St. Lawrence Seaway Shuts Down as Operators’ Union Goes on Strike

A union representing 360 workers on the Canadian side of the St. Lawrence Seaway has gone on strike after failing to reach a contract agreement, temporarily shutting down the Great Lakes’ connection to the sea.

In a statement, union Unifor said that talks with its employer, St. Lawrence Seaway Management Corporation (SLSMC), are “1,000 nautical miles apart on wages.” The union said that it had made every effort to avoid a strike, but SLSMC had not made enough movement in its bargaining position.

“The SLSMC works to find a fair and competitive labor agreement that balances wage demands and market realities,” said the corporation in a statement. “As a result, the system will remain shut down until an agreement can be reached.”

SLSMC carried out plans for an organized shutdown of the seaway system over the course of the last three days. This allowed all vessels in transit to safely exit the seaway and its locks, and no ships got caught in the middle, the corporation said. The U.S. side of the operation is also unaffected.

However, more than 100 vessels outside of the seaway have been impacted by the shutdown. The corporation has applied to the Canada Industrial Relations Board to make Unifor provide staffing for the safe transit of grain-carrying bulkers.

According to SLSMC, Unifor is seeking exceptional wage increases inspired by union action in the automotive industry. Unifor also represents thousands of auto workers, and it just concluded negotiations with General Motors on a multiyear contract earlier this month. The terms of the contract with GM are generous, including a 20-25 percent raise over three years and two more paid holidays. They aren’t the only ones: on the other side of the Canadian border, new union leaders at the United Auto Workers have secured tentative offers from the Big Three U.S. automakers for a raise of 23 percent over five years – and the UAW is still holding out for an even better deal.

Russia Closes Border to Ukrainians, Affecting Port Calls and Crew Change

On Monday, the government of Russia shut down border crossing access for Ukrainian citizens, tightening security after a series of covert attacks on Russian soil. The closure is expected, but it may have effects on shipping because of the large number of Ukrainian seafarers employed in international trade, according to the American Club.

The P&I club reports that Ukrainian seafarers will not be able to enter Russia through Russian seaports, putting an end to crew changes for these individuals until after the ship leaves Russia.

Even if a foreign vessel has no plans to carry out a crew change in Russia, but merely has Ukrainian crew aboard when it calls at a Russian port, there could be “significant difficulties” for the operator under the new rules, the club warned.

The Russian government’s formal notice restricts Ukrainian citizens to entering at two points only: the Moscow airport, or a road crossing at the Latvian border. Though this appears comprehensive, it is unclear whether it will be evenly applied across all Russian seaports. The insurer has only received advice related to the restriction for Russian ports in the Black Sea region – like Novorossiysk, Taman, Tuapse and Kavkaz. These ports will be prohibiting shore leave and crew changes for Ukrainian crewmembers.

“Members with Ukrainian citizens aboard their vessels that have plans to call at any Russian Federation ports are recommended to check and confirm the security policy at that port of call,” American Club advised.

The Ukrainian military and intelligence services have had considerable success in targeting Russian Navy assets in the Black Sea, and port access is tightly controlled. At Sevastopol and Novorossiysk, the harbors are protected not just by boat patrols and surveillance, but by multiple layers of movable net barriers enclosing the harbor entrance.

SHI Develops Device to Reduce Overboard Container Losses

Samsung Heavy Industries reports it has developed a patent-pending device that is simple and easy to use that will dramatically decrease the number of containers lost overboard while boxships are at sea. They are reporting that initial testing is showing that loss rates can be reduced by up to 70 percent while not impacting the loading capacity or operation of the vessel.

The industry increased its focus on container losses after a series of high-profile events in 2020 where hundreds or even thousands of boxes were damaged or lost overboard from a single vessel. The World Shipping Council in its report tracking container losses reported that 2020 was the worst individual year in recent memory with nearly 4,000 boxes lost overboard followed by over 2,000 containers lost in 2021. High losses such as the nearly 6,000 in 2013 had most often involved the loss of a vessel, whereas the recent numbers were due to bad weather and vessel handling. The number however fell dramatically in 2022 to just 661 boxes.

Much of the industry’s focus has been on weather conditions and a phenomenon known as “parametric rolling” which in a following sea is especially hazardous for container vessels. The industry has issued advisories on vessel handling while technology companies are working on systems that can predict dangerous sea conditions.

Samsung however has taken a much simpler approach focusing on the racks and securing the lashing bridges. Their loss prevention device, known as Special Structure Anti-Container Loss, is an additional device attached to the lashing bridge. They are pointing to the “severe shaking” of boxes in bad weather as a key contributor to the losses. Once in place, Samsung reports the device minimizes the “left and right movement of containers even in bad weather.”

They are reporting that they have obtained certification from four of the world’s leading class societies, DNV, ABS, LR, and KR, and have completed over 10 patent applications outside of Korea for the device. They said in developing the device there was a focus on minimizing the size and weight to make it easy to install. They are saying it has a compact design and that it will work on existing ships without affecting container capacity.

Samsung reports that the prototype structure is now at the Pusan National University. They are conducting strength testing as they seek to validate the product and increase its reliability. The device has already drawn the attention from the world’s leading container shipping companies and Samsung anticipates that they will begin full marketing within the year for the product.

European Commission Seeks to Support Ports in Fight Against Drug Smuggling

The European Commission today mapped out an aggressive roadmap of actions designed to step up the fight across member states against drug trafficking, including a strong focus on stopping illegal activities at ports across Europe. In laying out its plan and call for full support from the European Parliament and the Council, the Commission highlights the drug trade as “one of the most significant threats faced by the EU today.”

Today’s action follows a series of previous reports that have highlighted the scope of the drug trade and organized crime ranging from the major shipping carriers to ports across Europe. Europol in May 2023 released a detailed report working with the ports of Antwerp, Hamburg/Bremerhaven, and Rotterdam, looking at the efforts of organized crime. They cited the broad inflation of the ports by organized crime which was using efforts such as stolen identification numbers to gain access to containers that were being used to ferry the narcotics from South America. They found that criminal networks were placing people as employees in ports to gain access to their shipments. Separately, port officials have warned that the drug cartels are expanding efforts into smaller and secondary ports to avoid detection.

Executives from both MSC and Maersk have talked of their extensive efforts aimed at combatting drug smuggling. Last year, several of the major shipping companies and ports announced new partnerships to coordinate their efforts. The Financial Times, however, today in reporting the new EU roadmap quotes a Maersk executive saying the whole supply chain has been infiltrated by drug gangs.

The European Commission cites data from 2021 saying 303 tonnes of cocaine was seized while ports continue to make increasingly large captures. Both Rotterdam and Algeciras recently set records with the Dutch authorities announcing a single seizure of eight tones of cocaine while the Spanish seized 9.5 tonnes.

“Europe has now replaced the U.S. as the single largest cocaine market in the world and is fast becoming a world hub for drug trafficking – a disturbing claim to fame and one we have to redouble efforts to reverse,” said Margaritis Schinas, Vice-President for Promoting our European Way of Life. “Today we are announcing a new series of measures to enhance the resilience of logistical hubs and dismantle criminal networks. This will be complemented by strong engagement with partners worldwide to crack down on the main supply routes.”

The new roadmap from the European Commission calls for the launch of a new European Ports Alliance. It would specifically seek to reinforce customs authorities and law enforcement as well as the public and private ports to stop the infiltration by criminals. The plan has a total of 17 actions in four priority areas that also include more financial and digital investigations to catch criminal networks, better cooperation between member states, and working with international partners. The Commission commits to implementing its actions in 2023 and 2024.

The Financial Times in reviewing the roadmap says that it calls for allocating €200 million for scanning equipment at the ports. They cite Antwerp as an example saying overall that just two percent of goods are scanned and five percent of the containers identified as “high risk.” Antwerp’s current plans call for scanning all high-risk containers arriving at its terminals by 2028.

Another part of the effort would increase the screening and vetting of port employees. The Commission also plans to commit €20 million to support the Internal Security Fund and efforts to seek proposals to combat organized crime.

Vietnam’s Lach Huyen Port Buys Cranes for Next Phase of Expansion

The Japanese shipyard Mitsui E&S shipbuilding has received an order for 30 cargo handling cranes for a customer in Vietnam. The procurement was made by the Port of Haiphong Joint Stock Company (CHP), a subsidiary of Vietnam Marine Corporation (VIMC), which is currently constructing the container terminal in the Lach Huyen area in Vietnam’s northern city of Hai Phong. The new port represents one of the first public-private partnerships between the Governments of Vietnam and Japan.

The order consists of six STS cranes and 24 RTGs. The STS cranes to be delivered have a 65-meter outreach and can be capable of handling large container vessels exceeding 15,000 TEU. This will be one of the largest crane orders for CHP for its port complexes in Haiphong area.

Mitsui has a record of delivering cargo handling cranes to CHP, with the last delivery made in 2007 as part of Japanese government’s official assistance to Vietnam. Japan International Cooperation Agency (JICA) is involved in the planning, design and construction of the new Lach Huyen Port.

Plans for the construction of Lach Huyen International Port were first launched in 2013 under Vietnam’s 2020 Seaport Development Plan. It is intended to be an extension of the Port of Haiphong, which over the years has seen a rise in demand for containerized cargo. The new terminal is designed to handle large container vessels, enabling direct exports from Northern Vietnam to the U.S and European markets without using transshipment ports in Singapore and Hong Kong.

The Lach Huyen Port is being developed on Cat Hai Island and connected by a sea bridge and access roads to mainland Vietnam. The port is being constructed in phases, and the first two container terminals have already been in operation since 2018.

The third and fourth terminals are still in construction and are expected to be commissioned by 2025, according to a statement in July by CHP. The procurement of the cargo cranes shows the works are on schedule.

Maersk is also working with Vietnam’s HATECO to develop another two deepwater berths at Lach Huyen, capable of handing 18,000 TEU vessels. In the initial phase, the facility will have five STS cranes and 14 RTGs.

After Medevac, Captain of Cocaine-Laden Bulker is Held Without Bail

The master of the cocaine-laden ship that Irish authorities seized last week will be held without bail pending trial, a district court in Wexford, Ireland ruled on Monday.

Iranian national Soheil Jelveh, 50, was the master of the bulker Matthew during a transatlantic voyage to Ireland, which ended in a high-profile adverse boarding by Irish Army forces on September 26.

At the time of the military boarding, Jelveh was not on the ship. The Matthew’s crew had requested a medevac for him on Monday evening, and an Irish SAR helicopter flew him to a hospital in Wexford. The authorities boarded the Matthew the next morning and found $170 million worth of cocaine on board – the largest drug seizure in Irish history.

Jelveh was arrested at the hospital shortly after. According to the gardai, he was in possession of phones, documents and $53,000 in cash, and they suggested that he may have been attempting to evade arrest using the medevac flight. The captain asserted that the money he was carrying represented his own wages, which had been paid the month before.

“He was caught red-handed and we believe he was attempting to make an escape when he was airlifted from the ship,” a gardai detective told the court.

For his alleged role in transporting two tonnes of cocaine into Irish waters, Jelveh has been charged with possessing drugs worth more than £Ir 10,000 ($13,000) under Ireland’s Misuse of Drugs Act. Under Irish sentencing reform laws, the crime carries a minimum penalty of 10 years in prison. Prosecutors asked Wexford District Court Judge John Cheatle to deny bail, given that Jelveh has no significant ties in Ireland, maintains a family in Dubai and could be a flight risk. The judge agreed, overruling the objections of Jelveh’s counsel.

In total, seven men have been arrested in connection with the drug seizure, including two who had to be rescued from a small trawler which grounded while allegedly attempting to rendezvous with the Matthew.

The interdiction was unusually dramatic. On the morning of September 26, the Irish Navy patrol ship William Butler Yeats chased down the Matthew and fired warning shots when the vessel failed to comply with directions. In rough weather, and with the bulker maneuvering hard, Irish Army commandos fast-roped to the deck from a helicopter and took control of the ship.

Ukraine Works to Expand Exports as Three More Bulkers Arrive

Ukraine with support from a growing number of shipping companies is expanding its efforts to open the Black Sea shipping corridor and restore exports. Larger ships made the transit into Ukraine with reports from the markets that traders are taking the first tentative steps at offering Ukrainian grain.

Vice Prime Minister Oleksandr Kubrakov again took to social media to highlight the movement of four more bulkers. He reported that three new cargo ships were on their way to Ukraine for the loading of export products. He said they would be using the temporary corridor established by the Ukrainian Navy while the second vessel that traveled to Ukraine last weekend was now outbound on the corridor.

The Turkish-owned bulker Aroyat (18,315) dwt registered in Palau departed Chornomorsk this morning, September 22, loaded with 17,600 metric tons of wheat. The vessel had traveled into the port arriving last Saturday and is now following the corridor along the western shoreline of the Black Sea. It is heading to Egypt.

She is following the Resilient Africa which arrived off Turkey on Thursday, September 21. The ship is carrying 3,000 metric tons of grain from Ukraine. It is currently in the anchorage off Istanbul with reports that it will proceed to Asia.

Three more bulkers used the corridor and have now arrived at the Ukrainian seaports. The Liberian-registered Eneida (45,572 dwt) traveled to Chornomorsk arriving late today. The ship, which until recently was known as the Bosphorus Prince, is now reported to be managed from Panama. She had been holding in an anchorage off Turkey awaiting a contract.

Two of the vessels however went to the eastern port of Yuzhny marking the first ships to arrive there since July. The Azara (13,898 dwt) is registered in Palau and managed from Poland and arriving from Egypt. The largest of the ships is the Chinese-owned Ying Hao 01. The ship is 74,759 dwt arriving from China.

Kubrakov reports the ships will be loading both agricultural products and iron ore. Ukraine has only recently attempted to restart its ore shipments which were not covered by the year-long UN-brokered agreement which only covered foodstuffs. Kubrakov said the ships would be heading to China, Egypt, and Spain.

Traders are reportedly beginning to offer Ukrainian grains again, although at a steeply discounted price from the Ukrainian ports versus neighboring sources such as Romania. AgriCensus, a price reporting agency, highlights the lower prices as well as higher shipping costs for the products coming out of Ukraine. They note the limited number of ships and crews willing to make the trip. They however are reporting that additional contracts are expected and that additional ships have been fixed and are due to make the trip.

Russia continues not to comment on the Ukrainian exports and appears to have not made any attempts to approach the ships. The UK had warned that the Royal Air Force would be monitoring and seeking to deter any action against merchant ships in the Black Sea.

Report: China is Checking Ballast Water on Japanese Ships for Radioactivity

China has reportedly quietly begun checking all ships arriving from Japan looking for signs of radioactivity in their ballast, while the state news agency reported today the country is beginning a one-year pilot program to stop invasive species. According to reports from Japan, this is the latest step in China’s concern about the release of contaminated water from the Fukushima nuclear power plant.

Japanese officials reported that they planned to release into the Pacific Ocean small amounts of the treated radioactive water that had been stored at the Fukushima nuclear power plant which was destroyed in the 2011 earthquake. Despite widespread protests, Japan proceeded with the release of the first batch of water in late August.

Japan’s Kyodo News reported last week that China has begun testing the ballast water aboard cargo ships arriving from Japan at some key ports. The news outlet speculated that it was likely for radiation level inspections, noting that China has called the waters being released in Japan “nuclear-contaminated” demanding the stop of the release. According to the news report, local Chinese authorities have notified operators of the vessels that they will ban them from releasing ballast water at Chinese ports if the radiation levels in their samples exceed a certain limit.

The Japanese report says the testing is taking place at ports in Tianjin, as well as Shandong Province in eastern China. The newspaper believes the testing began in July, which was after Japan announced its intention but before it confirmed the first release of the water from Fukushima.

The Chinese state news agency Xinhua issued the first statement acknowledging efforts to stop “invasive species” from entering China.

“China decided to begin a one-year action plan to prevent invasive alien species from entering border ports across the country as part of efforts to safeguard the country’s biodiversity and ecological environment,” the report said while citing a large increase in the number of live animals and invasive plants stopped at border crossings.

Last month, China in addition to protesting Japan’s plan to release the water announced an immediate ban on the importation of seafood and fish from Japan. The announcement said the ban was effective immediately noting that China would “dynamically adjust relevant regulatory measures as appropriate to prevent the risks of nuclear-contaminated water discharge to the health and food safety of our country.”

China was reported to be importing more than $1.1 billion of seafood from Japan every year. Japan protested the ban and proposed setting up international monitoring insisting that the release of water from Fukushima would not impact the food supply.

UK Effort Plans First Electric SOV in Offshore Decarbonization Race

A coalition of leading maritime companies led by Bibby Marine and with financial support from the UK plans to develop the first zero-emission electric Service Operation Vessel (eSOV) to be used to support the offshore wind and energy industry. It is the latest entrant in the race to develop the first zero-emission vessels with a focus on the offshore sector and the potential of using power at the wind farms to charge the ships.

In their application for the UK’s Zero Emission Vessel Infrastructure (ZEVI) competition, the coalition points to the strong opportunities in the segment to support offshore wind operations. With the UK calling for 40 GW offshore wind energy in additional offshore wind energy capacity by 2030 expanding on the more than 10 GW already in operation, the group estimated that between 62 and 149 vessels will be required. They highlighted that all the UK-operating SOVs have so far been built aboard.

They are proposing a 295-foot vessel that would be primarily powered by electricity and batteries and have dual-fuel methanol-powered engines as backup. The ship will be ready for offshore charging and can recharge its batteries at night.

They expect that it will be possible to operate a two-week cycle onsite at an offshore wind farm emissions-free. Near shore the vessel will operate solely on battery power and also while onsite. For the long transits between the shore homeports and the farms, the vessel will use its engines and with methanol fuel, it would be possible to still reduce emissions by 90 percent versus fossil fuel operations. They noted in the application if offshore charging is not available, the vessel would use its methanol engines to recharge its batteries and would still achieve a 50 percent reduction in emissions compared to a conventional SOV.

DNV, which is one of the members of the coalition notes, “The number of fully electric and hybrid vessels will surge over the next few years, and continuing development on these technologies will be a key part of the maritime industry’s transition to a zero-carbon future.”

Bibby, which is leading the effort notes the vessel will be a natural progression in its decarbonization effort and the first new vessel for Bibby Marine in five years.

It was one of five projects that was announced today at London International Shipping Week as a winner in the UK Government’s competition designed to support the development of new zero-emission maritime technologies. Under the rules of the competition, the vessel needs to be in service by 2025.

They are estimating a cost of $37.5 million for the project with the UK government awarding them $25 million in funding. The project participants include Bibby Marine, Port of Aberdeen, Offshore Renewable Energy (ORE) Catapult, Kongsberg, DNV, Shell, and Liverpool John Moores University.

In the previous rounds of the funding competition, the UK has also awarded support to projects seeking to develop the technology required to provide offshore recharging capabilities. It has been highlighted that one of the challenges is the increasing distance from shore for the location of the wind farms, making onsite recharging critical. The UK projects are one of several looking at offshore recharging and creating vessels that are fully electric or use other technologies to be zero-emission ships.

Bankrupt Bed Bath & Beyond Seeks $15M in Damages from Yang Ming in FMC Case

Bankrupt retailer Bed Bath & Beyond continues to cite the shipping industry and its business practices during the pandemic as contributing to the demise of its operations earlier this year. In its latest move, the company filed a complaint with the Federal Maritime Commission seeking reparations totaling more than $15 million from Yang Ming for denial of service, premium fees, and detention and demurrage charges incurred in 2021 and 2022.

The filing with the FMC on September 12 is the latest in a series of legal moves by the bankrupt company attempting to seek restitution which would contribute to the bankruptcy settlements. In April, the company also filed a complaint with the FMC against Orient Overseas Container Line (OOCL) and OOCL (Europe) alleging that the carrier had “coerced,” “exploited” with price inflation in container shipping, and “deliberately” denied space to the retailer resulting in $25 million in excess costs as well as an additional approximately $6.4 million in D&D fees it contends resulted by OOCL’s business practices between 2020 and 2022.

Yang Ming took a preemptive step in April 2023 filing a complaint in the Southern District of New York, Federal Court. They sought to block Bed Bath & Beyond’s claims of $7.8 million in actual costs due to the issues cited with the service provided and fees imposed by the carrier. A week after the filing, the retailer informed the court of its voluntary bankruptcy petition and in June the court issued an automatic stay of “the commencement or continuation” of a judicial action based on the bankruptcy. The court case could proceed if Bed Bath and Beyond resolves the bankruptcy.

In its filing to the FMC, the former retailer cites many of the same issues as before, contending that “Yang Ming took advantage of price inflation in the container shipping sector and unfairly exploited its customers.” They allege that the carrier “engaged in a practice of systematically failing to meet its service commitments,” resulting in enormous expense to Bed Bath and Beyond, and then filed a “retaliatory declaratory judgment complaint,” in the U.S. District Court. Like the complaint against OOCL, they allege that Yang Ming flouted its service commitments, engaged in a practice of coercing the shipper, charged unreasonable D&D fees when it was not possible to return containers, and refused to negotiate.

At issue is an annual service contract that began on May 1, 2021, for the transport of 1,000 FEUs. They allege the carrier provided no space during the first month of the contract and when confronted admitted that it had over-committed to its customers. During the 12-month period, they report Yang Ming carried just 149 FEUs, 85 percent below the commitment resulting in more than $6.6 million in damages as the retailer sought other space for its containers. They further contend that Yang Ming coerced them into paying nearly $300,000 in surcharges, and charged nearly $750,000 in D&D fees, and refused refunds on the fees.

Citing a total of nearly $7.7 million in costs, Bed Bath & Beyond in the filing seeks an award of reparations. Under FMC rules they are seeking that the amount be doubled based on a conscious pattern which constitutes violations of the Shipping Act.

The complaint highlights that this is one of numerous similar complaints now before the FMC each citing denial of service. Many shippers have alleged that the carriers during the surge in shipments and capacity constraints failed to honor service contracts. Each of the complaints contends that carriers instead put the contracted space into the spot market where they could realize dramatically higher prices. Several service complaints have been settled under confidential terms while most of them remain in front of the FMC.

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