A month from today, shippers will be shelling
out more for their trucking needs when North Harbor truck
operators start implementing a 16% rate hike. This after the
Allied Transport Group, Integrated North Harbor Truckers Association
and WGA Truckers Association, the Supply Chain Management
Association of the Philippines (SCMAP) and the Philippine
Liners and Shippers Association (PLSA) agreed on the increase.
Starting Valentine’s Day, the new trucking rate will
be P5,917.77, up P817.77 per 20-footer from P5,100 per 40km
round trip to and from Metro Manila.
The extra cost should have been implemented as early as New
Year’s Day but the truckers, collectively known as North
Harbor Trucking Association, deferred the decision subject
to further discussion with the SCMAP and PLSA.
“There really is a need to increase trucking rates and
all parties agreed to it,” newly elected SCMAP president
John Guillermo said after the meeting with truckers and PLSA
late last week.
“SCMAP wanted it to be implemented on February 24 but
the truckers asked for an earlier date claiming (the increase)
is already long overdue,” he said.
PLSA said it also saw no problem with the increase because
they are not directly affected by it anyway. “Nonetheless,
we will discuss it with the PLSA Board. Whatever the decision
of the SCMAP will also be carried by our Board. Based on our
meeting, the rate increase is a go,” a PLSA official
said.
Another meeting is set for January 23 to finalize implementation
of the rate hike. At that meeting, the truckers will also
submit to SCMAP a paper on how they arrived at the percentage
of increase.
The higher cost of fuel and spare parts pushed truckers to
seek a rate hike. The truckers said the bunker surcharge has
increased 28% in the past four months – the latest of
which was the 14% hike last December – yet their rates
have remained the same.
As of last month, some truckers have already implemented the
16% rate increase on their in-house accounts.
In May 2006, INHTA, SCMAP and PLSA agreed to hike trucking
rates by 18%, 12-percentage points lower than the 30% increase
originally petitioned by the group.
The Association of International Shipping
Lines (AISL) has began technical testing of the systems of
two Bureau of Customs (BOC)-accredited value-added service
providers (VASPs). This is in preparation for the full implementation
next month of the advance inward foreign manifest (IFM) submission
requirement of the BOC.
The two VASPs are Cargo Data Exchange Center and E-Konek Pilipinas.
AISL deputy general manager Cora Bautista confirmed to PortCalls
the conduct of the technical testing.
The technical testing will run for several days before the
system is evaluated by the BOC in a parallel run scheduled
toward month’s end. The parallel run will involve electronic
and actual submission of the manifest to the BOC for counterchecking
to determine how fast the VASP system reacts to voluminous
entries.
Customs deputy commissioner Alexander Arevalo, who is also
chair of the VASP accreditation committee, earlier told PortCalls
he will soon meet with the Philippines Ship Agents Association,
Philippine International Seafreight Forwarders, Inc and Aircargo
Forwarders of the Philippines, Inc to discuss other aspects
of the IFM.
Under CAO 1-2007, the BOC requires shipping lines, non-vessel
operating common carriers, cargo consolidators, co-loaders
and break bulk agents to provide the BOC with accurate information
on vessels and cargoes that will arrive at any port 12 hours
prior through electronic transfer coursed through any of its
accredited VASPs.
Air carriers and forwarders are required to submit the IFM
two hours before arrival of the cargo.
Subic Bay Metropolitan Authority (SBMA) is
selling its 15% stake in Subic Bay International Terminal
Corp (SBITC), the company that operates the freeport’s
New Container Terminal-1 (NCT-1).
SBMA chair Feliciano Salonga, in a recent interview, said
SBMA being a government entity does not want a stake in a
private business venture.
SBMA has offered to sell its stake to International Container
Terminal Services Inc. (ICTSI) and Royal Port Services Inc,
the other owners of SBITC. Both declined.
ICTSI owns 83.33% of SBITC and Royal Port, 16.67%.
SBMA declined to say how much it was willing to sell its stake
for.
“We have long been offering our 15% stake to them, but
they don’t want to buy it,” Salonga explained.
During the previous SBMA dispensations of Felicito Payumo
and Richard Gordon, many companies wanted to wrest control
of the Subic port operations.
“We took the stake to unite the erring companies,”
Salonga said.
“SBMA is not involved in the direct management of the
company. I just sit in the board because I’m the chairman
of SBMA. But they manage it,” he said.
According to Securities and Exchange Commission documents,
SBMA has P24 million in paid-up capital in SBITC, which in
turn has a total property book value of P135.65 million, including
cargo-handling equipment.
Every year, SBMA has a share in the gross revenue that SBITC
earns. In 2005, SBMA collected P9.53 million and in 2006,
P11.29 million.
SBMA’s stake is worth more in the future since the agency
is expecting container traffic to increase to up to 150,000
TEUs by end 2008 then to 250,000 TEUs by next year.
Last year, SBITC handled 34,889 TEUs, up from the previous
volume of 31,238 TEUs.
As of April last year, SBITC’s board included Salonga
as chairman; Francisco Delgado III, vice chairman; Armand
Arreza; Enrique K. Razon Jr.; Vivien V. Minana; Edgardo Abesamis;
Noel M. Mirasol, and Francis M. Andrews.
Sky Land Brokerage enters its 39th year in the transportation
business promising more dynamic, efficient and cost-friendly
operations.
To achieve these goals, it is banking on the forging of more
network partnerships with international agents, automation
of operations, and investments in a new warehouse and additional
hauling units.
All these will help Sky Land Brokerage achieve sales growth
(in terms of transactions) of 10-15%, outstripping the 7-10%
increase projected for the freight forwarding industry.
“We expect to duplicate if not surpass (our sales)
this year,” Sky Land president Dominador De Guzman told
PortCalls.
Such bullishness is also anchored on a positive economic
outlook for 2008, helped along by the relative political calm
before the next presidential elections which are still two
years down the road, he said.
The issue of trust
Looking back, De Guzman attributes the company’s success
in the last 38 years on trust. “Our clients entrusted
to us their cargo worth millions of pesos, even dollars. They
trust that we will give their cargo the attention it deserves.
And we give that service plus more. To us, our clients are
more than our customers. They are our partners, our friend,
our family,” he said.
“Most of our new clients are referrals from satisfied
customers. Regardless of the nationality of our client we
make sure that we maintain that level of trust and we will
continue to build on that trust to weather yet another 39
years in the business,” De Guzman vowed.
“Our clients can look forward to a more dynamic Sky
Land as we enter our 39th year in the business, with the strengthening
of our network partnership with our international agents.
We can offer more services from point-to-point. We will have
more flavor to offer,” he said.
Tough 2007
Last year was a tough year for Sky Land Brokerage as it weathered
the effects of a strong peso, the shift to electronic lodgment
of entries at the Bureau of Customs (BOC), and high fuel and
labor costs.
Still, the company managed to post double-digit growth through
a series of cost-reducing measures. These include a timely
preventive maintenance program that helped ensure the efficient
use of vehicles, in the process mitigating higher fuel expenses.
“The strengthening of the peso can easily wipe out
your earnings overnight. We cannot do anything about that.
The best that we did was find innovative ways to make our
dollars work for us like finding better rates for them in
the market,” De Guzman said.
“The shift to electronic lodgment by the BOC, on the
other hand, had its growing pains both at the BOC and from
our end. This meant that our computer units had to be upgraded
to meet the requirement and this entailed additional costs.
But since we have been one of the pioneers of the SGL (super
green lane) system, our staff was quick to adapt to this new
setup. Hopefully, we will be able to see the full benefit
of this new system soon,” he added.
And with high labor costs, the company found ways to maximize
labor assets by improving workforce productivity. These measures
included the simple purchase of motorcycles for messengers,
making them more mobile at the same time reducing transportation
costs.
Highlights
Over the years, Sky Land Brokerage has grown into a respected
customs brokerage and freight forwarding company. In 2007,
it emerged as the top customs broker at the Manila International
Container Port, a distinction it never hopes to let go of
in the coming years. The company placed 9th and 8th in the
top in 2005 and 2006, respectively.
But most of all, it prides itself in its participation in
nation building through the transport of materials in key
infrastructure projects such as the Pantabangan Dam, Magat
Dam, Bataan Nuclear Power Plant, Malaya Thermal Power Plant,
Calaca II Coal Fired Power Plant, Rehabilitation of Sucat
Thermal Power Plant 1, 2 , 3 & 4 and the MRT 2 project.
It also handled special projects for the private sector such
as for the Coca-Cola bottling plants, San Miguel breweries
and Petron refinery.
The strong peso has continued to take its toll on the country’s
exports after the same dropped in November due to the slowdown
in electronic shipments.
The National Statistics Office (NSO) said November exports
dropped 2% to $3.951 billion from $4.031 billion in the same
month last year.
The decline, which comes after a double-digit growth a month
earlier, pulled down growth for the first 11 months to 4.76%
-- way below the target growth of 8% for 2007.
Chamber of Customs Brokers, Inc. (CCBI) president and Nonpareil
company president Rolando Quiambao told PortCalls the export
industry is, however, expected to rebound particularly if
the peso stabilizes at the P40 to a dollar range.
“Exports are really affected by the strong peso. However,
it doesn’t mean that (export-oriented companies) are
no longer earning. Their profit margins have been reduced
but they continue to earn,” Quiambao said.
“We, in the custom brokerage profession and the freight
forwarding industry are hoping that the peso will taper off
as its growth in the last few months has been really fast…
majority of companies operating in the country were caught
unprepared for such a condition,” Quiambao said.
Electronics, which accounted for 61.3% of the total shipments
in November, remained the country’s top export. However,
shipments dropped 4.5% to $2.422 billion from $2.535 billion
in the same month in 2006.
The second-largest exports were Articles of Apparel and Clothing
Accessories, which also declined 20.6% to $158.76 million
from $200.02 million in November 2006. The sector accounts
for 4% of the combined share of total exports.
The third-biggest exports were Cathodes and Section of Cathodes
of Refined Copper, which dipped 38.1% from $157.63 million
in November 2006.
Petroleum Products ranked fourth, with export receipts of
$89.84 million, or a year-on-year growth of 52.4% from $58.93
million in November 2006.
Woodcrafts and Furniture ranked fifth, with sales amounting
to $87.13 million, or a growth of 13.2% from $76.98 million
in November 2006.
Rounding up the list of the top 10 exports for November were
Ignition Wiring Set and Other Wiring Sets Used in Vehicles,
Aircrafts and Ships; Coconut Oil; Gold; other Products Manufactured
from Materials Imported on Consignment Basis; and Metal Components.
The US remains the Philippines’ top market, with export
receipts of $749.54 million, up 2.9% from $728.31 million
in November 2006. It was followed by Japan with $592.53 million;
the People’s Republic of China, $435.71 million; and
Hong Kong, $394.37 million.
Local cargo carriers are pushing for the amendment of implementing
rules and regulations of Republic Act 9295 or the Domestic
Shipping Development Act of 2004 to address conflicting provisions
of the law.
Members of the Philippine Liners and Shippers Association
(PLSA) are specifically questioning the issuance of special
permits to foreign-flag vessels and the rules on trampers.
The carriers said they have yet to experience the growth promised
by the law, but are instead seeing a shrinking of their markets
due to procedural conflicts in the issuance of special permits
to foreign vessels.
Trampers allowed to operate on liner routes without complying
with the necessary liner requirements have eaten up 10% of
the market of liner operators, the PLSA said.
“We have an ‘unlevel’ playing field here.
RA 9295 was passed to level the field but the opposite is
happening,” a PLSA official told PortCalls.
“The Maritime Industry Authority (Marina) should clearly
define the reasons (behind the) issuance of special permits
to foreign vessels and such vessels should not be allowed
to operate in the domestic trade for a long period of time,”
the official explained.
“If Marina deems there are justifiable reasons for issuing
permits to foreign-flag vessels for local operations, (the
issuance) should only be for a limited period and not subject
to extension,” he said, noting that this would protect
the interest of local operators and prevent violations to
the country’s Cabotage Law.
PLSA has proposed that foreign-owned international vessels
be allowed to operate locally only if they agree to fly the
Philippine flag and if their crew is composed of Filipino
seafarers. In addition, no foreign-flag vessels with foreign
crew should be allowed to operate on local waters for more
than three months, the association said.
Marina currently issues special permits to foreign-flag vessels
if there is a clear shortage of local bottom.
Despite PLSA claims that the shortage has been corrected even
before end-2007, there was still one foreign-flag vessel with
a foreign crew that continued to operate locally as of last
week.
The foreign-flag vessel’s sustained operations by virtue
of an extension of its permit issued by Marina, could be a
precedent to the entry of other foreign-flag vessels in the
local trade in violation of the country’s Cabotage Law,
said the PLSA official.
“We want to amend these rules as these are really detrimental
to local cargo carriers,” he added.
PLSA counts Oceanic, NMC, and Solid Shipping Lines among its
members.
“Trampers should also be disallowed to operate on liner
routes unless they are subjected to the same requirements
enforced on certified liner operators,” the official
said.
The Marina has yet to start reviewing the implementing guidelines
of RA 9295 despite announcements made two years ago that an
assessment will be conducted.
The Department of Transportation and Communication (DOTC)
is looking at limiting to one year the collection of funds
intended for the oil pollution fund.
Under Republic Act 9483 or the Oil Pollution Compensation
Act, P0.10 of every liter of oil delivered by tanker operators
will contribute to an oil pollution fund for use in cases
of oil spills.
“The collection is only temporary to obtain a seed fund
to mobilize immediate responses to oil spills,” Transport
undersecretary Maria Elena Bautista told PortCalls.
“If within the one-year period starting next month we
see that the amount is sufficient, then we will stop collection
in order not to burden the tanker operators,” Bautista
added.
“We are seriously considering complaints of operators
but the law is clear. What we can only do is to mitigate its
impact on their business and pegging the collection time to
a limited period is one of them,” she said.
Based on estimates, collection for a year may total P1.5 billion,
believed enough to cover immediate expenses in case of an
oil spill.
The amount will be managed by the Maritime Industry Authority
and can only be drawn from a bank during oil spill incidents
and disbursed by the Philippine Coast Guard.
The amount will be replenished by the owner or operator of
the vessel or vessels involved in the incident, whether international
or local, within a certain period. In case of failure to comply,
the used amount will be charged against assets of the company.
The DOTC is finalizing implementing rules and regulation of
RA 9483 for issuance next month.
Earlier, tanker operators warned of a tanker holiday if government
insists on implementing the law, arguing it will deal a final
blow to an already flagging industry.
