Preview Newsletter
Dory
-
U.S. Prepares to Act Alone Against North Korea
Jul 10, 2017 | Fox Business
By Ian Talley
The Trump administration is moving toward unilaterally tightening sanctions on North Korea, targeting Chinese companies and banks Washington says are funneling cash into Pyongyang's weapons program. -
LNG Bunkering Port Focus Group Strengthened Through Addition of Port of Ningbo-Zhousan, Port of Marseille Fos and Port of Vancouver
Jul 11, 2017 | Hellenic Shipping News
o strengthen the network of Liquefied Natural Gas (LNG) bunker-ready ports and to bolster efforts towards enabling the uptake of LNG as marine fuel, the Port of Ningbo-Zhoushan, Port of Marseille Fos, and Port of Vancouver have joined the Port of Singapore and seven other organisations[1] to participate in an international LNG bunkering port focus group. -
US drafts new sanctions resolution against NKorea
Jul 10, 2017 | ABC News
By Edith Lederer
The United States has circulated a draft resolution that would impose new sanctions on North Korea following its first test of an intercontinental ballistic missile, two U.N. diplomats said Monday. -
Cosco-OOCL deal may be last of its kind
Jul 10, 2017 | Journal of Commerce
By Joseph Bonney
The sale of Orient Overseas (International) Ltd.to Cosco Shipping Holdings and Shanghai International Port Group (SIPG) may end a flurry of container line mergers and acquisitions with a $6.3 billion exclamation point. -
Dramatic Drop in Containers Lost at Sea
Jul 10, 2017 | Maritime Executive
The World Shipping Council (WSC) estimates that the average number of containers lost each year has dropped since 2014 by 48 percent.
Port Mentions
City/Province Mentions
Competitor Mentions
US-China Relations
Industry News
-
U.S. Prepares to Act Alone Against North Korea
Jul 10, 2017 | Fox Business
By Ian Talley
WASHINGTON – The Trump administration is moving toward unilaterally tightening sanctions on North Korea, targeting Chinese companies and banks Washington says are funneling cash into Pyongyang's weapons program. Even before the July 4 launch, the Trump administration began trying to tighten sanctions to cut off "all illegal funds going to North Korea," Treasury Secretary Steven Mnuchin said. "We will continue to look at these actions and continue to roll out sanctions."
Late last month the U.S. Treasury said it would move to cut off China's Bank of Dandong from U.S. financial markets, saying North Korea was using bank accounts under false names and conducting financial transactions through banks in China, Hong Kong and Southeast Asia.
The Treasury also added to its North Korea sanctions list two Chinese citizens accused of working for front companies designed to evade existing North Korea sanctions.
Trump administration officials have warned that North Korea's latest missile test warranted an escalation in international pressure, seeking first collective action through the United Nations Security Council and urging Beijing to use its own powers to stem cash flows to Pyongyang.
Cabinet-level officials in recent days have signaled the White House is ready to use its own powers to cut off the flow of cash to Kim Jong Un's regime, though officials say they would prefer collective action through the United Nations and support from China. North Korea's ballistic missile test on July 4 will hasten U.S. unilateral efforts, analysts say.
North Korea has resisted such pressure for years and many experts question whether this time would be any different. Pyongyang has become proficient at evading sanctions, including by disguising its international trade and financial entities through firms in neighboring China.
The U.S. has almost no direct trade or other ties to North Korea after imposing wide-ranging bilateral sanctions in response to previous missile and nuclear tests by Pyongyang. North Korea's chief trade partner, Beijing, has also resisted tightening the screws against its neighbor because the status quo gives it geopolitical leverage, analysts say.
The George W. Bush administration brought North Korea back to the negotiating table in 2007 after escalating sanctions but many analysts say it relented too quickly, allowing Pyongyang to continue its nuclear-weapons program.
U.S. officials say the stakes are greater after last week's missile launch revealed Pyongyang's ability to put Alaska within reach and current efforts will be more stringent than in the past.
Tucked away in several documents linked to recent Treasury and Justice Department actions are clues to Chinese entities the administration may target.
The Justice Department, in a federal-court decision granting the administration warrant authorities unsealed on Thursday, pointed to "offshore U.S. dollar accounts" associated with a network of five companies linked to Chinese national Chi Yupeng. That included one of the largest importers of North Korean goods into China, Dandong Zhicheng Metallic Material Co.
The Justice Department, citing people including two North Korean defectors, said the so-called Chi Yupeng network hid transactions which helped finance North Korea's military and weapons programs.
That network isn't under U.S. sanctions but analysts say its a vital source of funds that can be choked off, in the same way the U.S. targeted another Chinese company late last year, Dandong Hongxiang Industrial Development Co. Ltd. Nearly two-dozen Chinese banks that allegedly laundered money from Dangdong Hongxiang could be targeted, analysts said.
China's Foreign Ministry didn't respond to a request to comment and Mr. Chi and Dandong Zhicheng couldn't be reached to comment.
"The United States is prepared to use the full range of our capabilities to defend ourselves and our allies," Nikki Haley, U.S. ambassador to the U.N., told the Security Council last week. Ms. Haley said past sanctions regimes proved insufficient.
Citing China's dominant role as North Korea's prime international trade and finance partner, she said Washington is ready to target any country doing business with North Korea.
U.S. Secretary of State Rex Tillerson said Friday that fresh sanctions issued last week against Chinese entities are a measure of the administration's resolve to bring more pressure to bear on the country by directly going after entities doing business with North Korea. He said the U.S. preferred for Beijing to use its own powers to curb North Korea financing.
But while Mr. Tillerson said the U.S. would apply "calculated increases in pressure," there was a limit to the administration's "strategic patience."
The Trump administration asked China to take action against a list of nearly 10 Chinese companies and individuals to curb their trading with North Korea following President Donald Trump's Mar-a-Lago summit with Chinese leader Xi Jinping in April, according to senior U.S. officials.
But U.S. officials say they have been disappointed by Beijing's response. The topic will be a focus of high-level U.S.-China talks next week in Washington, Mr. Mnuchin said.
Many former U.S. diplomats, including Juan Zarate, the top sanctions diplomat in the Bush administration, say Washington must ratchet up the pressure on Chinese firms and banks.
The U.S. has so far been wary of prodding Beijing too hard.
North Korea's latest missile test changes the administration's calculus, said Nicholas Eberstadt, a North Korea security expert at the American Enterprise Institute. He expects the White House to accelerate its sanctions against Chinese firms.
A central aim of the strategy of freezing out a Chinese bank from the U.S. financial system is to chill transactions by other Chinese institutions. Access to U.S. financial markets and the dollar are critical for trade and finance around the globe. But for that effort to be perceived as a credible, said Mr. Eberstadt, the administration will have to list other Chinese banks to instill broader fear.
"If I wanted to send a message, I'd probably send several postcards," Mr. Eberstadt said.
Analysts and senior officials from two previous administrations say the existing sanctions regime against North Korea have so far been elementary compared with the thicket of actions applied against Iran at the height of the Obama administration's punitive actions against Tehran.
That effort pushed the country into recession and forced the country back to the negotiations table, although many foreign-policy experts question the effectiveness of the subsequent deal the U.S. reached with Iran.
http://www.foxbusiness.com/features/2017/07/10/u-s-prepares-to-act-alone-against-north-korea.html
-
Jul 11, 2017 | Hellenic Shipping News
To strengthen the network of Liquefied Natural Gas (LNG) bunker-ready ports and to bolster efforts towards enabling the uptake of LNG as marine fuel, the Port of Ningbo-Zhoushan, Port of Marseille Fos, and Port of Vancouver have joined the Port of Singapore and seven other organisations[1] to participate in an international LNG bunkering port focus group. The inclusion of Port of Ningbo-Zhoushan was formalised today through a signing ceremony held at the sideline of the 3rd Port Authorities’ Roundtable (PAR) organised by the Ningbo Municipal Port Administration Bureau. With this expansion, the network will comprise a total of eleven ports and maritime administrations across Asia, Europe and North America.
LNG Bunkering Port Focus Group
The focus group was first formed in 2014 by Maritime and Port Authority of Singapore (MPA), Antwerp Port Authority, Port of Rotterdam and Port of Zeebrugge. In 2016, Asian representation in the LNG bunkering focus group[2] increased with the joining of Ministry of Land, Infrastructure, Transport and Tourism, Japan and Ulsan Port Authority, Republic of Korea. Through the signing of a Memorandum of Understanding (MoU) in Singapore on 5 October 2016, all members of the focus group committed to working together to deepen cooperation and information sharing in relation to LNG bunkering, to develop a network of LNG bunker-ready ports across the East and West and Trans-Pacific trade. The first meeting was held in April 2017 in Yokohama, Japan, where the focus group agreed to focus collaborative efforts on enabling the uptake of LNG as bunkers globally.
With growing interest to supply LNG as a marine fuel to meet future demands of the shipping industry, the focus group will be further expanded to include the Port of Ningbo-Zhoushan, Port of Marseille Fos and Port of Vancouver.
3rd Port Authorities’ Roundtable
Inaugurated by MPA in 2015, PAR remains a key platform for leaders of port authorities to come together to discuss key issues of mutual interests, exchange best practices and promote closer collaboration. The 3rd PAR is organised by the Ningbo Municipal Port Administration Bureau from 9 – 11 July 2017. This is the first time a Chinese port is organising PAR. The first and second PAR were organised by Singapore and Rotterdam in 2015 and 2016 respectively. PAR2017@Ningbo saw 14 organisations participating in the event including Port and Urban Projects Bureau, Kobe City Government, Port and Harbour Bureau, City of Yokohama, Port of Le Havre and Port of Dalian Authority who participated for the first time.
Topics of discussion at PAR2017@Ningbo included cooperation among ports to enhance cybersecurity responses, building sustainable ports for the future as well as integration of port resources to improve efficiency which comes at an opportune time to tackle emerging and on-going challenges faced by the maritime industry. In light of recent cybersecurity attacks, MPA proposed the formation of a “Port Authorities Focal Point Correspondence Network” comprising of PAR members to facilitate early reporting of maritime cybersecurity incidents to allow members to prepare and respond to imminent cyber attacks. This was well received by the participants at PAR2017@Ningbo.
Mr Andrew Tan, Chief Executive of MPA said, “The Port Authorities Roundtable, initiated by Singapore in 2015, is a useful high level platform to forge closer collaboration between ports based on like-minded interests. We are pleased that at this meeting, three more ports, including the first Chinese port, will be joining the LNG Bunkering Port Focus Group. We welcome Port of Ningbo-Zhoushan, Port of Marseille Fos and Port of Vancouver to the network and look forward to working with them. We are confident that the inclusion of Port of Ningbo-Zhoushan will add further impetus to enable the uptake of LNG bunkering for the Far East-Europe and Intra-Asia trade routes for the future.”
Mr Michio Kikuchi, Director-General, Ports and Harbours Bureau Ministry of Land, Infrastructure and Transport and Tourism, Japan said, “As the world’s largest LNG importing country and also as the world’s leading maritime countries, we believe that Japan has a responsibility to promote LNG as a marine fuel in order to accelerate cleaner shipping. It goes without saying that expanding the network of LNG bunker-ready ports network is vital in that regard. We would like to extend a cordial welcome to the Port of Marseille Fos, the Port of Ningbo-Zhoushan and the Port of Vancouver. We are confident that the participation of the Port of Vancouver will bring a significant effect on accelerating cleaner shipping for the Trans-Pacific Trade due to its strategic location.”
Mr Cai Shenkang, General Manager, Zhejiang Provincial Seaport Investment and Operation Group and Ningbo-Zhoushan Port Group said, “We are very happy to join the LNG port focus group at the invitation of Singapore. Ningbo-Zhoushan Port looks forward to work closely with members of the MOU to promote the use of LNG as a marine fuel for global shipping. Through this group, we believe strongly that we can work together to address safety requirements imposed by international organisations for LNG bunkering and barriers faced by ocean-going vessels looking to use LNG as a fuel in the future.”
Mr. Duncan Wilson, VP Corporate Social Responsibility, Vancouver Fraser Port Authority (VFPA) said “We are pleased to be invited by Japan’s Ministry of Land, Infrastructure, Transport and Tourism, Ports and Harbours Bureau, to join this Memorandum of Understanding. Together with other signatories, the Vancouver Fraser Port Authority is committed to working together to deepen cooperation and information sharing in relation to LNG bunkering, and to develop a network of LNG bunker-ready ports.
http://www.hellenicshippingnews.com/lng-bunkering-port-focus-group-strengthened-through-addition-of-port-of-ningbo-zhousan-port-of-marseille-fos-and-port-of-vancouver/
-
US drafts new sanctions resolution against NKorea
Jul 10, 2017 | ABC News
By Edith Lederer
The United States has circulated a draft resolution that would impose new sanctions on North Korea following its first test of an intercontinental ballistic missile, two U.N. diplomats said Monday.
The proposed resolution has been circulated to North Korea's closest ally and main trading partner, China, as well as the three other permanent members of the U.N. Security Council — Russia, Britain and France, the diplomats said, speaking on condition of anonymity because consultations have been private.
The spokesman for the U.S. Mission to the United Nations said he had "no comment" on the report.
North Korea's successful test launch of an ICBM last week was a milestone in its long-term effort to build a missile with a nuclear warhead capable of reaching the United States. President Donald Trump searched for consensus with Asian allies Saturday on how to counter what he called the "menace" of North Korea.
U.S. Ambassador Nikki Haley told the Security Council last Wednesday that the United States is prepared to use military force to defend the country and its allies against a North Korean ICBM if necessary, but she said the Trump administration prefers to use its clout in international trade to address the growing threat.
Both Trump and Haley put the spotlight on China, with the U.S. leader voicing his frustration in recent days that Beijing hasn't done more. But during their meeting on the sidelines of the Group of 20 summit in Hamburg, Germany, Trump told Chinese President Xi Jinping, "I appreciate the things that you have done relative to the very substantial problem that we all face in North Korea."
Haley was tougher, saying that seven U.N. sanctions resolutions haven't gotten North Korea to change its "destructive course." She stressed that much of the burden of enforcing the resolutions rests with China because it is responsible for 90 percent of trade with its neighbor.
Declaring that it's time to do more, Haley said the U.S. would put forward a new resolution in the coming days "that raises the international response in a way that is proportionate to North Korea's escalation."
She gave no details but hinted at what might be in a new resolution, saying that if the Security Council is united the international community can cut off major sources of hard currency to North Korea, restrict oil to its military and weapons programs, increase air and maritime restrictions, and hold senior officials accountable.
Haley said Sunday on "Face The Nation" that the United States is going "to push hard against China" because of its economic control over North Korea. "While they have been helpful, they need to do more," she said.
She said the United States doesn't expect the new resolution being negotiated to be "watered down" — as has happened in the past, mainly by China.
"It will be very telling as to whether China works with us, which we're hoping that they will — and we will know in the next couple of days whether that's going to be the case," Haley said.
It will also be very telling, she said, if Russia stands with North Korea and opposes the U.S. "for the sake of opposing us, or whether everybody is going to say once and for all to North Korea, stop, this is reckless, it's irresponsible, and we're not going to take it anymore."
The U.S. ambassador stressed that the ICBM test raised the conflict over North Korea's nuclear and missile programs to a new level.
China has the ability to pressure Pyongyang, Haley said.
"They know that. We know that, and we need to see some more action going accordingly," Haley said. "And I think the resolution is going to be a really big test on that."
http://abcnews.go.com/US/wireStory/diplomats-us-drafts-sanctions-resolution-nkorea-48554837
-
Cosco-OOCL deal may be last of its kind
Jul 10, 2017 | Journal of Commerce
By Joseph Bonney
The sale of Orient Overseas (International) Ltd.to Cosco Shipping Holdings and Shanghai International Port Group (SIPG) may end a flurry of container line mergers and acquisitions with a $6.3 billion exclamation point.
“There aren’t many other takeover candidates left on the shelf,” Drewry said in a research note that said additional large mergers could face regulatory hurdles. “There could still be some minor regional acquisitions, but the big wave of container M&A [mergers and acquisitions] looks to have been concluded with this deal.”
The Cosco-Orient Overseas Container Lines (OOCL) deal would create the world’s third-largest container line fleet, surpassing CMA CGM.
This and other recent mergers and acquisitions, combined with new ship deliveries, will leave the top seven ocean carriers with three-fourths of the world’s container ship fleet by 2021, compared with 37 percent in 2005, Drewry said. This, combined with growth in global demand and a slowing of new ship orders, “offers carriers a golden opportunity for far greater profitability in the near future,” although shippers may not be happy, Drewry said.
“The accelerating trend toward oligopolization in container shipping will reduce shippers’ options and raise freight rates,” Drewry said. “It is the unfortunate price to be paid for years of non-compensatory freight rates that have driven carriers to seek safety in numbers, either through bigger alliances, and/or M&A.”
Shippers already have expressed uneasiness about the latest merger announcement’s effect on competition. The world’s largest container lines have sorted themselves into three major vessel-sharing alliances — the 2M, Ocean, and THE alliances — in an effort to regain profitability after years of multibillion-dollar losses. “Shippers are getting used to consolidation in the container industry,” Drewry said. “That doesn’t mean they have to like it.” Even though OOCL will remain a separate brand, “it is questionable just how independent they will be from one another.
Effectively, shippers will be losing yet another carrier from the pool that increasingly resembles more of a puddle.” Hanjin Shipping collapsed last September. Cosco merged with China’s second-largest carrier, China Shipping Container Lines; CMA CGM bought Neptune Orient Lines and its APL liner subsidiary acquiry; Maersk Line bought Hamburg Süd ; Hapag-Lloyd merged with United Arab Shipping Company, and Japanese carriers MOL, 'K' Line, and NYK are merging their container shipping divisions into the One Network Express.
The mergers pose tough choices for mid-size carriers seeking to maintain a global presence, SeaIntel Maritime Analysis noted in its weekly report. Two of those carriers, Taiwan-based Yang Ming and South Korea’s Hyundai Merchant Marine, benefit from membership in the THE and 2M alliances, respectively. “But you only get out of [the] alliance what you put in, and their respective shares of the alliance capacity are completely dwarfed by their partners,” SeaIntel said.
“While they will likely claim that they are comfortable in their current David/Goliath struggle, they would likely benefit from being gobbled up by one of the larger carriers,” SeaIntel said. It said Evergreen Line would probably benefit most from an acquisition of fellow Taiwanese carrier Yang Ming.
The combined Cosco Shipping, a subsidiary of Cosco Shipping Holdings, and OOCL will have a fleet of more than 400 ships with total capacity of 2.9 million TEU including orderbook. Together, Cosco and OOCL would operate the third-largest mega-ship fleet and be the second-largest mover of US containerized goods, according to an analysis of PIERS data and the IHS Markit orderbook.
OOIL/OOCL had long been considered a prize catch for an acquisition-minded rival. The company has a record of “above-average profits in a challenging market and a reputation for being a very well-run company, earning the moniker ‘The Perfect Bride,” Drewry said. Despite OOCL’s above-average financial performance and reputation and an improving global outlook for container shipping, the $6.3 billion acquisition price seems “a bit steep,” based on the company’s estimated $4.5 billion book value, Drewry said. The transaction still requires regulatory approval, and it is not clear whether any significant hurdles will be raised, the report said.
Under the deal announced Sunday, Cosco will acquire 90.1 percent of Hong Kong-based OOIL. Another state owned Chinese company, SIPG, will take the remaining 9.9 percent. The buyers said they would keep OOCL’s brand, Hong Kong headquarters and management, and that there would be no job cuts for at least 24 months.
Drewry said retaining OOIL’s management, processes, and system “is a wise move and could be of enormous value to Cosco.” OOCL owns 66 container ships with average nominal capacity of 6,600 TEU and average age of 7.1 years.
It operates the largest container ship in service and will take delivery of its first 21,000-TEU vessel this year, with five more on order and options for another six. Cosco also has a large orderbook, including orders it inherited from its merger with China Shipping. Fitting OOCL into Cosco’s operations should be fairly simple, Drewry said.
Both lines are in the Ocean Alliance, which also includes CMA CGM and Evergreen and operates mainly in east-west trades. The deal’s biggest impact may be in intra-Asia trades, where both carriers have a large presence, Drewry said. The carriers’ share of the Asia-to-Middle East trade also will rise significantly.
“From a marketing perspective, the acquisition of OOCL will enable Cosco to broaden its customer base, having previously been perceived, rightly or wrongly, as China-centric,” Drewry said. “OOCL’s reputation and history with global shippers will provide Cosco with an inroad to a wider selection of big Western shippers with volume.”
Terminals also figure prominently in the transaction. Cosco has interests in four terminals — fully owned facilities in Long Beach and Kaohsiung, and 20 percent stakes in terminals at the Chinese ports of Tianjin and Ningbo. OOCL’s Long Beach operation is part of a large development that will be replaced by the three-berth Middle Harbor terminal project, the second phase of which is expected to start operation at the end of 2017.
Cosco already has two terminals in the ports of Los Angeles and Long Beach. These and the expanded OOCL terminal will account for nearly 30 percent of the ports’ capacity by 2020, Drewry said. The companies have stakes in different terminals at Kaohsiung and Tianjin but are shareholders in the same terminal at Ningbo. China Shipping Ports (CSP) reportedly is acquiring a 15 percent stake in SIPG from Shanghai Tongsheng Investment, which would make CSP the third-largest investment in SIPG.
Drewry said this “is further evidence of the agglomeration of the Chinese state-owned enterprises involved in the port sector. SIPG’s involvement in the OOCL deal is therefore not a left-field move but very much further evidence of the consolidation and intertwining of Chinese-owned port sector activity.”
http://www.joc.com/maritime-news/container-lines/cosco/drewry-cosco-oocl-deal-may-be-last-its-kind_20170710.html
-
Dramatic Drop in Containers Lost at Sea
Jul 10, 2017 | Maritime Executive
The World Shipping Council (WSC) estimates that the average number of containers lost each year has dropped since 2014 by 48 percent.
Based on the most recent survey results, an average of 568 containers are lost at sea each year, not including catastrophic events. If catastrophic events are included, that average more than doubles to 1,582. In 2014, these figures were 733 containers and 2,683 containers respectively.
The larger number of losses in 2014 was due primarily to the complete loss in 2013 of the MOL Comfort in the Indian Ocean and all of the 4,293 containers on board and, in 2011, the grounding and loss of the M/V Rena off New Zealand, which resulted in a loss overboard of roughly 900 containers.
WSC data consistently demonstrates that container losses in any particular year can vary quite substantially based on differences in weather and other unusual events. The data also consistently shows that the majority of containers lost at sea result from catastrophic events. For example, in 2013, there was a total loss of 5,578 containers – 77 percent of which occurred with the sinking of the MOL Comfort in the Indian Ocean.
The total loss of vessel El Faro occurred two years later in 2015. All containers on the El Faro were lost and this event alone accounted for almost 43 percent of the total containers lost into the sea in 2015.
In 2016, the international liner shipping industry transported approximately 130 million containers packed with cargo, with an estimated value of more than $4 trillion.
https://www.maritime-executive.com/article/dramatic-drop-in-containers-lost-at-sea
Port Mentions
City/Province Mentions
Competitor Mentions
US-China Relations
Industry News
Add recipients
Suggested