have drained productivity. Earlier this month, ICTSI Oregon, which operates Terminal 6, the only container terminal at the port, said productivity at the facility has fallen “well below acceptable historical levels.”

ICTSI says that in the last quarter of 2014, ILWU labor was producing only about 13.2 moves per hour, compared to 24.8 moves/hour in May 2012, a roughly 47 percent reduction, according to the terminal operator.

The labor issues are related to a jurisdiction battle between the ILWU, terminal operator and another union, the International Brotherhood of Electrical Workers, which date back to June. The two unions were fighting over disputed jobs involving the plugging/unplugging and monitoring of refrigerated containers at Terminal 6.

Since then, workers have walked off the job numerous times due to what the longshore union calls “multiple pay disputes and associated grievances” associated with the “mismanagement” of the terminal.

The dispute, which is unrelated to ongoing contract talks between the ILWU and Pacific Maritime Association, has led to multiple container ships bypassing the port over the past two-and-an-half years in order to avoid the situation.

PMA Shutting Terminal Ops for 4 Days

By Mark Edward Nero

The Pacific Maritime Association is suspending vessel operations at port cargo terminals for four days, beginning Feb. 12, with the explanation being that it didn’t want to give weekend and holiday pay to longshore workers during President’s Day weekend.

Weekend and holiday pay rates command a premium of at least 50 percent more than the basic longshore wage rate, according to the PMA, which would mean those working those days would have received between $54 and $75 per hour for longshore workers and clerks and between $77 and $92 per hour for foremen.

“PMA members have concluded that they will not conduct vessel operations on those dates, paying full shifts of ILWU workers such high rates for severely diminished productivity while the backlog of cargo at West Coast ports grows,” the association, which represents terminal operators, said in a Feb. 11 statement.

The four dates affected by the suspension of vessel operations are: Thurs. Feb. 12 (Lincoln’s Birthday); Sat., Feb. 14; Sun., Feb. 15; and Mon., Feb. 16 (Washington’s Birthday). However, yard, gate and rail operations are expected to continue at the terminal operators’ discretion as they did the previous weekend when the PMA also temporarily halted vessel operations as part of the ongoing dispute.

“This is an effort by the employers to put economic pressure on our members and to gain leverage in contract talks,” ILWU President Robert McEllrath said of the four-day lockout.

The maritime association and labor union have been locked in contract talks since May 2014 and the previous six-year deal expired July 1. And although a federal arbitrator joined the talks in January, a final resolution does not appear to be near.

On Feb. 4, the PMA revealed it had made the union an offer that would raise ILWU wages by 14 percent over five years, on top of current average full-time wages of $147,000 per year and would maintain fully employer-paid health care, plus increase the ILWU pension to as much as $88,800 per year. The ILWU, while not commenting on specifics on the contract offer, has said the two sides are close to an agreement.

Port of Quincy Requests Terminal Expansion Funding

By Mark Edward Nero

The Port of Quincy this week requested $16.2 million in transportation funding from the Washington State Legislature to expand the infrastructure at its intermodal terminal to help restore “critical domestic eastbound intermodal rail service” for Central Washington fresh produce, perishable and frozen foods shippers.

The port says the project would expand the infrastructure at the intermodal terminal to meet unit train requirements of BNSF Railway and help eliminate congestion on the Great Northern Corridor Rail Line in Quincy, Wash. In particular, the port says, the expansion project would include installation of three additional intermodal tracks to increase the capacity of the terminal to be able to simultaneously load or unload longer intermodal container trains, and a new longer siding track and set out/pick up track that would allow longer trains to pull off of the BNSF mainline at Quincy for arrival and departure in one piece.

The project would also entail expanding the surface area of the intermodal terminal to allow for more storage of containers, and constructing a bridge across the US Bureau of Reclamation West Canal near Quincy.

Expanding the terminal’s infrastructure would then allow the port to bring-in an intermodal operator to begin shipping fresh produce, frozen foods and other perishable goods grown in the state to the Midwest and Eastern US markets, the port says.

Tuesday, February 10, 2015

Vigor Wins $9.9 Million USN Repair Contract

By Mark Edward Nero

Portland-based Vigor Marine has won a $9.9 million contract for repair work to be performed on the USNS Yukon, a 677-foot-long underway replenishment oiler that provides fuel to ships at sea and jet fuel for aircraft assigned to aircraft carriers. The oiler, which was launched in 1993, has been involved in at least three collisions during its years in service, including in July 2000 when it suffered major damage, including multiple large holes and dents on her starboard quarter after it collided with the USS Denver during an underway replenishment off the Hawaii coast.

Also, in May 2012 it collided with the amphibious assault ship USS Essex after the Essex suffered an apparent steering malfunction upon approach for an underway replenishment. No injuries and no loss of fuel were reported however, and both vessels were able to continue to San Diego under their own power.

The work Vigor Marine has been hired to perform includes: flight deck non-skid preservation; port and starboard main engine overhaul; hip service diesel generator overhaul; port and starboard clutch and coupling overhaul; tank deck overhead preservation; habitability repairs; and cargo system wire replacement.

The contract also includes options that, which if exercised, would bring the total contract value to $10.1 million.

Work is to be performed in Portland and is expected to be completed by May 5, according to the US Navy’s Military Sealift Command in Washington, DC, which is the contracting activity.

Weekend Lockout Halts West Coast Port Operations

By Mark Edward Nero

Work at seaports along the West Coast resumed on Monday after the group that represents terminal operators and shipping lines instituted a two-day stoppage by that halted operations last weekend.

The action was taken, according to the Pacific Maritime Association, in response to an ongoing work slowdown at the ports by the International Longshore & Warehouse Union that allegedly began in late October.

“After three months of union slowdowns, it makes no sense to pay extra for less work,” PMA spokesman Wade Gates said in a prepared statement. “Especially if there is no end in sight to the union’s actions, which needlessly brought West Coast ports to the brink of gridlock.”

Last weekend vessel loading and unloading were halted, but each terminal operator had the discretion of whether to continue yard, rail and gate operations such as the processing of containers for truck and rail delivery to customers. The ILWU has repeatedly denied the slowdown allegations, instead blaming port congestion issues on larger vessels bringing in an ever-increasing number of containers, plus a shortage of the chassis’ used to haul the containers to and from the port terminals.

In a Feb. 9 statement, the union expressed a desire to reach a deal with the PMA.

“West Coast ports re-opened Monday morning after employers closed the docks for two days, increasing delays for customers needing containers,” the ILWU said in a Feb. 9 statement. “The union remains focused on reaching a settlement as quickly as possible.”

Talks to resolve the few remaining issues between the Longshore Union and Pacific Maritime Association are “ongoing,” according to the ILWU.

The PMA and ILWU have been in negotiations since May 2014. The previous six-year labor pact between the two sides, which covered almost 20,000 longshore workers at 29 ports up and down the West Coast, expired last July 1.

The PMA warned the union on Feb. 4 that it could impose a full lockout within 10 days if no contract agreement is reached by then.

Shipping 101 Course Planned for Puget Sound

By Mark Edward Nero

The Marine Exchange of Puget Sound is partnering with Artemus Transportation Solutions, a web-based trade compliance software industry, to hold the Global Commerce-International Transportation & Trade Shipping 101 Course on March 23-27 in Seattle.

The five-day course covers materials needed to effectively trade and ship in the global marketplace, whether as an importer, exporter, NVOCC, freight forwarder, ocean and/or domestic carrier. The course covers the transportation chain, critical work processes, compliance requirements and different modes of transportation and includes an on-site visit to a marine terminal for a first-hand look at the topics discussed throughout the course.

“This is the third time we will be holding the course with Artemus,” Marine Exchange of Puget Sound Executive Director John Veentjer said. “We believe a course like this is important to the community and the positive feedback from past students influenced our decision in hosting this course again.”

“Having a partnership with the Marine Exchange provides us an opportunity to help educate those in Pacific Northwest region who want to trade or expand their business internationally or just increase their knowledge of the international trade business to provide better service or possibly advance a student’s career objectives,” Artemus President & CEO Steve Pniewski said. “This course provides critical work process information so that students are up-to-date on the For more information, visit or contact Artemus directly at (866) 744-7101.

Cruise Industry Predicts 2015 Growth

By Mark Edward Nero

Strong growth for the cruise industry in 2015 is being projected by the Cruise Lines International Association’s annual State of the Cruise Industry Report, which was released Feb. 9.

A record 23 million passengers are expected to sail this year, and 61 percent of North American Cruise Lines International Association-certified travel agents report an increase in 2015 travel bookings over this time last year.

Also, member cruise lines are scheduled to debut 22 new ocean, river and specialty ships in 2015 for a total investment of more than $4 billion, according to CLIA.

“It’s an exciting time for the cruise industry and cruise passengers,” CLIA Chairman Adam Goldstein, who’s also president/COO of Royal Caribbean Cruises Ltd., said. “This year will prove to be another step forward for the entire industry as our members continue to strive to make cruising the best overall vacation experience.”

Among the other outlooks for 2015 that were identified by the cruise industry association:

• Cruise travelers intend to continue to set sail and are highly satisfied with prior cruise experiences. An estimated 62 percent are return cruisers and 69 percent ranked cruising as a better value than a land-based vacation. Overall, CLIA member ocean passenger volume is projected to increase to 23 million in 2015, a four-percent increase over 2014 estimates of 22.1 million.

• Specialty cruises continue to thrive. CLIA’s specialty segments, which includes sophisticated ships, luxury yachts, elegant ocean liners and the newest river cruises, continue to experience double digit passenger growth. In fact, specialty cruises grew by 21 percent annually from 2009 to 2014 estimates.

• The Caribbean is expected to see more than a third of the global deployment capacity market share in 2015. However, the Mediterranean continues to grow as a destination, as well as other regions including Asia and Australia. In 2015, 52 ships are expected to provide 1,065 Asian cruises with capacity for 2.17 million passengers.

• Although the Internet and mobile devices have overtaken how consumers make purchases, travel agents continue to be the most popular and best way to book a cruise. In fact, 70 percent of cruise travelers use a travel agent to plan and book cruise vacations.