Moore Stephens predicts 3% operating cost inflation
Vessel-operating costs are expected to rise by more than 3% in 2013 and 2014, according to a new survey by shipping accountants Moore Stephens.
The survey – based on responses from shipowners and managers in Europe and Asia – reveals that crew wages and P&I insurance are the cost categories likely to increase most significantly.
Crew wages are expected to increase by 2.4% in 2013 and by 2.5% in 2014, with other crew costs thought likely to go up by 2.1% and by 2.2% for the years under review.
The cost of P&I insurance is also expected to escalate by 2.4% in 2013 and by 2.5% in 2014, compared to the increases of 2% and 2.3% respectively predicted for the cost of hull and machinery insurance.
Expenditure on spares is expected to increase by 2.1% and 2.3% in 2013 and 2014 respectively, while survey respondents anticipate a 2.2% increase in the cost of lubricants in both years.
The cost of stores is expected to increase by 1.9% and by 2% for 2013 and 2014, while repairs and maintenance expenditure is predicted to increase in those two years by 2.3% and 2.4% respectively.
Dry docking costs over the same period are expected to rise by 2.1% and 2.4% respectively.
Meanwhile, as was the case in the 2012 survey, management fees are deemed likely to produce the lowest level of increase in both 2013 and 2014, at 1.4% and 1.7% respectively.
New Zealand and Pacific Islands Documentation - Cut-off and Late Fee
We advise our customers of the introduction of a documentation cutoff, and late fee for Shipping Instructions for all cargo out of Australia to New Zealand and the Pacific Islands effective 1st December 2013.
The changes to submission dates of Shipping Instructions are as follows:
Shipping Instructions for all cargo from Australia to New Zealand and the Pacific Islands is required to be submitted by day of vessel departure from the load port of the booking.
If Shipping Instructions for these destinations is received after this time, a Late Documentation Fee of AUD 25 per bill of lading will be applied.
The late submission of Shipping Instructions for New Zealand and Pacific Islands cargo, combined with the quick transit time can cause issues with New Zealand Customs that can hold up the release of cargo in New Zealand or the transshipping process to the Pacific Islands. Therefore the shipping lines have introduced the above changes to ensure that cargo is not delayed due to documentation issues.
Beijing urged to lift GST burden on foreign carriers
The International Chamber of Shipping has called on the Chinese government to ease an increased tax burden on foreign carriers that follows changes to the country’s goods and services tax that took effect in August.
“The unintended consequence [of the reform] is that foreign carriers are being placed at a competitive disadvantage to Chinese shipping companies,” the trade association said in a statement.
China’s GST reform, aimed at reducing tax burdens, abolishes a 5% business tax, also known as turnover tax and imposes 6% GST instead.
It has been implemented nationwide since August in the transport sector after small-scale pilot schemes last year.
As Lloyd’s List reported in August, under the new tax regime, international oceangoing shipping services are eligible for a zero-rate levy.
However, foreign carriers often set up subsidiaries in China as agents to collect bills from clients and those entities, categorised as freight forwarders, are still liable for 6% GST.
Domestic carriers, in contrast, are in no need of such agents and can benefit directly from what is in effect a tax waiver on the international leg of their operations.
ICS chairman Masamichi Morooka has written to the Ministry of Finance urging the government to resolve the problem.
The GST reform, however, has not proved popular with domestic lines either.
Chinese shipowners bemoan difficulties in the refunding process which they say has resulted in sharp increases in actual tax payables.
Source : Lloyds List
Antwerp taskforce fights cyber-crime
The shipping industry must mitigate the risk of its growing reliance on technology, which increases the vulnerability of both vessels and ports to hacking and cyber-attacks, PGI cyber and technology director Sebastian Madden has warned.
Costs of up to US$1bn per day could be incurred should a major US port fall prey to a successful cyber-attack, he said.
An independent study from the Brookings Institute, published earlier this year, found that cyber disruption at Long Beach or Los Angeles could hit 20% of the US maritime transport system and would cost the US economy roughly US$1bn for every day the ports stopped working.
Although the study focused on US ports, Mr Madden said growing reliance on automated systems, coupled with insufficient attention paid to cyber security, was a global concern.
He highlighted the case involving a criminal gang using the port of Antwerp to traffic drugs in containers for two years as a European example of the threat that ports face.
Antwerp’s port community is setting up a cyber-crime taskforce after hackers bypassed operating-system safeguards and removed containers from the Belgian hub.
Organised gangs used hackers to launch cyber-raids on selected European port systems, pinpointing the locations of containers packed with smuggled drugs and then releasing them to bogus drivers.
Antwerp Port Community System (APCS) representative John Kerkhof said: “The fight won’t be easy. The taskforce will mainly work pre-emptively, by sharing best practices and learning from each other’s experience.”
The taskforce will launch by year end and will involve Belgium’s federal cyber emergency team.
Antwerp handled 8.6m teu in 2012 and is Europe’s third-largest box hub, behind Rotterdam and Hamburg.
APCS was set up several years ago to standardise and share the IT applications developed by separate port companies.
Mediterranean Shipping Co this year introduced a container-release system that enables boxes to be collected from Antwerp more securely.
Users have to log into a secure portal site and identify themselves to access container release data.
This technology has now been made available port-wide, said APCS.
Karel Vanderheyden of Avantida, the IT partner that helped to develop the technology, said: “The great advantage of this application is that the crucial information needed to collect a container is not made up until the very last stage.
Shipping Schedule Reliability Study - 33% of Schedules Deviated More Than a Day
A study has analyzed vessel schedules for 22 ocean carriers on the arrivals at eight popular ports around the world from September 15 to October 15, 2013.
The ports were : Hamburg, Hong Kong, Jebel Ali, Long Beach, Los Angeles, Norfolk, Rotterdam, and Sydney.
It was found that there were 5,126 schedules covering these eight ports. By comparing the actual time of arrivals with the estimated time of arrivals provided in carriers’ long-term sailing schedules, the study measured the deviations to determine schedule reliability.
Overall, the average deviation of carriers’ schedules was 29.9 hours. Approximately 49% of the schedules deviated more than 12 hours and 33% of the schedules deviated more than one day.
The study further analyzed the schedule deviation of the eight ports during this period.
Among these ports, it was found that for the carrier schedules of Hong Kong, Los Angeles, and Norfolk, fewer than 30% deviated more than one day. For those of Hamburg and Rotterdam, around 35% and 39% deviated more than one day respectively. For those of Jebel Ali and Sydney, more than 50% deviated more than one day.
Source: Cargo Smart
OPINION: Federal government introduces bill to increase Customs fees
by Paul Zalai - FTA
A more equitable arrangement would be for an appropriate proportion of operating costs to be borne by the Australian taxpayer in line with the Australian Customs and Border Protection Service (ACBPS) border and community protection role.
As previously reported in Lloyd’s List Australia’s news bulletin, we have highlighted the many complexities associated with the assembly order (multiple supplier) cargo reporting issue in terms of systems implications, integration into contemporary commercial practices and meeting statutory reporting outcomes.
The other significant issue emerging from our representation revolved around the impact of any reform affecting the quantum of Import Declarations and therefore, the associated variation in government revenue generated via the Import Processing Charge (IPC) which is made on a per-Import Declaration basis.
This leads to a broader issue relating to the previous Labor government's May 2013 budget recommendation of a "restructure" to the IPC to recover the costs of all import-related cargo and trade functions undertaken by the ACBPS.
The proposed January 1, 2014 IPC for consignments valued over $10,000 (increasing by $102.60 to $152.60 per sea freight consignment and by $81.90 to $122.10 per airfreight consignment) will place a significant cost burden on importers and will adversely affect cash flow for intermediary Australian logistics service providers.
Freight & Trade Alliance (FTA) made a submission to government highlighting the financial impacts on all sectors of commerce and the unfair burden on the import sector.
The submission particularly focused on the Australian retail sector which in particular will feel the impact of fee increases as it provides a further commercial advantage to those that purchase goods online from overseas valued under $1000 as they are exempt from paying duty, GST and any form of IPC.
It appears as though the current government sees merit in progressing the IPC increase as outlined in the Import Processing Charges Amendment Bill 2013.
(refer to “Announcements for Importers” for links to IPC Amendment Bill)
