September 2020 Review

The European Parliament voted on September 15 in favour of including greenhouse gas emissions from shipping in the European Union’s carbon market from 2022, potentially one of the biggest rule changes to hit the industry for years. The International Maritime Organization will try and counter with its own global green solutions when its Marine Environment Protection Committee meets in November. Multinational commodity trading company Trafigura detailed its own ideas of a carbon levy for shipping this month, which it reckons ought to start out at between $250-$300 per tonne of CO2-equivalent. All three east-west liner alliances committed to reinstate blanked sailings in October on the booming transpacific tradelane following a remarkable intervention from Chinese authorities. Liner staff were called to a meeting with the Ministry of Transport this month as rates soared to record levels on many tradelanes, especially the Asia - US west coast route where rates closed in on $4,000 per feu. Authorities in the US and South Korea also voiced concern at how carriers had obtained such a stranglehold on rates via their blanked sailings policy. Shipping’s most acute logistical challenge of the past 50 years – the crew change crisis brought about by Covid-19 travel restrictions – could soon affect 1m seafarers, Guy Platten, the secretary general of the International Chamber of Shipping (ICS), warned at a United Nations-convened event last week. ICS estimates that there are now 400,000 seafarers stranded at sea with a further 400,000 ashore waiting to relieve them. If the crisis continues, Platten predicted that 1m seafarers could be adversely affected in the coming months. 41 men and more than 5,800 cattle are thought to have perished when a livestock carrier lost power in the centre of massive typhoon on September and then capsized and sank. Just two crew are confirmed survivors from the accident on the Gulf Livestock 1, the latest in a long string of livestock disasters in recent years. A huge restructuring at Maersk will affect up to 27,000 or one third of of the Danish conglomerate’s staff as it moves to integrate subsidiaries into the core organisation. Maersk announced plans this month to phase out its Damco and Safmarine brands while aligning many global functions of Hamburg Sud into the Maersk organisation. Marseille-headquartered CMA CGM suffered a sizeable ransomware attack, which brought many of its websites down on Monday. The news means the world's top four liners have been hit by hackers in recent years. In other developments this month, CMA CGM bought a 30% stake in French airline company Groupe Dubreuil Aero, citing its interest to expand its air freight footprint. Dubreuil Aero owns the Air Caraibes and French Bee lines, which operate primarily between mainland France and overseas French territories. Hafina, the Michael Skov-led product tanker arm of the BW Group, invested in an American methanol production facility. As part of the deal, Hafnia will provide and operate purpose-built methanol dual-fuelled ships to transport one-third of the methanol volume produced by the plant. These vessels will be tied to 19-year charters. The remarkable thawing of ties between some Middle Eastern nations and Israel has led to an unexpected port development with a Dubai terminal operator closing in on a deal to buy into the port of Haifa. DP World is now in discussions with Tel Aviv-based DoverTower to bid to take over operations at the previously government-owned Haifa port. DoverTower is owned by Israeli businessman Shlomi Fogel, and is a shareholder in Israel Shipyards and a partner at Eilat port. Sri Lankan and Indian authorities battled a severe fire on a fully laden VLCC for much of the first half of the month. A boiler explosion in the engine room of the New Shipping controlled New Diamond forced crew to evacuate. The ship has now been towed to an offshore terminal near Kandla where its cargo will be offloaded. A bitter family fight for the control of one of Norway’s most prestigious maritime firms made headlines this month. The cousins and aunts from three branches of the Wilhelmsen family bid NOK1bn ($353m) to try and get the current boss of the group, Thomas Wilhelmsen, to step down from all his roles at the diverse conglomerate. Wilhelmsen took the reins at the family’s holding company via his holding of A shares following the suicide of his father, Wilhelm Wilhelmsen, in February this year. He has rejected the offer from his family members. With one landmark Norwegian autonomous shipping project, the Yara Birkeland, hitting the skids this year, a new pioneering maritime vision has emerged from the Scandinavian nation in the shape of a futuristic looking roro. ASKO, a grocery distributor, has signed with Norway’s Kongsberg Maritime and Massterly – a Kongsberg Wilhelmsen joint venture – to equip two new vessels with autonomous technology, and to manage their operations at sea. The fully electric ships are due for delivery from India’s Cochin Shipyard in 2022.

September 2020 Review

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