Kingstonat the crossroadsJamaicas potentially game-changingtranshipment planINSIGHTSFORPROFITABLESHIPPING22 September 2011 Volume 373 Issue 6652 Price 15.00 www.fairplay.co.ukCaribbeanthemedissueINSIDE THIS ISSUE MARKETS: Price chasmpulls spot LNG to AsiaCOMMERCE: Hubs face pressure fromcarriers REGULATION: US examines contractrules LOGISTICS: Troubled times inCuraao DECISION-MAKERS: David Ross Global tramp and liner services More than 140 vessels World wide setup - 25 offices Local experience Powerful versatile fleet Lifting capacity up to 900 mtonsVisitusatBREAKBULKAMERICASNewOrleans2011Oct24th-27thBBC Chartering, LeerPhone +49 491 925 20 90leer@bbc-chartering.comBBC Chartering, HoustonPhone +1 713 668 4020houston@bbc-chartering.comBBC Chartering, SingaporePhone +65 6576 4130singapore@bbc-chartering.com32 Logistics:Troubled times in CuraaoThe Netherlands Antilles dissolution andCuraaos new government havereshaped port authority3 Look outCaribbean ahead in Canal raceGuarding the seas4 Story of the weekRight place, right time?6-15 MarketsPricing chasm pulls spot LNG to AsiaBoxship bargains En bloc salesdominate Painless Indian naphtha drop-of Uncertainty deters Capesize S&P16-27 Trade & commerceCaribbean: Domestic recovery sputtersForeigners feel Beijings scal biteRising costs cloud Indias seafoodsurge Season shrinks for cruise portsCarriers navigate Venezuela mineeld28 TechnologyEmissions down, warming up S-Classupgrade still to convince Spreadersoftware lifts downtime problems30 RegulationUS examines contract rules Denmarksees action on crewing laws ICSresponds to emissions tax report32-36 Logistics & supply chainTroubled times in Curaao Spainopens door to Europe Jakarta urgeslogistics developments Cochin seeksrelief for cabotage headache Railchanges for South African ore38 Decision-makersDavid Ross of SeaFreight40 Shoes & shipsECDIS confusion IMO responds42 Movers & shakers44 Shipping in numbersSW/HS/FP/11||oyd`s Reg|ster of Sh|ps on||neThe u|t|mate on||ne mar|t|me reference too|D|scover moreFor fu|| deta||s and a product eva|uat|on: www.sea-web.comthis weekevery week22 September 2011Volume 373 Issue 665222 September 2011 1 www.fairplay.co.uk[ Cover photo: Matthew Ramsdale / Shutterstock ]Look out for the sector focus stamps:Fairplay focuses on the Caribbean. Find the stamp throughout the magazine Caribbean6 Markets: Pricing chasmpulls spot LNG to AsiaAsian buyers are now paying a hugepremium to snare cargoes from Europeand America, writes Greg Miller28 Technology:Sulphur zone warms upLow-sulphur fuel regulations cutCalifornian emissions while adding toglobal warming, study shows4 Cover story:Kingston at thecrossroadsJamaica has a potentially game-changing transhipment plan38 Decision-makers: David RossSeaFreights heir apparent explains how lean management and aCaribbean style of doing business can pay of in the long run16Trade&commerce:Hubs face carrier pressureCSA president CarlosUrriola is amongthose expectingtranshipmentmargins to besqueezed, reportsGreg MillerThe Freeport Container Port is one of the worlds largest container shipping conglomeratesconstructed, and the deepest Container Port in the region.Freeport Container Port islocated 65 miles fromFlorida . With a depth of 16m, The Freeport Container Port servesas a major container transshipment hub between the Eastern Golf Coast of the UnitedStates, the Gulf of Mexico, the Caribbean, South America, and trade lanes to European,Mediterranean, The Far East and Australasian destinations.FREEPORT CONTAINER PORTThis 24-hour facility boasts of having the most advanced port computer systems, operational expertise and professionalmanagement, in addition to state of the art security and full surveillance. The port is capable of handling the largestcontainer vessels in the world and aims to provide excellence in container services through the dedication of its staf andapplication of leading edge technology, by using highly advancereal time communication and port management systems.PORT FACTS 42.5mAir draft permissible above water level 1036mBerth 16mMaximumdepth at berth 3ft Tidal range 1mMinimumunder keel clearance alongside 1 Mobile Harbour Crane 61 Tons SWL under spreader 71 Tons SWL under hook 46.5mOutreach of cranes 9 Gantry quay cranes Minimumnumber of 20bays between gantries2 No restriction on number of tiers that can be worked on deck 38.7mMaximumheight of spreader for water level at lowwater 8 in. Over height limit (under spreader) for 20 units and 40 units 30.48mLongitudinal clearance between the legs gantries 27.7mMaximumcargo width Class 1 & 7 limitation in haz cargo that can be stowedat the terminal 30 Moves per hour/per gantry 430 Reefer points (reefer plugs available at terminal) 24 Hour securityFor More Information Contact:Freeport Container Port LimitedP.O. Box F-42465Freeport, Grand Bahama, The BahamasTel (242) 350-8000Fax (242) 350-8044EQUIPMENT 72 Straddle carriers 9 Super Post Panamax Quay Cranes 14 Train tractors & heads 17 Forklifts 2 Top lifters 4 Man LiftsThe Transshipment Hub of the Americas22 September 2011www.fairplay.co.uklookoutRichardClaytonFairplay EditorIts ofcial: carriers are now in the thick ofservice-plan revisions to take advantageof the Panama Canal expansion in 2014.A new round of transhipment deals iscurrently under way for upsized vesselson the Asia-US East Coast run. Becausenecessary terminal upgrades includingcrane installations can take up to twoyears, pivotal decisions should be made bycarriers by the end of 2012.Some arent waiting. The MoU signed inKingston by CMA CGM is just the openinggambit. Expect more major hubannouncements and dont be surprised ifsome long-time carrier customers switchto new terminal partners.In general, the Caribbeans marketposition looks increasingly bright. SeveralUS ports have yet to secure dredgingcommitments to handle New Panamaxvessels, but carriers must serve thesegateways, given the static locations oftheir top shippers distribution centres.In the US, Charleston and Savannah arescrambling to secure funds for dredging,while it looks increasingly unlikely thatNew York-New Jerseys air draughtconundrum created by the BayonneBridge will be resolved in time.The problem in America is that politicalrhetoric is now squarely geared towardsdebt reduction. This could make dredgingand infrastructure funding even moredifcult to obtain, just when its neededmost. The clock is ticking andapprehension within Americas portcommunity is building.This concern has created a signifcantopportunity for deep-dredged, capacity-rich terminals such as Freeport, Bahamas,which may serve as feeder hubs for the US.In the end, the American ports losscould be the Caribbeans gain. Followinginvestments in Panama, Colombia,Jamaica and the Bahamas, the Caribbeanlooks as if it will indeed be ready forcanal expansion even if the US EastCoast isnt.FCaribbean ahead in Canal raceGuarding the seasAnother day, anotherdiscussion about piracy andyet another grudgingacknowledgement that ourfoe is smarter than the averagecriminal. But last weeks ICS/ISF gathering in Londonbrought out tensions withinthe shipping community.Stephen Askins, a lawyer,fears that the more legislationallows for armed guards, themore politicians will see piracyas a commercial, rather than amilitary, problem. EUNAVFORchief of staf Capt Keith Blountreveals that owners rarelyadmit they are carrying aprivate security team until thevessel is under attack;Pottengal Mukundan at theIMB expresses his frustrationover the attitude of fag statesto protecting their ships.Blount says categorically noship carrying a private securityteam has yet been pirated,which sounds like the militarypressing for a commercialsolution. There are 166 privatecompanies operating in theSomali region, of which about50 are linked to SAMI, theregulatory trade association.And even if a SAMI-recognised security companyis selected, how many guardsmake a team? The Dutch arenow debating about 17 which Blount regards asridiculous while others go forthree of four which Blountbelieves would be useless.The unspoken dilemma iswhether there would beenough lifesaving equipmenton board to keep a protectedvessel under SOLAS.FAs carriers plan for a post-expansion network, not all ports will be ready4 22 September 2011 www.fairplay.co.ukRight place,right time?Jamaicas Kingston Container Terminal(KCT) is the elephant in the room ofAmericas transhipment because itssuccess or failure will dictate howcompeting hubs fare for years to comeand how millions of containers will berouted annually.KCT boasts a near-perfect location to tapeast-west trades to benet from thePanama Canal expansion, north-southroutes fuelled by Brazil, and the mainstaySouth Florida-to-Caribbean run.And yet, KCT continues to have sparecapacity. A lot of spare capacity. Its actualthroughput remains less than half of itsstated 3.2M teu/year capacity. To put thisin context: current spare capacity at KCT isroughly equivalent to the total volume ofsome of its regional competitors.Furthermore, Kingstons prodigious drypowder is set for another huge jump. PortAuthority of Jamaica (PAJ) chairman NoelHylton conrmed to Fairplay that the boardrecently approved a memorandum ofunderstanding (MoU) with a privateinvestor to develop PAJs Fort Augustaproperty and bring Kingstons capacity to awhopping 5.2M teu/year by 2014.The Fort Augusta expansion is just oneof four crucial initiatives moving ahead inparallel. In addition, PAJ is negotiatingpivotal arrangements with anchor clientsCMA CGM and Zim; seeking government-supported dredging to prepare for larger,post-Panama Canal expansion boxships;and forging ahead with plans to sell ofPAJs equity.The PAJ negotiations with its two anchorcarriers have taken centre stage. In earlyAugust, the Jamaican governmentannounced an MoU with CMA CGM to givethe carrier a 35-year lease in return for a$100M investment, with CMA CGM to takeover management of its allocated spacefrom PAJ [see Fairplay 8 September, CMACGM looks to better times].Several regional sources speaking toFairplay expressed astonishment at thismove, because it appeared to favour CMACGM over Zim, KCTs more importantclient. According to the latest availablestatistics, Zim accounts for about 55% ofKCT throughput, CMA CGM about 35%. Itlooks like seniority doesnt play any role inthis business its all about opportunity,said one competing terminal executive.Fairplay has conrmed that Zim was upsetwith the CMA CGM deal and that Zim hassubsequently held talks with a number ofCaribbean terminals to explore its options.Hylton acknowledged this when he spoketo Fairplay last month. I know other portshave gone to Zim and made ofers. I wouldbe nave to think they wouldnt. We makeofers to other ports clients all the time.Hylton also provided more details on theprocess ahead with both CMA CGM andZim, dispelling several of the misperceptionsthat have fed the rumour mill. Mostimportantly, the PAJ boss adamantlyasserted that he will not go forward withthe CMA CGM lease if it means losing Zim.Theres a lot of gossip about Zim and us.But we have said to CMA CGM, openly,that we will not do the deal with themunless we settle with Zim, said Hylton. Henoted that the agreement with CMA CGMwas only an MoU. We must settle theterms and conditions of the lease [withCMA CGM] by the end of the year, he said.I am not bragging yet.Asked how the CMA CGM plan cameabout, he revealed: CMA CGM made thisproposal. They wanted to decide on a hub.Instead of losing them altogether, we saidwed go along with it.He also claried what CMA CGM hasactually been ofered. A Jamaica govern-ment press release stated that the CMACGM deal would award the carrier KCTsSouth Terminal, the facility built on re-claimed land known as Gordon Cay. In fact,the MoU would give CMA CGM roughly 60-65% of Gordon Cay, not all of it, said Hylton.For Zim to accede to the CMA CGM deal,it must be convinced that the remainingKCT space suits its future needs. Zim isbeing ofered part of Gordon Cay, plus all ofthe west and north terminals. Hylton main-tained that the area to be allocated to CMACGM is essentially where theyd beoperating anyway.story of the weekSeizing an opportunity, Jamaicas bold and riskytranshipment plan is reverberating across theCaribbean. Greg Miller has an exclusive reportCaribbeanwww.fairplay.co.ukOther questions have been raised aboutwhat exactly CMA CGM would be spendingits $100M on, and when. Hylton reportedthat the carriers investments should beginin 2012 after a nal lease has been signed,and be completed within three years.Because Gordon Cay was built onreclaimed land, the carriers investmentswould be focused on strengthening theyard to allow for full containers stackedsix-to-eight high, strengthening the berthface to allow for deeper draught andbringing in new cranes.A CMA CGM ofcial told Fairplay that itsportion of Gordon Cay would have capacityfor 1.75M teu/year by 2015. The ofcialsaid the KCT deal would allow it to operateseveral lines deploying New Panamax shipsafter the canal expansion is complete.The government will be responsible fordredging to bring draught from 15m to17-17.5m, a project that would accom-modate not just the CMA CGM-allocatedfacilities but the entire property. We knowwe have to dredge, whether or not thisdeal goes through, said Hylton.The crucial negotiations with CMA CGMand Zim have yet another twist: they areunder way concurrently with the PAJslong-brewing plans to sell its equity andcover its debt obligations.Questions have emerged about therelationship between the CMA CGM leaseproposal and the future privatisation.Hylton said those tracks were separate.He said that after CMA CGM made thelease proposal, KCTs privatisation adviser,PricewaterhouseCoopers, concluded thatit would not, in their view, afect theprivatisation process.The potential complication is that if theCMA CGM deal is approved, the carriersterminal operating arm would agree tomanage the allocated facilities for 35years. Yet the KCT privatisation, when ithappens, would, presumably, put theentire property out to bid for purchase bya major international terminal operator.So who would eventually manage thesection of Gordon Cay allotted to CMACGM? That question would be dealt with inthe lease agreement to be signed by year-end, said Hylton. He also emphasised thatin any future privatisation, both CMA CGMand Zim would be ofered an equity stake.How KCTs multiple schemes pan outwill have sweeping implications for futurebusiness planning for the entire Caribbeantranshipment sector. If KCT can success-fully seal long-term agreements with bothZim and CMA CGM, secure dredgingfunding, develop Fort Augusta and sell itsequity, then Jamaica will become a farmore dominant force. If not, competitorsare anxious to pick up the pieces.FI knowother ports havegone to Zimand madeofers. I would be nave tothink they wouldntstory of the weekPAJ chair Noel Hylton (right) with CMA CGMexecutive director Rodolphe Saade and Jamaicatransport minister Mike Henry (centre), at the MoUsigning in August22 September 2011 5Theoretically, liquefed naturalgas (LNG) is supposed to bringglobal natural gas prices intogreater equilibrium, la crude,but it hasnt worked out that wayas regional prices move evenfurther apart.A newreport by IHS CERAreveals howthree entrenchedpricing regimes Asia, Europeand NorthAmerica are dictatingspot LNGfows. Gaps betweenthe three are widening, despite agreater availability of fexiblecargoes not bound for fxeddestinations. In the AtlanticBasin, the US import market hasbecome increasingly irrelevant,withAmericas Henry Hub pricelanguishing below$4 per millionBritish thermal units (MBtu).CERAbelieves the US willremain oversupplied as a result ofdomestic shale gas and a lack ofexport capacity, with non-competitive pricing to persist.In Europe, spot pricing islinked to the National BalancingPoint (NPB) hub. Unlike NorthAmerica, the [European] marketis not oversupplied, noted CERA.NBP has been hovering around$9-10/MBtu and is predicted toreach $11.80/MBtu this winter.But the big driver of todaysspot LNGmoves is the PacifcBasin, thanks to the surprisinglyhigh premiums on ofer. Asianbuyers paid $13.38/MBtu forspot cargoes in July and regionalpricing has since topped $15.In a perfect market, Asianbuyers should be paying justenough over NBP to covershipping costs and divertcargoes from competing biddersin Europe.This thesis held true in late2010 and early 2011, but not inrecent months.Rather than paying justenough to outbid competition,Asian short-termprices haveescalated well above NBP. TheJuly premiumfor Asian cargoesover NBP came in at $4.32/MBtu, the widest spread sinceMarch 2009, CERA noted. Asianbids for Middle Eastern cargoestrumped Americas by more than$10/MBtu.The Asian premiumcan bepartly explained by the highershipping costs of routes fromliquefaction plants in the MiddleEast and Africa compared withshorter voyages to Europe. Thisefect is heightened by the 150%increase in LNGtanker charterrates over the past year, which isbeing passed along to shippers.However, the current AsianPricing chasmpulls spot LNGto AsiaAsian buyers are nowpaying a huge premiumto snare cargoes fromEurope and America,reports Greg Millerpremiumis much greater thanjustifed by shipping diferentials,maintained the analyst. Clearly,another factor is in play.The key, it believes, is thediference between fexiblecargoes and available cargoes.The lack of available shippingcapacity is limiting the amount ofLNGthat can make its way toAsia, causing buyers to bid up thecargoes that do make thejourney, the report stated.There are no indications that theAsian premiumwill disappear soon.The natural ceiling for Asian spotdeals, set by long-termcontractpricing, is around $20/MBtu.There is still a lot of runningroom, saidCERA.Asian demand is being furtherboosted by Japan, which mustreplace ofine nuclear capacity.The more time that passeswithout a plan to restart Japansnuclear facilities, the greater thecountrys demand for LNGforpower generation will grow,CERA commented.To the extent shipping capacityis available, spot LNGcargoesshould increasingly divert towardsAsia, as they have for each of thepast four months.The volume of LNGheadingout of the Atlantic to the Pacifchas grown considerably, reportedIHS CERA, which predicted thatthe disparate prices underpinningthis trend will remain apart.FLNGimports by region 2008-13(Mtonnes) Middle EastAtlantic BasinPacic Basin20092010201120122013The longer without a plantorestart Japans nuclear facilities,the greater its demandfor LNG[Source:IHSCERA] 22 September 2011 www.fairplay.co.ukContainer ships: Charterers poised to pick up more bargains Sale and purchase: En bloc deals dominateMid-range tankers: Painless Indian naphtha drop-of Capesizes: Uncertainty deters potential buyersFairplay subscribers have access to complete listings of newbuildings, ship sales, fxturesand bunker prices on the Fairplay website. To access, go to www.fairplay.co.uk/markets OtherMeat/poultryFish/seafoodExoticsDeciduousDairyCitrusBananas OtherMeat/poultryFish/seafoodExoticsDeciduousDairyCitrusBananasmarketsMore breakbulk reefers cannibalisedReport highlights thechallenges to specialisedfeets from refrigeratedcontainers, writesMichael HollmannTough competition fromthecontainer lines will continue tosqueeze out conventional reefership capacity at a rapid pace in thecoming years, according to a newreport fromLondon-basedconsultancy Drewry.If current trends prevail, thespecialised reefer feet coulddwindle from691 ships today toonly 476 by 2015, its ReeferShipping Market Annual Reviewpredicts. Scrapping programmesby owners of conventionaltonnage sawan average of 36vessels heading to Asian recyclersbetween 2008 and 2010 whilethe newbuilding orderbook hasdropped to zero for the frst time,Drewry said.Containerisation of perishableproducts is forecast to increase to74%by 2014. The container linesshare of overall reefer carryingcapacity could even reach 95%.However, just as in the standarddry container sector, carriers arepushing capacity up too fast.Given the high number ofnewbuildings scheduled to bedelivered, this suggests downwardrate pressure, commentedDrewry associate Susan Oatway.Also, beyond 2015, containerlines will fnd it harder to achievefurther market share gains as thepotential for containerisationdwindles, the report says. This isbecause many of the seasonalhigh-volume commodity tradesthat remain are ideally suited tospecialised reefer services. It isthese that will ensure itscontinuing and proftable future, albeit on a smaller scalethan in previous years.So far, this year has been aroller-coaster for breakbulk reeferoperators and shipowners, withspot rates crashing to rock bottomin 2Q11 fromvery frmlevels in1Q11. Civil unrest in NorthAfrica and the Eastern Mediterra-nean deprived the market of keydemand drivers, explained UK-listed operator Star Reefers in itsrecent half-year report.A Hamburg chartering brokertalking to Fairplay put the averagereefer spot rate today at $0.60-0.70/ft3for modern and $0.50-0.60 /ft3for older tonnage with aslightly frmer tendency. Itmeans smaller older vessels canstill hardly recoup their operatingexpenses, the broker said.Worldwide, about 50specialisedreefer vessels were put into lay-upor idle without employment thisnorthern summer, a fairly highnumber compared with past years.One of the operators cuttingback on capacity was fruitmultinational Chiquita. It mergedits two conventional CentralAmerica/North Europe servicesinto one loop, the broker pointedout. Instead the group is nowbelieved to be booking more of itscargo on MSCreefer containerservices into Bremerhaven.Fixing activity in the periodmarket for reefers is anticipatedto go up in the coming weeks andmonths with a lot of charterscoming up for renewal. Ships thatwere fxed for a multi-year charterback in 2007 at levels about $1/ft3would nowbe facing marketlevels of $0.80-0.85 /ft3, anotherbroker told Fairplay.FTotal seaborne trade of perishable reefercargo by commodity, 2010691current feetof specialisedreefer shipsestimatedsize of reeferfeet in 2015 47622 September 2011www.fairplay.co.ukDairy[Source:Drewry,SextantConsultancy]8 22 September 2011 www.fairplay.co.ukThe prospect of a post-holiday rallyin period rates has been steadilydwindling in recent weeks, withinated availability levels in mostsize classes nowcasting a longshadowover the market.Charterers are calling the shotsagain, extending or xing tonnagefor exible periods at bargainrates, although their pleasure willbe tinged with frustration aboutmounting losses on many freightroutes into Europe and the US.The average charter rates theyare incurring on fresh xturesdeclined by about 2%last week,according to the ConTex, andowners should be bracingthemselves for what promises tobe a very challenging lowseasonthis winter.Given the scarcity of newbusiness compared with thegrowing list of spot/prompttonnage, we see little chance of arecovery or even a halt in thedecline in the near future,warned a UKchartering broker.Broking houses fromHamburgandCopenhagen echoed thatsentiment in their commentarieslast week, lamenting the lack offresh business amid the urry ofshort-termcontract extensionsnowdominating activity.Statistics showspot availabilityof charter-free tramp vessels hasreached alarming levels in theupper size classes, not seen sincethe early stages of the chartermarket recovery in 2010. OneHamburg broker estimated spotavailability in the 4,250teu sizeclass at eight ships worldwide andin the 3,500teu class at awhopping 19 units.Increased relet activity amongthe container ship operatorscoupled with a general decline inrequirements because of a atcargo peak season are leavingmore big ships without employ-ment opportunities. And this iseven ahead of the historicallyquiet fourth quarter, which sawdaily hire levels slip by more than10%in previous years.London broker BraemarSeascope warned in its latestmarket round-up that thepressure fromthe Panamaxsegment is seemingly taking itstoll on the sizes below. Panamaxrates have already nosedived by36%to 46%, depending on periodlengths and regions, brokers said.19unitsspot availability in the 3,500teusize classAnumber of fresh xtures andextensions of 2,700-2,800teu andof 3,000-3,500teu types revealeda sharp decline in charter values inthese segments, too. These includethe 3,359teu ERMelbourne, whichContainer ship chartererspoised for more bargainsPressure on charter ratesis reaching the sub-Panamax sectors and arate recovery is unlikelysoon, brokers sayextended a short exible periodwith Maersk Line at a weak$9,500/day with delivery atAlgeciras last week. The geared3,091teu Letavia achieved$12,000/day in a six-month periodwithCMACGMin northeast Asia,although this is hardly more thanthe going rate for the smaller2,500-2,800teu types.Pricing in the larger sizes iscertainly out of kilter with thesmaller feeders and this looks setto continue, commentedanother UK broker.Out of touchThe ConTex values 24-monthperiods for 2,500 and 2,700teutypes at $13,217 and $13,659/day, respectively, but suchdurations are currently out oftouch with the market. Instead,ships are increasingly xingshorter or exible periods at wellbelow$12,000/day, in the hopethis might cover themthroughthe quiet season to the northernhemispheres spring or summernext year. The gearless 2,732teuPassat Spring xed a six to 12-month period with MISCinSoutheast Asia at $11,450/day,while some others only securedvery short periods or roundvoyages at about $12,000/day.That could leave themexposedthough during the winter.One of the more stable areasof the market is the midsize1,700teu segment, which sawsome ships xing at about$10,000/day above theConTex rate for immediatespot positions. For example,Korean operator KMTC had topay $10,200/day in a four tove-month period extension onthe 1,740teu Cape Nelson fromthe end of September in Pusan.Steady xing activity in this sizeclass over the recent weeks hasled to a lack of prompt supplyfor the end of September intoearly October requirements,brokers said.FmarketsThe 2,732teu Passat Spring was xed for a six to12 month period with MISC in Southeast Asiaat $11,450/day [ Photo: Dietmar Hasenpusch ]Pricing inthe larger sizes iscertainly out of kilter withthesmaller feeders andthis looksset tocontinue22 September 2011 9 www.fairplay.co.ukA number of multi-ship sale andpurchase deals were concludedover the past week, although themarket currently lacks obviousdirection in either main sector.Recent improvements possibly seasonal in the Balticdry indices may have put atemporary brake on falling bulkervaluations. However, the balanceof opinion about prospects for2012 remains mainly pessimistic,considering the macroeconomicoutlook and expectations ofgrowing tonnage supply.Sumitomo is believed to havegiven up in its attempts to securemore than $30Mfor itsKamsarmax TritonOsprey (built2007 Universal, 81,448dwt), byagreeing a sale price of about$28MfromMykonos Shipping.There are currently a couple ofolder Panamaxes under rmnegotiation, with the pricesrumoured to be at levels ratherlower than achieved before.Precious Shipping of Thailand,previously a Handysize specialist,is said to have been the buyer ofthree prompt-delivery Supramaxresales fromTaizhou SanfuShipbuilding in China at $26.5Mper unit. The 57,000dwt shipswere originally contracted byOskar Wehr. Indonesian interests,meanwhile, are thought to havepaid $22.5Mfor Young Spring(built 2002Oshima, 53,023dwt)which was sold by the originalcontracting owner, Ta-TongMarine of Taipei.Handysize values continue toslip, sale by sale. Orient Marinesopen-hatch type Aladdin Rainbow(built 1999 Kanda, 32,260dwt)has reportedly been committed at$16M, compared with the$17.5Mpaid in June for thesimilar Crimson Forest (built 1999Hakodate, 31,727dwt).In the tanker sector, TitanOcean has continued to dispose ofits single-hull FSOs, withPetrobras said to have paid$72.7Men bloc for TicenOcean(built 1991 Daewoo,284,497dwt), TitanOrion (built1992 Hyundai, 284,480dwt), andTitanAries (built 1993 Daewoo,302,493dwt). These are destinedto serve the Brazilian oil majorsstorage requirements and, evencompared with the alternative ofscrapping, the price levels lookquite modest.Sinochemis believed to havepurchased the stainless chemicaltanker sisters Isabel Knutsen andMaria Knutsen (built 2000 and2001Gijon, 22,377dwt) forabout $22.5Meach, en bloc.The price for the ships, whichboth have 24 cargo tanks, is moreor less in line with recent sales ofJapanese stainless units. How-ever, the Chinese major mighthave, arguably, paid a smallpremiumfor a pair of ships withhigh specications.LeonTrading of Greece isthought to have paid about $20Meach for Sekwang ShippingsMarineline-coated sisters RoyalStella and Royal Orion (built 2009Sekwang, 19,997dwt) at a sherifsauction in Singapore. With IMO2chemical notations but withcoated tanks, the vessels have lesscargo exibility and inherentmaterial value than stainless ships.Nonetheless, in the event of amarket recovery, the modest pricelevel paid for such modern Korean-built units may prove to be asuccessful long-terminvestment.In yet another en bloc chemicaltanker deal, the Norwegian-controlled, coated ships SichemPadua and SichemPandora (built1993 and 1994 Hyundai,9,215dwt) are believed to havechanged hands for $4Meach,with unidentied Greek buyersthought to be involved.In the smallest range of tankersales, ve of a series of Chinese-En bloc sales dominateMore deals are beingdone but the outlookremains pessimisticbuilt product tankers havereportedly been sold for $6Meach to UK-based interests. Theships involved are Brixham,Mumbai, Harlington and Kiel(built 2009-2010 RongchengShenfei, 5,500dwt) and theRmeil (built 2010 RongchengShenfei, 6,174dwt).Technomar is believed to haveconcluded another purchase andcharter back deal for largecontainer ships. Orient OverseasOOCL Japan, OOCL Britain, OOCLSingapore and OOCL Netherlands(built 1996-97 Mitsubishi,67,473dwt) are believed to haveachieved $32Meach with timecharters back to the sellers at$27,800/day, or the bareboatequivalent, in each case.Delivered in time for thehandover of Hong Kong toChinese rule, these were fromtherst series of 5,300teu over-Panamax ships built for the Tungfamilys container line.Overall, the rmness of scrapprices continues, with India takingthe lead in terms of numbers ofnewprojects while Chineserecyclers are showing greaterwillingness to pay up in order tokeep their dry docks occupied.Perhaps the most signicant salein the latter respect was the$480/ldt reportedly paid byChinese buyers for the single-hullSuezmax Shen Non II (built 1991CSBC, 25,545ldt), a distinctimprovement on the recent rangeof $440-$450 which hasprevailed this summer.Alang breakers showno sign oflosing an appetite for newprojects, even when the deliveryposition of the vessel involves alengthy repositioning voyage. Asan example of this, scrappingreports list Indian interests as thepurchasers of SoponatassPanamax tanker Estrecho deMagallanes (built 1991 Zaliv,15,991 LDT), at $440/ton, basisdelivery as is in Chile at the endof the year.Fmarkets$27,800/daytime charter back agreement or the bareboat equivalent reported for fourOOCL containerships, each 67,473dwt, 5,300teuFalling Handymax values:Aladdin Rainbowis typical[ Picture: World Ships ]The versatile medium-range (MR)products tanker market shouldcushion any impact fromdecliningIndian naphtha exports.Indias annual naphtha exportshave reached 106Mtonnes since2008. But recent reports suggestthe gure is set to drop owing torising demand fromIndiasexpanding plastics industry. Indiannaphtha demand is expected togrowby 11.45%year-on-year.MRrates for theWCIndia-Japanand theWCIndia-Singapore laneshave begun softening, althoughthis could also be because ofrecently ended month of Ramadan.On 18August, WCIndia-Japanrates averagedW175andWCIndia-Singapore rates averagedW215.Last week, WCIndia-Japan ratesaveragedW151andWCIndia-Singapore rates averagedW190.Indian naphtha consumptiondropped froma high of 13.9Mtonnes in 2006-07, to 10.1Mtonnes in 2009-10, beforerecovering gradually to 10.7Mtonnes in 2010-11.MRtanker operators areunconcerned, telling Fairplay thattheir vessels small sizes enablethemto easily nd alternativeemployment. MRtanker poolHandytankers managing directorKristian Lohmann said: The bignaphtha trading pattern is AG-Japan and it is usually transportedon LR2s. Handytankers transportsnaphtha but it is mainly fromAlgerian reners.Even with a weak market inIndia, Handytankers can still seizeopportunities elsewhere due tothe wide area we trade in.Brokers agree with Lohmannsassessment, pointing out goodemployment opportunities in thecross-AGand intra-Asia markets.For everyIndiancargo,there are five-to-six MiddleEasterncargosW175freight rates for India-Japan route on18 AugustRates are very protable dueto tight tonnage availability andcharterers demands for shortPainless Indian naphtha drop-ofStrong intra-regionaltrades would cushionimpact of falling exportsturnaround times. Voyages lasttwo-to-three days so slowsteaming does not apply here. Forevery Indian cargo, there are ve-to-six Middle Eastern cargoes,said one Singapore-based broker.Reported xtures showcross-AGMRrates have headed northmonth-on-month.Cross-AGrates range from$230,000-$275,000, on a lump-sum-per-voyage basis. Riskierlocations such as Iran and Iraqcommand premiums. Last week,Tragura took TORMCarina for aUAEIraq voyage for $350,000.Gasoil, gasoline and Iraniannaphtha are among the productsthat are commonly shippedwithin the AG.But MRtanker operators are inno rush to divert ships to the AGas intra-Asia rates are comparable.Last week, Shell took VinalinesDai Minh for $285,000 for aUncertainty detersCapesize S&PDoubts over the sustainability ofcurrent Capesize spot rates andother factors have ensured thatresale prices continue to lag behindfreight levels.Just last week, bankrupt KoreaLine reportedly tried and failed tosell 2005-built Begonia, for whichthe highest ofer, reportedly fromChinese parties, was $37.5M.That was the second failedCapesize resale in two months,after Sanko Steamshipsunsuccessful attempt to sellnewbuilding Sanko Partner toGreek interests for $45M. Lastweek, Norwegian brokerLorentzen &Stemoco reportedthat NYKLine sold 1994-builtSuma (renamed GloryApollo) toSea Star Ships Management inChina for $14.5M.In a similar transaction inMarch, Hong Kong-basedVermilion Overseas Managementsold 1996-built Cape Azalea(renamed Cape Ioanna) to Greekinterests for $23M. Analystsagree that uncertain freightlevels are the main reason forsluggish asset prices.Greek shipbroker Intermodalsanalyst George Eliades said: Mostmarkets10 22 September 2011 www.fairplay.co.ukshipowners are still sceptical aboutwhether the timing is right forthemto make a move. The feelingof too lowto sell and too high tobuy is dominating the market. Itseems most owners are pacingthemselves for an unpredictablequarter and indeed for theunpredictable years to come.LimSimKeat, CEOofSingapore-based Pacic ShippingTrust, is one such owner. He toldFairplay that, for now, he had noplans to expand his Capesize eet.PST took delivery of ShagangHongfa fromHyundai HeavyIndustries on 5September. Asistership, Shagang Hongchang, isPotential buyers stillthink resale prices coulddrop furtherCapesize freight rates aredependent only ondemandforsteel andpower generationHsuChihChienscheduled to be delivered soon andboth ships have been chartered toChinese steel mill Jiangsu Shagangfor 10years at $27,000/day.Limsaid: I dont foreseecurrent rates to be sustainable asthe orderbook-to-eet ratio is stillsubstantial. There are severalsecondhand Capesizes on sale butmarkets22 September 2011 11 www.fairplay.co.ukThailand-Singapore trip and BPtook Tanker Pacic Manage-ments Pacic Crystal for$295,000 for a Map Ta Phut-Singapore voyage.Shipments regularly move onthe South Korea-Singapore,Singapore-Australia, andSingapore-Japan lanes. Firmingrates have encouraged charterersto request period charters of one-to-two years, said the broker.At present, period charter ratesfor MR tankers approximate to$14,000/day.Voyages to pirate-infestedareas in the Red Sea and of EastAfrica remain rewarding for risk-taking owners.A broker quoted W270 for anAG-East Africa voyage, translatinginto daily earnings of $17,000after deducting voyage costs.French shipbroker BarryRogliano Salles made a similarassessment.The MRs have been busy witha consistent owof intra-regional moves. Cross-MEGvoyages are xing at about the$280,000 lump-sumlevels andAG-Red Sea is going at$850,000, said BRS.The cross-AGmarket is doing sowell that BRS says owners areunwilling to x AG-UK-Continentvoyages, which are priced at$1.8M/voyage.Shipbroker Simpson Spence &Young concluded that as TaiwansFormosa Petrochemical Corp isset to restart its 700,000 tonnes/annumnaphtha cracker thismonth, Asias naphtha backward-ation is set to strengthen on rmdemand and tight supply.Mitsui OSKLines is optimisticabout its MRoperations,expecting more naphtha exportsfromSingapore to the Far East.With some Indian reneriesdue for maintenance soon, wealso expect more cargo, mainlydistillates, to move fromSingapore to India. It might causetight vessel supply in Singaporeso we will position our vessels inthe Singapore-Japan range, saidan MOL spokeswoman.F// //older vessels are not fuel-efcientand current bunker prices make ituneconomical to operate theseships. Because of this, we preferto invest in newbuildings.Courage Marine chairman HsuChih Chien told Fairplay hebelieved volatile Capesize freightrates mean owners shouldconsider carefully beforecommitting. The company hasjust one Capesize vessel.The Taiwanese shippingveteran said: Capesize freightrates are dependent only ondemand for steel and powergeneration. Congestion in majordry bulk ports or a slight uptick indemand will make rates go up.Conversely, freight rates quicklygo down when demand dips.Analysts consensus is that theCapesize market will staydepressed over the next two-to-three years. Massive newbuildingdeliveries could mean really goodpre-owned bargains by then.Todays situation, where prices arealmost the same for all bulkersizes, is really silly. So I would waitlonger before buying a Capesize.Greek shipbroker GoldenDestinys analyst Maria Bertzele-tou told Fairplay that on average,no more than ve bulkers havebeen sold every week. The lastrecord of year-to-date activity inthe bulk carrier segment was inthe week ending 13August, whennine units were reported sold.It is true that there has been asignicant rally in the dry sector,driven by the substantialearnings for Capesizes due tormChinese iron ore demand,but there is still hesitation aboutthe solidness of the market as wemove towards the end ofSeptember, said Bertzeletou.Spot and period charteringactivity has shown signs ofstrength for all vessel sizes,oating at levels above operatingexpenses, she continued, butthere is always a time lagbetween the direction in thefreight markets and asset prices.She told Fairplay Capesizeprices dived when spot rateslanguished in 1H11 and it wouldtake some time for asset valuesto recover.She said: Buyers just recentlysawnewasset levels after waitingfor months whenCapesizeearnings struggled to remainabove $10,000/day. Nowthemarket has shown the rst signs ofrmness with the Baltic Dry Indexsurpassing the 1,700mark, playersare waiting to see what will be thenewdirection post-September.F$37.5Mofer for 2005-built Begonia.The sale failed[ Photo: Courage Marine ]Baltic clean tanker rates, West Coast India to JapanTC12Route description: 35,000 tonnesNaptha Sikka (WCI) to Japan 22 September 2011 www.fairplay.co.ukshipping marketsWeekly summary of all the keyindustry indices and dataContainer ship Timecharter Assessment[Source:BalticExchangedata][Source:HamburgShipbrokersAssociation(VHSS)]Type1,100teu1,700teu2,500teu2,700teu3,500teu4,250teu[Source:BalticExchangedata][Source:BalticExchangedata]F M A M J J A S O N D J F M AQ Q Q Q QA S O N D J F M A M J J A S O NQ Q Q Q Q Q[Source:HamburgShipbrokersAssociation(VHSS)][Source:BalticExchangedata]A S O N D J F M A M J J A S OQ Q Q Q Q1,5001,2009006003000Index5,0004,5004,0003,5003,0002,5002,0001,5001,0005000Index30,00025,00020,00015,00010,0005,0000$/day700600500400300200100ConTexBaltic dry indices BDI: 1,814 -24 (-1.3%)Outlook: In the Baltic Capesize index forthe iron ore trade from Brazil to China, ratessoftened about a $1.00 to $26.77/tonne andlost $0.63 to $10.92 on Western Australiato China. Brokers suggest major charterersare trying to contain the recent gains in theCapesize market where rates have reachedhighs for 2011. Panamax grain markets havefrmed for early ship availability from the USGulf Coast to the Far East at $25,000/day plusa $500,000 ballast bonus. The South Americangrain season is winding down with trips to theUK/Continent at $15,250/day plus a $450,000ballast bonus. Supramax grain rates from theUS Gulf Coast have frmed to $32,500/day.Container indices ConTex: 533 -11 (-2.0%)Baltic tanker indices BDTI: 681 9 (1.3%) BCTI:646 -13 (-2.0%)Outlook: A small hopeful frming sign forVLCC spot rates from West Africa to the LOOPwas the gentle increase to W46.9. From theGulf softening fuel prices improved the timecharter equivalents (TCE) for the TD1 route by$2,904 to -$12,420/day; less negative but stillthe same worldscale of W34. Suezmaxes fromthe Baltic Sea to Mediterranean saw rates jump13 points to W82.3 which lifted the TCE fromnegative levels to $10,168/day. West Africa toPhiladelphia rates frmed to W70.89 and morethan doubled the TCE to $8,776/day. Aframaxrates saw frming on the North Sea to UK/Continent (TD17) route to W97.5. Elsewhererates were similar to last week.Outlook: Over capacity and a drop inenquiry because of mid-autumn holidays inAsian countries saw another 2% drop in theConTex week-on-week with most signifcantlosses aficting the Panamax sector. Pressureis also fltering through to the 2,500-2,800teutypes which are now fxing below $12,000/dayfor shorter and fexible periods and so wellbelow the ConTex average based on 24 monthperiods. The 1,700teu midsize types show moreresilience amid tighter availability for promptpositions in Asia, according to brokers.8 Sept 15 Sept$7,687 $7,545$9,785 $9,634$13,419 $13,217$13,920 $13,659$15,149 $14,767$17,694 $17,054-5.6%Capesize IndexThis week: 3,008 3 MH: 3,342Last week: 3,185 3 ML: 1,738+3.6%+3.2%-0.9%Panamax IndexThis week: 1,746 3 MH: 1,796Last week: 1,685 3 ML: 1,475Supramax IndexThis week: 1,446 3 MH: 1,446Last week: 1,401 3 ML: 1,244Handy IndexThis week: 677 3 MH: 721Last week: 683 3 ML: 641VLCC TCEThis week: -$7,195/dayLast week: -$9,431/daySuezmax TCEThis week: $9,472/dayLast week: $1,748/day +441.9%Aframax TCEThis week: $483/dayLast week: -$656/day +173.6%MR-TCEThis week: $7,196/dayLast week: $6,766/day +6.4%+23.7%BFA BDI 4Q11: 1,559 BFA BDI 1Q12: 1,33822 September 2011 13 www.fairplay.co.ukThe global lndependent authorlty on marlne fuel and shlpplng prlce lndlces, news analysls, lnformatlon& counterparty credlt rlsk lntelllgence. Por more lnformatlon please vlslt www.bunkerworld.comwww.bunkerworld.com00k0fN0fl0Call: +44 l753 4l0 940for enqulrlesEUROPE 380CST 180CST MDO MGOD ANTWERPD FALMOUTHD GREAT BELTD HAMBURGD ROTTERDAMD ST PETERSBURGMEDITERRANEAN 380CST 180CST MDO MGOWAUGUSTAWFOS/LAVERAD GIBRALTARD ISTANBULD OFF-MALTAD PIRAEUSAFRICA 380CST 180CST MDO MGOD ARZEWD CANARY ISLANDSWDURBAND OFF-NIGERIAWDAKARS O N D J F M A M J J A S OQ Q Q Q QBunkerworld index1,7001,6001,5001,4001,3001,2001,1001,000BW380, BW180 in centi StokeBWDI for distillate fuelsFor online bunker information:www.fairplay.co.uk/markets orwww.bunkerworld.com/pricesIndexFor online bunker information: www.fairplay.co.uk/markets orvisit www.bunkerworld.comMIDDLE EAST 380CST 180CST MDO MGOD DAMMAMD FUJAIRAHD JEDDAHD SUEZASIA 380CST 180CST MDO MGOD CHENNAID COLOMBOD HONG KONGD KAOHSIUNGD SINGAPORED SOUTH KOREAD SYDNEYD TOKYOAMERICAS 380CST 180CST MDO MGOD BUENOS AIRESWHOUSTONWLOS ANGELESWNEW YORKWPANAMAD SANTOSWSEATTLED VALPARAISOWVANCOUVER BCWVENEZUELAN PORTSBunkerworld prices [ Source: Bunkerworld ]Latest end-of-week prices listed in $ as at Monday 19 September 2011.D=delivered, W=ex-wharf. Ports listed alphabetically by region.Outlook: The BWI showed theaverage price of bunker fuel as beingrelatively stable at the end of last week.Global average bunker prices uctuatedduring the week but by Friday, theBW380 index rmed by $2.00 to$672.50/tonne and the BWDI wasunchanged at $992/tonne.At the beginning of the week, theSingapore bunker market saw softprices but rmed strongly on Friday. Anaverage of $674.50/tonne for IFO380centistoke (cSt) was seen, $33/tonneup from Mondays price, by the closeof the week average marine gasoil(MGO) prices were at $953/tonne.Market players commented thatdemand had been relatively weak dueto high prices. Onshore stocks of fueloil rose to 21.275M barrel in the portlast week, according to data publishedby International Enterprise. Marketcommentators predicted that stocksshould continue rising towards the end ofSeptember. October is also expected tosee heavy Western arbitrage inows, withover 3.5M tonnes booked so far, accordingto Reuters.In Rotterdam, tight avails werereported during most of the week bysome suppliers. The price for IFO380 cStproduct closed on Friday at $652/tonneand MGO prices closed at $958/tonne.However, there were mixed reports fromsome sources; one player mentioned thatrumours of tight avails were unfounded.By the close of the week, prices ended rmin the bunker market in Fujairah. Averagedelivered IFO380 cSt prices closed up at$676.50/tonne and MGO prices reached$1069.50/tonne. In Houston, IFO380 cStprices nished at $651/tonne and MGOat $982/tonne. According to the UnitedStates Department of Energy, crude oilinventories fell 6.7M barrels last weekwhile gasoline stockpiles rose by 1.9Mbarrels which may have a downwardinuence on bunker prices.On Friday, crude oil futures contractson the Nymex slipped to $87.96/barreltrimming its fourth straight weeklygain and longest winning streak sinceJuly; a result of concern that Europeanplans to solve its debt crisis may fail.Brent, which closed at $112.22/barrel,saw little change last week; accordingto chart analysis by Citigroup it maybe headed toward $150/barrel, with asubsequent impact on bunker prices.Bunkerworld Indices BW380: $672.50 $2 BW180: $695.50 $0.50BWDI: $992 $0$636.50 $656.50 n/a $941.00$680.00 $721.00 n/a $1,004.50$656.00 $688.50 $940.00 $976.50$653.50 $673.50 n/a $967.00$634.50 $657.50 n/a $942.00$516.50 $528.00 $720.00 $842.50$662.00 $697.00 n/a $985.00$651.00 $693.00 n/a $978.00$659.00 $688.50 $962.00 $983.50$682.00 $703.00 n/a $1,002.00$657.00 $679.50 n/a $958.00$655.00 $682.50 n/a $958.00$701.00 $726.00 n/a $1,011.50$675.00 $695.50 $981.00 $992.00n/a $676.50 $1,139.00 $1,148.00$700.00 $734.00 n/a $1,018.00n/a n/a n/a $1,062.50$675.00 $680.00 n/a $1,072.00$659.00 $681.50 n/a $1,059.50$714.00 $747.00 n/a $1,117.00$695.00 $737.00 n/a $1,090.00$706.00 $799.00 n/a $1,134.00$714.00 $735.50 n/a $1,062.50$666.50 $674.50 $938.00 $948.00$689.00 $698.00 $981.50 $996.50$653.00 $663.50 $916.00 $927.00$683.50 $705.00 $966.00 $976.00$777.00 $790.50 n/a $1,106.00$722.50 $732.00 $997.00 n/a$669.00 $699.00 $1,106.50 $1,095.00$641.00 $674.00 $985.50 $966.00$658.00 $687.00 $988.50 n/a$660.00 $690.00 $1,007.50 n/a$652.50 $694.00 $1,030.00 $1,022.00$685.50 $707.00 n/a $1,017.50$659.00 $686.50 $1,026.00 n/a$734.00 n/a $1,197.50 n/a$674.50 $717.50 $1,098.50 n/a$655.00 $695.00 n/a $1,020.50 22 September 2011 www.fairplay.co.ukSale &purchase All details given in good faith but without guaranteeFor full listings of newbuilding orders and deliveries: see www.fairplay.co.uk/marketsNewbuildings [ Source: IHS Fairplay ]For full listings of sale and purchase deals: see www.fairplay.co.uk/marketsTo get the very latest information on shipbuilding activity, subscribe to the DailyNewbuilding News email service. Visit www.ihsfairplay.comor email sales@lrfairplay.comCoNtaiNer &MultipurpoSeaVoNBorG, alaSKaBorGand atlaNtiCBorG:(general cargo ships) sold en bloc by Wagenborg Shipping,Netherlands, to CITGOPetroleum, US, $73.50M. Avonborg:2009. 17,407dwt, 11,864gt, 962teu. Built Hudong-Zhonghua, Wartsila/15kt. Alaskaborg: 2009. 17,407dwt,11,864gt, 959teu. Built Hudong-Zhonghua, Wartsila/15kt. Atlanticborg: 2008. 17,356dwt, 11,864gt, 959teu.Built Hudong-Zhonghua, Wartsila/15kt.terra BoNa (container ship) ex-La Bonita: sold bySinga Star, Singapore, to PT Tanto IntimLine, Indonesia,$8.40M. 1993. 22,308dwt, 16,869gt, 1,304teu. Built ShinKurushima, Mitsubishi, 12,961bhp/19ktBulKerSlorDBYroN(bulk carrier) ex-Blue Star: sold by AnthonyGiavridis Maritime, Greece, to undisclosed interests,Russia, $5.70M. Last sale: $17.30M(2007), 1985.25,694dwt, 14,889gt. Built Imabari, B&W/13kt.taNKerSHiGHCeNturY: (oil products tanker) sold by dAmicoSocieta di Navigazione, Italy, to Nathalin, Thailand, $27M.dAmico purchase option taken in July transferred toNathalin. Last sale: $23.80M(2011), 2006. 48,676dwt,28,799gt. Built Iwagi, MAN-B&W/15kt.SNFeDeriCa(oil products tanker) ex-White Dolphin: soldby Finservice, Italy, to Venice Shipping & Logistics, Italy,$26.50M. Three-year time charter back at $15,000/day,Last sale: $32.50M(2010), 2003. 72,344dwt, 40,763gt.Built Hudong-Zhonghua, MAN-B&W/15kt.iSaBel KNutSeNand MariaKNutSeN: sold enbloc by Knutsen OAS Shipping, Norway, to SinochemInternational, China, $45M. Isabel Knutsen (productstanker) ex-Chembulk Savannah: 2000. 22,377dwt,13,753gt. Built Naval Gijon, MAN-B&W/16kt. MariaKnutsen (products tanker) ex-Chembulk Barcelona: 2001.22,171dwt, 13,753gt. Built Naval Gijon, B&W/16kt.HoWa: (products tanker) sold by Sampo Unyu, Japan,to Petrolift Group, Philippines, $9.20M. 2002. 8,298dwt,5,123gt. Built Fukuoka, Mitsubishi/13kt.NeWBuilDiNG reSaleSHelGa SelMer, tHoMaS SelMer and iDaSelMer: (bulk carriers) sold en bloc by clients of TaizhouSanfu, China, to Precious Shipping, Thailand, $79.50M.Helga Selmer: 2011. 57,000dwt, 32,957gt. Built TaizhouSanfu Ship Engineering, MAN-B&W/14kt. Thomas Selmer:2011. 57,000dwt, 32,300gt. Built Taizhou Sanfu ShipEngineering, MAN-B&W, 10,956bhp/14kt. Ida Selmer:2011. 57,000dwt, 32,300gt. Built Taizhou Sanfu ShipEngineering, MAN-B&W, 11,510bhp/14kt.SeleCteDNeWBuilDiNG orDerS reporteDWeeK eNDiNG 16 SepteMBer 2011Shipbuilder No owner/operator Delivery type CapacityKitanihon 6 Zodiac Maritime 2013/8 Chem/oil prods tanker 19,800dwtSTX Rauma 2 Eide Marine 2013/3 Well stimulation vessel 31,000dwtSamsung 1 Thenamaris 2014/12 LNG tanker 160,000mSeleCteDDeliVerieS reporteDWeeK eNDiNG 16 SepteMBer 2011Vessel Shipbuilder owner/operator Delivery type CapacityAmazon New Times Dynacom 2011/9 Crude oil tanker 163,000dwtBaosteel Emotion Namura MOL 2011/9 Ore carrier 226,434dwtConfance SPP Christian F Ahrenkiel 2011/9 Bulk carrier 34,970dwtEagle Texas Tsuneishi AET 2011/9 Crude oil tanker 107,500dwtGolden Enterprise Jinhai Heavy Golden Ocean 2011/9 Bulk carrier 79,471dwtHanjin Samarinda New Century Hanjin 2011/9 Bulk carrier 115,000dwtIndustrial Force Sainty Jiangdu Jungerhans 2011/9 General cargo ship 14,358dwtJewel of Tokyo IHI Marine Emirates Trading 2011/9 Bulk carrier 56,300dwtKimberly C Jiangsu Yangzijiang Carisbrooke 2011/8 General cargo ship 6,750dwtKing Harold New Century Knig 2011/9 Bulk carrier 80,000dwtLiberty Island Saiki HI Marubeni 2011/9 Bulk carrier 37,000dwtMaersk Cunene Hyundai Samho AP Mller 2011/9 Container ship 4,500teuMezaaira A STX Jinhae ADNOC 2011/9 Oil products tanker 73,400dwtRich Duchess II Sumitomo Fuyo Kaiun 2011/9 Crude oil tanker 104,280dwtRickmers Tianjin Xinshun Rickmers 2011/9 General cargo ship 17,409dwtSeastar Endurance Zhejiang Jingang Norbulk 2011/9 Bulk carrier 33,500dwtStar Borealis HHIC-Phil Star Bulk 2011/9 Bulk carrier 180,000dwtSTX Symphony Taizhou Maple Leaf STX Pan Ocean 2011/8 Bulk carrier 31,800dwtVishva Nidhi STX Dalian SCI 2011/9 Bulk carrier 57,145dwt22 September 2011www.fairplay.co.ukFor more information on fxtures see: www.fairplay.co.uk/marketsFixtures [ Source: Maritime Research Inc / www.maritime-research.com ]Mar|t|me Research Inc. Fixture Reports via email Spreadsheet, Database or PDF formats499 Emston RdPar|in NJ 08859 USAPhone. (732} 727-8040Fax. (732} 727-0243Emai|. mri499@ao|.comWebsite. www.maritime-research.com Historical data dating back to 1951 lndexes and statistical analysisSupp|y|ng the mar|t|me |ndustry w|th comprehens|ve and |ndependent xture |nformat|on for over 50 yearsIDry FixturesCargo Vessel From To Tonnes Date $/tonne Chart TermsCoal Polymnia, 11 Puerto Bolivar Rotterdam 150,000-10% Sep 26/30 14.25 SwissMarin FIO;50,000tShinc/25,000tShincCoal Coronado, 00, or sub, Gladstone WC India 75,000-10% Sep 10/20 21.50 SAIL FIO;20,000tSatShex/25,000tShincCoal Medi Lausanne, 06 Mobile Koper 70,000-10% Sep 20/30 22.25 Pioneer FIO;30,000tShinc/15,000tShincIron ore Oriental Nicety, 86 Tubarao Qingdao 190,000-10% Oct 20/30 23.00 Dreyfus FIO;ScLd/30,000tIron ore Steamer, (Cosbulk) Tubarao Qingdao 160,000-10% Sep 20/30 29.75 Minmetals FIO;ScLd/30,000tIron ore Daniela Schulte, 10 Guaiba Kaohsiung 90,000-10% Sep 15/30 30.75 CSE FIO;40,000t/38,000tIron ore Steamer Pointe Noire Piombino 75,000-10% Oct 1/10 15.00 Erdemir FIO;40,000t/40,000tIron ore Taskent, 03 Narvik Bakar 70,000-10% Sep 15/24 14.25 Cobelfret FIO;ScLd/18,000ttimeChartersConsumption Vessel From To Dwt Date $/day Chart Terms14k/52t Baltic Wolf, 10 Del Rotterdam Redel Pass Muscat 177,000 Sep 20/22 45,000 Kleimar TripViaNarvik/MEGulf14k/52t Nightwing, 06 Del Rotterdam Redel Skaw/CapePassero 170,000 Sep 28/30 26,500 CNR TransAtlRd14.5k Gl Xiushan, 11 Del Caofeidian Redel Sing/Japan 98,681 Sep 11/13 14,000 CNR AusRd13.8k Sea Breeze, 09 Del Kaohsiung Redel Sing/Japan 91,913 Sep 14/16 13,000 CNR IndonesiaRd;Relet14k/35t Clara, 06 Del Praia Mole Redel Mobile 77,073 Sep 16/19 15,750 U-SeaBulk TripOut;SteelSlabs14.3k/34.8t Francesco Corrado, 08 Del Tachibana Redel Sing/Japan 77,061 Sep 20/25 14,000 Cargill NoPacRd;Soyabeans14k/35t Captain P Egglezos,07 Del Of Recalada RedlPassMuscatViaMEGulf 76,559 Sep 25/30 25,000 ETA Dubai TripOut+$600,000Bonus14k/34t Bahia Blanca SW, 11 Del SW Pass RedlSing/JapanViaUSGulf 75,700 Sep 20/25 25,500 Crossbridge TripOut+$550,000Bonus14.5k/33.6t Pearl C, 87 Del CJK Redel Sing/Japan 65,522 Sep 13/18 9,500 CNR NoPacRd;Grain14.5k Christine B, 09 Del Of Recalada Redel Sing/Japan 58,058 Sep 19/22 22,000 Bunge Trip+$425,000BB;Relet14.5k Ocean Future, 10 Del USGulf Redel Sing/Japan 55,771 Sep 18/20 30,000 Norden Trip out14k/31t Oceanqueen, 94 Del Surabaya Redel Bahrain Via Aus 42,529 Sep 15/16 12,750 Grandview TripOut;AluminaWet FixturesCargo Vessel From To Tonnes Date Rate Chart TermsOil dirty Tenjun, 08 Ras Tanura USGulf 280,000 Oct 2 W34 Vela Part cargoOil dirty Umm Al Aish, 11 Rotterdam Singapore 270,000 Sep 26 $2,850,000 Unipec PtC;Lump sumOil dirty Katsuragisan, 05 ME Gulf Japan 265,000 Sep 24 W46 CosmoOil dirty Antarctica, 09 W Africa China 260,000 Sep 26 W42 UnipecOil dirty Minerva Doxa, 07 Novorossiysk UK/Continent Med 135,000 Sep 25 W67.5 VitolOil dirty Spyros K, 11 Ceyhan Terminal USGulf 130,000 Sep 30 W55 VitolOil dirty Yannis P, 10 W Africa UK/Continent Med 130,000 Sep 29 W62.5 CSSAOil dirty Hellesp Trooper,orSub ME Gulf USAtlantic USGulf 130,000 Sep 30 W47.5 ChevronOil dirty Stena Arctica, 05 Primorsk UK/Continent 100,000 Sep 25 W72.5 ST ShippOil dirty United Honor, 10 W Africa Trinidad 100,000 Sep 25 W77.5 AdmarOil dirty Proteas, 06 Hound Point UK/Continent 80,000 Sep 22 W97.5 Shell Part cargoOil dirty NS Columbus, 07 CPC Mediterranean 80,000 Sep 26 W87.5 Litasco Part cargoOil dirty Zaliv Vostok, 09 Sidi Kerir Spain 80,000 Sep 25 W82.5 Repsol Part cargoOil dirty Eagle Turin, 08 W Africa UK/Continent 80,000 Oct 1 W87.5 CSSA Part cargoOil dirty Green Warrior, 11 Ras Tanura Mumbai 69,000 Sep 25 W114 SCI Part cargoOil dirty SN Federica, 03 Seria Daesan 58,000 Sep 26 W127.5 HOB Part cargoOil dirty Fourni, 10 Black Sea Mediterranean 40,000 Sep 23 W117.5 SaicatOil clean SKS Delta, 10 ME Gulf Japan 75,000 Sep 15 W127.5 YNCC Part cargoOil clean Glory Express, 06 USGulf UK/Continent 38,000 Sep 11 W110 CNROil clean Nord Innovation, 10 Pembroke USAtlantic 37,000 Sep 16 W125 ValeroOil clean Jag Prakash, 07 Sikka Singapore 35,000 Sep 21 W192.5 Conoco Part cargoOil clean British Security, 04 Qatar Sohar 30,000 Sep 17 $270,000 Shell PtC;Lump sum16 22 September 2011 www.fairplay.co.ukEconomic trends: Apprehension make times tough Greek shipping: Banks merger spells good news for industryCruise crunch: Europe puts the squeeze on summer Venezuela: Currency controls are Catch-22for shippersWhen container lines suferedhuge losses in 2009, theypleaded with their Caribbeantranshipment partners forconcessions, fromtarifbreaks toextended payment terms.It looked like carriers wereback on track last year but itdidnt last. Carriers are once moredeep in the red and concessionchatter has resumed.There used to be crises everyve to seven years. Nowit lookslike were back again after twoyears the timing is gettingshorter, saidCarlos Urriola,general manager of PanamasManzanillo International Terminal(MIT) and president of theCaribbean Shipping Association.It is really tough times for theshipping lines we are basicallyrepeating 2009, conrmed PoulHestbk, Hamburg Sd seniorvice-president of the Caribbeanand Central America.Everybody, includingHamburg Sd, is focused oncutting costs. Whether itslooking at tarifs or ways of doingthings more optimally, everysingle cost itemis being exam-ined, he told Fairplay.Hamburg Sds volumes in theCaribbean Basin returned to 2008levels last year and have increasedin the single digits in 2011. Itsnot a volume issue, its a rateissue, Hestbk explained.Last year, Hamburg Sdsrevenue/teu was still about 10%below2008 levels. This year,revenue/teu has generallymatched 2010. But the real killerin 2011 versus 2010 has been thebunker costs, Hestbk said,explaining that very fewlineshave been able to pass this on,which is why they are running atheavy losses.The higher volumes in theregion can be seen in the strongHubs face carrier pressureFairplay examines international trade and commerce developments across industries andsectors and puts them into a maritime context. Visit www.fairplay.co.uk for daily news updatesTranshipmentmargins couldbe squeezed aslines struggle, reportsGreg MillerCaribbeanThere usedtobe crises every fivetosevenyears. Nowit looks likewere back againafter twoyears.The timing is getting shorterCSApresident Carlos Urriolathroughput numbers of some, butnot all, the transhipment hubs.MITs volumes are up 20%year-to-date, according to Urriola.Another indicator is the volumecarried by the Panama CanalRailway (PCR). PCRrepresents animportant link in a keytranshipment model, wherebyboxes are unloaded at Balboa onthe Pacifc side and shuttled toCristobol and MIT on the Atlantic.PCRpresident TomKenna toldFairplay the railway expected tomove 400,000 containers thisyear, the equivalent of 1.36Mteuin transhipment terms. Thatrepresents an 11%increase versuslast year.Meanwhile, Cartagenacontinues to growat breakneckpace, with higher volumescreating temporary pressure.Cartagena is struggling withits own success. They have beencaught ofguard by the surge involume, Hestbk conceded.Hamburg Sd is Cartagenas topclient. We are confdent theywill push through it.According to GiovanniBenedetti, marketing vice-president of Cartagena terminaloperator SPRC: Volumes werehigher than expected, so there is alittle pressure. Following lastyears 25%jump, he predicted2011 throughput would increaseanother 20%, to 1.8Mteu.Capacity tightness will bealleviated by expansion at boththe Manga and Contecar termi-nals. By January, Mangas capacitywill rise to 1.5Mteu/year andContecars to 1.2M. This willbring total capacity to 2.7Mteu/year from1.9Mat present.SPRCis nowweighing its nextgrowth phase. The next threemonths will be very important tous, Benedetti explained. Ifmarket feedback is positive, SPRCwill immediately approve the nextexpansion of Contecar, adding afurther 800,000teu/year after an18-month construction period.Cartagena is just one of manyhubs plotting newcapacity as thePanama Canal gears up for its2014 widening.According to Urriola, the MITboard has approved investmentsto almost double capacity, from2.2Mteu/year currently to 4M.He expects phased constructionto begin next year, although heunderscored that MIT would becareful to not overbuild.Kingston planIn Jamaica, Kingston ContainerTerminal (KCT) recentlyannounced a project to increasecapacity from3.2Mto 5.2Mteu/year. This plan comes despiteKCTs lower volumes this year the reverse of the double-digitgains reported in Colombia andPanama. KCT expects throughputof 1.5Mteu inApril 2011-March2012, down 8%fromthe previousfscal year.Like Jamaica, Hutchison-controlled Freeport Container Port(FCP) in the Bahamas represents ahuge swath of available capacitythat could have major implicationsfor future routes.FCP CEOGaryGilbert told Fairplay that dredginghas recently been completed to18mon an additional 1,000mofberth, bringing the total up to2,000m. A further 1,500mofberth will be dredged by 2014.FCPs current capacity of 2Mteu/year could be easily expandedto 5Mteu/year with theinstallation of additional cranes,which would be ordered whennewcarrier clients sign on.Gilbert confrmed thatnegotiations are well under waywith potential customers.Just 105kmof Floridas coast,FCP is ideally located to serve as ahub for southeastern US ports.Gilbert believes several Americanports will not be dredged in timeto accommodate the larger shipsdeployed after 2014s PanamaCanal expansion.We need 18-24months leadtime to build the cranes and putthemin, saidGilbert. Workingbackwards from2014, this meanswere talking about 2012.Decisions are being made rightnow[by carriers] on what to do in2014-15. Were ofering themagood option for those big ships.Complementing projectsplanned at existing Caribbeanhubs, newterminal players areentering the region. As previouslyreported by Fairplay, PSAInternational has agreed tooperate the newterminal underconstruction in Mariel, Cuba.While Mariel will be a domesticterminal, some believe thecontract is partly a stalking horseto position PSA for a future Cubantranshipment hub.Last month, APMTerminalssealed a 33-year contract for the$992MMoin Container Terminalin Costa Rica. AlthoughAPMhasinsisted that the facility will bepurely domestic, multiplesources speaking to Fairplaypredicted that it would ultimatelyhandle transhipment.All the newcapacity in thepipeline, combined with thefnancial condition of thecarriers, will dictate future tariflevels at hubs.The questions will be: howmuch of this additional capacitypeople are talking about willhappen, and what will thiscapacity be aimed at? saidBenedetti. We need to defnewhat type of market wereentering: a carrier market or aterminal market.Ftrade & commerce22 September 2011 17 www.fairplay.co.ukCaribbean Basin GDP outlookCountry 2010 2011 2012Bahamas 0.5 1.0 0.5Barbados 0.2 2.1 2.9Colombia 4.3 4.8 4.2Dominican Republic 7.8 6.0 5.4Haiti 5.5 9.0 8.0Jamaica 1.3 1.2 2.9Panama 7.5 7.2 7.0Puerto Rico 2.1 1.2 0.9Trinidad & Tobago 2.3 2.9 3.0Venezuela 1.5 3.1 2.6[ Source: IHS Global Insight. 2011 and 2012 GDP trends estimated ]Freeport is actively seekingnewcarrier clients tosupplement its MSC business[ Photo: Erik J. Russell/Keen iMedia Ltd ] 22 September 2011 www.fairplay.co.ukfor market share in Barbados, headded, cutting margins for agents.Shipping executives also toldFairplay of two parallel trends inCaribbean cargo sourcing: onefavouring regional sellers and theother favouringAsian producers.In the regional category, HamburgSd SVP Poul Hestbk cited a shiftin low-value production towardsthe Dominican Republic, ElSalvador and Honduras.Smaller lotsThis trend coincides witheconomic uncertainty amongregional cargo buyers, who areseeking to buy smaller lots withshorter lead times. If you order inChina, you may have to purchase100,000units, three or fourmonths in advance. InCentralAmerica, you might be able toorder 1,000units and get themdelivered every week. Thats muchless risk for buyers, said Hestbk.A separate dynamic is pushingsome purchases towards Asia andaway fromtraditional US sources.There is a consolidation ofdistribution companies in theCaribbean, where larger groupsare taking interests in the smallerislands, said Paelinck. Thisincreases their buying power andallows themto source directlyfromthe Far East.Hestbk agreed: With morebuying power, they dont need togo to Miami or the Coln FreeZone. In general, he said, themarket for goods imported fromthe US and Europe is not growing,and may be shrinking, whileAsianvolumes continue to pick up.FFears for future economic growthare hampering recovery in theCaribbean as tourismstrugglesand the reconstruction of Haitistalls. More than anything else,its apprehension. The Caribbeanmindset is shadowing whatshappening in the US, saidSeaFreight executive vice-president David Ross.Speaking to Fairplay, Rossnoted that, after a solid frst half,the autumn peak season ramp-upwas behind schedule. Back inJanuary and March, the hotelswere talking about projects again,doing refurbishments theyd putofthe year before. I would say itsa diferent song now.Bernuth Lines EVPTomPaelinck echoed this view.Tourismhas not been strongenough to restore investorconfdence and allowresortnewbuildings and refurbishmentsto go forward, he said. Domesticcarriers had hoped such projectswould support fresh volumes.Furthermore, the very largestproject in the region thereconstruction of Haiti after theearthquake remains stalled bypolitical uncertainty. Theexpected food of constructioncargoes has not materialised.Nothing has happened. It hascome to a standstill, reportedRoss. There is so much moneypiled up waiting to go in there butno-one in their right mind is goingto put money in if they dontknowwhos in charge.Several sources dividedCaribbean performance into two:countries reliant on tourism,which are struggling, and those,such as the Dominican Republic,that are supported by exports.No-one intheirright mindisgoing toputmoney inif theydont knowwhos inchargeIn the tourismcategory isBarbados. According to RobertFoster, former president of theShipping Association of Barbados,food and fuel infation, combinedwith tourisms malaise, hasdecreased local buyers spendingpower. Carriers are skirmishingDomestic recovery sputtersApprehensionabout theeconomic growth hasput the brakes on theislands cargo reboundtrade & commerceCaribbeanRegional mainstay Caribbean Feeder Services (CFS)has newcompetition. Several years after it frst con-sidered entering the Caribbean Basin, global operatorX-Press Container Line has fnally made its debut.X-Press newseven-day service links ManzanilloInternational Terminal and Coln Container Termi-nal in Panama with Honduras and Guatemala. Its14-day service links the two terminals with Curacaoand Venezuela.X-Press has been an established player in Asia foralmost four decades and claims to be the worldslargest feeder carrier, with services spanning Europeand Africa as well.X-Press is a force in the market, acknowledgedCFS director Frank Wellnitz. Asked about this yearsoutlook, he said demand improved slightly earlier inthe year, then stalled. We expected more out of itbut it has levelled out, he told Fairplay.Commenting on rates, he said: We were not ableto get back all the way to the pre-problem days[2008] but its better.Feeder market heats upBernuth Miami Terminal:island demand is slipping in2H11 [ Photo Bernuth Miami ]20 22 September 2011 www.fairplay.co.ukshipping portfolios, which have agood cross-section of owners, willbe easy, said Petropoulos, becausealthough there is some overlap-ping, it is not extensive.As far as Qatars involvement inthe merger is concerned, it showsthat sovereign wealth funds(SWFs) fromoil-rich countriesstill have the appetite to buydistressed assets.Bearing in mind that these arevery sophisticated investmentvehicles, they have longer-terminvestment horizons comparedwith other investors, a Dubai-based research director for aLondon-headquartered invest-ment banking brokerage rmexplained to Fairplay. SWFs havebeen better able to commit largerproportions of their portfolios tolonger-terminvestments despitethe challenging nancial climate.The deal is benecial for Qatar,which is nowable to lower thecost of its existing 4%stake inAlpha Bank, purchased in 2008for about 18/share. Alphasshares nowtrade for 2.5.Qatar expects to get an annual10%coupon fromthe newlenderuntil its three-year instrumentconverts at 1.70/share a 20%discount to the pro-forma marketprice at the time of the deal.FMarriages betweenGreecesshipping families are common,but a diferent Greek shippingunion will spawn tangible industrybenets. Aunion betweenAlphaBank and Eurobank will create thefourth-largest nancier for Greekowners, after Royal Bank ofScotland, Deutsche SchifsbankandCredit Suisse.Alpha and Eurobank ranked10thand 17threspectively withinGreek ship nance are Greecessecond- and third-biggest retailbanks and big players in south-eastern Europe. The combinedentity, to be called AlphaEurobank, will become thebiggest bank in the region with146Bn ($201Bn) in assets andmore than 1,000 branches acrosseight countries.IHS Global Insight reportedthat the deal involves an exchangeof ve newAlpha Bank ordinaryshares for every seven Eurobankshares, which will give theformers shareholders 57.5%ofBank merger boosts ship nanceMerger creates Greekshippings fourth-largest lender andfeeds Qatars appetitefor distressed assetstrade & commerceA co-operation agreementbetweenWrtsil and Shell, toaccelerate use of liqueed naturalgas (LNG) as a marine fuel, willrun for several years, thecompanies said and will targetrst the US Gulf Coast beforeexpanding elsewhere.While this is an agreementwith Shell, its not an exclusiveagreement and we will continueto work with other suppliers,Wrtsil NorthAmerica vice-president for ship power JohnHatley told Fairplay. What Shellbrings is an enduring, securefuture supply that the marketdesperately needs so it knows itcan safely proceed with LNG.The use of LNGas a marine fuelhas yet to extend to any largedegree beyond Scandinavia.Shipowners have beenreluctant to make costly invest-ments to retrot vessels and thislowdemand has made oil and gascompanies just as reluctant toinvest in supplying the market.A new IHS CERA report sawno major market for LNG bunkerfuel until 2025, especially sincea large number of new fuel oil-burning ships have recently beendelivered or ordered.However, oil and gas retailershave a windowof opportunityto develop LNGdistribution,CERA says. Those that do shouldbe able to maintain a competitiveadvantage during LNGs progres-sive rise to dominance.FLNGmarine fuel pushEngine maker and oilgiant break LNG bunkerfuels US stalematethe combined entity and Eurobankshareholders 42.5%. The largestshareholder inAlpha is thefounding Costopoulos family; theLatsis shipping and oil family is acore shareholder, as is the QatariInvestment Authority. Qatar willspearhead a capital increase of3.9Bn, which will see the newoutts capital ratio increase to14%, Global Insight said.According to research con-ducted by Athens-based shipnance analyst Ted Petropoulos,the two banks have signicantshipping portfolios: Alphascurrently stands at about $2.5Bn;Eurobanks at $1.4Bn. Theirmerger, Petropoulos told Fairplay,is a very positive turn for Greekship nance. It creates a sub-stantial shipping portfolio and itsimportant to say that both bankshave very good relations withtheir owner-clients.According to Petropoulos, Greekship nance has been stagnant oflate but the merger, he believes,will restore its dynamismandcompetitiveness and will give itnewdirection. The banks increasein capital means that, as a mergedentity, they will be able to respondto requests of clients they couldnot respond to until recently.JoiningAlphas and EurobanksThe mergedentity will beable to respondto clientrequests theycould not respondto until recentlyAlphaEurobanksassestsLenders coin a newbankfor Greek shipping[ Photo: Malcolm Latarche ]$200BnIhe WesIern Hem|sphere's 8eoconof Mor|I|me Exce||enceThe Port of Klngston has,over the past 30 years,developed lnto an lmportantplayer ln the lnternatlonalshlpplng lndustry and ls now theleadlng transshlpment hub portln the reglon.Operatlons at the KlngstonContalner Termlnal hlghllghta well-tralned and motlvatedworkforce, ln an envlronmentof stable lndustrlal relatlons andleadlng-edge technology.The Port of Klngston lsstrateglcally located on both thenorth-south axls and east-westaxls through the Carlbbean and[ust 32 mlles on the maln tradlngroute to and from thePanama Canal.The Port Authorlty of 1amalcal5 - l7 Duke Street, Klngston, 1amalca w|Tel: (876) 922-0290 - 8 Pax: (876) 924-9437e-mall: pa[Qport[am.comKCT Servlces LlmltedTel: (876) 923-5l42 Pax: (876) 937-79l6 22 September 2011 www.fairplay.co.ukaccounted for 27%; SoutheastAsia 16.4%; China and the US15.4% each. The other majormarkets are Japan and the Gulfstates. MPEDA said frozenshrimp was the number-oneexport value item, accounting for44.2% of earnings.Newmarkets such as Egyptand South Africa are expected tosupplement growth, said SanduJoseph, secretary of the SeafoodExporters Association of India.Rising freight and export costs,as well as mounting interestcharges, are causing concernamong Indias exporting commu-nity. Seafood exporters inparticular point out that higherterminal handling charges acrossports have hit their margins.For example, Cochin Port, oneof the key seafood exportgateways, recently raised handlingcharges by $200/teu.Exporters warn that higherexport costs in India, which iscompeting with other Asian,Southeast Asian and LatinAmerican producers, mayultimately make exports uncom-petitive in international markets.FLeading shipping lines are vying toget a share of the targeted $4Bnseafood export market that Indiascommerce ministry has earmarkedfor the year ahead. The target iswell ahead of the $2.8Bn outputfor seafood exports in 2010-11.Nowthe season has begun, weforesee very good movement,said Kochi-based Asha Pillai ofCMACGM. We cater to theWestern European sector and wehave seen a very good increase inthe exports.A senior Safmarine executive inMumbai told Fairplay:We willbeef up our reefer business to caterto the growing exports.In 2010-11, a total of 813,091tonnes of seafood was exported,up from678,436 tonnes in theprevious year. Frozen shrimp,frozen fsh and squid accountedfor most of Indias exports.A majority of the reefers hastraditionally been handled bycontainer terminals in state-Rising costs cloud Indias seafood surgeRising global demand forIndian seafood is feedingreefer operatorstrade & commerceFromnext week, China will beginimposing an updated version of itsso-called port construction feeon cargo coming and going atChinese ports.The new, two-tiered levy ajoint creation of the ministries offnance and transport will eatinto shippers margins from1October and remain in force until31 December 2020, according toministry statements.Domestic cargo is not subject tothe fee, only imports and exports.Pointedly, foreign companieswill have to pay more than locals.Economists suggest the demarca-tion may be engineered to giveChinese companies a competitiveedge over foreign companies that,in some instances, are competitors.The foreigners fee for bulkcargo is Rmb5.60 ($0.88)/tonne,but Rmb4 if the import/export isauthored by a domestic business.Containers showan even biggerdiference. Domestic import/exporters pay Rmb32 ($5)/teuand Rmb48 ($7.20)/feu com-pared with virtually double forforeign import/exporters: $10/teu and $15/feu.These fees will have to be paidby the shipper, the consignee ortheir agent.The levys aimis to defray costsof construction of Chinas ports.Foreigners feel Beijings fscal bitePort fee rise will hurtnon-Chinese shipping,reports Bouko de Grootowned major ports such asJawaharlal Nehru Port (JNPT),Cochin, Chennai, Tuticorin, Vizagand Kolkata. Private ports, whilelesser benefciaries, havenonetheless increased their shareof seafood exports. These includeAP Mller-Mrsks GujaratPipavav and Mundra.The southernstate of Tamil Nadureported$631Minseafoodexportsales the highest among allseafoodclusters: terminals operatedby DPWorldandPort of SingaporeAuthority at Chennai Port andTuticorinPort respectively haveincreasedtheir share of totalexports. Other leading clusters are:Maharashtra ($499M), mostlythroughJNPTandMumbai Port;Gujarat ($481M), mostly throughPipavav, Mundra andKandla; andKerala ($442M), viaCochinPort.While the traditional markets inEurope and the US continue to buymost of Indias seafood, China hasemerged a strong buyer, especiallyfor value-added products.Indias Marine Products ExportDevelopment Authority (MPEDA)said exports grewby 34%in 2010-11: The largest market, the EU,At present, a lot of port capacity isin the wrong place or lackingproper connections with thehinterland. In particular, largedrybulk terminals and domesticcontainer terminals are needed tomake Chinas domestic growthand trades more efcient.In a separate blowto foreigners,Beijing has decreed that expatri-ate employees must pay localsocial security taxes for servicesmost will never be able to use, ameasure to shore-up a socialsecurity net feeling the doubleefects of an ageing populationand infation.F813,091tonnesindian seafood exports 2010-11 [ Photo: Shutterstock ]The perfect location foryour container terminal?You can call us day or nightYou do not need to know much about container terminals to see that the location is ideal.In the Netherlands. At the entrance of the Westerschelde river. Directly located on the sea.With a draft of 16.5 meters even accessible for the latest generation of ULCS containerships. At this location, Zeeland Seaports wishes to develop the Westerschelde ContainerTerminal in the port of Vlissingen. The terminal has a deep sea quay stretching more than2 kilometers and a 900-meter inland shipping/shortsea quay. The hinterland connectionsby rail, inland waterway and road are optimum and both port efciency and labour mentalityare excellent. We are seeking a partner for the Westerschelde Container Terminal. Are youinterested in operating this unique terminal and therefore sharing in the benets of thisideal location and the growth of the container market? Then contact us on +31 6 5319 3275.You can literally call us on this number day or night. www.zeelandseaports.com Directly located on the sea Excellent hinterland connections Draft at deep sea quay 16.5 m(LLWS) Deep sea quay 2000 m Inland shipping/shortsea quay900 m 75 km from Rotterdam, 38 kmfrom Zeebrugge and 55 km fromAntwerp Total surface area 140 ha Indicative transshipmentcapacity of deep sea quay2.5 million TEU Capacity for 5 deep sea vesselssimultaneously (ULCS>15,000TEU)westerschelde container terminalzeelandseaportsrotterdamhamburglondonzeeland seaportsantwerpzeebruggeHans van der Hart, managing director Zeeland SeaportsThe Caribbean is a year-round destination, not a six-monthdestination Nathan Dundas, CSA cruise committee head[ Photo: Greg Miller ]The Caribbean cruise market isbeing seasonally scuppered byintense competition fromEuropean ports able to generatehigher income yields.Froman industry standpoint,its no secret whats going on,said Carnival Cruise Lines (CCL)deployment vice-president TerryThornton. Capacity has left theCaribbean betweenApril andOctober because its chasingyields in Europe, where they cangenerate higher pricing.Although this is not the case forthe CCL brand, which is thelargest player in the region andremains staunchly year-round,the summer migration of RoyalCaribbean and other lines is nowraising alarms.ACaribbeanTourismOrganisa-tion (CTO) delegation met withthe Florida-Caribbean CruiseAssociation (FCCA) in June toaddress the issue. The CTOSeason shrinks for cruise portsAttractive Europehas taken abig bite out ofCaribbean summercruise deploymentstrade & commerce24 22 September 2011 www.fairplay.co.ukthe western Caribbean. Whileplaces such as Cozumel are safe,froma perception standpoint, itsMexico, said Thornton.But our number-one concerngoing forward is fuel, hestressed. This issue will beexacerbated by the comingimplementation of the emissioncontrol areas (ECAs) along the UScoast as well as in Puerto Ricoand the US Virgin Islands.The fuel implications of theECAs are more onerous in theeasternCaribbean than the west,he explained. Thornton speculatedthat, in the future, lines may opt tosave on fuel by not travelling as farsouth as St Thomas.That scenario is much morelikely if Cuba opens up. Cuba isvery close [to Florida] so it wouldbe very good froma protabilitystandpoint, he said, citing fuel.Cubas opening would probablychange our whole thinking,particularly given whats going onin the US Caribbean [referring tothe Puerto Rico-USVI ECA].Thornton cited two newCarnival investments that shouldhelp address fuel costs. The rst isa $65Mcruise terminal on thenorthern shore of the DominicanRepublic near Puerto Plata. To becompleted in 2013 and used as atransit terminal, not a homeport,the facility will be in a perfectlocation to help us on fuel costs,said Thornton.The second project in thepipeline is a dedicated privateisland for CCL in the n orthernBahamas. Alocation has yet to beidentied but Thornton conrmedthat CCL is nowin the market.While CCL already calls at HollandAmericas private Bahamas island,Half MoonCay, its too far south.An island further north, closer toFreeport, would be very helpful onfuel, he explained.FCaribbeanFor the firsttime inanumber ofyears, we haveseenthewesternCaribbeansignificantlyunderperformthe easternCaribbeanTerry Thornton,Carnival$65MCost of Carnivals newcruiseterminal in Dominican Republicwarned of a continued massiveloss of cruise business,particularly from the southern/eastern Caribbean, as a result ofseasonal repositioning.The Caribbean is a year-rounddestination, not a six-monthdestination, said Nathan Dundas,head of the Caribbean ShippingAssociation (CSA) cruisecommittee. He told Fairplay theCSA was seeking to play a liaisonrole with the CTOon theworsening seasonality issue.There may not be much thatisland businesses can do toreverse the trend. It looks likethe strategy [for Royal Caribbeanand others] is working, so I dontsee everybody suddenlymigrating back, said Thornton,who also chairs the FCCAsmarketing committee.On a positive note, Thorntonpointed out that newbuildingsare increasing total Caribbeancapacity this year following veyears of relative stasis. Thecaveat is that the sheer size ofsome of the newcomers, such asRoyal Caribbeans Allure of theSeas, limits the number of portsthat benet.Asked about regionaldeployment trends, Thorntontold Fairplay: For the rst timein a number of years, we haveseen the western Caribbeansignicantly underperform theeastern Caribbean.CCL gauges performance withthree measures: ticket price,onboard revenue and fuel cost.Even though Western routesburn less fuel, they are stillfalling behind.We believe US consumers arebad with geography and thehorric safety and security issuesin Mexico are having an impact onRather than list the features and benets here, we invite you to a Webinar so you cansee for yourself!Suitable for newcomers to AISLive and seasoned users alike, this Webinar willdemonstrate why IHS Fairplay have been setting the industry benchmark since 1764,and why AISLive is your best choice for tracking live global vessel movements.The Webinar is available on two dates in September:27th 3pm (UK BST) and 29th 7am (UK BST).Sign up today!Please sign up for your free webinar today as spaces are limited. Registration couldnot be simpler, just visit www.aislive.com/webinars. You will also receive a free trialrequest form so you can try out the product in your own time.www.aislive.com/webinars3952_0911AA_AISLive PlusYour invitation to preview AISLive PlusThis new service from IHS Fairplay is released on 4th October.3952_0911AA_AISLive Plus teaser ad.indd 1 15/09/2011 16:02Venezuelancurrency controls havereduced the countrys ports tomere feeder status, say operatorswho feel they are being held toransomby the government.I dont see it getting better. Infact, I see it getting worse, saidFrank Wellnitz of CaribbeanFeeder Services (CFS).The silver lining for companiessuch as CFS is that internationalcarriers have shifted en masse tofeeders versus direct Venezuelancalls to minimise servicedisruptions. Apart from a fewservices, Venezuela has nowbecome a feeder country,conrmed Poul Hestbk,Hamburg Sd SVP of CentralAmerica and the Caribbean.Venezuela feedering is a mixedbag for ports in neighbouringcountries. Its a positive because alot of direct services are not goingtoVenezuela, so were receivingadditional transhipment, saidGiovanni Benedetti, vice-president (VP) of Cartagenaterminal operator SPRC.However, we are negativelyafected because, for services thatdo call inVenezuela, you neverknowwhen youll receive thoseships so it puts a lot of pressureson windows froman operationalstandpoint. Its creating a mess,Benedetti conceded.The biggest issue for theVenezuelan shipping marketremains the tight currencycontrols introduced by thegovernment of president HugoChvez. Importers inability tond enough dollars to coverCarriers navigate Venezuela mineeldThe inability to repatriatefunds is also having a majoraffect on the multinationalretailers that fuel a large share ofimport cargoes.Two US-listed retailers withvery high Venezuela exposure areColgate Palmolive (CP) and Avon.At the end of 2Q11, CP had$207M in bolivar-denominatedearnings it had yet to repatriate.Avon had $146M, with $76M inrepatriation requests languishingin the government queue.Major importers like CP andAvonhave also taken huge hits fromVenezuelan currency devaluations.CP logged a $271Mcharge in 2010as it switched to hyperinationaryaccounting for Venezuela. Avonwrote down $58.8M.The situation worsenedfurther in January 2011, whenVenezuela abolished its 2.60bolivars/dollar exchange rate foressential goods.This suddenly pushed CPsexchange rate to 4.30, promptingan additional $36M charge. Avonnoted in its most recent lingthat it was highly sensitive totrade & commerce26 22 September 2011 www.fairplay.co.ukIt is very difcult to repatriaterevenuecollectedinVenezuelaHamburg Sds Poul HestbkShip operators,struggling torepatriate whatthey earn, still cantignore the marketCaribbeanfreight continues to limitvolumes. Exchange regulationshave also made it extremelydifcult for businesses thatgenerate revenue in the countryto get their money out includingcarriers. It is very difcult torepatriate revenue collected inVenezuela, said Hestbk.We, as shipping lines, arebeing less favoured incomparison with airlines. Theairlines now have a systemallowing them to repatriatemoney collected in Venezuela.We do not. We are working on itbut, so far, we are struggling.That is our biggest headacheat the moment the lack of orreduced ability to transfercollected freight out of thecountry, said Hestbk.Hamburg Sd is not alone.According to a VP of another majorinternational carrier who declinedto be identied: TheVenezuelangovernment recently made acommitment [to allowcarriers torepatriate revenues] but it has nowbeen months and nothing hashappened, she said. They are notfullling this obligation.We are always waiting for thenext crazy actVenezuelan ports such as La Guaira (pictured) are sufering the efects ofcurrency starvation[ Photo: Greg Miller ]trade& commerce22 September 2011 27further devaluations.Smallerimporters are in an even moredire straits.Small Venezuelan players arereportedly ocking to Colombianborder towns, exchanging bolivarsfor dollars at a premium, thenwiring dollars fromColombia tobanks overseas in places such asFlorida, where partners use thosetransfers to cover the cost offreight to Venezuela.But the currency issue may notbe afecting all importers thesame way depending on wherethey source globally.According to SeaFreight EVPDavid Ross: I dont knowif thisis a deliberate political shift,but some of ourcustomer base hastold us that itseasier to get foreign exchangenowif theyre buying goods fromChina than if theyre buyingfromthe US.On top of the currencyconundrum, carrier sources toldFairplay that operational and costissues at Venezuelan portsremain extremely challenging.Shipping has grown weary of theerratic moves of the Chvezgovernment, worsened by hiscurrent ght with cancer that takeshimto/fromCuba for treatment.According to the carrier VPwho requested anonymity: Weknowwhats happening nowandwe calculate that into our costs,but we are always waiting for thenext crazy act. The ports are notmanaged professionally, shelamented, adding that majorchanges were announced withnotice of literally one day.Both this executive and Rosspointed to an escalating issueinvolving nes for empties.There is a lawin Venezuela, nowreally being enforced, that saysevery container that enters thecountry has 90 days to exit or it issubject to a ne or conscation,said Ross.Catch 22This creates a Catch-22 becausewhen you bring boxes in, thecustoms process takes a long timeand when you put a ship in to getyour empties out, you may nothave time [because of operationalinefciencies at Venezuelanports] so you leave the emptiesbehind. But if you leave thembehind too long, youll be ned,Ross said.Yet despite all thesechallenges, most carriers havenot dropped Venezuela. Volumesare still huge, particularly fromChina, because Venezuela mustimport virtually everythingexcept oil. Carriers can also passhigher costs along to shippers.Expenses are so high inVenezuela that virtually anynumber you put on the trade isjustied, said one executive.This executive believes thatcarriers have not pull