24 March 2009
A free fortnightly publication produced by Maritime London
|Lord Mayor of London
A maritime delegation of 18 from the UK joined
the Lord Mayor of the City of London in Turkey last week,
promoting the UK's financial, business and maritime services.
The Turkish shipping community was able to
benefit from advice from a panel of leading UK experts on
a wide range of issues including over capacity of the vessel
orderbook; where owners could hope to find finance in the
future; how to approach shipyards for postponed deliveries;
ship quality and vetting; freight derivatives; legal alternatives
for dispute resolution and environmental issues.
Hosted by the Turkish Chamber of Shipping
and chaired by Michael Drayton of the Baltic Exchange, the
panel consisted of Jonathan Kemp (Eversheds), Neil Rokison
(Galbraiths), Alistair Johnson (Holman Fenwick Willan),
Nigel Russel (HSBC Insurance Brokers), Nick Burgess (Ince
& Co) Ian Teare (Norton Rose), David Peel (RightShip UK)
and Karl Lumbers (Thomas Miller). The Lord Mayor delivered
a keynote address to the conference focusing on the benefits
of the UK's expertise in the shipping market and outlining
the potential difficulties facing the international shipping
community. Other companies involved included BMT Harris
& Dixon, Lloyd's Register, COSMIC, Clyde & Co and V Ships.
Maritime London chief executive Doug Barrow
"This was a hugely successful trip and
our members met a good cross section of the Turkish maritime
community. The collective expertise of our group was second
to none and the feedback we have had very postive."
"Our thanks to the Turkish Chamber of
Shipping for hosting such a first class event and to the
help and assistance provided by the British Embassy and
the UKTI team at the British Consulate General."
Lord Myners report covers maritime
The Professional Services Global Competitiveness
Group (PSGC) has published
a report into the medium and long-term challenges facing
professional services in the UK, including the maritime
sector. Co-chaired by the Financial Services Secretary Lord
Myners and Sir Michael Snyder, the group’s findings will
be reported to the Chancellor.
The report calls on government support and
encouragement for the maritime cluster to develop a medium-
to long-term strategy, including the establishment of a
Maritime Services Committee involving Government representation;
ensuring the continued competitiveness of the UK’s Tonnage
Tax; protection of the UK’s seat on the International Maritime
Organisation (IMO); and measures to boost the numbers of
students in maritime subjects.
The group’s report also outlines a number
of areas of general focus for the Government, the professional
services industry and professional bodies, to ensure that
the sector remain competitive, including:
• The role of professional services firms in setting global
standards and promoting good corporate governance
• Raising skills levels across the economy, to the benefit
of both professional services firms and their client companies
• Combining a tradition for quality and expertise with flexible
working practices to deliver innovative products and services
• The UK's continued attraction as a global headquarters
for international professional services firms
• Seeking opportunities for synergies with other major professional
services centres, particularly in emerging markets
• Continuing to develop an open and constructive relationship
Maritime London chief executive Doug Barrow
said: “This is an important and timely report and builds
on the work of Maritime London. The UK’s maritime services
sector is an important component of the UK economy and working
together with the government we can ensure that the UK remains
a world beater.”
Financial Services Secretary Paul Myners said:
"The UK's professional services industry will continue to
be an immensely valuable part of our economy. This report
sets out both a compelling vision for the sector over the
next 10 to 15 years, and highlights further work required
to ensure London retains its place as the leading international
Marine insurers face an uphill battle as premium income
falls dramatically due to reduced fleet values and cargo
volumes despite an “encouraging decrease” in claims according
to AXA Corporate Solutions. The net result will have a significant
negative impact on the bottom line at a time when there
is no investment income to bolster results.
Cedric Charpentier, chief underwriting officer
– cargo, for AXA Corporate Solutions said that after a number
of exceptional years the 2009 outlook for cargo insurance,
which makes up about half the total marine insurance, was
looking “scary". After five years of massive increases,
world growth was projected to fall to half of one per cent
in 2009, its lowest rate since World War ll.
Speaking in Miami during the spring meetings
of the International Union of Marine Insurance's executive
and seven technical committees, he noted: “Advanced economies
were projected to be almost all in recession, and while
emerging countries were still showing high growth, there
were significant reductions compared with 2008. The severe
downturn of the world GDP had caused a collapse in demand
for manufactured goods from western countries. This, combined
with a trade credit shortage, had resulted in a similar
collapse in international trade of goods. Between the last
quarter of 2008 and the last quarter of 2007, there had
been a drop of 45% in world trade values.”
He concluded: “All these factors clearly demonstrate
a shrinking of insurable values that will have a direct
and massive impact on world marine insurance income.”
A survey by international shipping recruiter and Maritime
London member Faststream has revealed that despite economic
difficulties, salaries and demand for technical people within
shipping companies and classification societies remain firm.
Based on data collated by the company’s recruiters
in the UK, USA, Singapore and Norway between September 2008
and February 2009, the report shows that the average salary
across all sectors currently stands at £55,620. The figures
reveal that ship operators and managers pay the best salaries
(average £59,583) and offer the best packages. Nearly three
quarters of candidates placed within shipping companies
were offered some form of bonus scheme, compared with only
a quarter of those placed with classification societies.
Shipping companies are also more likely to offer pensions
and private healthcare.
The report also found that the average age
of a technical superintendent placed within a company was
41. Faststream says that trainees in the shipping sector
are still in demand, particularly from classification societies.
The average salary in 2008/09 was £32,843 with an average
of eight weeks required to fill the role.
Faststream managing director Mark Charman
said: “Faststream’s research shows that despite the doom
and gloom, there are still positions which need filling
and high quality candidates are in demand. We will continue
to monitor the market and update this report later in 2009.
We are also currently compiling statistics for commercial
roles such as charterers, brokers and managers and hope
to publish the results by early summer. "
here to download a full copy of the report.
Although a USD 29.8m charge to settle a legal
dispute with Russian shipowners Sovcomflot and Novoship
cut pre-tax profit from USD36.4m in 2007 to $25.85 last
year shipbroking and shipping services group Clarksons reported
a 24% increase in underlying operating profit to a record
USD55.6m. Revenue soared by 44% to USD355.5m.
However chief executive Andi Case said that
so far this year trading conditions in some markets had
caused a significant decline in revenue.
He nevertheless struck an optimistic note
saying: "Whilst we expect market conditions throughout 2009
to remain challenging, revenues will continue to be supported
by our forward order book and the US dollar exchange rate
should they remain at the current level."
Clarksons did though caution in its statement
that it was not immune from the crisis in the newbuildings
market as ship values plunged, owners faced cash flow and
finance problems and newbuilding contracts were put under
The Baltic Exchange and the London Maritime Arbitrators
Association (LMAA) have teamed up to establish a mediation
service for shipping and commodity related disputes. Drawing
on the experience of both senior Baltic Exchange members
with hands on shipbroking expertise and LMAA mediators,
the service will offer companies an alternative to arbitration
and court litigation as a means of resolving disputes.
Governed by the LMAA/Baltic
Exchange Mediation Terms (2009), the service will offer
a flexible means of resolving disputes – mediations may
be conducted either physically in one location or by video
link or correspondence between the parties and the mediator.
Baltic Exchange chief executive Jeremy Penn
said: “Collectively Baltic Exchange members have an unrivalled
experience of all aspects of commercial shipping. We expect
this new service to be popular with owners, charterers and
traders looking to avoid lengthy and costly legal proceedings.”
LMAA president John Tstasas said: “Mediation
allows companies which work together regularly to come to
an amicable commercial solution. Mediation is not a new
concept, but has grown in popularity in recent years. It
allows for creativity in resolving disputes to enable parties
to continue doing business together.”
Mediators operating the service will be both
Baltic Exchange members and as a minimum supporting members
of the LMAA, and will be trained as mediators.
Diverse shipping services group James Fisher has reported
a strong performance for 2008 revenue and profit from operations
both up by over 28%, to GBP233.6m and GBP27.5m respectively.
In its statement the company says: "2008 proved
to be an excellent year for James Fisher. Group revenue
and profit from operations were both up strongly and, once
again, our cash flow was impressive. The key to our performance
was good organic growth in the marine support divisions
of Offshore Oil, Specialist Technical Services and Defence.”
However operational issues with new tonnage hit the company's
Marine Oil division (James Fisher Everard) with divisional
profit falling 30.5% to just under GBP6m.
The company says there were phasing problems
concerning the fleet renewal programme and issues relating
to the new European Maritime Safety Agency (EMSA) contract.
The situation was made worse when Svithoid Tankers, the
Swedish owner of two of the company’s bareboat charters,
went into receivership. These problems have now, James Fisher
says, been resolved. Looking ahead the company says that
it is difficult to comment too definitively in an economic
climate which is changing rapidly and mainly for the worse.
“However,” it says, “the immediate outlook
for the divisions has not changed from last year and the
company in 2009 is trading to management expectations. On
present evidence the company is well placed, with a proven
track record, to continue to produce good growth and further
value for our shareholders."
Greek fleet is still the world's
The Greek-controlled fleet decreased slightly
in number of vessels but increased in deadweight and gross
tonnage terms, according to latest Lloyd’s Register – Fairplay
figures released by the London-based Greek Shipping Co-operation
Greek interests now control around 8.2% of
the world’s total number of vessels in service and on order,
15.2% of the world fleet deadweight, or 13.2% of the world
fleet expressed in gross tonnage, against 8.7%, 16.4 % and
14.01% respectively, last year. In terms of ships on order,
the percentages are 10.3%, 16.2% and 14.4% respectively.
The Greek owned fleet remains the first in the world.
As of 27 February Greek interests controlled
4,161 vessels of various categories, totalling 63.6m dwt
and 156.2m gt, including 1,072 newbuildings of 53.4m gt
still on order. The latest figures represent a decrease
of 12 vessels, but an increase of 2.6m dwt and 1.6m gt.
The Greek-flag, has also decreased, now comprising 1,121
ships, including 356 on order, against 1,197 ships in 2008,
including 422 vessels then on order.
Ports and terminals insurance mutual TT Club and equipment
manufacturers trade body PEMA (Port Equipment Manufacturers
Association) are joining forces to promote best practice
in designing safe port operating equipment worldwide.
The move comes after PEMA’s recent AGM in
Amsterdam, where Laurence Jones, director of global risk
assessment for the TT Club, presented the results of his
recent research into causes of equipment accidents and loss
in the port and terminal sector.
A TT statement says: “Given its position as
a leading insurer globally to the marine terminal market,
TT Club has a wealth of insight into the key factors contributing
to such accidents.”
“We are delighted to co-operate with the
TT Club in increasing knowledge and awareness of such a
vital aspect of the port equipment business,” said Ottonel
Popesco, PEMA president.
The club says its research shows that, although
human factors were the major cause of accidents, existing
systems and technologies could be included in the design
of equipment to help operators avoid accidents.
Mr Jones also called for continuing development
of new technology to improve the safety of personnel and
equipment, citing the example of quay-crane booms colliding
with ships – a frequent accident that is easily prevented
by the installation of a simple boom anti-collision electronic
“For about USD10,000 per crane this alone
can save millions of dollars in damage as well as injuries
and downtime”, says Jones.
“Due to price sensitivity, crane manufacturers
often do not provide boom anti-collision as standard or
offer a low-cost mechanism that does not provide adequate
protection. My aim is to encourage all terminals to specify
electronic boom anti-collision sensors so that crane manufacturers
fit them as standard.”
Michael Everard CBE has been appointed the 107th President
of the Institute of Marine Engineering, Science and Technology
(IMarEST) at its 120th anniversary AGM.
Outlining the challenges facing the institute,
Michael Everard said:
"The Institute was never more influential
than it is today and the problems facing the marine world
never more daunting. I come from a shipping background and
understand only too well the difficulties that industry
is suffering but it seems we should be engaged on many fronts.
The 'credit crunch' has severely damaged global trade and
the shipping industry, its chief source of moving commodities
around the world. Charter rates are at an all time low and
shipbuilding is in turmoil. Climate change is an ever increasing
threat to the future well being of our planet and marine
and ocean scientists hold the key to our understanding of
the major changes that are manifestly endangering our long
term existence. The supply of the growing energy needs of
an ever developing world in an environmentally safe and
acceptable manner was never more important. Marine renewable
energy is a major element in the battle to provide for the
"We, as the world's largest marine science
and engineering professional body, can contribute and help
in many ways to resolving these issues through innovation,
engagement with the key maritime agencies IMO, UNCLOS, IOC
and by contributing to the Institute's prime objective of
the development of Marine Engineering, Science and Technology.
If ever an Institute such as ours was needed, now is our