Friday, June 17, 2011

NOL Orders 12 New Box Ships, Upgrades Order For 10 More


Officials from Neptune Orient Lines Group, the parent of ocean carrier APL and the seventh-largest shipping line in the world, announced Thursday that letters of intent had been signed with two South Korean shipbuilders for the construction of 12 new container vessels and that an existing order for 10 additional vessels had been upgraded in scope.

The new and upgraded orders are part of NOL's ongoing efforts to invest in new, larger vessels to reduce unit capital and operating costs, meet future growth needs and replace older and smaller chartered vessels that will be returned to their owners in the charter market.

The Singapore-based NOL Group said that the vessels, all to be built in South Korea, would include ten 14,000-TEU vessels to be constructed by Hyundai Samho Heavy Industries Co., Ltd and two 9,200-TEU vessels to be constructed by Daewoo Shipbuilding & Marine Engineering Co.

NOL officials said the carrier has also upgraded a December, 2010 order placed with Daewoo – originally for ten 8,400-TEU vessels – to ten 9,200-TEU vessels of a "new, more efficient design and technology."

The new vessels and upgrades will cost NOL about $1.54 billion with delivery set for 2013 and 2014. Earlier in June, NOL announced that it had secured $1.1 billion in loan agreements to cover the original order for the 8,400-TEU vessels from Daewoo, as well as two 10,700-TEU vessels the carrier ordered in 2007. 

According to NOL, the ten 14,000-TEU vessels – set for deployment in the Asia-Europe trade – will be NOL’s largest and most fuel efficient to date. The 9,200-TEU vessels in the upgraded order will likely be employed in the Trans-Pacific trade, NOL said.

The new vessels, according to NOL, will allow subsidiary shipping line APL to "provide more efficient, reliable service to customers."

The letters of intent are still subject to contract signing with the shipbuilders.

Green Groups Seeks 10-Knot Speed Limit for Vessels Off California Ports

Four environmental and conservation groups filed a legal petition last week asking the National Oceanic and Atmospheric Administration (NOAA) to set up a 10-knot speed limit for large commercial vessels traveling in and out of the ports of San Francisco Bay and Southern California.

The four groups – the Center for Biological Diversity, the Environmental Defense Center, Friends of the Earth, and Pacific Environment – allege that commercial vessels are afecting marine wildlife in federally-protected marine sanctuaries with vessel strikes on marine life, noise pollution, and greenhouse gas emissions.
The main traffic channels for the Bay Area and Southern California ports pass through the state's four National Marine Sanctuaries, which include the Channel Islands off of Southern California and the Cordell Bank, the Gulf of the Farallones and the Monterey Bay sanctuaries in the Bay Area.

The three Bay Area marine sanctuaries cover the entire entrance to San Francisco Bay, requiring any vessel moving into or out of ports such as Oakland, Richmond, Sacramento, San Francisco, and Stockton to pass through three designated traffic zones that overlap the marine sanctuaries. Near the Southern California ports of Long Beach and Los Angeles, the major shipping traffic lanes located to the northwest of the ports run between the Channel Islands and the Santa Barbara/Ventura counties coast, overlapping the Channel Island marine sanctuary in one stretch.

It is not uncommon for large commercial vessels to travel at speeds much greater than 10-knots in these overlapping areas. According to a January, 2011 study on the Channel Island whale strikes by commercial vessels, NOAA reported that "On average, some 6,500 large (over 300 gross tons) vessels transit through the Channel every year, the majority of them at speeds greater than 14 knots."

Most vessels approaching Southern California voluntarily participate in the Long Beach and Los Angeles ports' Vessel Speed Reduction Program, which requires the vessels to slow to no more than 12 knots within roughly 40 miles of the ports. The Channel Islands overlap area is just outside the 40-mile speed reduction zone for the Southern California ports.

The entrance areas to most of the major ports along the Atlantic seaboard are already covered by a 10-knot maximum speed rule for commercial vessels over 65 feet during NOAA-designated right whale migratory and calving periods throughout the year. Areas around Glacier Bay National Park and Preserve in Alaska and the Hawaiian Islands National Marine Sanctuary also have similar seasonal restrictions to protect humpback whales.

In their petition, the four groups ask United States Secretary of Commerce Gary Locke to take action through NOAA to apply vessel speed restrictions similar to those on the East Coast to the California coastal areas outside the Bay Area and Southern California ports.

Specifically, the petition calls for: "A mandatory 10-knot speed limit for vessels greater than 65 feet within the Cordell Bank, Gulf of the Farallones, Monterey Bay, and Channel Islands National Marine sanctuaries to protect whales from collisions with vessels and noise pollution, and to provide other benefits associated with reduced speeds that will further protect sanctuary resources."

“Our marine sanctuaries should be a safe harbor for marine life, but instead whales in California are at constant risk of being run over by big ships,” the Center for Biological Diversity's oceans director Miyoko Sakashita said.

The January, 2011 NOAA study found that the most affected whales in the Channel Islands area are fin whales, but strikes on blue, gray and humpback whales have been noted.

“Reducing ship speed is a simple, reasonable way to protect whales and other aquatic life, as well as public health, from risks posed by large vessels that travel through California’s waters," Friends of the Earth's director of the Oceans and Vessels Project Marcie Keever said.

The groups point to at least six whales which have been killed by collisions with vessels in 2010 and more than 50 large whales which have died off the California coast in the past decade.

The groups also allege that noise pollution and engine emissions from increased maritime traffic is impacting marine life in the sanctuaries.

“A 10-knot speed limit seems to be the best practical solution offering the most benefits – such as reducing climate change emissions, air pollution and ever-increasing ocean noise pollution,” Pacific Environment's interim executive director Leah Zimmerman said.

The January, 2011 NOAA study concluded that, "In general, the case studies presented indicate that dynamic management of vessel behavior can reduce the risk of ship strikes. They may also minimize impact on commercial activities by limiting vessel speed or course only during necessary times or in critical areas."

However, the study also pointed out that the examination of existing speed control programs found that, "the creation of these management actions were time and resource intensive."

The NOAA study developed seven recommendations, including: continue and expand research and monitoring efforts of whale strikes; consider the appropriateness of changes to vessel behavior in the Santa Barbara Channel region; explore changes to the Santa Barbara Channel traffic separation scheme; continue and expand education and outreach; explore incentive and mandate-based options for vessel speed reduction; apply an adaptive management approach for the implementation of the recommendations; and, continue to engage and involve relevant agencies, stakeholders and the maritime industry groups in the consideration and implementation of these recommendations.

Northwest Ports Detail Progress on Clean Air Program

The ports of Metro Vancouver, B.C., Tacoma, Seattle, released a report this week detailing the progress the three port authorities have made on the goals of their collaborative omnibus plan to cut port-related air pollution in the Puget Sound and Georgia air basins.

The Northwest Ports Clean Air Strategy (NPCAS), developed jointly by the three port authorities and adopted in early 2008, includes long- and short-term programs to address and reduce air pollution from cargo-handling equipment, harbor craft, ocean-going vessels, rail, and trucks servicing the ports.

The newly released implementation report details the improvements achieved by all three ports through their NPCAS programs as well as their efforts to achieve the NPCAS goals by working with customers, tenants, and air and environmental regulatory agencies.

According to the three port authorities, the 2010 implementation report results mark the end of the NPCAS's first milestone, "showing progress in producing cleaner air for the communities that surround our harbors."

The 2010 results contained within the implementation report include:
  • Cargo-handling equipment: Approximately 62 percent of diesel-powered yard equipment met the NPCAS performance goal through retrofits, replacements and/or use of low-sulfur fuels.
  • Harbor craft: Despite technical challenges, made progress through replaced engines, shore power connections, resurfaced hulls and/or low-sulfur fuels.
  • Ocean-Going Vessels: Approximately 44 percent of frequently calling ocean-going vessels used low-sulfur fuels or electrical shore power to meet the NPCAS performance measure.
  • Trucks: Approximately 98 percent of ports-servicing drayage trucks met the NPCAS goals through outreach, engine retrofits or incentive programs.
  • Rail: Partner agencies replaced rail engines, added idle- and friction-reduction technologies and used low-sulfur fuels.

The 46-page implementation report, available at each port authorities' website, outlines detailed results for each port. The report also details efforts under way to meet the NPCAS' more stringent 2015 standards.

Los Angeles Port Posts Second Strongest May In Port History

The Port of Los Angeles turned in impressive cargo volume numbers for May, posting the highest total container moves of any month so far this year.

Los Angeles, the busiest container port in the Western Hemisphere, reported a 12.3 percent growth in total container volumes compared to April, and slightly surpassed the numbers reported in May of last year.

May volumes at the port were the strongest for any single month since September 2010 and the second strongest May showing for total volume in port history – surpassed only slightly by the record-holding May of 2006.

The port handled a total of 692,933 TEUs in May, a 12.3 percent over April and a 0.5 percent increase over May, 2010.

On the import side, the port handled a total of 360,969 loaded inbound TEUs in May, a 15.6 percent increase over April import box volumes and a 5.5 percent increase over May of last year.

On the export side, the port moved a total of 184,274 loaded outbound TEUs in May, a 10 percent increase over April and a 14.7 percent increase over same month last year.
For the first five months of 2011, the port has handled a total of 3,126,433 TEUs, up 6.6 percent over the January through May period in 2010.

Tuesday, June 14, 2011

Port of Tacoma Receives Federal Approval for Foreign Trade Zone Reorganization

The Port of Tacoma has received approval to reorganize its Foreign Trade Zone 86 under the US Department of Commerce’s new Alternative Site Framework (ASF) program.

The ASF program simplifies the designation process for firms seeking to use FTZ areas, allows firms seeking to use the FTZ to obtain the FTZ designation within 30 days instead of between six months to a year, and lowers the cost of thjavascript:void(0)e FTZ designation process.

“Obtaining the ASF designation makes our FTZ a more effective marketing tool,” Port of Tacoma Director of Real Estate and Asset Management Jack Hedge said. “We will now be able to dramatically increase our flexibility and speed in designating and adjusting sites within our FTZ to meet our customers’ needs.”

FTZs provide importers and exporters a flexible way to ship, store, and add value to goods while delaying, reducing, or in some cases, eliminating payment of U.S. Customs duties.

As a result of the approval of the ASF application, the port's FTZ 86 now consists of 11 Magnet Sites (industrial parks or property) that cover more than 2,235 acres of both port and privately-owned land. First established in 1983, FTZ 86 has been expanded three times over the years.

Mazda and Kia both use Tacoma’s FTZ 86 to process imported vehicles. In addition, Puget Sound International, Norvanco International and Pacific Distribution Services all provide FTZ warehousing services to companies involved in the importation and distribution of a wide range of products.

Tacoma’s FTZ ranks third among the 35 West Coast FTZs (behind Long Beach and San Diego), and 18th out of the 272 FTZs in the United States in total dollar value of foreign status merchandise being admitted into a zone. For the government fiscal year 2010 (October 2009 through September 2010), the total dollar value of foreign merchandise that moved through FTZ 86 tripled to $1.3 billion.

Oakland Truckers Warn of Stoppage Over Air Rules

A trade group representing motor carriers at the Port of Oakland has submitted a petition to Governor Jerry Brown warning of a general work stoppage at the port if state air regulators do not reconsider extending deadlines for impending truck emission regulations.

Members of the West State Alliance (WSA), which include about 60 trucking and trucking-related firms, propose a shutdown of all cargo movements at the Oakland port if the California Air Resources Board does not extend the deadline for the next phase of CARB emissions controls for drayage trucks by an additional six years.

On May 16 motor carriers at the Port of Oakland under the WSA banner sent a petition to CARB condemning a December, 2010 decision not to adopt proposed amendments to the drayage truck rule. The groups cited concerns over CARB's Phase II regulation mandating compliance with standards for NOx reduction in diesel exhaust starting in 2014. This measure affects some 4,400 drayage trucks, or approximately 75 percent of the total Oakland port fleet.

According to WSA, Oakland port truckers say they are prepared to assume the cost burden of purchasing PM filters for 2004-2006 engine model trucks required under Phase I of the drayage rule, but only if they are assured these trucks will remain legal until 2020. A proposal to extend the NOx emissions deadline an additional six years, from 2014 until 2020, was rejected by CARB.

This now leaves Oakland port truckers, WSA said, with a short window of emissions compliance before having to incur the expense of NOx equipment upgrades.

Furthermore, according to WSA, there are no after-market NOx emissions reduction filters readily available for diesel trucks to meet ARB emissions standards.

“Come 2014, owners of 1994-2006 engine model year trucks are left with no other option than to dispose of their tractors outside the Port and replace them with 2007 or newer models,” WSA said in a statement. “Current prices range upward of $65,000 for a used truck, and a scarce supply is rapidly depleting the market of available equipment.”

WSA said that one reason cited by Oakland port truckers for a delay in the NOx reduction schedule is a 2010 Bay Area Air Quality District (BAAQMD) study that found an unanticipated 40 percent reduction in NOx emissions at the port due to CARB's Phase I-mandated replacement of older polluting trucks. The WSA claims these reductions put the Oakland trucking fleet well on its way to significant reductions in NOx emissions without the need of imposing the Phase II regulations set to be implemented in 2014.

“Furthermore, Phase I of the drayage truck rule already placed a heavy financial burden on Port truckers,” the WSA said. “Many went out of business, many incurred high-interest loans and large amounts of debt, and state grants were grossly insufficient in number and size to help the majority of truck owners. The seventeen signatories to the petition to the ARB say that in meeting Phase I requirements of the drayage truck rule they have done their fair share and more to shoulder the burden of state clean air regulations. Now, they say, the City of Oakland “can ill afford the certain loss of jobs on the local economy and the devastating social and health impacts that will result from the mandated obsolescence of 4,400 trucks.”

Signatories to the petition include: AB Trucking, Bay Area Container, Fargo Trucking, GSC Logistics, Horizon Freight System, Impact Transportation, Kamal Trucking, Lengner & Sons Express, Mason Dixon Intermodal, Mutual Express, PCC Logistics, Quintero Trucking, Rodgers Trucking, Stockmyer Trucking, VA Transportation, Viper Transportation and Yardell Truckaway.

Long Beach Port Posts Strongest May Cargo Numbers In 4 Years

The Port of Long Beach posted the strongest month of container moves for the year in May, and the strongest May posting for the port since 2007.

May also marked the strongest month since October 2010 for imports at the port. The one downside for the month was a sizable 9.4 percent drop in exports over April's numbers.

The port handled a total of 536,681 TEUs in May, a 1.1 percent increase over April and a 2.3 percent increase over May of last year.

In the import column, the port handled a total of 275,100 loaded inbound TEUs in May, a 1.8 percent increase over April and a 4 percent increase over May 2010.

On the import side of the ledger, the port posted a total of 121,551 loaded outbound TEUs in May, a 9.4 percent drop over April and a 6.1 percent drop over the year-ago period.

The port remains well within positive territory for the calendar year, having moved a total of 1.2 million TEUs in the January to May period – putting the port up 6.5 percent over the first five months of 2010.