January 24, 2011 -  The politics of Iran and the Gulf are one of the more dangerous problems the world faces, both economically and militarily. What is surprising is the level of exposure that logistics has to the struggle between the West and the Iranian regime. An example is the recent move against Hong Kong forwarders and shipping lines who are accused of being fronts either for the Iranian state shipping line or for weapons procurement organisations.

The Government of Hong Kong is planning to pass legislation to close down and seize the assets of 20 businesses which it believes are a front for Iranian Government interests. Responding to the publication of an American Treasury Department list of companies it accused, Hong Kong is essentially looking to fulfil China's promise to comply with sanctions on the Tehran regime.

At the centre of these actions is the Iranian state shipping line, IRISL. It has long been a troubled organisation. Subject to increasingly severe sanctions, the company has led a 'cat and mouse' existence as it sought to evade action against it, reflagging ships and constantly moving its ownership to a string of shell companies domiciled in a variety of different countries. The line has also had a number of its ships seized by authorities from Malta to Singapore over the past year, with creditors accusing the company of non-payment of loans. Of course such financial transactions are also increasingly difficult as United Nations sanctions have shut down Iran's banking system.

One of the accusations made, particularly by the United States, is that IRISL is used to transport missile and nuclear weapons technology from North Korea to Iran. However there is a wider agenda of suppressing Iran's economy in order to put pressure on the Tehran regime. IRISL expanded aggressively into the container market in the past decade. In aiming to put IRISL out of business the Western powers are looking to both strip the Iranian regime of a useful business asset and to make it more difficult to import and export from Iran.

Increasingly the Iranians are turning to hub ports in the Gulf to solve their transport problems, in turn creating political problems for the likes of the United Arab Emirates who are now under pressure to refuse trade from their aggressive neighbour.


Transport Intelligence

 

Januarry 25, 2011 - (SHANGHAI) China is drawing up plans to either scrap or reduce export tax rebates on some of the country's energy-intensive and high-polluting industries, a local paper reported yesterday, citing unidentified sources.

A move to scale back on export rebates would mark China's second such move since the outbreak of the global financial crisis in 2008 and be a double whammy for exporters, already facing the prospects of a rising yuan. The mounting pressures on exporters could accelerate their consolidation.

But on the other hand, analysts said the end of a tax kickback could have a bullish impact on prices of some commodities, such as steel, which have long suffered from over-capacity issues and deteriorating margins.

The National Development and Reform Commission, the Ministry of Finance and the Ministry of Commerce are reviewing tax rebates on a list of goods in various sectors, including rubber, non-ferrous metals, steel and construction materials, and have not yet decided on the final tax reduction, said the Economic Information Daily, which is managed by the official Xinhua news agency.

'The overall reduction would not be drastic, but goods in the steel, building materials and additives sector will obviously see larger cuts on rebates compared to other industries,' the paper quoted an unidentified source with knowledge of the process as saying.

Steel traders told Reuters that the market is rife with speculation that the government may scrap an existing 9 per cent rebate on some flat-steel products, a move which would greatly dent their price competitiveness in Asia.

Any moves that raise producers' costs will have a sizeable impact as firms are already battling with a stronger yuan, said Judy Zhu, a Shanghai-based commodities analyst with Standard Chartered. Several analysts expect the yuan may appreciate between 5 and 6 per cent this year.

The related government bodies have also already drafted strategic reviews on export duties for various commodities, including rare earth, iron and steel, petroleum, coal, nickel, molybdenum, tungsten, solar polysilicon and other raw materials.

But the government is still working on the finer details of the tax overhaul and has not yet issued a final document, as it needs to consider China's overall export performance this year and seek the views of several other ministries, the paper said.

January 11, 2011 -  Naviland Cargo has opened the first container rail link from the French port of Le Havre to Germany.

The first train on the new service left the Channel port for the KTL terminal in Ludwigshafen, which is in South-west Germany and has links to Eastern Europe, on 18 January and returned the next day.

The overnight service will operate three rotations a week during the first year of service, with trains made up of wagons that can accommodate the heaviest containers and tanks.

Naviland Cargo said it planned to begin operating daily frequencies on the route early next year and to increase the length of the trains from 570 to 750 metres, once access works at the KTL terminal were completed.

The operator said: "This new international rail freight service is designed to handle the sea freight flows of freight forwarders, logistics operators and maritime shipping companies, and to meet the requirements of chemical and petrochemical companies at Le Havre and major tank wagon operators."

 

January 24, 2011 -  Continued concern over possible market manipulation and unjustified rate fluctuations is said to be one of the reasons for the Federal Maritime Commission (FMC) introducing tighter traffic reporting rules for container line coalition on all trade routes serving the US.

Although the new rules apply to all routes, there is little doubt that the transpacific is the main target. Of the 10 carriers in the three alliances - New World, Grand and CKYH - all but one are members of the Transpacific Stabilisation Agreement (TSA), the association of 15 lines that discusses economic conditions on the route. Its authority was recently extended to cover environmental issues, such as slow steaming, which has become a controversial topic in the industry. This was recently allowed to extend its area of interest to capacity as well.

The biggest coalition of transport and consumer good companies, the National Industrial Transportation League (NITL), has been clamouring for the stabilisation agreement to be abolished, claiming that it is a cartel that connives to change market conditions to its own advantage.

The new reporting rules state that the alliances must provide monthly minutes of "the senior-most committee that approves the capacity and schedule planning recommendations developed by lower level committees or subcommittees; including any chief executive officer committee meeting or principals' committee meeting of the alliance members." Previously, these had to be filed quarterly.

Details to be provided are the number of sailings by service strings during the month; total available TEU capacity by service string overall and the amount made available to each agreement member; total TEUs loaded on each service string overall and the amount loaded by each agreement member; total deadweight capacity by service string overall and the amount made available to each agreement member; total deadweight loaded on each service string overall and the amount loaded by each agreement member.

The commission said that quarterly capacity reports were not sufficient to allow FMC monitoring. By the time the FMC receives the data, they could be more than five months out of date.

A new requirement is for the alliances to tell the commission of changes in capacity of five percent or more on any trade route within five days of the decision. Details to be provided must "identify the string or strings affected, the nature of the change such as an increase or decrease in capacity and its amount, the proposed date of implementation of the change, the cause of the change, the effect of the planned change on the string's average weekly capacity, and whether the planned change is temporary or permanent.

"If a planned change is temporary in duration, the notice shall contain the planned duration. For planned changes caused by vessel substitutions, the notice shall identify the ship by name, operator and International Maritime Organisation number. For planned changes caused by sailing cancellations, the notice shall identify the voyage number(s), operator, and direction."

The commission said global alliances, while potentially efficiency enhancing, also had the potential to be complex and have anti-competitive operational agreements.

Last year's severe disruptions in the ocean leg of the global supply chain experienced by US exporters and importers have led the commission to conclude that more timely notice and reporting are needed for global alliances.

Hapag Lloyd, Nippon Yusen Kaisha (NYK), and Orient Overseas Container Line are members of the Grand Alliance. The New World Alliance is made up of APL, Hyundai Merchant Marine, and Mitsui O S K Lines. The CKYH is made up of Cosco,"K" Line, Yang Ming and Hanjin.
 

Cargonews Asia

January 24, 2011 -  Canadian National Railway and the Canadian Auto Workers union reached a tentative contract agreement early Jan. 24 that heads off a potential strike that was less than a day away.

The CAW said the accord came "following a 48-hour marathon negotiation session." On Jan. 22, the union had served notice to the railroad that its employees would strike at 12:01 a.m. on Jan. 25.

That is the first of two CAW strike deadlines against the two largest Canadian railroads. The union has also set a Feb. 8 strike deadline against Canadian Pacific Railway.

At CN, the CAW represents about 3,975 workers in Canada in four bargaining units of the railroad and its intermodal trucking subsidiary CNTL. Their jobs include mechanical work on locomotives, clerical and intermodal workers, excavator operators and owner-operator truckers.

CN said full details of the tentative agreements are being withheld pending ratification by the union membership, which the CAW expects to complete before the end of February.

But it said the agreements would "provide fair wage and benefit increases to CAW members," along with "progressive provisions that would help CN retain and attract skilled employees critical to its workforce" in coming years.

CAW National President Ken Lewenza said the new contract terms have "the full support of the CAW master bargaining committees. Leaders of union locals will go to Montreal to review those terms on Jan. 27, before the deal goes to a series of ratification meetings.


Journal of Commerce

  

January 26, 2011 - A strike which completely or partly affected all French sea ports for several days over the last two weeks is to resume Friday and will last until Monday, as negotiations between unions and government over pension age and working conditions haven't reopened, the ports' CGT labor union said Wednesday.

The strike will continue and industrial action will be increased if talks don't make any progress, the union said in a statement, adding a meeting is scheduled Monday to decide on further action.

Different categories of port workers have been striking on and off for the last two weeks, making port operations close to impossible.

The strike doesn't affect oil or passenger traffic, but the flow of containers and bulk commodities such as coal and grains has been disrupted at most French ports, Anthony Tetard, deputy chief of the union, told Dow Jones Newswires Wednesday.

However, operations could be disrupted at the Fos-Lavera oil terminal in southern France, the world's third largest oil port, where striking port workers render loading and unloading difficult, Tetard said.

Port workers in France went on strike for several weeks in September and October over a number of issues including pension arrangements and working conditions. The Fos-Lavera oil terminal, the world's third largest, was blocked for more than a month, contributing to a shortage of fuels across the country. 

January 25, 2011 -  The South African supply chain is braced for strike action by truck drivers, as their unions meet to discuss wage negotiations with employers.

Four leading drivers' unions are holding meetings with their members this week to discuss wage demands and terms of employment before showdown talks with the Road Freight Employers Association (RFEA).

The SA Transport and Allied Workers Union (Satawu), Motor Transport Workers Union (MTWU), Professional Transport Workers Union (PTWU) and Transport and Allied Workers Union of SA (TAWUSA) are seeking a mandate to strike.

Given the go-ahead for strikes, the unions would only need to give employers 48-hours' notice of any industrial action.

IFW understands the unions are calling for wage increases of 20% over the next two years, and will also ask for a housing allowance, reduced overtime and reduced working hours for certain members of staff, as well as a ban on labour brokers in the industry.

They have, however, indicated that they are willing to negotiate on the wage demands, but RFEA has only offered a 7.5% increase in 2011 and a second 7.5% increase in 2012.

RFEA employs about 65,000 people, 51% of whom are members of the four unions.

Commentators have suggested that an all-out strike would bring the country's supply chain to a halt.

The four unions negotiate with RFEA through the National Bargaining Council for the Road Freight and Logistics Industry, and the two sides have been in deadlock since December.

The unions initially announcing they planned to strike in the middle of last month, but action was put on hold to allow negotiations to continue.

The MTWU said that non-members could also join in the strike action.

    

January 21, 2011 - Legislators for an estimated 30 states have plans to take up bills that would restrict chemicals, and several states are planning comprehensive state chemical laws, state lawmakers and environmental groups say.

The state-level campaign marks a shift for environmentalists who have had to redirect their campaign for reform of the Toxic Substances Control Act (TSCA) after Republicans won a majority in the House in the 2010 midterm elections.

This year, the most popular product-specific ban continues to be bisphenol-A (BPA) with measures planned or in effect in 17 states.

At least 11 states plan to pass a resolution calling on Congress and the federal government to enact nationwide TSCA reform, and nine states have or will introduce comprehensive chemicals management laws.

Three states and the District of Columbia are working to ban the flame retardant decabromodiphenyl ether (decaBDE), according to a roundup by the environmental coalition Safer Chemicals Healthy Families (Washington).