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Project Dory Monitoring 29 August 2017
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His advisors supported it, but Trump reportedly declined Chinese proposal to cut steel overcapacity
Aug 29, 2017 | CNBC (In Reuters)
U.S. President Donald Trump last month rejected a Chinese proposal to cut steel overcapacity, despite the endorsement of some of his top advisors, the Financial Times said, citing people familiar with the matter. -
India and China Turn Down the Heat
Aug 29, 2017 | Bloomberg
By Mihir Sharma
As summer reached the high Himalayas this past June, one corner of the mountains turned hotter than expected. On a small plateau called Doklam, close to where the India-China border meets the tiny kingdom of Bhutan, two of the largest armies in the world faced off against each other. -
Chinese research vessel sails for east Pacific
Aug 29, 2017 | Xinhua
Chinese oceanographic research ship Xiangyanghong 06 set sail from the port of Qingdao Tuesday to conduct polymetallic nodule surveys in the east Pacific. -
Shippers, transport providers steel for long Harvey recovery
Aug 29, 2017 | Journal of Commerce
By Joseph Bonney
Freight transportation in and around Houston remains at a standstill as companies check on staff, assess damages, and prepare for a difficult recovery and higher truck rates after historic flooding unleashed by Hurricane Harvey. -
Demand for new containers returns
Aug 28, 2017 | Journal Of Commerce
Singamas reported strong demand for new containers in the first half when the world’s second-largest box maker sold almost 90,000 more TEU than it did in the first six months of 2016, and the company has given a bullish outlook for the remainder of the year.
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His advisors supported it, but Trump reportedly declined Chinese proposal to cut steel overcapacity
Aug 29, 2017 | CNBC (In Reuters)
U.S. President Donald Trump last month rejected a Chinese proposal to cut steel overcapacity, despite the endorsement of some of his top advisors, the Financial Times said, citing people familiar with the matter.
Beijing proposed cutting steel overcapacity by 150 million tonnes by 2022 in a deal twice rejected by Trump, who instead urged advisors to find ways to impose tariffs on imports from China, the paper said, citing the sources.
The deal was endorsed by U.S. Commerce Secretary Wilbur Ross a week before U.S. and Chinese officials held a high-level economic dialogue, the FT added, citing a U.S. official and another person familiar with the matter.
White House spokeswoman Natalie Strom declined to comment on the "purported internal discussions" between the president and his cabinet members when contacted by Reuters.
Last week, American steel industry executives appealed to Trump for immediate import restrictions in a letter seen by Reuters, saying the industry was suffering the consequences of government inaction.
Total steel imports through July were up 22 percent from the same period a year ago, the American Iron and Steel Institute said in a report.
Pressure over trade between China and the United States seems likely to grow in future and Beijing should prepare, China's hawkish Global Times newspaper said on Tuesday.
"China should not overly focus on the Trump administration's actions," it said in an online editorial. "Instead, it should begin drafting retaliatory measures against the United States so as to gain an upper hand."
https://www.cnbc.com/2017/08/28/his-advisors-supported-it-but-trump-reportedly-declined-chinese-proposal-to-cut-steel-overcapacity.html
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India and China Turn Down the Heat
Aug 29, 2017 | Bloomberg
By Mihir Sharma
As summer reached the high Himalayas this past June, one corner of the mountains turned hotter than expected. On a small plateau called Doklam, close to where the India-China border meets the tiny kingdom of Bhutan, two of the largest armies in the world faced off against each other. Chinese soldiers, convinced they were on Chinese territory, had brought equipment to extend a road; Indian soldiers, who viewed the land as disputed, blocked the earth-movers. For three months, the armies camped just meters away from each other, the Indians on the higher ground and the Chinese in a little valley. Neither government seemed to know how to back down.
That's changed -- although exactly how and why remains unclear. On Monday, the Chinese Foreign Ministry announced that the Indians had “withdrawn” and that China would “continue to exercise its sovereign rights” over the plateau. Some Indian government officials claimed anonymously that China had backed off as well, removing its road-building equipment, although the official Indian statement didn't confirm any such climbdown.
Perhaps both sides compromised. Perhaps India pulled out first; perhaps China promised to put its road-building on hold for awhile, if not forever; perhaps some other deal was struck in an unrelated dispute, such as over counter-terrorism or China's Belt and Road infrastructure scheme. We can't know -– and that’s fine. What matters is that two large, nuclear-armed countries -- nations with outsized ambitions, hyper-nationalist lobbies and leaders who pride themselves on “strength" -- somehow managed to find a via media that allowed them to wiggle out of a difficult position.
This is a welcome sign of maturity. A confrontation that bled into domestic politics was in neither government’s interest. That they managed to defuse the standoff -- just days before Prime Minister Narendra Modi was due to visit China for a BRICS Summit -- reflects well on their diplomats.
Over the coming decades, India and China are destined to clash time and time again. China, which has been so determined that the world make place for its rise, has done precious little to make space for India rising in turn. For strategic planners in Beijing, India is still too insignificant to matter, with an economy still a fifth the size of China’s. But Indians don’t see the situation like that: If their country isn’t China’s equal now, they reason, it will be in a few decades -- and had better start behaving as if it already is. This clash of worldviews will inevitably be mirrored in more concrete tensions on the ground.
The real question is how these clashes will be handled. Predicting the course of public opinion in both countries is pretty crucial to answering that question. But that isn’t so easy. The Indian media has, in the past, reacted with shrill jingoism to Chinese “incursions” across the border, while the Chinese media has more calmly repeated its government line. This time, India’s news channels -- always ready to create “war rooms” in safe New Delhi studios featuring anchors dressed absurdly in flak jackets -- largely kept their rhetoric under control. Critics complain about the stranglehold that Modi’s government has over the news. But, in this case, government pressure may have had a beneficial effect.
Meanwhile, in an odd inversion, the Chinese state-owned media grew rabid over the Doklam standoff, launching broadside after editorial broadside into the soft target that is under-achieving India. Yet, in the end, neither the Indian media's restraint nor China's anger seemed to feed into the calculations of Indian and Chinese diplomats.
o what the Doklam standoff suggests is that, even although clashes might be constant and unavoidable, we can hope that neither side will feel it’s worthwhile escalating petty confrontations to a genuinely dangerous level. Certainly, that’s been the case so far. Unlike India’s other disputed border, with Pakistan, there hasn’t been a shot fired in anger over the India-China border in decades. Earlier this month, when pictures emerged of Indian and Chinese soldiers scuffling and throwing stones at each other by a mountain lake in Ladakh, the subtext was actually quite heartening: Everyone involved knew better than to use bullets.
https://www.bloomberg.com/view/articles/2017-08-29/india-and-china-learn-how-to-turn-down-the-heat
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Chinese research vessel sails for east Pacific
Aug 29, 2017 | Xinhua
BEIJING, Aug. 29 (Xinhua) -- Chinese oceanographic research ship Xiangyanghong 06 set sail from the port of Qingdao Tuesday to conduct polymetallic nodule surveys in the east Pacific.
The country's 47th oceanic expedition is being carried out under an agreement signed by China Minmetals Corporation (CMC) and the International Seabed Authority in May this year, which granted China exclusive rights to search for polymetallic nodules in a 72,000-square-km area of the east Pacific over the next 15 years.
The expedition will survey polymetallic nodule distribution and geologic features, estimate resource amounts and select test mining areas.
The CMC is an important force in China's exploration and use of maritime mineral resources. The company's first maritime expedition will last around 90 days. A total of 26 scientists are on board.
http://news.xinhuanet.com/english/2017-08/29/c_136565669.htm
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Shippers, transport providers steel for long Harvey recovery
Aug 29, 2017 | Journal of Commerce
By Joseph Bonney
Freight transportation in and around Houston remains at a standstill as companies check on staff, assess damages, and prepare for a difficult recovery and higher truck rates after historic flooding unleashed by Hurricane Harvey.
Port terminals, major highways, rail lines, airports, industries, trucking docks and warehouses remain closed, along with most regular business activity in the fourth-largest US city. Cargo remains stuck in warehouses, at port terminals, and on inbound ships.
Port Houston is taking a day-by-day approach to reopening its terminals, which closed at mid-day Friday before Harvey hit land near Corpus Christi. The US Coast Guard has halted ship traffic at Houston, Galveston, Freeport, and Corpus Christi until port channels and navigation aids can be checked.
As rescues continue in flooded neighborhoods across the Houston metropolitan area, the logistics industry is looking ahead to a likely spike in trucking rates after high water recedes from streets and neighborhoods.
“Look for spot prices to jump over the next several weeks, with very strong effects in texas and the South Central region,” said Noel Perry, partner at freight analyst firm FTR. “Spot pricing was already up strong, in double-digit territory. Market participants could easily add 5 percentage points to those numbers.”
FTR said Hurricane Katrina, which devastated New Orleans and the Mississippi coast in 2005, caused annualized trucking rates to rise at an average rate of 7 percent. The mid-winter storms of 2014 produced a 22 percent year-over-year jump in spot rates, the analyst said.
Richmond, Virginia-based Seaport Global Securities had a similar view. It noted that Katrina struck when trucking rates were trending downward, but that Harvey arrived when the market was tightening. The result could be higher rates through the holiday season and into the first-quarter 2018 bidding season, Seaport said in a research note.
Analysts say that when transportation resumes in the Houston area, freight demand will be huge — first for items such as bottled water and food, and then for building materials, home furnishings and other supplies.
When that will happen is still unclear. Major highways in the Houston area remained impassable at key points Monday after as much as 30 inches of rain that the National Weather Service said could reach a total of 50 inches in some places by Friday.
Large refining and petrochemical plants along the Houston Ship Channel remained closed. The Gulf Coast region between Corpus Christi, Texas, and Lake Charles, Louisiana, has the largest concentration of US oil refining capacity.
Details on conditions at trucking depots and warehouses have been slow to emerge, but some large operations appeared to escape damage. Third-party logistics provider Dunavant said its Houston facilities had no wind or water damage.
Recovery could be slowed by the sheer scope and extent of the storm,. Many employees at logistics companies, terminals, and other supply chain work lost homes and vehicles in the flooding.
“That’s the untold story in these events. Most commercial properties are prepared, but they need workers to run their facilities -- and at least initially, they may not be available,” said Jason Hilsenbeck, president of Drayage.com and LoadMatch.
Hilsenbeck said he expects Houston-area drayage rates to spike when highways, port terminals, and railroads resume operations. “I think the peak will come about three days after the port opens up, when free time starts to expire and everybody wants their cargo out,” he said.
Port Houston posted a 16 percent year-over-year increases in full TEU during the first half of this year. In 2016, Houston handled more than 1.8 million TEU of full containers, and accounted for more than two-thirds of US Gulf container volume.
Container lines serving the port have avoided diverting cargo to other ports. Maersk said it hoped to work two ships, the Maersk Ohio on its TA1 service and the Maersk Denver on its MECU service, at Houston on Wednesday if labor was available.
The Port of Corpus Christi, which didn’t flood but was close to Harvey’s eye when the storm hit land with 130 mph winds, said its terminals had light to moderate damage. The port said it was working to restore power to all facilities and hopes to return to normal operations Sept. 4.
The Coast Guard said set conditions limiting vessel operations at the ports of Beaumont, Port Arthur, Orange, and Lake Charles, which are east of Houston and are in the path of the storm’s latest path.
BNSF and Kansas City Southern railways and Union Pacific Railroad suspended operations in the Houston area and embargoed traffic at the hurricane approached, and said customers should expect delays.
Trucking companies also suspended operations in the region, with the pain inflicted by the storm reaching far inland. Terminal operations as far away as Laredo, Dallas and Fort Worth were affected by the diversion of freight or the inability to move freight on to its final destination closer to the Gulf.
“All shipments currently in our network destined to the impacted are being held at destination break terminals or the Fort Worth, Texas terminal,” Central Freight Lines said in a statement.
The Waco, Texas-based less-than-truckload carrier’s terminals in Houston and Victoria, Texas, will be closed the remainder of the week, the carrier said. “The Houston flooding situation will get worse before it gets better,” Central said in a notice to shippers. “It is impractical to talk about recovery plans for the Houston area at this time.”
The carrier’s Victoria terminal was damaged and will need to be cleaned up before terminal operations can resume, Central said. Its Corpus Christi terminal was closed Monday, but “there is a good chance it will reopen this week. San Antonio and Austin are operating normally at this time.” Central is diverting truck capacity to help with state relief efforts.
https://www.joc.com/trucking-logistics/shippers-transport-providers-steel-long-harvey-recovery_20170828.html
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Demand for new containers returns
Aug 28, 2017 | Journal Of Commerce
Singamas reported strong demand for new containers in the first half when the world’s second-largest box maker sold almost 90,000 more TEU than it did in the first six months of 2016, and the company has given a bullish outlook for the remainder of the year.
Rising container demand saw the Hong Kong-listed company increasing its revenue to $577 million, 31 percent above that recorded in the first half of 2016 as the average selling price of 20-foot dry containers rose 25 percent to $1,902.
Singamas said in an exchange filing that the performance allowed the company to significantly turn around its first half result, posting a $17 million profit compared with a loss of $37 million from January through June in 2016. It was a result well above a profit expectation of $12 million that it issued in June.
Giving Singamas a helpful boost was a Chinese environment regulation requiring all containers to use waterborne paint from April 2017. This led to a surge in orders from carriers enjoying a market upturn as the shipping lines sought to avoid any container shortages ahead of the temporary closure of production lines for conversion work to the new paint.
Also driving a return to orders was renewed confidence from container leasing companies that had again begun to place orders as the business continued to improve. That saw Singamas’ manufacturing operation producing 310,070 TEU compared with the 223,982 TEU made during the same period of 2016. But the strong demand for dry containers was not matched by that for specialized equipment that softened significantly year over year.
Singamas said dry containers accounted for 82.1 percent of manufacturing revenue compared with 60 percent in the first half of 2016. Revenue from specialised boxes accounted for 17.9 percent in the first half of 2017 while last year it was 40 percent.
The company’s outlook for the second half of the year is optimistic. In its analysis, Singamas said the positive momentum experienced during the first six months is expected to continue in the second half of the year as the global economy continues to recover, improving trade pushes up container volume (particularly in and out of China), and market sentiment strengthens.
“Positive market sentiment has already led to strong demand for the group’s dry freight containers, with order books full for July and August 2017,” according to the boxmaker. Signals said demand would be further stimulated by the improving performance of carriers, which were more willing to allocate capital for the replacement of old containers and to purchase new containers to meet anticipated demand.
“What is more, with the inventory of new containers at a low level due to the temporary closure of production lines during the review period, the average selling price of dry freight containers should remain firm as well as the margin level of such products,” Singamas noted.The major carriers have been reporting vastly improved first half results compared with 2016 as growing container volume and stronger rate levels push up profitability. Container Trades Statistics data show that volume on Asia-Europe grew by 3.9 percent in the first half with carriers transporting 7.85 million TEU.
https://www.joc.com/maritime-news/demand-new-boxes-returns-pushing-singamas-first-half-profit_20170828.html
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