Global Shipping Faces Upheaval
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HILLARY CLINTON FOR PRESIDENT LORETTA SANCHEZ FOR U.S. SENATE FROM CA Organized 1885 Official Organ of the Sailors’ Union of the Pacific Volume LXXIX No. 10 SAN FRANCISCO, CALIFORNIA Friday, October 21, 2016 SUP President’s Report Global shipping faces upheaval Arbitrator issues bum orld-wide container collapse,” said Jonathan Roach, The economies of two major volumes are on track an analyst at London-based importers –the U.S. and the Wfor zero growth this Braemar ACM Shipbroking. eurozone– expanded 1.2% and decision in Matson year, which would mark the sec- “Demand is around zero and any 0.3%, respectively in the second tor’s worst performance since the moves to increase freight rates quarter. 2009 economic crisis and a likely will likely fail.” “Global growth is just stum- Navigator catalyst for further bankruptcies crewing case Hanjin Shipping Co., South bling along and this has had a n Columbus Day, backwards to help Matson, and possible shipping-industry Korea’s biggest operator and the profound impact on shipping,” MFOW President An- expressing vague, unsub- consolidation, according to an world’s seventh largest in terms said Basil Karatzas, a U.S.-based thony Poplawski and stantiated concerns about article in the September 28, Wall of capacity, filed for bankruptcy maritime adviser. O Street Journal. SUP President Gunnar Lun- whether arbitration was the protection in August and is under Most of the 20 biggest contain- deberg issued the following appropriate forum to resolve Freight rates, the predominant court order to sell its own ships er lines, including A.P. Moller- statement: the dispute given Horizon’s source of income for shipping while returning chartered ships Maersk A/S’s Maersk Line, were “Justice was denied on past collective bargaining companies, fell 20% to $767 to their owners. deeply in the red in the second a container in the benchmark October 3, when the MFOW obligations, and on that basis Container operators, which quarter, and analysts expect Asia-to-Europe trade route last and SUP received Arbitrator denied our grievance. move everything from clothes them to report a collective $8 month. and shoes to electronics and Frank Silver’s September We may never know what billion to $10 billion in losses for Rates have mostly stayed well furniture, are burdened by 30% 30 decision on the Unions’ led the arbitrator to ignore the full year. below $1,000 since the start of more capacity in the water than grievance over the company Shipping analysts say any op- the law and issue such an the year. Operators say anything demand. crewing the Matson Navigator outrageously biased decision. erator with less than 5% global below $1,400 is unsustainable. Many companies are fighting in the unlicensed engine and But while disappointing, to share of the container shipping They aren’t expected to turn for survival as freight rates bare- deck departments with non- say the least, his decision market may be taken over by around soon. China’s Golden ly cover fuel costs. MFOW and SUP mariners. does reaffirm our right to the bigger players or be confined to Week holiday started at the be- China’s slowing growth is con- The Navigator is one of the work on all Matson vessels, regional trades. ginning of October, marking the sidered the main cause of the in- everywhere that Matson op- Only four companies among vessels that Matson obtained slow season for operators as many dustry’s problems. The economy the world’s top 20 have more as part of its acquisition of erates, as long as they are not Chinese factories cut production of the world’s biggest exporter than 5% global share of that Horizon Lines in 2015. The among the few vessels Matson levels after an output frenzy in the grew 6.7% in the second quarter, market. They include Maersk, arbitrator agreed with us that obtained as part of its acquisi- summer months when Western far less than the double-digit Swiss-based Mediterranean the Navigator is now owned tion of Horizon in 2015.” importers stack up products for growth of past years, as it tries to and operated by Matson and the year-end holidays. transform its growth model from Shipping Co., France’s CMA is therefore a vessel covered The President’s Report “The industry faces its worst heavy industry and construction CGM and China’s Cosco Con- by our Agreement. If he had continues on page 10 year since the Lehman Brothers to services and consumption. tainer Lines. been doing his job, he would have ended his analysis right there and upheld the griev- ance. Instead, he bent over Hanjin woes hit West Coast ports he bankruptcy of Korean tember 2015. That made it the slight improvement from a year weeks, Hanjin’s ships have been Tocean carrier Hanjin Ship- weakest September for imports earlier. Panjiva Inc., which tracks cleared, one by one, to berth and ping Company battered West since 2012. In the month, dock- customs data, found that while unload cargo at various ports Coast ports in September. workers imported 282,945 20- the overall number of import around the world. For weeks after the South foot equivalent units, or TEUs, shipments to the U.S. fell 11.2% But delays and confusion are Korean operator filed for bank- a standard measure for container from August to September of mounting. Thousands of Hanjin ruptcy protection, its fleet of cargo. Long Beach port officials this year, the monthly figure containers –unloaded from ships dozens of vessels, about 3.2% said Hanjin’s containers account- was a 1.3% improvement over and emptied of their imported of global container capacity, ed for 12.3% of the port’s total September of last year, despite goods– clutter warehouse yards sat idle in international waters container volume. the Hanjin bankruptcy. and parking lots, many of them with billions of dollars in cargo In Oakland, the 10th-largest In terms of exports, Oakland attached to trailers that port trapped on board. The disruption U.S. port and a major hub for continued to recover, with 76,356 truckers need to move other came as retailers were stocking Asian cargo, imports were TEUs for the month. That is companies’ goods on and off their shelves for the busy holi- down 4.2% year-over-year. an improvement of 10% over the docks. day season, a time that usually The Bay Area port handled September 2015, but still off Earlier this month, Hanjin results in among the strongest 70,307 loaded import TEUs in from 2013 and 2014 September started accepting empty con- months at U.S. ports. September, down from 73,420 exports. Exports out of Long tainer dropoffs at port terminals Instead, import volumes sank last September and 72,271 in Beach declined, falling 4.2% in Long Beach and Seattle. Ma- Periodicals’ postage paid at San Francisco, CA (USPS 675-180) postage paid at San Francisco, CA Periodicals’ at the ports of Long Beach and September 2014. from the year-earlier period to rine-traffic control in Southern Oakland last month. Analysts estimated overall 120,383 TEUs. California said that the vessel Long Beach, the nation’s sec- U.S. monthly imports would fall As Hanlin’s bankruptcy pro- Hanjin Seattle was expected to ond-largest port by container from August to September. But ceedings have moved forward arrive later this month in Long volume, reported a 15% drop they expected that last month’s in South Korea and New Jersey Beach to discharge more con- in imports compared with Sep- performance would still be a courts over the past several tainers. Labor Endorsements for Election on Nov. 8: Pages 4 & 5 ESU News: Page 7 Page 2 WEST COAST SAILORS Friday, October 21, 2016 SUP Honor Roll Voluntary contributions from the membership to the following funds: West Coast Organization/ Sailors General Fund Leo Moore. 100.00 Cal Cunningham. 25.00 Anthony Ingegneri . 25.00 Political Fund Les Jeziorski. 40.00 John Perez. 25.00 Dave Connolly. 100.00 Jennifer Corner. 25.00 Douglas Crute. 50.00 Dues-Paying Colin Dewey in memory Pensioners of Ernie Acosta. 100.00 Mike Dirksen. 50.00 Robert Copeland Book #4763 Valeriy Gonchardv. 50.00 Donald Cushing Book #4777 David Ibarra. 25.00 Romaine Dudley Book #2593 Marcel Javier. 100.00 Diane Ferrari Book #2251 Peter Johnsson. 20.00 Gerald Ingemansson Book #0379 Gunnar Lundeberg. 50.00 Kaj E. Kristensen Book #3120 John Mancilla in memory Hannu Kurppa Book #3162 of Freddie Cato. 50.00 Dave Larsen Book 19078 Adian Minty . 20.00 Duane Nash Book #2437 Michael O’Boyle. 50.00 John Perez Book #3810 Edwin Pastolero . 40.00 Alex Romo Book #3193 John Perez. 100.00 Francisco Salvatierra Book #7498 Paul Puragganan. 50.00 James Savage Book #7488 Steven Ross . 50.00 Ralph Senter Book #7323 Steve Swinson . 25.00 David Shands Book #7483 Roy Tufono. 50.00 Arthur Thanash Book #3249 Erick Weiss . 100.00 Vietnam plans port expansion at DaNang A mega-port is being planned for port development should see it become Vietnam’s central city of Da Nang. an international gateway for passengers, The first phase of the $1.4 billion containers and liquid and dry bulk cargo development is expected to be com- and liquid. pleted by 2020; the second and third The city plans to increase its annual phases by 2030 and 2050 respectively. capacity to 12 million tons of cargo. Initial construction work will include In July, Vietnam’s government an- a breakwater, fairways and technical nounced plans for a port development infrastructures, and will be followed in the country’s southern-most province by harbors, traffic infrastructure and Ca Mau in the Mekong Delta.