The UK Ship Register (UKSR), along with Denmark, Germany and Hong Kong managed to achieve top scores on the shipping industry flag state performance table published by the Round Table of international shipping associations.

The UKSR is part of the Maritime and Coastguard Agency whose CEO, Peter Cardy, said: “We are delighted that the UK Ship Register has achieved the joint top position of the shipping industry flag state performance table. This is another step in the right direction in demonstrating that we are a quality register, with high standards and a commitment to providing a high level of service to our customers. We hope that this excellent news encourages shipowners to look at the UK flag as a viable alternative, particularly in these difficult times of financial uncertainty.”

The Chamber of Shipping also welcomed the news. Its president Jesper Kjaedegaard said: “I am delighted to see this recognition of the UK-flag fleet as a world leader in quality shipping. At a time of difficult shipping markets, it would be all too easy for standards to drop. The total lack of any possible negative performance indicators against the UK register is clear evidence that this has not happened here – it’s great news for the UK. The Maritime and Coastguard Agency has worked hard to maintain the quality of the register and shares the credit for this outcome with the owners and managers of our fleet.”

However, Danish shipping giant AP Moller-Maersk announced last week that it is to reflag 55 vessels as part of its moves to simplify its registration structure. 15 box ships and tankers will be reflagged from the UK to Denmark, with 17 offshore supply ships following suit from the Isle of Man. The good news for UKSR is that a reported 20 Maersk container ships will be moved onto the UK registry from other flags.

Safety concerns over stockpiled Indian iron ore

The UK P&I Club has once again warned its members of the serious risks that can be associated with the carriage of iron ore fines loaded in Indian ports.

Reports of serious incidents continue and include two vessels loaded with this product that have capsized in the last two to three months. At the present time the Club is dealing with 12 current cases involving this commodity.

According to the Club, much of the iron-ore stockpiled in India has been exposed to rain during the summer monsoon and the moisture content of large quantities of ore is over the Transportable Moisture Limit as set out in the International Maritime Organization’s IMSBC Code.

The tenth Annual Market Review & Forecast from Drewry on the liner industry shows that 2009 was every bit as bad for the global container industry as was predicted as recession ravaged one economy after another.

While there are a few pieces of good news these are offset, the specialist shipping consultant says, by the critical issue of over-capacity. Drewry warns: “Managing over-capacity and keeping costs contained needs some clear management focus if container businesses are to survive the challenging market conditions that will prevail until at least 2014.”

The positive news includes a predicted small recovery in global traffic in the second half of 2009 and some minor recovery in trade flows for 2010, up by around 2.4%.

“Freight rates,” Drewry comments, “have been improving recently but rates, as we know, tend to be counter-cyclical. We are also projecting that average all-in East-West rates will climb encouragingly by around 18%. Costs have also been held in check and spiralling wages driven by a shortage of skilled mariners have also been halted.”

Some ocean carriers, Drewry notes, have quite effectively micro-managed supply at the individual trade route level and, since July this year, there have been positive signs of increased container flows and freight rates on certain key routes. To achieve this services have been cancelled, vessels have been cascaded and effective capacity switched into laid-up or off-hire inactive capacity.

A new report, released by Maritime London member Lloyd’s Register - Fairplay Research, predicts that the world’s dry bulk carrier fleet will continue to show strong growth over the next five years, spurred largely by surging demand for iron ore and metallurgical coal to feed China’s undiminished appetite for steel production.

The report estimates that the dry bulker fleet, currently standing at 7,839 ships with a total capacity of 432 million deadweight tons (dwt), will grow by an average of 9.5 percent through the end of 2013, up from 6.5 percent annual average growth the previous five years. The fastest growing segment will be very large ships over 200,000 dwt, increasing at 16.8 percent per annum. Deliveries of new bulkers through year-end 2013 will amount to some 318 million dwt, up 150 percent from the last five years. This will be offset by an increase in scrapping, with 76 million dwt of capacity to be removed from the fleet. Shipyard orderbooks for new bulkers will diminish as the large number of ships ordered during the boom years of 2007 and 2008 are delivered to the fleet.

The contract forecast for 2009-2013 stands at 139 million dwt, considerably lower than the last five years, but a respectable size nonetheless, due to expected orders for new tonnage to be placed by Chinese and Japanese interests.

The continuing surge in Chinese imports of iron ore and coal will be the primary growth engine for the world’s bulker fleet, offsetting the falloff in grain and agricultural product exports and generally low freights for bulk commodities, according to the research report.

“Steel production provides business for nearly half the world’s bulk carriers, and China now produces nearly 50 percent of the world’s steel,” observed Niklas Bengtsson, one of the report’s authors. “China’s imports of energy and non-energy commodities to supply its industry with materials for production of domestic goods and investments in infrastructure have triggered a surge in demand for large-tonnage bulkers.”

The growth curve for general cargo ships will be much flatter, according to the report. In August 2009, the general cargo fleet consisted of 17,137 ships with a total capacity of 81 million dwt. It is predicted to grow by just 2.5 percent annually through 2013. There are still a large number of newbuilds to be delivered – a hangover from the ordering binge of 2007 and 2008 – but scrapping will remove 12.7 million dwt from fleet capacity through 2013, and new orders will plummet by 63 percent as demand softens.

The report also notes that the market for specialized refrigerated cargo vessels will continue to decline, with only a handful of ships on order. Given China’s dominance in the steel industry, it is no surprise that China holds the top position in shipbuilding for the dry bulk and general cargo sector. China’s share of the orderbook through 2013 is a whopping 50 percent, while Japan and South Korea come in a distant second and third place.

The report notes that bulker and general cargo ship deliveries from European yards have more or less disappeared over the last 30 years, and concludes “there is absolutely nothing that points to a reversal of this trend.”

Maritime London member Steamship Mutual has issued a set of guidelines to assist shipping companies preparing vessels safely for lay-up and to minimise the risk of P&I claims. Such claims could typically be for wreck removal, injuries to crew, and pollution of the local environment, particularly arising from the leakage of oil leakage, or other contaminants or the leaching of antifouling.

According to the club, other possible claims could arise from damage to third party property, including other vessels, underwater cables or pipelines, pleasure craft, aquaculture installations, beaches and reefs.

In an indication of the increasing environmental pressure on the shipping and ports industry, the Port of Rotterdam has joined Friends of the Earth Netherlands in calling for the maritime industry to cut CO2 emissions by 30% by 2020 and 80% by 2050, compared to 1990 levels.

In a joint statement, the two organisations said: "An 80% reduction by 2050 is necessary, according to scientists, if global warming is to be restricted to 2degC, the internationally accepted upper limit. Transport by water is more energy efficient than by land or air. In that sense, it is sustainable. Also, according to expectations, more and more goods will be transported by water in the coming decades. Hence, there is every reason to aim for a powerful reduction in CO2 in shipping."

Study focused on kiwi fruit

A study carried out in New Zealand comparing kiwi fruit exports from the country has found that per unit greenhouse gas emissions are 27 per cent higher for reefer containers when compared to dedicated reefer ships.

The research, carried out by the Agribusiness and Economics Research Unit (AERU) of Lincoln University in Christchurch, New Zealand, set out to assess more fully the shipping emissions generated in fresh produce supply chains. Using the kiwifruit industry as an example, the study focused on shipping emissions and measured greenhouse gasses on outward and return journeys, while accounting for different shipping routes, ship utilisation, and the volume and weight of cargo.

When the emissions of port activities, refrigerant losses and transport of fruit from orchard to port were included, the study found that GHGs produced by container shipping were even higher, exceeding those created by specialised reefer shipping by 36 per cent. Reefer shipping groups welcomed the findings, saying that they vindicated the use of reefer ships.

However a recent report by analyst Drewry predicted that specialised reefer shipping was likely to all but disappear within the next 20 years.

The UK minister for security & counter-terrorism, Lord West will be giving a presentation on the maritime dimension of the UK’s national security strategy on 27 October at the Army & Navy Club. The event, organised by the Society of Maritime Industries commences at 1015 and includes a buffet lunch.

For further details contact Clem Upton.
Email: Clem@Maritimeindustries.org

The London Maritime Arbitrators Association celebrates its 50th anniversary next year and is marking the occassion with a conference, reception and dinner at the Guildhall, London.

Taking place on 18 March 2010, the conference will be opened by Lord Lloyd of Berwick. Guest speakers at dinner will be Lord Clarke of Stone-cum-Ebony and Mark Jackson, chairman of the Baltic Exchange. The Lord Mayor of London will also be hosting a reception at Mansion House the previous evening, 17 March.

Conference and dinner tickets are now available for £290 + VAT (conference only: £175 + VAT).

www.lmaa50th.co.uk/book.asp