Don't wait - are you prepared for SOLAS
Despite publicity about the amendment to SOLAS (International Convention for the Safety of Life at Sea) requiring that all packed containers have verified gross mass (VGM) stretching back at least five years, many parts of the industry have waited to the eleventh hour before putting individual and collaborative minds to the issue of implementation. With less than five months to mandatory global enforcement on 1 July 2016, it is critical for all stakeholders to engage now.
Recent weeks have - perhaps inevitably - seen a surge in interest and comment on the forthcoming mandatory requirements for container shippers to obtain and communicate VGM as a precondition of every packed container being loaded on board a ship. It is somewhat galling that this fundamental step-change, which has been regularly discussed over at least five years, is now often giving rise to more 'heat' than 'light.
Clarity for stakeholders
TT Club participated in preparing an Industry FAQ document and, together with the other sponsors, remains committed to assist any stakeholder in the supply chain globally to achieve timely and effective compliance. At their heart, the revised requirements appear logical and straight-forward. However, they undeniably carry complexity in implementation and require thorough evaluation of the precise local operational circumstances for each stakeholder, as well as proactive engagement between counter-parties.
Nobody can deny that identification of accurate gross mass for freight has always been necessary. The crystal clarity now set out in this regulation as to what comprises gross mass for SOLAS purposes - the mass of everything put into the container and the tare mass of the unit itself - presents little logical challenge. The historic, current and future challenge may well be more to do with processes by which such gross mass is obtained, signed for, communicated and used accurately throughout the transaction.
"The historic, current and future challenge may well be more to do with processes by which such gross mass is obtained, signed for, communicated and used accurately throughout the transaction"
Determine methodology
Shippers - as often as not consolidators and freight forwarders - need to evaluate the requirements in the context of their operations and the types of cargo being consigned through the container supply chain. 'Method 2' (paragraph 4.2) was specifically crafted to facilitate compliance by those who are able to determine weight by reference to regular and systemised processes. Shippers of homogeneous full load cargoes are the direct beneficiaries; all other types of shipment may prove too complex, costly or time-consuming to process following an actual weighing for all freight, dunnage and securing that is being packed into the container. Nevertheless, many packing forklifts or handling devices facilitate the capture of mass information - they simply need to be calibrated and certified... however, MSC.1/Circ.1475 (paragraph 5.1.2.2) specifically mentions that bulk (which necessarily includes liquids in flexitanks and ISO tank containers) and unstructured cargoes need to follow 'Method 1'. "safety in all modes should drive packers towards creating the ability to obtain VGM before the journey commences"
Thus, the evaluation of the operational circumstances may lead to the conclusion that Method 1 is more accessible. Safety in all modes should drive packers towards creating the ability to obtain VGM before the journey commences. Traditional weighbridges offer a solution, but are expensive to install and require careful procedural control. ( see MSC.1/Circ.1475 paragraph 11.1) to ensure sufficient accuracy - subtracting everything extraneous to the glorified packing case, the packed container itself. Amongst the emerging alternatives to fixed weighbridges are the landed and trailer jack solutions being developed by Bison in New Zealand.
Liability & contracts
Having determined how gross mass will be obtained, shippers/consolidators/forwarders need to ensure that any other party involves will provide the level of service required. At its most basic, this means due diligence that the service complies with national calibration and certification requirements for the equipment used. However, those providing such services - for which the shipper signing the document will take legal responsibility - will need to be persuaded to accept terms and conditions that dovetail appropriately with the transport contract regimes and these SOLAS requirements.
Furthermore, streamlined and timely communication of VGM to the carrier and terminal, whether from a third party weigher or simply from the shipper, needs to be managed. INTTRA suggests that roughly half of the estimated 300,000 containers exports per day are currently non-digital, which presents both challenge and opportunity for the industry to smarten dramatically the speed, consistency and accuracy of data flows. yet again, this may not be quite so simple, since the standard EDI messages both need adaption (which is in hand) and are often not quite so standard .
ideally, VGM is provided well before the container is presented at the marine terminal. Processes between the carriers and terminals will need to be slick for this to be full-proof, but more than anything these parties must agree how the in-gate process will work and how any form of exception will be handled. Some terminals have definitely decided to refuse containers that do not have VGM, others are working out the implications of investing in weighing equipment and additional space requirements. Bottom line, it is a binary process, for which both carrier and terminal are legally exposed - VGM load, no VGM no load. the spectres of land or water side congestion, or disruption to port throughput are extremely unattractive for all commercial and political stakeholders.
"Bottom line, it is a binary process, for which both carrier and terminal are legally exposed - VGM load, no VGM no load"
Disruption expected as new box weighing rules loom
On July 1 this year new regulations will come into force where each container loaded onto a ship engaged in an international voyage must have a declared Verified Gross Mass (VGM)
These regulations will be introduced worldwide and are predicted to cause major headaches for shippers and other stakeholders in the container supply chain, with a large number of countries not ready to implement the changes.
In order to bring long-needed improvements to container safety the International Maritime Organisation (IMO's) Maritime Safety Committee introduces amended to the International Convention on Safety of Lives at Sea (SOLAS)..
These changes were brought about in response to a number of accidents on vessels with overloaded containers that caused or contributed to loss of life or loss of vessel.
Prime examples were the grounding of the MSC Napoli in the English Channel in 2007 due to structural failure, where 20% of 660 checked containers were found to be more than three tonnes different from their declared weight, and the sinking of th MOL Comfort in the Indian Ocean in 2013.
The IMP, which has 170 member states, started work on the development of measures to prevent loss of containers in 2011 and in January 2015 the new guidelines were approved and adopted.
Member states were consulted extensively during this process and on July 1, 2016 these guidelines will become law. The container shipper will be responsible for providing the VGM.
There are two approved methods of calculating the VGM; either weighing the packed container, or weighing all the packages and cargo items, including pallets and dunnage, and adding the tare mass of the container to get the total weight.
In Australia these new guidelines will be implemented by the Australian Maritime Safety Authority (AMSA), which has published a revised draft of Marine Order 42 (Carriage, stowage and securing of cargoes and containers) and has asked for comments from the industry.
Currently containers shipped on international voyages arrive at the container terminals with an electronic Pre Recieval Advise (PRA) notice stating the declared weight.
A new PRA electronic format has been developed in which the shipper provides the VG, stating which method was used to determine the weight and signs this off as being correct.
This data needs to be completed and transmitted to the container terminal before the arrival of the container and is subsequently communicated to the master (or his/her representative) of the vessel on which the container is to be loaded.
AMSA is still deciding on the acceptable limits of accuracy for the VGM calculation and how they intend to police the new regulations, including penalties applicable for non-compliance.
They have stated that the accuracy of the weighing device needs to comply with National Measurement Institute standards. Vessels used in coastal services such as the Bass Strait service are exempt from the new regulations.
A straw poll of container terminal operators in Australia - Patrick, DP World and Hutchinson Ports Australia, has confirmed that if the container does not have a VGM on the PRA it will not be received into the terminal for loading.
They have also indicated that they will not provide any facility for weighing containers at their terminals. Flinders Adelaide Container Terminal is still reviewing its position and the entrant, Victoria International Container terminal, scheduled to Commence operations later this year at Webb Dock, Melbourne, has indicated it might be willing to provide a weighing service.
A number of international terminal operators across the globe, including DP World, and APM Terminals have said they wil be providing a weighing service at a number of their facilities.
Internationally, the pictures is somewhat different and was described at the recently held International Cargo Handling Coordination Association (ICHCA) International conference in Barcelona, where this subject was a hot topic as chaotic.
There are fears that global supply chains will come to a halt as a large number of Jurisdictions are not ready to implement the new rules.
In Rotterdam a large Dutch freight forwarder test-weighed a number of export containers and found discrepancies of as much as 14%.
The Port of Rotterdam processes 10,000 export containers per week and have only five weighbridges.
A quick calculation shows that if every container was to be weighed, each weighbridge would have to handle 12 containers per hour in an around-the-clock operation.
There has also bee push back from large shipper's associations, such as the Agricultural Transportation Coalition in the USA, who said that it had not been consulted.
The US Coastal Guard, which has jurisdiction over the loading of containers on vessels in US ports, has also clouded the matter by issuing contradictory statements. However, IMO Secretary-General Kitack Lim, who was at the Barcelona Conference, issued a warning to all member states saying that they were all consulted and not one objection was recieved during the prescribed period for submissions.
In Australia information sessions will be held in most capital cities in the coming weeks to provide further clarity for shippers and other stakehoders in the container supply chain.
A number of organisations, such as AMSA, Container Transport Alliance Australia (CTAA), the Australian Peak Shippers Association (APSA), the Freight & Trade Alliance (FTA). 1-stop Connections and ICHCA Australia will provide information at these sessions to ensure a smooth transition to the new regulations.
Date finally set for opening of expanded Panama Canal
Following a host of delays and uncertainties regarding the completion of the much anticipated Panama Canal expansion project, a date has finally been set for the opening of the third set of locks.
The Panama Canal Authority (ACP) used the opening of a new state-of-the-art training facility last week to announce that the expanded waterway will be inaugurated on June 26, 2016.
Furthermore, the ACP, in keeping with its tradition of using percentiles to monitor the project’s progress, said it is now 97% complete and final testing will be conducted in the weeks leading up to the official opening.
“The dream of expansion will become a reality when we inaugurate the biggest infrastructure project in the history of the canal and the country of Panama,” declared ACP administrator Jorge Quijano.
The 'reality' for Panama, however, will come some 18 months later than originally planned.
When the expansion project began nearly nine years ago, it was scheduled to be completed or rather open for business in October 2014.
Yet since ground was broken on the multi-billion dollar venture, it has been plagued by delays and setbacks, ranging from local and national strikes, long-running disputes with contractors and unions, to the use of the wrong concrete in construction and the most recent hold-up caused by cracks that appeared in the sills in the new locks at the Pacific entrance to the waterway.
Before the seeping sills came to light in August last year, the ACP said it was anticipating the third locks to be up and running in early 2016. However, having realised the extent of the damage to the locks and the rigorous testing required thereafter, it pushed the opening back to April, which soon became May and now, of course, late June.
In stark contrast, Panama’s rival for Asia-US east coast traffic, the Suez Canal, has managed to complete and open its own new channel without delay to allow two-way shipping on all stretches of the canal for the first time.
When the Panama Canal’s new locks open in June, vessels of up to 14,000 teu will be able to transit the Central American artery. Although it is not expected that ships of this size will make the journey immediately, they will certainly be much bigger than the current maximum of slightly below 5,000 teu in capacity.
Nevertheless, the ACP expects the canal to be on a level playing field once more with the Suez in the battle for US east coast trade. The task then will be to win back the traffic lost to the Suez.
Operating on these larger vessels will be alien to the pilots and likewise tugboat captains that operate on the canal today, and the ACP will use its new scale model manoeuvring training facility, inaugurated recently by Panama’s president Juan Carlos Verela, to provide seafarers with the necessary skills.
The new centre, spanning more than 35 acres, features two lakes that are an exact replica of the canal’s Culebra Cut at a ratio of 25:1, including identical channels, models of the new locks and operable scale model tugboats and post-panamax vessels.
The facility also features wave and wind generators to provide a “realistic, hands-on training experience”, according to the ACP.
"The scale model training facility will allow us to continue providing world-class service to the global maritime industry, while guaranteeing safe and efficient transits through the soon-to-be inaugurated expanded canal," said Mr Quijano.
Government sides with local industry
A TCO is a form of legal permission to import a particular good duty-free with the onus on the importer to demonstrate that there are no substitutable goods produced in Australia.
The proposed changes would enable a local manufacturer to oppose a TCO without having to demonstrate any minimum level of Australian content in the locally produced good. Changes have also been proposed to make it harder to obtain TCOs for “made to order capital equipment”.
Currently to oppose a TCO, a local manufacturer needs to demonstrate that at least 25% of the material, labour or overhead costs of the goods are of Australian origin. This requirement has been seen as too burdensome for local industry and the Government is seeking to remove it. The sole requirement will be to demonstrate that a substantial process in the manufacture of the goods occurred in Australia.
Freight & Trade Alliance (FTA) and Hunt & Hunt made a submission in respect of the proposed amendments last year. In the submission it was raised that there are occasions where "local manufacturers" could not prove that they met the minimum 25% local content requirement. It was also pointed out that there are a number of more pressing issues associated with the TCO system, such as the uncommercial definition of "substitutable goods" and the difficulty with interpreting TCO wording.
Russell Wiese, Partner Hunt & Hunt provided a detailed commentary for Freight & Trade Alliance (FTA) on the legislative changes and practical operational implications of recent decisions. He also noted that the Government has missed an opportunity to make more important changes. Wiese noted “the key area of uncertainty regarding TCOs is the question of what goods are covered by the wording of existing TCOs. This has been an area of great uncertainty since the decisions in Toro and Brand Developers.”
Wiese is of the view that the Government could have eased the administrative burden on importers by amending the Customs Tariff Act to set out whether TCO wording covers goods usually imported with the good described in the TCO. As it is, importers have to continue to struggle with the impractical outcome of Toro and Brand Developers decisions.
The theme of the above amendments is that the Government wants to make it easier for local industry to oppose and revoke TCOs. Further, the failure to address the outcome of the Torodecision demonstrates a willingness to leave the system in a state where it is very difficult for importers to utilise TCOs with confidence.
Wiese offers the following warning that in this environment, importers should exercise caution in utilising TCOs. The terms of TCOs should be carefully reviewed and brokers should ensure that they are aware of all features of, and accessories imported with, their client’s products. “It is clear that if made to choose between local industry and importers, the Government will side with local industry.”
Urgent need for Melbourne to address port capacity issues
On the Government side it is relief that the path is now clear to collect much needed revenue to fund already committed infrastructure projects while, from the perspective of the Opposition, there is relief that future State governments are unlikely to face hefty compensation claims from the successful bidders as pressure eventually grows to build a second container port in Victoria.
For industry, at last there is a degree of certainty about the port’s future, but that view is tinged with doubts as to whether that future is secure in the longer term given questions over how well equipped and ‘fit for purpose’ the port is to meet the capacity demands of a container shipping industry in flux.
The Government had proposed a compensation regime, known as the Port Growth Regime (PGR),that involved making payments to the new port operator in the event that the State develops or sponsors a second port that handles international containers that could otherwise have been handled at the port of Melbourne. Following a rejection of the port lease Bill by the Opposition late last year, a compromise was eventually agreed in March that saw the PGR apply for the first 15 years, rather than the full term of the lease.
Had the Bill gone through in its original form, there was a compelling view that the compensation clause would have been triggered well within the 50-year timeframe of the lease which some estimated could have cost the State up to $2 billion, a significant slice of the $6 billion anticipated from the sale.
With this obstacle out of the way, the onus is very much on the current administration of the port, the Port of Melbourne Corporation, and the three container terminal operators – DP World, Patrick Ports (or its successor) and the Victorian International Container Terminal (VICT) – to illustrate to nascent buyers of the port precisely what they are planning to do to enhance operational efficiencies and container capacity.
As things stood before the decision, the Victorian Government had much to do to justify the figure outlined in the sale document that the container capacity of the port of Melbourne is up to 8m TEUs.
To date, neither the PoMC nor the State has explained how additional capacity would be created. Ultimately, it is capacity that will determine the longevity of the current port footprint and naturally that will be factored into the final value of the lease.
As the recent Parliamentary Inquiry into the Proposed Lease of the Port of Melbourne found, estimates of the port’s ultimate capacity vary widely, ranging from about 5m TEU to 8m TEU.
While physical capacity is debatable, what is not in doubt is that shipowners will increase freight rates and impose surcharges if berth windows do not match their schedules. Therefore, it is commercial costs and not physical capacity that will initiate development, an expansion that would be triggered with a 60 to 65% berth utilisation.
There are a number of factors affecting port capacity that when aggregated tend to challenge the belief that the port has an ability to effectively more than triple its current throughput of about 2.5m TEU.
In its final report, the Inquiry Committee expressed concern that the PGR may create a risk that Government could delay developing a second port in order to avoid compensation payable, leading to a shortfall in container port capacity in Melbourne. If this were to occur, the State risks significantly higher costs associated with port services by virtue of capacity constraints and the entrenched monopoly position of the Port of Melbourne.
These are valid concerns, given the fast changing nature of container shipping. A recent ports industry conference in Melbourne heard several prominent industry analysts explain that the pace of Australian port development has lagged well behind international shipping developments.
The upscaling of the world container fleet that has occurred since the Global Financial Crisis has resulted in the major shipping lines putting increasing pressure on the three major east coast ports – Melbourne, Port Botany and Brisbane – to accommodate larger ships in excess of 8,000 TEU.
In this respect, Melbourne is in trouble. The existing two container terminals at the upriver Swanson Dock simply cannot accommodate these vessels owing to their length (approximately 30 metres longer than the current largest ship), beam and issues concerning air draught under the Westgate Bridge.
The third terminal – VICT, operated by ICTSI of the Philippines, is located at Webb Dock at the mouth of the River Yarra and is scheduled for completion by the end of the year.
In its current configuration, VICT will be capable of handling one of these larger generation vessels of around 335 metres at a time. The impediment to the berthing of two larger vessels is a concrete obstruction from a decommissioned berth 3 of around 100 metres that PoMC has left behind.
VICT management is anxious to reach an agreement with the port corporation to extend its berth frontage into this unused waterfront area adjacent to the terminal, just enough to enable it to concurrently handle two 8,000+TEU ships, effectively increasing the capacity of the entire port by up to 25%.
The stevedore maintains that its plan would boost the value of the port and increase the size of the government’s windfall from the upcoming sale. However, PoMC management has rebuffed the stevedore claiming that ICTSI’s proposal was beyond the current scope of the works agreed to in May 2014 as part of a competitive market process.
The corporation argues that ICTSI must operate to the same standard as Swanson Dock, to prevent it gaining a competitive advantage over Patrick and DP World.
Representatives of the three stevedores spoke at the Melbourne conference and it was interesting to compare and contrast their approaches.
As mature and established operators, it was appropriate that DP World and Patrick should focus on how they were meeting customer expectations and actively addressing their concerns.
However, while both stevedores are targeting increased efficiencies, there was little in their presentations to indicate how they would be expanding capacity on a scale that would contribute significantly to meeting the 8m TEU target.
Certainly, there was an emphasis on the much-vaunted Port Rail Shuttle, but rail offers no panacea; the reality is that even best estimates suggest the rail link would add no more than 100,000 TEU to port capacity.
So where do they find those additional slots? The terminals could increase the height of the container stack; there is scope to do this, but it would involve considerable disruption to their terminals as work was carried out to reinforce the hard standing. To have capacity offline for extended periods of time is not exactly ideal when you are operating in an increasingly competitive stevedoring environment.
The conference heard that, faced with the considerable handicap of having no rail access to its Webb Dock terminal, ICTSI had to draw on innovative technological solutions to achieve productivity and efficiency gains. Central to this was creating the most efficient terminal design incorporating seamless integration between its quayside and landside capabilities. This is to be achieved through a high degree of automation.
Once operational, the terminal should be noted for its lack of trucks queuing outside the gate. The terminal will accommodate two-way running, allowing hauliers to plan for single visits, which provide a combined drop-off and pick-up of boxes, ease of access for High Productivity Vehicles (HPVs) and better use of cargo information to make operations more seamless and efficient.
This system provides carriers with more choice, a few days in advance of available booking slots, allowing them ample time to coordinate and ensure that each vehicle’s trip, both to and from the terminal, has boxes on board (laden and empties). This aligns well with the Direct Empty Return (DER) feature desired by shipping lines.
Importantly, by providing off-peak slots daytime traffic congestion on Melbourne’s roads should ease and allow carriers the option of avoiding slower daytime slots.
In addition to a paperless vehicle booking system, block-stacking via group codes is a feature being established to provide more flexibility for the larger carriers by grouping large container consignments ensuring they are stacked together and, therefore, more efficiently retrieved from the terminal.
VICT is currently looking to gain the approvals to provide an accurate and cost-effective container weighing service, which could be accessed by both exporters and shipping lines.
The terminal is designed to ultimately handle 1.4m TEU, but VICT management believes there is scope to considerably increase that target and it would like to have a conversation with the PoMC to that effect. So far, efforts in this direction have been to no avail.
Melbourne’s position as the nation’s leading container port is already under threat from Port Botany and with a lot of money at stake, action will be needed to halt this trend.
Given the significance of increasing port capacity to the eventual financial return for the State of Victoria from the sale of the port lease, surely this is a matter that PoMC management should treat with much more urgency.
Air Cargo Ships Could Soon Alter Global Supply Chains As We Know Them
Igor Pasternak, The CEO and Chief engineer of Worldwide Aeros, is fulfilling his lifelong dream of creating aircrafts that are lighter than air, more fuel-efficient and "greener" and his Aeroscraft is gaining recognition and significant funding.
How will airships compete with jumbo cargo carriers currently in the marketplace?
They’ll compete in many ways. Importantly, Aeroscraft will access more austere areas directly, independent of infrastructure (VTOL), more easily move large ‘project’ cargo, and accommodate shipping containers and cargo on pallets.
The Aeroscraft’s cargo bay will measure (LWH) 220’ x 40’ x 30’ on the smaller 66-ton payload aircraft (ML866), much larger on our 250 ton aircraft, and will overcome the dimensional accommodation challenges arising from nose/tail loading of the fixed-wing fuselage. Aeroscrafts will also consume less than 1/3 that of freighters on a per ton-mile basis by using helium to stay aloft (static lift), and propulsion simply to move forward and overcome aerodynamic drag.
We anticipate these vehicles will empower traditional energy, alternative energy, project engineering, mining, agriculture, manufacturing and other global industries by reducing their unique logistics challenges for specialty cargo.
The Aeroscraft will help with product movement while retaining warranty in some cases, reduce on-site final assembly (time/cost) in others, overcome seasonal limitations like ice road deliveries, or deliver other project management benefits like shorter development schedules and reduction of idled equipment and manpower.
The Aeroscraft will also provide new opportunities and efficiencies for the transport of certain sub-segments of global commercial cargo and traditional air cargos. The Aeroscraft’s landing site flexibility, global reach, payload capability and faster speed than existing ground modes, are further expected to provide expanded opportunities for military airlift and humanitarian/ disaster relief efficiency
Will air ships collaborate with commercial air cargo carriers?
The Aeroscraft will introduce a speed and cost intermediary between sealift and airlift. For air cargo operators, our vertical take-off and landing Aeroscraft will likely broaden network reach.
Thinking of just a few examples, it could also expand service capabilities for perishable cargos (field access, power for refrigerated containers), move hazardous belly cargo quickly (LI batteries, etc.), enhance security for sensitive cargo relative to current intermodal practices, or facilitate introduction of new multi-day global delivery services appropriate for certain cargo/packages.
Certain cargo types may shift toward the Aeroscraft for reduced delivery cost while providing global reach at speed surpassing surface modes, or for point-to-point/ volume efficiencies providing speed and cost benefits distributing retail (CPG, CE, apparel) products. Aeroscraft would facilitate direct delivery to new places including regional distribution centers, offering a new alternative to air/truck intermodal.
Will airships also work with ocean cargo carriers in an air/sea strategy?.
Aeroscraft will be able to access and operate in both harbor environments and remote areas without support equipment.
I expect cargo airships may serve ocean cargo carriers by moving containers from more remote areas with insufficient road/rail infrastructure to main container terminals, and facilitate similar reverse distribution. Their capabilities to augment existing main line vessel support will likely help operators expand services, particularly in the arctic and Asia-Pacific regions.
Aeroscrafts would also serve ocean-based logistics providers by speeding delivery to countries lacking an ocean harbor (land locked countries), where intermodal transport combined with customs can slow final destination delivery, especially for higher-value, lower-density (HVLD) containers.
The aircraft’s container capacity will vary depending on loading. (Whereas most aircraft today are volume constrained before they are weight constrained, we’ll typically be weight constrained before becoming volume constrained.) (see chart)
With the capability to precisely deploy cargo from hover (landing not required), or on-board cargo while hovering, Aeroscraft can also expedite cargo movement to and from off-shore container vessels, when required.
Which emerging nations are likely to see the first use of cargo air ships?
Cargo airships will be particularly attractive for emerging nations that have less developed infrastructure.
I am unable to identify specific countries at this time, but can say earliest adopters will be those where the Aeroscraft reduces the need for major infrastructure investments to facilitate economic development projects/initiatives to the greatest extent. (e.g. where use would negate the need to build a special airport for project cargo, mitigate port/terminal construction and its associated inland infrastructure for regional development, or minimize environmental impacts in prized pristine places).
Are there any security advantages that airships provide?
Yes, because cargo can be delivered directly from ‘point of origin’ to ‘point of need’ by our VTOL-enabled aircraft in a secure internal bay, cargo security will be enhanced compared to intermodal means involving more handling, transfers and/or storage.
Why has it taken the industry so long to recognize the value of air ships?
The logistics industry is filled with intelligent, logical and mission oriented professionals much more familiar with other transport modes and technology.
Infrastructure has been a component of transport since Roman times, often still dictating the width of roads, so the opportunities arising from infrastructure-independent transport are generally not top of mind. False starts and broken promises by other earlier cargo airship concepts have certainly contributed to scepticism about such innovation.
Perhaps it has taken the U.S. military’s recent interest, exploration and incubation of LTA technologies for the larger commercial industry to realize that the utility and benefits modern cargo airships would provide soldiers were so highly transferable to commercial markets.
To explain, Aeros’ military partners DARPA/DOD were seeking benefits to operational tempo and mission flexibility, enhanced delivery capability, and operational cost savings in enduring logistical sustainment operations.
Cargo airships deliver something between high-speed, lower-capacity airlift, and low-speed, higher-capacity sealift, supporting a range of strategic and tactical missions. For the military, this new generation of airships has the potential to:
· greatly increase heavy cargo lift capability
· better facilitate direct delivery to austere locations
· reduce the logistics footprint in theater
· reduce dependence on airbases and ports
· minimize surface convoys and susceptibility
· reduce the effectiveness of anti-access strategies employed by adversaries
· and augment the hub and spoke logistics structure to one of point-to-point delivery
An aircraft purposely designed to address military logistics challenges delivers similar opportunity for value creation within the wider logistics community.
In addition, cargo airships have enormous potential to enable economic development opportunities and accelerate export logistics, expand capabilities in disaster relief response, and drive greenhouse gas reductions in global aviation.
These may be some of the secondary opportunities, more recently realized and championed, that are now elevating the holistic value recognition for airships within the logistics profession.
Agreement reached on GST
THE ATO has agreed to a methodology of dealing with GST on importation services after “concerted, protracted and labour-intensive negotiations,” according to the Customs Brokers and Forwarders Council of Australia (CBFCA).
A consortium made up of the CBFCA, the Conference of Asia Pacific Carriers (CAPEC) and the Australian Federation of International Forwarders (AFIF), lobbied the ATO for clarification on how GST should be charged when overseas entities are involved.
GST must be levied on all services for goods entering Australia, but there was confusion as to how and where this should be levied.
Now, after the agreement, customs brokers and freight forwarders can choose the method that best suits their business practices.
If the shipper or airline does not charge GST, the customs broker or forwarder can either include it in the value of taxable importation (VOTI) or charge the tax to its principal on the invoice.
But if the principal is an overseas entity, then all charges must be included in the VOTI.
In any case, there is now a clear system for customs brokers and freight forwarders to ensure the ATO gets its GST.
