Shippers hit
with additional increase in trucking rates
BARELY three weeks after implementing a
7% general rate increase, North Harbor truckers led by the
reconstituted Integrated North Harbor Truckers Association
(INHTA) have started levying an additional P153.35 to basic
trucking rates based on an automatic diesel recovery adjustment
program it earlier crafted.
The program calls for truckers to automatically add P153.35
(plus expanded value-added tax [EVAT]) to the basic trucking
rate (now at P6,000) charged for every 20-footer transported
each time there is a P5.00 cumulative increase in diesel prices.
The association said the current P6,000 basic TEU rate at
40 kilometers round trip is based on a P50 per liter cost.
Over the weekend, diesel prices have already reached the P56.50
per liter level.
But as a relief to shippers, INHTA has abandoned plans to
implement an additional 8% rate increase at the start of next
month and instead permanently adopt Philippine Liner Shipping
Association-approved rates.
“We already informed the PLSA about this (implementation
of automatic diesel recovery adjustment) as well as our decision
to stick to their approved rates and totally drop our earlier
proposal of an 8% general rate increase by next month,”
INHTA president Catalino Costales told PortCalls.
“With the automatic rate adjustment, North Harbor truckers
will be able to cope with current times particularly if diesel
prices continue to soar,” he added.
The price of diesel, the most common fuel used by trucks,
has increased more than P27 per liter since January this year.
If the weekly P1.50 per liter increase keeps up, diesel prices
will increase by another P5.50 per liter by August 8, thus
another P153.35 plus EVAT will be added to the North Harbor
basic trucking rates.
World oil prices have dropped from $142 per barrel to about
$136 per barrel as of this writing but are still expected
to go up particularly with continuing conflicts in oil-rich
countries such as Nigeria and Iran.
As this developed, cargo carrier MCC Transport Philippines,
Inc. said it is implementing a rate restoration initiative
(RRI) for its Philippine domestic services effective August
15.
MCC, a joint venture between the Aboitiz and the Maersk groups,
said the RRI is in response to escalating variable costs,
particularly expenses related to bunker and other vessel-related
costs.
It added that the RRI quantum would be P4,000 per standard
twenty-foot container applicable to all its ports of call
like Manila, Cebu, Cagayan de Oro, Bacolod, Davao and General
Santos.
Other cargo carriers such as National Marine, Oceanic, Solid
Shipping, Sulpicio Negros Navigation and Lorenzo Shipping,
all members of the PLSA, also increased rates by 10% last
month to offset costs related to fuel.
The operators will also hike their bunker surcharges by 7-8%
each time diesel prices grow 10%.
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Airfreight targets for ’08 stay –
GCCI
THE Global Cargo Council, Inc (GCCI), the
association of air cargo airlines in the Philippines, is keeping
its airfreight industry projections for a high single-digit
to low double-digit growth for the year despite the tough
times.
“Carriers are really having a hard time now,”
GCCI president Rene Banzon told PortCalls. “Still and
despite the drag in the long-haul market, we were able to
post modest growth during the first semester of the year.”
More than any other industry, the aviation – including
airfreight — sector is getting a beating from high fuel
prices. This coupled with the US economic debacle are expected
to slow down air cargo traffic this year compared to 2007.
“We ended the first semester a little lower than our
target growth but we are maintaining our forecast as we expect
business to maintain, if not pick up, within the second half
of the year,” Banzon said.
Saved by regional growth
He added that regional players posted 20%-25% growth in both
loads and actual sales in the first half. Long-haul players
particularly those operating in the US and Europe, on the
other hand, experienced a bad landing.
Banzon said the gap between the target and actual performance
should have been much narrower if not for the foreign exchange
fluctuation and the continuing spike in fuel prices.
Originally, GCCI forecast a mid to high double-digit growth
but toned this down due to concerns related to the US, fuel
prices and foreign exchange, the negative effects of which
became more apparent toward the end of the first quarter of
the year.
If not for the active regional markets (manufacturing firms
in China, Japan, Malaysia, Hong Kong and Korea), the airfreight
industry could now be operating in the red without hopes for
growth this year, the association said.
For the Philippines, GCCI is expecting a drag in air cargo
this year, as exports and imports are likely to stay at the
same levels.
GCCI said the garments sector, one of the country’s
top airfreight sectors, has been on the decline in the last
few years with no change in fortunes in sight.
Philippine air cargo forwarders also said earlier they expect
a middling performance this year due to the expected decline
in electronics and garments export shipments.
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Customs drumming up support for Batangas
port
THE Bureau of Customs (BOC) is urging shippers
from southern Manila to use Batangas port instead of Manila.
In a meeting between the BOC and port stakeholders late last
week, Customs Commissioner Napoleon Morales said the move
is practical considering most shipments that enter the Port
of Manila are from Philippine Economic Zone Authority (PEZA)
operators in the Cavite, Laguna, Batangas, Rizal and Quezon
(Calabarzon) area anyway.
At the same time, a switch to Batangas will decongest the
Port of Manila by up to 50%.
Morales said Batangas can also now offer full cargo operations
after the Philippine Ports Authority equipped the port with
requisite cargo handling equipment. “This was the main
problem before, we did not have these equipment, but we have
recently acquired these machines so there is no stopping the
promotion of Batangas as an alternative port of entry for
PEZA importers,” he explained.
“PEZA locators should take advantage of Batangas as
there is no truck ban in the area which will enable them to
transport their cargo 24/7, aside from the port’s proximity
to PEZA zones,” he added.
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ICTSI makes a bid for operation of Indian
terminal
INTERNATIONAL Container Terminal Services,
Inc (ICTSI) is looking to build a container terminal in Ennore
Port, one of India’s major international gateways.
The company has been short listed from among 22 bidders to
build the $305-million cargo terminal with a maximum capacity
of 1.5 million 20-foot metal containers.
The other bidders are Gammon Infrastructure Projects in partnership
with Dragados Spain, Australia’s biggest construction
firm Leighton Holdings, DP World in partnership with India’s
Infrastructure Development Finance Company Ltd Projects Inc,
PSA Singapore with ABG Infralogistics Ltd; The Macquarie Group,
NYK Line, Mundra Port, and Mitsui.
Ennore port is known for handling “dirty cargoes”,
as it mainly deals with thermal coal destined for thermal
power stations owned by the Tamil Nadu Electricity Board.
According to documents from the Asian Development Bank, which
is loaning funds for the port’s development, Ennorre
port is the 12th major port in India and has adequate road
and rail links. It has a 560 meter-long coal wharf for berthing
two Panamax-sized vessels and fully mechanized systems for
handling 16 million tons of cargo a year.
It was designed as a world-class port, with two breakwaters—one
in the north measuring 3,080 meters and the other in the south
measuring 1,070 meters. It has the capacity to develop 22
berths for handling a variety of bulk, liquid, and container
cargo.
Located on the Coromandel Coast some 20 kilometers north of
Chennai, Ennore is the first corporatized port in India. Envisioned
to become a satellite port to decongest and improve the environmental
quality at the bustling Chennai Port, Ennore Port now wants
to evolve into a full-fledged port with the capacity to handle
a wide range of products.
Development in phases
Ennore Port currently outsources all services required for
operation and maintenance. It eyes the development in phases
of facilities for handling of iron ore, coal, petroleum, oil,
and lubricant products, liquefied petroleum gas, liquefied
natural gas, and containers.
The port’s bidding, however, faces delays after DP World
and PSA said they will go to the court to question moves to
trim down the list of bidders.
At the start of the year, ICTSI said it will continue its
hunt for other terminals worldwide, seeing very little activity
in the domestic market.
Aside from Asia, ICTSI is looking to land another port in
Latin America, and the Middle East.
ICTSI manages facilities in Brazil, China, Colombia, Ecuador,
Georgia, Indonesia, Madagascar, Poland, and Syria.
The country’s largest terminal operator recently landed
the 25-year management and operations contract for the Mindanao
Container Terminal in Misamis Oriental.
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Barge operators petition for CPC exemption
from Marina
TUGBOATS and lighter/barge operators are
seeking exemption from securing the Certificate of Public
Convenience (CPC) required by the Maritime Industry Authority
(Marina), saying their operations are private in nature and
do not need such a certificate.
The Lighterage Association of the Philippines and the Concerned
Metro Manila Tugboat, Barge and LCT Operators said the CPC
applies only to the liner sector.
“The tugs and barges are operated as private carriers
and therefore do not undertake to carry for all persons but
transport only those with whom they see fit to contract,”
the group said in a letter to Marina.
“The shippers and barge/tug owners negotiate rates and
routes and the terms and conditions are designed to suit commercial
considerations of the contracting parties,” the group
stressed.
“The voyages are based on cargo commitments that vary
with the ship’s employment. Tugs or barges do not undertake
to ply a fixed route on specified rates for an extended period
of time and do not hold themselves out to the public as a
carrier to render themselves liable to an action if they refuse
to carry for anyone who wished to employ them,” it said.
Marina’s claim that the CPC for the lighterage sector
is required under Republic Act 9295 or the Domestic Shipping
Development Act of 2004 does not hold water, according to
the group, because the law’s provisions deal mostly
with public utilities only applicable to the liner sector.
The group added operators would be financially overburdened
if forced to secure a CPC especially under the present economic
conditions.
Marina, for its part, argues that the element of competition
exists in the sector as lighters/barges compete with other
ships and vessels are used to carry cargoes on a commercial
scale.
Under RA 9295, it said, competition requires a CPC.
The Department of Transportation and Communications is seeking
a legal opinion from the Department of Justice on the matter.
In another development, Marina has disowned reports claiming
the agency has cleared the ship captain of the ill-fated MV
Princess of the Stars of any liability and blamed the Philippine
Atmospheric Geophysical and Astronomical Services Administration
for the inadequate weather bulletin on typhoon Frank.
Marina explained its role is to consider recommendations of
the Board of Marine Inquiry (BMI) related the safety and seaworthiness
of vessels. It said the BMI and not Marina will determine
the culpability of the ship captain.
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