Editorial

The bear is roaring and shares on stock markets worldwide are cringing as the surging oil price fans inflation and slowing growth. But the bunker industry is booming as prices surged to an all time high in May. Companies such as Unicorn Calulo and Smit Amandla Marine have timed the arrival of their new - and re-newed (respectively) - bunker barges well as they come on stream in the ports of Durban and Cape Town.

The oil price makes the cost of transport all the more expensive of course but one Durban-based company doesn’t appear to have felt the impact. Whilst there is misery in many quarters, Grindrod has issued a trading statement advising its shareholders that instead of headline earnings per share for the six month period to 30 June 2008 increasing between 55% and 75%, headline earnings per share are anticipated to be 85% to 95% compared to the corresponding period of the previous year.

It’s interesting times indeed. Transnet reported in June that it had taken a 40% plunge in net profit in the year to March although revenue from continuing operations increased by almost 12%. Over the next five years Transnet will be investing R80 billion expanding the coal and iron ore rail lines and related infrastructure, on expanding the ports of Durban and Cape Town and completing the construction of the port of Ngqura. Some of the money is being directed to container-related projects as volumes climb to 3,7 million teus at the ports and government has been persuaded to leave port operations alone rather than move it to a separate entity because this will have negative implications for Transnet.

While curbs loom for scrap metal exports to ease input costs on downstream manufacturing, booming coal sales have topped the unprecedented level of $200/ton FOB from Newcastle, Australia. Richards Bay’s prices are hovering at the $140/ton FOB mark and have more than doubled since May 2007.

Attracting, attaining and retaining staff is an ongoing challenge. In recent weeks there have been many news clippings about the exodus of skilled personnel from the South African Navy, highlighted most recently by the arrival of the third and last submarine in Simon’s Town. This sector is not the only one affected but awareness at government level is growing and recently a new website, www.careers-at-sea.co.za was launched to inspire young learners.

This issue was also raised by SAMSA which has commented about the lack of technological capacity to monitor foreign vessels in South African waters. SAMSA now plans to put forward a proposal to government in August for a Long Range Identification and Tracking (LRIT) system used to track and monitor the movement of large ships passing within 1000 nautical miles of the coastline. South Africa has committed in terms of an international agreement to putting this in place by 1 January 2009.

While there is generally global doom and gloom, there are also opportunities out there for innovation and creative thinking. Some logistics oriented companies and suppliers have literally “taken the bull by the horns” to make the economy work for them. More about this as you turn the pages.

As we went to press we were reminded that Maersk Line celebrates its 80th anniversary this month – on 12 July to be precise and eight decades since the first Maersk Line vessel, Leise Maersk departed in its liner service from Baltimore on the U.S. East Coast en route to the Far East via the Panama Canal. In her holds was 3600 tons of cargo, the equivalent of 200 twenty-foot teu. She reached Japan 59 days later.

How times have changed. These days’ Emma Maersk has the capacity to carry more than 11000 teu, 65 times more cargo than the Leise Maersk, and Maersk Line has become the largest liner shipping company in the world.

To conclude, yes it is true, I am back! My sojourn into the sunset was as shortlived as the Pride South Seas! Returning to port you can still reach me on the same number and at the same email address, trachandler@telkomsa.net. I would love to hear from you.

Editor
 

Cover Story

The 40450-deadweight tanker Biz, alongside after being towed into Cape Town. The tanker, laden with vegetable oil, was disabled 160 nautical miles west of Cape Point with steering difficulties — later it was ascertained that she had lost her rudder — and the Svitzer tug Battleaxe was contracted to undertake the tow to Cape Town. When approaching the coast, further additional assistance was required from the Smit Amandla, with the Battleaxe having a line fast astern.

Photograph : Ocean Images Cape Town.