USMX – ILA negotiations Status Update
The International Longshoremen’s Association (ILA) and the (employers) U.S. Maritime Alliance (USMX) master contract is set to expire September 30, 2012.
This agreement covers the ILA labor that works on the U.S East Coast, all the way down into the U.S. Gulf coast; covering 14 ports between Maine and Texas.
According to the information published in the official USMX website, the talks are at a difficult stage and at this moment no further meetings have been scheduled.
We remain optimistic, however, that negotiations will resume. Interested parties may monitor the status of the negotiation at the USMX official website:
http://usmxlaborupdates.com/
Port of Melbourne expansion gets underway
The A$1.6 billion Port of Melbourne’s redevelopment of Webb Dock in the Australian state of Victoria is advancing significantly, with the awarding of civil and maritime design contracts.
The expansion of capacity at the Port of Melbourne, which is Australia’s largest container, automotive and general cargo port was announced by the Victorian Premier, Mr Ted Baillieu and the Minister for Ports, Dr Denis Napthine in April this year.
Port of Melbourne Corporation Chief Executive Officer, Stephen Bradford this week announced the appointment of two consultants who will be responsible for the delivery of detailed designs for the project’s internal roads, services infrastructure, interface buffers and maritime engineering services.
“This is an important first step in the redevelopment of Webb Dock which is the site for Melbourne’s third international container terminal and a new world class automotive facilityâ€, Mr Bradford said.
Port of Melbourne Corporation’s EOI and tender processes attracted an enormous amount of interest. Mr Bradford stated that the submissions received displayed a high level of technical expertise and demonstrated a strong competitive focus.
The evaluation processes determined that the contract for civil engineering design services be awarded to Aurecon Australia. The scope of the civil works includes detail design of internal roads, interface buffers site preparation works and services infrastructure.
The Port of Melbourne Corporation also advised the appointment of Arup to provide maritime engineering consulting services for the project’s extensive maritime works. The maritime program includes re-engineering of the existing wharves at Webb Dock East, dredging and the design of a new 920 metre wharf for the port’s automotive trade which will be consolidated into a new world class facility at Webb Dock West.
China’s port growth to continue leading the world
The Chinese Academy of Sciences (CAS) recently released a forecast report on world’s top 20 container ports this year. The report predicts that most ports in the world will experience slowdown in their growth due to a slackening economy, while China’s will continue to maintain growth, Xinhua reports.
CAS scientific research director Wang Shouyang said the Euro-debt crisis and gloomy world economy will continue to cast shadow on world’s container shipping market.
Being an important trade partner for Europe and America, China will also be inevitably affected by their depressed economies. CAS experts expect to see more pronounced slowdown in China’s container shipping demand this year if the Euro-debt crisis continue to deteriorate.
CAS also forecasts that the box throughput of China’s top 10 ports will continue to rise, but growth will continue to lose ground. Predictions also pointed out that gap between different regions will become wider with throughput growth in Bohai Rim and Yangtze River Delta faster than in the Pearl River Delta.
CAS also predicts that eastern China’s port of Dalian will become the fastest growing port in the world, with an increase rate of about 24 per cent.
Shanghai’s throughput will continue to stay on the top of the world with about 33.2 to 33.6 million TEU, up 4.9 to 6.2 per cent. Tianjin will break into the top 10 list.
Chinese ports and will account for half of the world’s top 20 ports, says CAS.
Unions slam Howard’s calls for WorkChoices return
Australian Council of Trade Unions president Ged Kearney says recent comments by former prime minister John Howard show that attacking workers’ rights is “core Liberal policy.â€
In a statement released simultaneously on both the ACTU and Maritime Union of Australia websites, Ms Kearney said that, “despite Tony Abbot’s denials,†Mr Howard’s comments “reveal that the Liberals’ love affair with WorkChoices remains as strong as ever.â€
Can shipping buck the global economic trend?
Compared to just a year ago, shipping rates are much higher than they were. Shippers and customers alike will benefit in the long term from having a more stable industry. But how can this be the case when capacity in the industry is still growing relative to demand?
The economic backdrop is not good. Growth is almost non-existent within Europe, with some countries in recession and the outlook being continuously downgraded. The USA doesn’t fare much better, with growth rates of some 2 percent. Even China and India have had growth forecasts revised downwards, with the IMF’s July report reducing forecast growth for 2012 by 0.2 and 0.7 percent respectively, compared to April estimates. The consensus is that the global economic outlook remains uncertain.
Low growth means a lowering of global demand for goods and services which, in turn, means less of a need for transportation services for those goods. Year on year volumes in Q1 2012 actually fell by almost 4 percent.
In July, Bill Mongelluzzo said in the Journal of Commerce that “when carrier capacity is increasing 2½ times the growth of cargo volume, shipping lines are usually in no position to increase their rates, and certainly not five times in eight months.â€
So how can it make sense that rates are increasing?
“Shipping companies, deploy their assets in a different way than in the past. For example, in order to reduce our bunker consumption we have added vessels to a number of services and are thereby able to slow steam more. At the same time, we are using more vessels whilst actually leaving deployed capacity in the market unaffected. In addition, the industry has increased the idling of vessels where it doesn’t make economic sense to have them in service,†says Morten Engelstoft, Chief Operating Officer at Maersk Line.
“So whilst, nominally, it may appear that capacity is increasing because there are more or larger vessels, this is not necessarily the case. This new approach comes from a realisation that the huge cyclical losses of the past are just not sustainable.â€
This view is born out by other commentators, with the TSA (Transpacific Stabilization Agreement) spokesman Niels Erich being quoted in the Journal of Commerce as saying: “The TSA’s 15 member lines are maintaining vessel utilization rates of about 90 percent, with the busy lanes … operating at 95% or higher utilization.â€
In essence it appears that shipping companies can influence the markets, if each one acts rationally to maximise its own profitability rather than chasing loss making volumes. This strive towards greater stability in the industry will lead to a more consistent service to customers, and better shareholder returns.
Australian web sellers ignore global potential of internet
The internet may be global — but for Australian web-based merchants it's more a case of think local, act local.
Online businesses in Australia make the vast majority of their sales to customers in the same town and don't capitalise on the worldwide nature of the web.
The annual Sensis e-Business Report said that 87 per cent of small and medium size enterprises (SMEs) with an online presence sold goods and services to local customers. The figure was unchanged from the previous year.
Overseas customers were identified by just five per cent of SMEs as their main e-commerce customer group.This was a two per cent increase on the previous year.
Some 27 per cent of SMEs reported at least some sales to overseas customers, unchanged from the previous year.
Report author Christena Singh said the report showed that Australian small business were grappling with how to use the internet to target overseas customers.
"E-commerce offers SMEs the opportunity to reach a potentially global market, so it is interesting to note most sales made using e-commerce are still relatively close to home," Singh said.
"If small businesses want to make the most of the new world of mobile and internet-enabled customers, they really need to think strategically and put in place a strong digital business plan."
Although 62 per cent of SMEs had a website for their business and 27 per cent use social media for business purposes, only 15 per cent had a digital business strategy, the report found.
Despite this, 55 per cent of SMEs reported that they had recovered their initial investment in e-commerce and a further 17 per cent expect to recover their investment in the next year.
When asked what concerned them about e-commerce, Australian small businesses nominated internet security as their number one issue.
More than one in four SMEs (27 per cent) said a lack of computer expertise and knowledge was a major burden, an increase of five per cent over the past year.
A lack of personal contact with customers, the cost and time to introduce new technologies and the cost of hardware and software were issues raised by at least one in five SMEs.
