Seacurus Daily: Top Ten Maritime News Stories 14/12/2016
1. Maersk FedEx Model
Søren Skou, group CEO of AP Møller Mærsk, outlined his vision for the future of the company’s transport and logistics businesses during the firm’s capital markets day this morning. The group announced in September it is splitting its transport and logistics divisions away from its energy related business. Energy makes up around 25% of the group’s current total revenues. Skou said he was keen to make up this loss in revenues fast – with recent addition Hamburg Sud filling the gap by 15%, leaving just 10% to fill. Analysts are predicting the group will soon sell off all or part of its energy holdings to fund further transport acquisitions.
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2. US Imports Drop
U.S. import prices recorded their biggest drop in nine months in November on declining petroleum costs, with renewed dollar strength threatening to keep imported inflation subdued. The Labor Department said on Tuesday import prices fell 0.3 percent last month after a downwardly revised 0.4 percent gain in October. Last month’s drop was the biggest since February and followed two straight months of increases. Economists polled by Reuters had forecast import prices falling 0.4 percent last month after a previously reported 0.5 percent increase.
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3. 2017 Year of Mergers
Indications have emerged that more mergers and acquisitions of shipping companies would be sealed in 2017, just as the cost of operations keep soaring. Besides, growing level of merger of shipping firms showed that the worth of the container consolidation among the five majors currently estimated at $33.4 billion will soon soar with more agreement coming on stream in the New Year. A recent Fitch Rating showed that muted demand growth would exacerbate overcapacity for the shipping sector in 2017, putting pressure on freight rates and driving further consolidation and defaults.
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4. Shots Fired at Dockers
Sri Lankan naval troops fired warning shots to break up a protest by striking dock workers who have held up a Japanese vessel for four days at the island’s southern international port. Troops entered Hambantota port from the sea Saturday and fired warning shots to disperse the crowd, considering their action an “act of piracy,” navy spokesman Akram Alavi said. The protesters had prevented the Japanese vehicle carrier Hyperion Highway from leaving the port. No casualties were reported.
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5. Crew Abductions Rise
The piracy reporting center ReCAAP ISC continues to warn about the many crew abductions currently taking place in the Sulu-Celebes Sea area – between Sabah, Malaysia and the Southern Philippines. ReCAAP has now published its November 2016 Report on Piracy and Armed Robbery in Asia. The good news is that ReCAAP sees a 60 per cent decrease in the overall number of incidents compared to the same period in 2015. Notably continued improvement has been observed in the Straits of Malacca and Singapore (SOMS) with no incident reported in the SOMS since April 2016.
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6. Social Partners Drive Change
The European Social Partners in the maritime transport sector – European shipowners (ECSA) and European Transport Workers’ Federation (ETF) are requesting the European Commission to amend the Social Partners’ Agreement Directive on seafarers’ right to decent conditions of work. The Directive adopted in 2009 reflected the ILO Maritime Labour Convention (MLC), an international agreement setting minimum requirements for nearly every aspect of working and living conditions for seafarers. The Social Partners now expect the Commission to revise Directive 2009/13/EC in accordance with the MLC as amended in 2014.
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7. So Many Ships Scrapped
The “Viktoria Wulff” recently became the youngest container ship to be sold for demolition at an age of only 10 years without a previous accident. The story of the ‘Viktoria Wulff’ is characteristic for the failed business practices of German KG ship owners as well as ship funds. Nearly 600 ships have been sold due to insolvencies and financial problems since 2008, many of which ended up on the South Asian beaches. The bill for the ship owners’ and investors’ greed for profit is paid by workers and the environment in destinations like Bangladesh, where ships end up without any consideration of the human and environmental costs.
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8. El Faro Transcript Released
The transcript from the El Faro’s voyage data recorder bridge audio is one of five factual reports added Tuesday to the National Trasportation Safety Board’s El Faro investigation docket as part of the agency’s ongoing investigation into the loss of the TOTE ship that sank during Hurricane Joaquin in October 2015.
All 33 crew members perished in the accident Entered into the docket were factual reports from the Electronic Data Group, Meteorology Group, Survival Factors Group, Engineering Group and the Voyage Data Recorder Audio Transcript Group.
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9. Latest Record Breaker Confirmed
Singapore shipping trust Rickmers has confirmed that it has sold a seven-year-old containership, the youngest ever to be scrapped. IHS Markit data shows that the ship was initially bought for USD $60 million but the troubled Singapore-based container ship owner has been forced to sell the 2009 Panamax ship to deal with mounting bank debt. The India Rickmers containership (previously known as the Hanjin Newport) has a deadweight of 50,574 tonnes and a capacity of 4,250 TEU. The ship has been sold in an attempt to repay senior loans from Germany banking company, Commerzbank.
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10. Heavy Price to Pay
Hyundai Merchant Marine (HMM) will pay a “heavy price” for access to the 2M services offered by Maersk and MSC, according to Alphaliner in its latest weekly report. It has been revealed that HMM has not gained full membership to the vessel sharing agreement. Instead, HMM would have to take a series of slot sharing deals. The container analysts note that Maersk and MSC will take control of an unspecified number of vessels currently operated by HMM on the Asia – Europe and Asia – US East Coast (USEC) routes. These ships will be operated and marketed by Maersk and MSC, with HMM “relegated” to the role of slot buyer.
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Daily news feed from Seacurus Ltd – providers of MLC crew insurance solutions www.seacurus.com
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